Intrinsic vs. Extrinsic Motivation For Employees

To be motivated means to be moved to do something. Internal motivation comes from within a person, not something imposed from outside: a feeling that something is “the right thing to do” (aligns with the person’s morals, ethics or convictions). External motivation originates outside the person and can include laws or organizational regulations: expectations of other people (and probably not shared by the individual). But, as we’ll see, the line between the two types of motivation is blurred.

The Importance Of Employee Motivation

Military organizations often use the saying “If you are having a problem with a person’s performance, it is usually either a training problem (they don’t know what to do) or it is a motivation problem (they are not motivated to perform). An unmotivated team is an unproductive team. In every organization, supervisors and managers try to motivate people to be their best and to help the organization meet its goals. Managers and executives are sometimes confused as to why their teams seem unmotivated and appear to be just “going through the motions”. But we think these managers are looking too far away from the solution.

Employee Motivation Theory

The old Theory X and Theory Y view of people as being basically lazy or not has fallen out of favor in modern discussions of Human Capital/Resources. We now know that motivation is very complex and that lots of factors are at play, some complementing each other, and others in direct contradiction. The speaker in this video, Daniel Pink, makes the case that the traditional if-then motivational construct held by management in the 19^th century – – – if you do this work, then the company will pay you this much money – – – only works for menial work and not for the kind of brain-intensive, knowledge work that is increasingly common today.

What Is Intrinsic Motivation And How Does It Relate To Your Employees?

If external (extrinsic) rewards do not motivate people, what other leverage does management have? Intrinsic rewards. Intrinsic means “relating to the essential nature of a thing”. So, intrinsic motivation causes a person to do (or not do) something because that course of action is inherently gratifying, interesting or enjoyable to that person. The behavior might meet deeply rooted psychological, spiritual or physical needs or it could somehow be inherently satisfying. It might align with the person’s view of how the world should be. A person taking an action due to intrinsic motivation might describe the action as being fun, a challenge, interesting, just “play”, or maybe satisfying a thirst for knowledge. Every person, including every one of your employees, is intrinsically motivated to do certain things.

What Is Extrinsic Motivation And How Does It Relate To Your Employees?

Extrinsic is defined as “not part of the essential nature of someone or something; coming or operating from outside.” It refers to behavior that is driven by external rewards such as money, popularity, school grades or praise. This type of motivation arises from outside the individual, as opposed to intrinsic motivation, which originates inside the individual. Extrinsic motivation causes a person to do (or not do) something because it fulfills some externally-originating need or meets some other party’s objective or requirement. So, which is better (and easier to employ by management)? It turns out humans need both types.

The Employer’s Role In Fostering Intrinsic Motivation

Intrinsic motivation can be harder for employers to promote and encourage because so much of it comes from the employee and their internal desires and drive. There are things that employers and managers can do to help grow that internal motivation. Some examples of ways that employers can contribute to intrinsic motivation are by allowing and promoting autonomy and knowledge, encouraging purposefulness and meaningfulness, increasing responsibility while tracking progress, recognizing accomplishment and fostering social interactions.

The Employer’s Role In Fostering Extrinsic Motivation

Extrinsic motivators can be easier for employers to encourage and promote, although they often don’t have as lasting an effect as intrinsic motivators. Employers can foster extrinsic motivation by first giving permission to the managers who directly supervise the employees to reward them with things such as pay increases, time off, bonuses, rewards and other symbols of acknowledgment. Upper management should be considering things like the benefit structure, what can be realistically offered to the employees and what the company can afford or getting creative to come up with ideas that work within the budget.

Intrinsic vs. Extrinsic Motivation: Which Works Best For Your Team?

As managers and leaders, we want both types of motivation in the workplace and we want them aligned with each other. Often this takes time. When joining a high-performance team, new people evolve from the initial, extrinsic “I sure hope I can fit-in here and do what these people expect of me” to the intrinsic “I will be the best at my job so I don’t disappoint my team/colleagues”. The adage applies here: “What do your people do when they are certain nobody is watching?” The reward mechanism becomes internal once the person’s own expectations begin to guide every action: Be the best, do the right thing, go the extra step, etc. John Venable, in his excellent book “Breaking the Trust Barrier – – – How Leaders Close the Gaps for High Performance” talks about the amazing transformation that occurs when newly assigned ground-crewmen (including women) make the transition from being an Air Force jet mechanic to being a Thunderbird Air Demonstration Team F-16 jet mechanic. The improvement in their attention to detail in their personal appearance, their work on the jets, even the way they hold their heads up and walk with purpose, must be seen to be believed. “It isn’t arrogance,” John said, “it is just an awareness that you are now part of an amazingly close-knit team that is doing something incredible” (maintaining six jets that fly at 500 mph, just 18 inches apart, while rolling and looping, is clearly incredible and the tiniest mechanical malfunction is often lethal to the pilot).

