They lied to you: Why Punishment DOESN'T WORK..

In this video, I'm going to talk to you about incentives. How to get people to do the things you want. And if you don't know what the definition of power is, by the way, is how to influence events or people. All right? So, the ability to direct or influence events or people, that is the definition of power. And so, most people, hopefully, if you're watching this, you want to become more powerful. And the thing is, if that word makes you feel queasy on the inside, it's because you have a very poor definition of power. Power is neither good nor bad. What you do with it can be good or bad, right? It's just it is just raw potential. So, in this video, and if you don't know who I am, by the way, my name is Alex Rossi. I'm an ownquisition. com. It's a portfolio of companies over $und00 million a year. And I make these videos because a lot of people are broke and I don't want you to be one of them. All right? And I also have a lot of fun doing this. And so, that is why I make it. So, you want people to do stuff, right? There's the component of persuasion in getting them to believe that it is in their best interest. That is fundamentally what leadership is. Is to get someone to believe that doing the thing that you want them to do uh is really just to get them to want to do that, right? That is what it is. And so a lot of leadership is power which a lot of power if you sign the definition is selling. But today I'm not going to talk about selling. I'm incentives. Right? So this is like kind of the brass tax side. There's the persuasion, the soft side which is still very important. The psychology side and the other side is kind of the behavioral side. And so this is adapted from a conversation that I had with my closest friend Dr. Trevor Cashy and we were talking about behavior and getting humans to comply. And so what I want to talk to you about is the ways to do that. And so a big part of that if my little my little dude that'll start working. That's what she said. Um here we go. And we're going to make a little boxy do. Fantastic. Boxy do completed. Okay. So if it's not a perfect box, deal with it. You've got pluses and you've got minuses and you can add them or you could subtract them. What this means is that we have a combination of both punishment and we have reward. Stuff that people don't want and stuff that people do want. All right. So, for example, and I'm going to give a simplistic reasoning to get someone to do something. So, we'll use a simple one, which is how do you get your kid to clean their room? This is a simple example that you can extrapolate to whatever it is that you want someone else to do. You can add a good thing. I can give you a cookie. That is something that I can do. I can if you do the chore, I will give you a cookie. Simple. You do the thing, you get the reward. Awesome. The next thing that we could do is we could subtract a negative. You get no cookies. All right? So they don't get to have dessert anymore, which would be impossible because you can never skip dessert, right? Like not in this family, right? And so we could subtract something that they do have that they like, right? So if you don't do your chores, I will remove video games or you don't get to eat dessert. Makes sense. So those are two things that we can do with a positive or a reward. On the reverse of this is that we can add a negative. So we can say, I will spank your ass. I'm going to add a negative. I'm going to spank your ass if you don't do your chores. Oh, no. That sucks, right? But I'm going to add something that wasn't currently in your life that you will not like. All right? Is we add a negative. The fourth thing that we can do, and I'll get to how you can think through these in a second. We can subtract a negative. Okay? So, I can uh I plan on spanking you every day and I can remove spanking. Or let's say there's something that you uh that you don't like doing, which might be like you're expected to do the dishes, right? You don't have to do the dishes. Or let's say you don't like, you know, you don't like riding the bus, right? So, bus. I'll drive you to school. That's kind of like taking away negative and adding a positive. Ah, right. And so we can do no dishes, which would be subtracting a negative. Think about these in this way. These are things that people want to avoid. And these are people things that they want. Here's what's kind of interesting about all of this stuff. Incentives drive behavior. There's tremendous amount of documentation on that. Hopefully, you're not going to fight that point with me. All right. But here's what's interesting. When you create punishments for people, people will do anything to avoid the punishment, which may not mean doing the thing that you want them to do. So, for example, if your child sneaks out at night and then you punish them for sneaking out, the incentive is not necessarily stop sneaking out. The incentive is to stop getting caught, right? It encourages criminal behavior. It encourages people to find new and ingenuative ways to do the thing they want to do, which is their incentive, their plus side, and figure out ways to avoid the downside. Here's what is kind of interesting about this is that with punishments in general, you get people to avoid the behavior, but you don't get them necessarily to do what you want them to do. So, if you want someone to do something, it's much easier to incentivize that if you do the thing, right, you get this, right? Because incentives direct behavior. Punishments

