Creating an Energized Workplace

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American management is discovering that the traditional methods of motivating employees—either with carrots (bonuses, raises, stock options) or with sticks (coercion, fear, firing)—no longer work. As Peter Drucker has observed, “Economic incentives are becoming rights rather than rewards. Merit raises are always introduced as rewards for exceptional performance. In no time at all they become a right…The increasing demand for material rewards is rapidly destroying their usefulness as incentives and managerial tools.” Negative management techniques are likewise becoming a less useful option. In our legalistic culture, firing an employee—or even giving an unflattering reference—is often an invitation to a lawsuit.

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