Intrinsic and Extrinsic Motivation

Intrinsic motivation has been described in many ways. Amabile, Hill, Hennessey, and Tighe (1994) describe it as “the motivation to engage in work primarily for its own sake, because the work itself is interesting, engaging, or in some way satisfying” (p. 950). According to Ryan and Deci (2000) intrinsic motivation refers to “doing something because it is inherently interesting or enjoyable” (p. 55). Pink (2009) defines intrinsic rewards as encompassing three components: Autonomy (the need to direct your own life), Mastery (desiring to get better at something you’re passionate about) and purpose (the longing to be a part of something bigger and better).

When all an employer wants from an employee is compliance, the traditional concepts of management will work. In the case that the employer seeks engagement, self-direction is more motivating. Amabile (1996), a professor at Harvard Business School, asserts that “Without intrinsic motivation, an individual will either not perform the activity at all, or will do it in a way that simply satisfies the extrinsic goals” (p.

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7). This statement supports that for an employee to be engaged in what they are doing
and satisfied doing it, intrinsic motivators are required. If your employees are only completing the tasks given to them because you are motivating them with extrinsic rewards, it can be expected that when you take the reward away, they will no longer be motivated to complete the work.

Extrinsic motivation has been defined as “Doing something because it leads to a separable outcome” (Ryan & Deci, 2000) or “the motivation to work primarily in response to something apart from the work itself” (Amabile et al.

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, 1994). An example of an extrinsic reward is when an organisation motivates their workers to perform by rewarding them with money, such as bonuses, increased salaries, stock options or benefits. These rewards are easy to monitor as they stem from results. If an employee is following the organisational procedures and adhering to the rules, the manager can reward. If not, there will be no reward. It’s a very common motivator for organisations as it’s easy to manage. They don’t have to think about how the employee feels or if he/she is passionate about their job.

It made sense for extrinsic motivators to work in older generations. Most employees had one job to do, with a simple set of tasks. For example, a bookkeeper’s job was to record all financial transactions in relevant journals, creating profit and loss statements balance sheets etc. They were assigned to those exact tasks. Today, we have programs like MYOB that does all of that work for us. We are no longer working in organisations where our jobs are routine. Our work has become more complex and more interesting. Workers today are looking for ways to use their minds and to be involved in bigger things than just monotonous tasks. Time magazine published an article stating that “They [generation Y] just want to spend their time in meaningful and useful ways…” (Trunk, n.d.). Extrinsic rewards are not only becoming less suitable for modern times, research has shown that they can also decrease intrinsic motivation.

…consideration of reward effects reported in 128 experiments leads to the conclusion that tangible rewards tend to have a substantially negative effect on intrinsic motivation. Although rewards can control people’s
behaviour….reward contingencies undermine people’s taking responsibility for motivating or regulating themselves. (Deci, Koestner, & Ryan, 1999, p. 658-659)

Extrinsic rewards can also cause people to lose interest completely in the activity. Deci’s research concluded that “…when money is used as an external reward for some activity, the subjects lose intrinsic interest for the activity” (1971, p. 114). Furthermore, Amabile (1996) states that “A number of studies have shown that a primarily intrinsic motivation will be more conducive to creativity than a primarily extrinsic motivation” (p. 7).

The candle problem was a behavioural study developed by psychologist Karl Duncker (1945). He had numerous people that he split into two groups. Both groups were given a candle, matches and a box of thumbtacks. Dunker told them to stick the candle to the wall in such a way that the wax won’t melt onto the table and using only the materials given. The subjects first tried sticking the candle to the wall with the thumbtacks, it didn’t work. Some tried to melt the side of the candle with the matches and adhere it to the wall but to no avail. After a while both groups managed to figure out the solution: stick the box to the wall with the thumbtacks, and put the candle inside it.

