8

Moving Past Carrots and Sticks

The carrot and the stick are pervasive and persuasive motivators. But if you treat people like donkeys, they will perform like donkeys.

—John Whitmore, Coaching for Performance, GROWing Human Potential and Purpose

In 1986, Dick Schulze, Best Buy’s founder, was facing a serious challenge. The business he had started 20 years earlier was under attack from Detroit-based consumer electronics chain Highland Superstores. Highland, the second largest electronics retailer in the United States, had opened stores in Best Buy’s own turf of Minneapolis and was selling at rock bottom, unsustainable prices.

Best Buy had been close to bankruptcy twice before, and this was another critical life-or-death moment. Dick felt ...

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