Examples of extrinsic rewards in the workplace

Definition: An extrinsic reward is a tangible and visible reward given to an individual or an employee for achieving something. They usually have monetary value such as a salary hike, bonus, award, or public recognition.

Description: They are usually offered by the individual’s immediate manager who decides upon them. These rewards are typically financial such as an increase in salary or a cash reward for performing well or a gift certificate for going beyond the call of duty.

These rewards motivate and inspire employees because money or equivalent rewards are important to most people. Someone would work on a project in lieu of extrinsic rewards even when that person is not internally motivated. For example, a sales person may not be interested in the product he/she is selling but upon realising that he/she would get a cash bonus on the completion of sales targets, he/she would make an additional effort to complete his/her targets on/before time.

Because extrinsic rewards are tangible in nature, they are generally given to the individual directly responsible for the effort.

Extrinsic rewards differ from intrinsic rewards which are generally qualitative in nature such as a challenging work assignment, involvement in key decisions, a better rank in the work hierarchy, etc.

Extrinsic rewards are also commonly used for behaviour conditioning. Typically, there will be something that acts as the event and then there will be an extrinsic reward which reinforces it. For example, if an organisation wishes that employees have higher attendance levels, they may introduce a cash reward for the employee with the highest attendance throughout the year.

However, those using extrinsic rewards in a modern workplace would do well to remember research conclusions of modern behavioural scientists that efforts towards conditioning using extrinsic rewards may lead to completely unintended consequences.

Extrinsic rewards work well in the short-term to motivate behaviour. However, one should always consider the following questions before implementing them for long term.

1. Are you motivating the required behaviour or just motivating people to get the award?

2. Will you need to keep increasing the award amount to keep this behaviour sustainable?

3. Are you replacing an internal source of motivation with an external one?

As you can see above, in the long-term scenarios intrinsic rewards are much more suitable than extrinsic rewards.

Extrinsic motivation uses rewards or incentives — like praise, fame, or money —as motivation for specific activities. It is based on external factors and may be less effective long-term than intrinsic motivation.

Extrinsic motivation is a type of operant conditioning, which is a form of behavior modification. It uses rewards or punishments to increase or decrease the likelihood of specific behaviors recurring.

Being paid to do a job is an example of extrinsic motivation. You may enjoy spending your day doing something other than work, but you’re motivated to go to work because you need a paycheck to pay your bills. In this example, you’re extrinsically motivated by the ability to afford your daily expenses. In return, you work a set number of hours a week to receive pay.

Extrinsic motivation doesn’t always have a tangible reward. It can also be done through abstract rewards, like praise and fame. In contrast, intrinsic motivation is when internal forces like personal growth or a desire to succeed fuel your drive to complete a task. Intrinsic motivation is typically seen as a more powerful incentive for behaviors that require long-term execution.

Examples of extrinsic motivation

Extrinsic motivation can be used to motivate you to do various different things. If there’s a known reward tied to the task or outcome, you may be extrinsically motivated to complete the task.

Examples of external extrinsic rewards include:

• competing in sports for trophies
• completing work for money
• customer loyalty discounts
• buy one, get one free sales
• frequent flyer rewards

Examples of psychological extrinsic rewards include:

• helping people for praise from friends or family
• doing work for attention, either positive or negative
• doing tasks for public acclaim or fame
• doing tasks to avoid judgment
• completing coursework for grades

Is it effective?

Extrinsic motivation may be more effective for some people than it is for others. Certain situations may also be better suited for this form of motivation. For some people, the benefits of external rewards are enough to motivate high-quality continuous work. For others, value-based benefits are more motivating.

Extrinsic motivation is best used in circumstances when the reward is used sparingly enough so it doesn’t lose its impact. The value of the reward can decrease if the reward is given too much. This is sometimes referred to as the overjustification effect.

The overjustification effect happens when an activity you already enjoy is rewarded so often that you lose interest. In one study, researchers looked at the way 20-month-olds responded to material rewards compared to their response to social praise or no reward. Researchers found that the group that received material rewards was less likely to engage in the same helpful behaviors in the future. This suggests that the overjustification effect can start at an early age.

There’s some evidence that an excessive amount of extrinsic rewards can lead to a decrease in intrinsic motivation. Not all researchers agree, however. The idea was first explored in a study published in 1973.

During the study, some children were rewarded for playing with felt-tip pens. This was an activity they already enjoyed. Other children weren’t rewarded for this activity. After continued reward, the reward group no longer wanted to play with the pens. The study participants who weren’t rewarded continued to enjoy playing with the pens.

A meta-analysis from 1994 found little evidence to support the conclusions from the 1973 study. Instead, they determined that extrinsic motivation didn’t affect long-term enjoyment of activities. However, a follow-up meta-analysis published in 2001 found evidence to support the original theory from 1973.

Finally, a more recent meta-analysis from 2014 determined that extrinsic motivation only has negative outcomes in very specific situations. But for the most part, it can be an effective form of motivation.

Depending on how it’s used, it’s possible that extrinsic motivation could have negative long-term effects. It’s likely an effective method when used in addition to other forms of motivation.

What are some of the cons to using extrinsic motivation?

A major drawback to using extrinsic motivation is knowing what to do when the reward is gone or its value is exhausted. There’s also the possibility of dependency on the reward.

The usefulness of extrinsic motivators should be evaluated on a case-by-case and person-by-person basis.

Extrinsic motivation and parenting

Very few studies have explored the long-term effects of continuous extrinsic motivation use with children. Extrinsic motivation can be a useful tool for parents to teach children tasks and responsibilities.

Certain extrinsic motivators, like support and encouragement, may be healthy additions to parenting practices. Some rewards are often discouraged because it may lead to unhealthy associations with the rewards later in life. For example, using food as a reward may lead to unhealthy eating habits.

For small developmental tasks, extrinsic motivators like praise can be very helpful. For instance, using praise can help with toilet training. If you use external rewards, try phasing them out over time so that your child doesn’t become dependent on the reward.

Takeaway

Extrinsic motivation can be useful for persuading someone to complete a task. Before assigning a reward-based task, it’s important to know if the person doing the task is motivated by the reward being offered. Extrinsic motivators may be a useful tool to help children learn new skills when used in moderation.

For some people, psychological extrinsic motivators are more appealing. For others, external rewards are more attractive. It’s important to remember, however, that extrinsic motivation isn’t always effective.

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