How do Intrinsic Motivation and Extrinsic Incentives affect Workplace Performance?
We’ve already broken down an important, single study on Extrinsic Motivation vs Intrinsic Motivation for you on this blog. This time we will zoom way out, and analyze a meta-analysis. This one, the 10th meta-analysis to examine this field of inquiry, covers over 40 years of research on extrinsic vs intrinsic motivation, spanning 154 sources and 212,468 respondents.
The Paper:
“Intrinsic Motivation and Extrinsic Incentives Jointly Predict Performance: A 40-Year Meta-Analysis” from Psychological Bulletin, Feb 3, 2014.
Authors: Christopher P. Cerasoli, Jessica M. Nicklin, Michael T. Ford
Two Core Findings
A meta-analysis conveys definitiveness in research.
In that spirit of conclusiveness let’s share the two core findings straightaway:
“Intrinsic motivation remains a moderate to strong predictor of performance regardless of whether incentives are present.”
Clear extrinsic motivations disincentivize teamwork and creativity
A meta-analysis helps develop the theory of intrinsic motivation as it gives a “population-level” view. This differs greatly from the limited sample individual papers use as the basis of their hypothesis in intrinsic motivation psychology.
How to apply the findings from this comprehensive study is, of course, what interests us in business. After all, Attuned was created to give managers tips and insights to further the goal of meaningful work.
Analysis is great but what you do with it is what matters.
Key Takeaways on Workplace Motivation
In analyzing the study, we’ve pulled a few quotes that provide the basis for practical applications to help managers:
extrinsic motivation, meaning the use of very clear incentives, “narrows cognitive focus, strongly encourages behavior X, and intensifies behavior toward a goal”
“as incentives become larger … teamwork and creativity will be disincentivized, intrinsic motivation and its importance to performance will be crowded out, and unethical or counterproductive behaviors may become more likely”
“Tasks that are straightforward, highly repetitive, and perhaps even less inherently enjoyable, should be more closely linked to extrinsic incentives. For example, linking pay to performance has been found to improve productivity on relatively straightforward tasks, such as tree planting…”
We could have taken a much shorter version of this last quote, but we loved the mention of extrinsic motivation being appropriate for “tree planting”. The authors are clear, extrinsic motivation has a limited scope, and the types of work managers should think to use extrinsic motivation incentives as their primary motivational tool, are similarly limited. Just for work that is repetitive and straightforward.
But the world isn’t going in that direction; creativity and teamwork are the themes of our business generation. Many businesses struggle to improve their teamwork and creativity. If managers can ignore their urge to use incentives, and instead foster intrinsic motivation, they should expect higher levels of creativity and teamwork within their teams as a result.
“basing an entire salary on attaining objectives can lead to lower well-being and counterproductive behaviors.”
What was really interesting from the study is rather than finding that incentives are not effective, it was actually the opposite. Incentives are too effective! They force out what is inherently joyful in an activity.
More WFH—and all the new complications it adds for organizations—means that managers need to increase teams’ well-being more than ever before. To help with that we should not base our team’s salary heavily on incentives. While the world needs more trees, very few of us are in the business of tree planting. As a motivational tool we should leave extrinsic motivation to the professional tree planters.
gender plays no discernible role to intrinsic motivation
In other words, intrinsic motivation is gender neutral. The benefits intrinsic motivation brings to individuals and teams are the same for women and men. This, of course, seems intuitive but important to have spelled out very clearly in a research-based academic paper.
Some other cool, nuanced findings:
“Older respondents averaged not only higher levels of intrinsic motivation but also somewhat higher levels of performance compared to younger workers.”
This bodes well for aging populations in developed countries. Is it that as we age, we grow to understand ourselves better? Ignore the ambitions that others have for us? Follow our own motivations more closely? Leading to better output? Knowing that intrinsic motivation levels seem to increase with age is comforting for this aging author.
The Interaction of Intrinsic and Extrinsic Motivation
As much as we would like a simplified approach or an easy theory that explains motivation, in reality, it gets a bit more complicated. Where the research stands today is that intrinsic motivation and extrinsic motivation interact with one another. Both matter, each can influence the other, both influence performance and feelings. The yin and yang of motivation.
On top of this, there are further layers of complexity such as how personality interacts with motivation styles. There is still much more research to be done on the links between the two types of motivation to reach a better understanding. Our geeky selves are excited for these subtleties to scientifically progress.
In Conclusion
For now though, the takeaway is that for “complex jobs that require judgement and intense personal investment” intrinsic motivation is best. The authors summarize, “For example, teachers who are paid based on their students’ performance do not [do] better (Springer et al., 2011), and doctors who are paid based on patient outcomes do not have healthier patients. (Petersen, Woodard, Urech, Daw, & Sookanan, 2006)”
Whether it be an individual academic study or a meta-analysis of hundreds of studies the importance of intrinsic motivation to create meaningful work is clear.
Through intrinsic motivation we want to help managers predict what types of outcomes their systems will create for their teams. To solve the age old organizational problem of how to increase productivity and how to boost morale think about motivation intrinsically.
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