A scientist named Sam Glucksberg (1962) re-created the candle problem but gave the subjects incentives. The first group were not offered a reward but told they were a part of a study to ‘establish norms’ and see how long it takes the average person to solve the problem. The second group were offered different sums of money depending on how fast they solved the problem. It was recorded that the incentivised group took almost three and a half minutes longer than the non-incentivised group. This research defies every rule that says extrinsic motivators work. In their third edition Organisational Behaviour book, Wood et al. (2013) describe extrinsic rewards as being “positively valued work outcomes the individual receives from some other person in the work setting. They are important external reinforces or environmental consequences that can substantially influence people’s work
behaviours through the law of effect” (p. 131). The candle problem with incentives has been copied for the past forty years and every time the incentivised group solved the problem the fastest.

Glucksberg prepared the experiment again but this time he handed his subjects the materials separately. Instead of supplying the thumbtacks inside the box, he put them next to the box. For the first time ever the incentivised group beat the non-incentivised group. The results suggested that when the problem was made simpler, extrinsic motivators worked better. Extrinsic rewards usually only work for problems that have a simple set of tasks and a right answer. Workers today are more creative and conceptual and enjoy solving problems. When we have technology that does most of the simple tasks for us, we spend more time trying to solve problems that have many possible answers.

Contemporary companies are finding and implementing ways to motivate their employees by using intrinsic rewards. The best example would be Google Inc. Google is renowned for their great benefits and modern offices. There are too many benefits to list them all but some include sleep pods, reading areas, swimming pools, free food, free rental cars if you need to run errands, and some even have on-site child care facilities. One motivator that benefited the company and the employee is the 80/20 rule. Google don’t want people to have to leave the company to pursue their personal passions so every employee is to dedicate 80% of their time to their primary job, and 20% of their time working on ‘passion projects’ that can help the company. Half the products released at Google were invented in the 20% time. E.g. Gmail, Chrome, Google News (Mediratta, 2007). Fortune magazine ranked Google as the number one company to work for in the world in 2012 and 2013 (“100 Best Companies to Work For,” n.d.) It’s not hard to see why this is the case. Besides all of the above, Google has no real hierarchy (Mills, 2007). They have no official channels, only tiny work groups where ideas flow within the group. If an employee wants to work with another team they can without having to ask permission. While the intrinsic rewards are desirable enough, Google also offer very attractive extrinsic rewards such
as 100% paid maternity leave for up to 18 weeks. Like Google, Atlassian, an Australian software company, introduced a quarterly system where an individual could use 20% of his/her time to work on their own ideas and present them at a meeting the next day. This was called the ‘ShipIt Days’ (because it had to be delivered by the next day). This one day of autonomy led to 47 internal projects being used within the software company that never would have emerged otherwise, and more than $2 million in sales (Smith, n.d.). Atlassian has also been in the top ten of BRW’s best places to work for the last couple of years.

Another example of autonomy in the workplace is ROWE (Results Only Work Environment). (“What is Rowe,” n.d.) writes how employees are evaluated on their outputs and what they achieve at the company, not how long or when they are working. As long as you get your work done, you can come in anytime, leave anytime, not come in at all and meetings are optional. Companies who have implemented the ROWE human resources strategy have seen their productivity increase by 35% and their voluntary turnover dropped between 50% and 90% (Penttila, n.d.).

Not-For-Profit (NFP) Organisations are another good example of how intrinsic motivators work to retain staff when they are being paid much less than people in the same position who are working for private companies. Frey (1997) suggested that once an employee receives a wage that is enough to live off, they begin to seek purpose in their work. A case study by Tippet & Kluvers (2009) researching motivation in NFP organisations showed that most employees were satisfied with their pay. This research shows that because they see their pay as sufficient, intrinsic motivation may be more of an importance. Pink asserts that “Effective organizations compensate people in amounts and in ways that allow individuals to mostly forget about compensation and instead focus on the work itself” (2009, p. 170). In other words, get the issue of money off the table first so employees aren’t feeling mistreated or de-motivated, then focus on intrinsic motivators.

