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The Power of Intrinsic Rewards

The strongest motivators come from inside a person.

Not long ago, a county administrator asked me about performance bonus systems and other approaches to rewarding employees for good performance. This inspired me to collect my thoughts about motivation. Here's a summary.

First, motivation is idiosyncratic. That is, different things motivate different people. So any approach to motivation needs to take the individual into account. That's why I like to stay away from elaborate organization-wide reward systems. Instead, you will get better results by giving managers and employees a set of tools that they can use to motivate themselves and others -- each according to their own motivation needs.

While doing annual reviews with employees at my firm, The Public Strategies Group, one person asked that the firm pay for her house cleaning service. She figured it would cost about $400 per month. I wanted to give her a substantial reward, so I suggested giving her a raise of $800 per month instead. She said, "No, I don't want the money because I will never end up using it for house cleaning. I want the firm to give me a clean house." It was hard for me to refuse the opportunity to reward a great employee at half the cost of what the firm was prepared to spend.

You may not confront such a unique request or have the flexibility to make such an offer; the point is to find out what the person really wants and then see if you can meet that need. I remember one team in the U.S. Department of Justice whose members wanted, as a reward, their boss to cook them one of his famous Tex-Mex dinners. He was delighted to oblige when they exceeded their goal.

Second, two general types of reward motivate people: extrinsic and intrinsic. Extrinsic rewards can come from your boss, the organization, even your co-workers or a customer. They involve somebody rewarding you. Things like bonuses, plaques or days off are examples of extrinsic rewards. Intrinsic rewards come from inside the person. They are self-rewarded. What drives a mountain climber? Or a student doing extra credit to get an A+? Or a busy mother who volunteers her precious time at a local food bank? Intrinsic rewards.

Frederick Herzberg, who studied motivation back in the 1960s, found that feelings of accomplishment, personal challenge, increased responsibility and belonging were among the strongest intrinsic rewards in organizations. Further, he demonstrated that intrinsic rewards are generally much stronger than extrinsic ones (although some individuals are strongly motivated by money and other extrinsic rewards). Most important, Herzberg posited that the motivational value of extrinsic rewards tends to "zero out." That is, if I get used to winning a bonus for my good work, I'll come to expect the bonus. It will no longer "satisfy" me in Herzberg's terms. In fact, not getting a bonus will dissatisfy me.

So how does one harness the power of intrinsic rewards? Give people frequent opportunities to reward themselves rather than creating some sort of reward system.

Ask yourself these questions about your organization:

o Do employees have the opportunity to connect directly with those whom they serve? People value feedback from their "customers" even more than from their boss. Since so many government employees are mission-driven, they especially like to hear from those whom they serve.

o Do employees have objective data -- measures -- that tell them every day how they are doing? Imagine two bowlers. One can see the pins fall as she bowls. The other is bowling into a fog and has to rely on his boss to tell him how many pins he knocked down. Which will be more motivated? More innovative?

o Do employees have the opportunity to use their strengths in their work -- to give their best? The Gallup Organization has empirically demonstrated the power of this intrinsic motivator (see Now, Discover Your Strengths ).

o Do employees experience challenge in their work? The best managers don't limit themselves to a strict interpretation of their employees' job descriptions. Rather, they create meaningful challenges for employees and inspire workers to accept those challenges.

o Are your employees learning? Workshops and other professional development programs are fine, but the best organizations are methodical about making every day a learning experience for their employees and for the organization as a whole. Short, five-minute time-outs to reflect on experience, ask what the data is telling us, or to debrief an activity can be tremendously motivating to most employees.

When considering issues of motivation remember that each of us is different. Tailor your strategies to individual people rather than building "one size fits all" systems. And harness the power of intrinsic rewards. Modern psychology tells us these can be the most powerful motivators.

Babak Armajani was a Governing contributor. He was the chair for the Public Strategies Group, where he and his partners focused on transforming bureaucracies into customer-focused enterprises.
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