Lecture Outline:

Introduction

Extrinsic Motivation in the Workplace: Factors, Types & Examples

Factors to Encourage Motivation

Reward Systems & Employee Behavior: Intrinsic & Extrinsic Rewards

Intrinsic Rewards in the Workplace

Extrinsic Rewards in the Workplace

Want to encourage and inspire motivation? You need to know what motivation is -really.

Motivation is an employee's intrinsic enthusiasm about and drive to accomplish activities related to work. Motivation is that internal drive that causes an individual to decide to take action.

An individual's motivation is influenced by biological, intellectual, social and emotional factors. As such, motivation is a complex, not easily defined, intrinsic driving force that can also be influenced by external factors.

Sometimes, simply receiving a paycheck is not enough of an incentive to keep employees dedicated and focused. Managers must think of new ways to hold an employee's attention and interest on a project, or the company as a whole. Many companies employ motivational tactics and rewards systems, both of which have advantages and disadvantages.

Companies use both positive reinforcement and negative reinforcement to motivate employees. Many managers believe that using positive motivation techniques encourages employees to produce more and better quality work. For example, some companies select an employee as "Employee of the Week."

This technique praises the winning employee, while positively encouraging other employees to keep trying to do well. Other managers believe negative reinforcement motivates employees to stop bad behavior. For example, a company may issue a written-warning system, or threaten employees with termination to get them to perform a certain way.

Companies reward their employees with both tangible goods, as well as praise. For example, a sales department may offer a monthly bonus to the highest earner. Not all tangible rewards come in the form of money. Some companies host free lunches, or give away company gear to good workers. Many managers choose to reward their best employees by simply praising them for a job well done, or by recognizing the hard work they put in to a project.

By using positive reinforcement to motivate employees, a manager may build a good relationship with his employee that fosters a sense of trust. In a good manager-subordinate relationship, employees may feel respected and comfortable in their working environment. Providing rewards, both tangible and in the form of praise, can make employees happier. Happier employees often perform better at work.

Using negative enforcement as a form of motivation could cause employees to become dissatisfied with their jobs.

Unhappy workers typically produce less quality work, become sluggish or fail entirely to meet deadlines . Applying too much motivation or offering too many rewards can also have a negative effect. Employees can become over-confident.

They may feel that they are the bosses' favorite workers, even if they start to slack off on their projects or test the limits of their working relationship with their supervisors.

Extrinsic motivation is an important concept for managers to understand. We will learn what it is, some of its key factors, and different types of extrinsic motivation.

Why Is It Important?

Extrinsic motivation is an important tool an organization can use to motivate members of an organization to accomplish organizational tasks. Knowing its advantages and disadvantages will help a manager decide when it's effective to use and when it's not.

Definition

Extrinsic motivation is a means of encouraging an activity based upon external consequences resulting from performing the activity. The most common examples of extrinsic motivations are rewards and punishments.

Factors to Consider

Some factors need to be considered before you decide to use extrinsic motivation. You will often use extrinsic motivation in situations in which the activities are uninteresting and provide little, if any, internal satisfaction. Stuffing envelopes is a good example of the type of task that probably requires extrinsic motivation. You also need to consider the level of control that will be necessary in developing extrinsic motivators.

Types of Extrinsic Motivators

Some extrinsic motivators provide the organization more control over motivation than others. The classic motivators of reward and punishment are considered the most controlling and are often referred to as external regulation. In other words, your task performance is completely controlled by the related rewards and punishments. For example, if you exceed your sales quota, you may get a bonus, but if you miss your sales quota by a significant amount, you may be fired.

Sometimes extrinsic motivators can be partially internalized. This may occur if you are motivated by self-esteem, ego, or guilt. Such partially internalized motivation is called introjected regulation. For example, let's say that you work as a member of a team for a special project. While you obtain no internal satisfaction from your task, you would feel guilt or shame if you let your team down. Thus, you have internalized the motivation - guilt - but you still perform the task because external forces are influencing your behavior.

These are some of the factors that are present in awork environment that many employees find motivating.