Thomas (2009) suggests that to increase intrinsic motivation you should begin
to de-emphasise money as a motivating factor. By paying your employees fairly, but not offering monetary rewards, they will begin to achieve goals for the satisfaction. Usually when you offer rewards employees may only just do what is asked of them, rather than going one step further. Organisations not only need to change the way they motivate their employees, they also need to realise that not everyone will be motivated by the same intrinsic reward. Ryan and Deci (2000) state that “People are intrinsically motivated for some activities and not others, and not everyone is intrinsically motivated for any particular task” (p. 56). As expected, humans do not have the same passions in life and the same goals, therefore we cannot expect them to be motivated by the same rewards.

While Google Inc. has a wide range of benefits that should suit most employees, they have also employed a ‘Chief Culture Czar’ whose main job is devoted to making sure everyone is happy. Google have an annual global survey that is focused on finding out how happy their employees are, and what it’s going to take to keep them with the company. The current CCC, Stacey Sullivan, has said of the survey “…career development is more of a focus than giving more stock options or increasing salaries” (Mills, 2007).

Thomas (2009) suggests identifying shared passions within an organisation so focus can be on achieving the desired goal. When passions are clarified and identified it’s much easier to pursue them in a systematic way. A team unifies when they discover that passion: “Aha, that’s what we care about. Now let’s go after it” (Thomas, 2009, p. 155). Teammates are then likely to connect and see each other as partners with a shared purpose.

For a leader to be successful in building employee engagement within an organisation, they need to be aware of what drives them and how to manage their own intrinsic rewards. Thomas (2009) declares that “Developing this skill helps you recognize the intrinsic rewards in your employees, gives you more credibility, and – as a bonus – helps you stay more engaged and energized” (p. 193).

Employee Engagement
Many people define employee engagement differently, but according to Thomas (2009) employee engagement is the phrase used to describe the motivation needed in organisations today. In the 80s and 90s it was ‘empowerment’ and in the 70s it was ‘enrichment.’ As work becomes more demanding and supervision slackens the need for workers to be “…psychologically ‘engaged’…” (Thomas, 2009, p. 11) when performing their work is essential. Although employee engagement itself can be defined in many ways, Macey and Schneider assert that it “…is a desirable condition, has an organizational purpose, and connotes involvement, commitment, passion, enthusiasm, focused effort and energy…” (2008, p. 4). Thomas defines employee engagement as active self-management that has four key intrinsic rewards “…the sense of meaningfulness, the sense of choice, the sense of competence, and the sense of progress…. These four intrinsic rewards are the psychological vital signs of an engaged workforce” (2009, p. 192).

Employee engagement is valuable for any organisation as it can breed employee loyalty. When an employee is loyal they contribute to moving the company forward and help it reach its goals. Lockwood (2007) emphasizes the link of engagement to business success after a survey of 50,000 employees in 27 countries revealed that “Organizations that have a highly engaged workforce were found to have almost 10 times as many committed, high-effort workers as those with a low-engaged workforce. The findings point to the manager as the most important enabler of employee commitment to the organization, job and work-teams” (p. 9).

The effects of intrinsic and extrinsic rewards have long been debated and will continue to be examined as psychologists and researches alike try and find the ‘answer’. This paper was intended to provide the reader with a worthy argument as to why intrinsic motivators are becoming a more obvious style of management. There are many examples of organisations focusing on intrinsic motivators and the effect they have on the success of a company. As Pink (2009) suggests, while extrinsic rewards are becoming less relatable in modern times, they should not be thrown out altogether, as one must still be satisfied with their pay to allow intrinsic motivators to work. The
evidence readily available today should be enough to convince more organisations to introduce intrinsic motivation and decrease the importance of extrinsic rewards with their companies.

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Intrinsic and Extrinsic Motivation. (2022, Apr 08). Retrieved from

Intrinsic and Extrinsic Motivation

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