force people to avoid anything that will give them the punishment. It's subtle, but hopefully you're picking up what I'm putting down. The reason this I think is very interesting is that when you look at so Jim Collins uh wrote a lot of the best management books that are out there and what's interesting if you if you follow his career it seems like he's he went from super quantitative to more qualitative. Now he still did quantitative to arrive at his qualitative decisions but he talks about how leadership is such an important part of building great businesses and we know that great people build great companies. Okay. And so we as entrepreneurs must be leaders and good people so that we can attract good people so we can build good companies. Now, a big part of that is figuring out how to get people to do stuff. And so, based on the research that he had presented, which I thought was really fascinating, is that over time, if you have negative reinforcement, performance degrades, right? It's always critical feedback, always negative. Only talk to somebody when they do something wrong. On the flip side, if you have positive feedback, by large, majority of the time, performance improves. Isn't that

interesting? And so I saw that through this lens, which is we can direct people's behavior far more effectively with positive incentives than we do with negative stuff, which has huge implications for like the jail system and the punitive system and all that stuff is like people just find ways to avoid punishment. They don't necessarily do what people want them to do because it's much because punishment is just people can the the activity sprays in any direction that's just away from the thing whereas incentives directs it towards what you want. All right? And so if we think about this within the context of managing people and get them to do the things that we want them to do, then it makes more sense for us to add to think about an activity rather than a single outcome into as many many incremental steps as we possibly can and then incentivize those many steps. And the incentives don't necessarily need to be monetary. In fact, most times they don't need to be monetary. They need to be things that people can perceive as positive outcomes, which many times is just status and feedback, which is just great job, awesome stuff. You did that thing yesterday and it was great. You just reinforce the things that they are doing that are good and we reinforce and then now that they've realized I did this one thing, not anything to avoid something, but I did this one thing and I got this cookie. Well, I want to do that one thing again and they get another cookie, right? And we reinforce behavior. And so I like this process of thinking and Trevor and I talk about this a lot because it gets around the hullaloo of trying to figure out what's going on inside of people's heads, right? And what we have instead are circumstances and the outcomes

right? And then we have our incentives and all of these things we can measure. We can say I saw that this person we were in this circumstance which we can measure. We inserted uh this incentive and then they did this outcome. Yes or no, right? Whether they felt inspired or whether they psychologically loved, we don't know and we never will know cuz not everyone even knows how they're feeling and whether they answer questions is not necessarily even true. We have no idea. But if we can just measure the conditions then we can start directing behavior in the right ways. And so I thought this was a fascinating topic um for getting others and this applies to spouses. How do you get your spouse to do the stuff that you want them to do? It certainly doesn't come from nagging them all the time. All they're going to do is try to avoid being nagged. H interesting, right? And so this gives you four boxes to look at the these two. Oh, you can't really see them. But anyways, this one, this box over here, this guy, and this guy, those are things that you can't really direct people's behavior as much. Whereas this guy and this guy, you can direct people's behavior to the singular outcome that you're looking for. And you continuously reinforce those behaviors such that they start doing them without even thinking about it because it has been so reinforced, right? And so instead of trying to think how do I have an amazing marriage, it's how can I condition this person to stay married to me? Kind of interesting little flip for you. So anyways, Mosy Nation, this is the kind of stuff that I do geek out on and I think is really interesting. Um I hope you enjoyed it as much as I enjoyed making this for you. This is how you get people to do You can think about it in the terms of the soft side in terms of persuasion, but you can also think about it in terms of the hard side of what are the reinforcements that we're going to use either positive or negative. And are we going to add positives? remove add negatives? Are we going to remove negatives so that we can accomplish what we want together? So, lots love Bo Nation. Let me know if you like this stuff in the comments and keep being awesome. I'll see you guys next video.