Our esteemed editor, Ann Bares, wrote recently on what incentives can and cannot do. Reading it reminded me of research I dove into this month on the effect of rewards on motivation. I’m often asked, “Doesn’t rewarding someone for the work they do diminish their intrinsic motivation (motivation based on taking pleasure in an activity rather working towards an external reward)?”
This is a fallacy – one supported through oft-cited research showing rewards do, indeed, lower people’s pleasure in their work because now you’re paying them for it. But let’s be honest – we’re already paying people for their work; that’s the basic contract for employing them.
The research itself, when examined closely, does not bear out the myth. One paper in particular digs deeply into the last 25 years of research, showing no negative effect from properly applied rewards on intrinsic motivation.
“Our analysis of a quarter century of accumulated research provides little evidence that reward reduces intrinsic task interest. If a person receives a tangible reward that depends on completing a task or meeting a standard of quality, and subsequently the reward is eliminated, the person generally spends as much time on the activity as he or she did before the reward was introduced. Any lessening of intrinsic interest resulting from tangible reward, received for successful task performance or task completion, is too small in magnitude to be detected by sensitive statistical procedures that combine the results of similar studies.”
1) Rewards can increase creativity.
“Recent research also has shown that reward for a high degree of creative performance can be used to increase generalized creativity. Reward for high creativity in one task enhances subsequent creativity in an entirely different task. These findings suggest the need to revise conventional views about the detrimental effects of reward. Reward, when used appropriately, has a much more favorable effect on task interest and creativity than is popularly supposed.”
2) Reward achievement and quality of result, not just activity, to get desired benefits.
“The receipt of reward in education and business usually depends on task completion, performance quality, or both--reward procedures not found to reduce intrinsic task interest. Reward can be used effectively to improve various kinds of performance, including creativity, without detrimental effects on intrinsic task interest.”
3) Be sure to convey why recognition and reward is being given.
“A tangible reward that one perceives as being deserved for successful performance of an activity is likely to maintain or enhance the perception of self-competence without undermining feelings of self-determination (Bandura, 1986). Furthermore, when a previously unavailable reward is made contingent on performance, the reward may be experienced as providing increased freedom of choice.”
Can rewards ever have a detrimental effect on intrinsic motivation? Yes, in two instances only:
- In “performance-independent” rewards where there is no differentiation in rewards given to low contributors/achievers vs. high contributors/achievers. This is no surprise as people quickly become disenchanted (and even cynical) when a person who has potentially saved the company millions through a new process receives the same reward as a person who helped out as part of a team on a minor project.
- In “expected tangible” rewards (if/then incentives rewards, where the reward is known before the task is completed). This is the major caution with incentives programs. Incentives, properly designed, can play an important and very useful role in encouraging achievement of specific goals. But be sure you know the outcomes you’re seeking and are designing your incentives approach to avoid any unintended consequences.
Intrinsic motivation is, in fact, strengthened by recognition and reward that reinforces why accomplishments and contributions are valuable to the team, the company, or the customer. Don’t buy into the myth.
What’s the most meaningful recognition or reward you’ve received?
As Globoforce’s Head of Strategic Consulting, Derek Irvine is an internationally minded management professional with over 20 years of experience helping global companies set a higher ambition for global strategic employee recognition, leading workshops, strategy meetings and industry sessions around the world. His articles on fostering and managing a culture of appreciation through strategic recognition have been published in Businessweek, Workspan and HR Management. Derek splits his time between Dublin, Montreal and Boston. Follow Derek on Twitter at @globoforce.
Paper that this blog post is based on is published in 1996. That's 18 years ago.
So saying, that it "digs deeply into the last 25 years of research" is simply inaccurate at best.
As far as I know, the evidence for the hypothesis that monetary rewards weaken the intrinsic motivation - especially in creative efforts - has been piling up in that 18 years. In particular thanks to the field of neuropsychology.
That being said, this doesn't mean that proper meta-analysis of papers couldn't provide insights that are missed by individual ones. But one being referred in this article is not one.
I'd be delighted to hear about similar study with fresh data and focus in creative and cognitive tasks. Kind of tasks that major of modern day work assignments are.
Perhaps the author or other readers could help me in finding one?
Posted by: Olli Pietikäinen | 02/03/2014 at 11:59 AM
The most recent meta-analysis was cited recently here http://www.compensationcafe.com/2013/05/memo-to-dan-pink-and-friends-incentives-do-not-undermine-employee-motivation.html by guest contributor Gerry Ledford, PhD. And there are others.
MIT/Duke researcher Dan Ariely, PhD, also confirmed the power of rewards while simultaneously clarifying the VERY important point that "intrinsic" motivation varies by context: the drivers in commercial transactions are quite different than those activated when social norms govern behaviors. For example, people will fill sandbags for free to protect their community from flood but will reject the same "job" if offered $12/hr to do it. Friends will volunteer to help you move without charge but commercial movers demand cash compensation. Switching the situational context changes the motivation and alters the dynamics of the behavioral reinforcement environment. Kinda basic for rewards professionals to know...
Posted by: E. James (Jim) Brennan | 02/03/2014 at 02:36 PM
First of all, I'm not a compensation professional, merely an individual interested in the topic. I'd appreciate if this would not be used to dismiss everything out of hand.
Paper that was cited was "Negative Effects of Extrinsic
Rewards on Intrinsic Motivation:
More Smoke Than Fire" and can be found here: http://ceo.usc.edu/pdf/Ledford_Fang_Gerhart_2013_Intrinsic_Rew_WaWJ.pdf
Yes, context does matter. And a lot. I think that everyone agrees on those examples on sandbags and moving. But I was trying to narrow the context down to a smaller sub-set of conditions that is more relevant to modern day work and my own field.
Something in the lines of "How monetary incentives affect performance, creativity and work quality in knowledge work organizations".
Original post does not make the distinction but goes on to make broad generalization of e.g. "Rewards can increase creativity." I'm making an assumption of monetary reward here, because that is the argument author is going against if I understood correctly. Apparently case about monetary rewards as creativity killer is not as bleak as I have so far thought, but still I haven't been able to find any credible proof for this particular claim.
Posted by: Olli Pietikäinen | 02/04/2014 at 07:51 AM
I believe, Olli, that author Derek Irvine does not peddle monetary reward systems but is a non-cash reinforcement/recognition expert. If my broad characterization is wrong, he can/will correct me, I'm sure; but I don't think he wanted to narrow the discussion down to monetary remuneration approaches at all.
All the research (and practical workplace findings) to my knowledge confirm that the creative output of students or professors in academic settings can be suppressed by cash rewards, but employees in commercial businesses REQUIRE cash and pay a LOT of attention to what produces it. Anything can be abused, of course; putting too much money on the table can indeed overwhelm the senses and create chaos.
Most creative people are driven by intrinsic motivations and would be creative no matter what they were paid. Money doesn't drive their behavior. Besides, very few workers are employed to "be creative," so it's rarely an issue to society in general.
Nearly everyone everywhere could somehow find another job that pays "more money"; but people remain reluctant to switch jobs for small increases. Not all rewards jingle. It's not as simple as it might appear.
Posted by: E. James (Jim) Brennan | 02/04/2014 at 07:15 PM