This book by Daniel Pink shows there is a large gap between the science of motivation and business practices and management. Motivation is largely intrinsic but in business rewards are typically extrinsic (for example, financial bonuses).
Studies show that higher pay and bonuses only lead to better performance in tasks with basic mechanical skills and have clearly defined steps and solutions. However, tasks that require cognitive skills, decision making and creativity suffer when rewards are offered (and this is the direction of the vast majority of jobs in the 21st century).
There are flaws with the ‘carrot and the stick’ model:
- can extinguish intrinsic motivation
- reduce performance
- crowds out good behavior
- can encourage cheating or unethical behavior
- can encourage short term thinking
- can become addictive
Motivating individuals requires three factors:
Autonomy– desire to direct our own lives
Mastery– to make progress and improve skills or competence in something that matters
Purpose– the desire to do what we do in something larger than ourselves
Organizations should strive to move away from the dated carrot and the stick model of rewards and punishments, and should create an environment that allows individual employees to be motivated through the previously mentioned factors that lead to intrinsic motivation.