Charles Cotton: Combine extrinsic and intrinsic reward to create a tailored motivation strategy

Charles Cotton, CIPD

There are a number of ways organisations can boost motivation. One is to use extrinsic rewards, such as pay. A simple example is that employees are motivated to sell more by being offered a financial incentive, such as commission.

However, employees are only likely to change their behaviours if they value the reward on offer and believe they have a realistic chance of getting it. Insights from behavioural science reveal that while individuals or teams are motivated by extrinsic rewards, too much focus on these may result in unanticipated or inappropriate behaviours.

Organisations have tried to get around this by putting various checks and balances in place, or by deferring the incentive payment over time. However, this can reduce employee motivation, because staff find it harder to understand what they need to do to achieve the reward and they value it less because they have to wait a long time to receive it.

As well as extrinsic awards, organisations can also use intrinsic ones, such as recognising employee efforts, listening to their concerns, acting on their suggestions and offering training opportunities.

Organisations may use their mission and vision to motivate employees out of a sense of greater good. As the old adage goes, if you want someone to do a good job then give them a good job to do.

What is important is to use both types of reward to motivate, getting to understand employees so the employer knows when and how to use cash, and when to use other forms of reward.

Charles Cotton is reward advisor at the Chartered Institute for Personnel and Development (CIPD)