Management and leadership actions that empower employees,

Transparent and regular communication about factors important to employees,

Treating employees with respect, Providing regular employee recognition, Feedback and coaching from managers and leaders, Above industry-average benefits and compensation, Providing employee perks and company activities,

and Positively managing employees within a success

framework of goals, measurements, and clear expectations.

Have you ever wondered why some employees are more motivated than others to work at a higher level of productivity? This lesson explains how managers use intrinsic and extrinsic rewards to reinforce positive employee behavior.

Effective Reward Systems

A motivated workforce can be a significant factor in organizational success. When employees are motivated to work at higher levels of productivity, the organization as a whole runs more efficiently and is more effective at reaching its goals. This is in contrast to an unmotivated workforce, who can negatively disrupt an organization and distract employees from their work. For this reason, it is imperative that managers understand the power of reward systems and how they are used to influence employee behavior.

Rewards are positive outcomes that are earned as a result of an employee's performance. These rewards are aligned with organizational goals. When an employee helps an organization in the achievement of one of its goals, a reward often follows. There are two general types of rewards that motivate people: intrinsic and extrinsic.

Intrinsic Rewards

Intrinsic motivation is internal to the person in that it is something that you have to offer yourself and is driven by personal interest or enjoyment in the work itself. Because intrinsic motivation exists within the individual, achieving it does not depend on others. Some people believe that the most powerful rewards come from inside a person.

Think of that sense of accomplishment you feel once you have overcome a significant challenge or completed an assignment or work project that required a good deal of effort. Intrinsic motivation provides that personal pat on the back or natural high that reflects a person's ability, competency, growth, knowledge and self-control over their endeavors. Employees who are intrinsically motivated tend to work at higher levels of productivity and strive to develop professionally. Intrinsic rewardsinclude things such as: personal achievement, professional growth, sense of pleasure and accomplishment.

In a knowledge economy where the greatest asset an employee can offer an organization is their intelligence, experience, problem solving ability and change-savvy persona, intrinsic rewards are especially important to workers. In fact, Frederick Herzberg, who is one of the leading theorists of workplace motivation, found intrinsic rewards to be much stronger than financial rewards in increasing employee motivation. This is not to say that employees will not seek financial rewards in addition to intrinsic rewards, rather it just means that money is not enough to maximize motivation in most employees. People want to feel like their contributions matter.

For example, an employee might want to reach a sales quota set by his manager to earn the bonus that is attached to it, but unless the employee feels a sense of accomplishment as part of making those sales, the motivation to achieve the quota is less powerful. To help employees with their intrinsic motivation, managers should:

provide meaningful work allow workers to make choices through a high level of autonomy provide opportunities for employees to show their competence in areas of

expertise facilitate professional development so that employees can expand on their level of

knowledge offer frequent opportunities for employees to reward themselves allow employees the opportunity to connect with those with whom they serve to

obtain valuable feedback give them a path to monitor their progress with milestones along the way

Extrinsic motivation is based on tangible rewards. Unlike intrinsic motivation that is self-administered, extrinsic motivation is external to the individual and is typically offered by a supervisor or manager who holds all the power in relation to when extrinsic rewards are offered and in what amount. Extrinsic rewards are usually financial in nature, such as a raise in salary, a bonus for reaching some quota or paid time off. However, extrinsic rewards can also be as simple as getting the better office, verbal praise, public recognition or awards, promotions and additional responsibility.

These material rewards can be motivating to employees because pay, time off, advancement and recognition are important to most workers. Just imagine how de-motivating it would be to underpaid, overworked and unappreciated, and you can quickly see how important extrinsic rewards are to organizational success. An extrinsically motivated person will work on a task that they do not particularly care for simply because of the anticipated satisfaction that will come from some extrinsic reward. For example, the employee may not be interested in the product he is selling, but reaching the quota means the bonus, therefore he is motivated to put forth the effort he needs to meet the sales quota.

Providing employees with extrinsic rewards is relatively straightforward and usually built into performance reviews or individual projects.

They are particularly useful in the short-term for motivating employees to work towards one specific organizational goal. Meeting the sales quota for a bonus is an example of offering an extrinsic reward for a short-term goal.