People (especially students) don’t do their best work when compensation or reward is based on intermediate performance goals:
Google Wave: Why did Google feel that Google Wave was a good product? – Quora: “In short, Google was experimenting with a drastically new model in an attempt to retain key talent and ended up getting the incentives so perversely aligned that it both directly contributed to a failed product and also compensated that failure more than what a moderate success would have been.”