So how do we build our own Thunderbird-like, high-performance organizations?

1. Hire people based on intrinsic characteristics, to the degree you can uncover them. It sounds so simple when management tells the Director of Human Capital (aka Human Resources) “Just hire the right people for us!” But people are not transparent and they often pose as something they are not, especially when interviewing for a job. Ross Perot’s computer company EDS had a standard recruiting question on college campuses. Disguised as just another “getting to know you” question, recruiters asked each candidate “Do you play any musical instruments?”. The question was important because EDS’s HR analysts had assessed the assimilation of new hires and determined that musicians made better coders, with all other things being equal. They caught-on to coding more quickly and were happier doing it. With only a few openings and thousands of applicants, EDS wanted to use every possible predictor to identify candidates most likely to succeed at EDS.
   Beyond the obvious issues of a college degree, grade point average, and level of experience, have you analyzed your human capital to see if there are trends and “success indicators” that could help you hire people who will do well in your organization? And don’t forget the importance of intrinsic values, work ethic, and upbringing: A friend in a major engineering firm always looked for college grads who had average grades but had worked their way through school, with little financial help from others. He even preferred candidates who had held multiple jobs, especially people who had held at least one technical job, such as working as a highway engineering helper in the summer. My friend said he could teach people to do a job but he couldn’t teach honesty, a strong work ethic, tenacity in pursuit of a goal, morals or ethics: People either had those qualities instilled in them by their parents, the military, or maybe self-taught, or they didn’t. John Venable calls these “Personal Principles – the fundamental values that drive an individual’s behavior and reasoning.” Are you equipping (and challenging) your HR team to ask the right questions so they can find people with the intrinsic qualities important to your business?
2. Manage people based on things you can control (extrinsic motivations) but plan to get some of those external motivations internalized (made intrinsic) very quickly. A healthy, friendly, risk-tolerant workplace lets people self-motivate to become their best, then the individuals’ actions and attitudes, in aggregate, shape the organization. The whole reflects the characteristics of its parts.
   As leaders, our ultimate goal is a self-directed team where ongoing excellence is everyone’s main goal because 1) it pleases them to belong to such a great team (intrinsic pride, mutual support, sense of belonging) and 2) it meets the organization’s larger goals of providing outstanding products and services (extrinsic appreciation by others, advancement by management, pay, and benefits commensurate with risk and effort). “Manage Yourself. Lead Others.” (Peter F. Drucker)
   Drucker’s counsel in his ground-breaking article “Managing Oneself” in the 1999 Harvard Business Review could be summarized as “get your own house in order before you worry about anyone else (including employees)”. Be sure your entire work environment expects and rewards excellence. Adopt Kaizen (constant improvement) practices where no process is sacred and everyone seeks to do things better, every day. Ask yourself “Are we seeking out, identifying and publicly rewarding the behavior we want everyone to exhibit.” Ask “Are our people afraid to make mistakes, or are they encouraged to take small, calculated chances for big potential gains for the enterprise?” If the answer to either question is no, the problem isn’t just your people – – – it is also your organization! You cannot grow award-winning roses in pure sand, and talented, motivated people cannot flourish in anything but the most fertile, supportive business environment.Take a hard, objective look at your staff – – – are they the kind of leaders your new-hires will look up to and want to emulate? Do they set a high standard? Do they walk-the-talk? If they do, their daily work will motivate your employees (their direct-reports) to be their best. If they don’t, you need to ask how those supervisors got there. Why did you/your predecessor hire them? Have you been happy with their performance? If not, why haven’t you addressed that problem before now? Are they being motivated properly? If not, maybe you need to ask yourself how you can improve your management team’s work environment, which should cause you to finally ask . . . what motivates you?

Peter Drucker would be so proud!

What are the biggest challenges facing you today related to the hiring, managing and motivating of employees?

Your comments are welcomed.

For further reading:

1. Intrinsic and Extrinsic Motivations: Classic Definitions and New Directions, Richard M. Ryan and Edward L. Deci, University of Rochester, 1999
2. Breaking the Trust Barrier – How Leaders Close the Gaps for High Performance by JV Venable, Berrett Koehler Press, 2016.
3. 1001 Ways to Reward Employees by Bob Nelson, Workman Press, 1994
4. “Managing Oneself”, Peter F. Drucker, Best of HBR 1999, Harvard Business Review