How Extrinsic Rewards Can Drive Intrinsic Motivation and Behavioural Change at Work

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How Extrinsic Rewards Can Drive Intrinsic Motivation and Behavioral Change at Work

Foundation of Workplace Gamification: Motivation and Behavioral Change

Extrinsic rewards are the tangible rewards that are awarded upon accomplishing something such as pay raises, bonuses, and benefits. They are extrinsic because they are external to the work itself and are usually given to the person doing the activity. In contrast, intrinsic rewards are intangible rewards such as recognition, sense of achievement, or a conscious satisfaction. In other words, intrinsic rewards are those that originate from within the person, and extrinsic rewards are those that originate from outside of the person’s control.

Using extrinsic rewards has been a norm for organisations and our society for people engagement as it is very easy to implement to get the desired actions from the participants. However, the application of the extrinsic rewards is pretty tricky and harmful to intrinsic motivation where more than often you will stumble in the motivational traps if you use it frequently. This means that an individual has become dependent on extrinsic rewards to keep going. 
In his book, Actionable Gamification, Yu-Kai Chou talks about how to make someone who loves drawing, stop drawing. When you start paying the person who draws for joy initially, then pay the person successively less until you reached a very insulting amount, say 20 cents. At this point, the person would feel insulted and have no desire to draw anymore even though he/she happily drew for free before. Yu-Kai explained that "the intrinsic motivation of drawing for joy has now been shifted to an extrinsic motivation of drawing for money." This situation is explained as an “Overjustification Effect” where the person who loves drawing becomes too engage with the reward up to the point that it replaces the intrinsic motivation he/she had in the first place. 


Yu-Kai has also broken down the types of Extrinsic Motivation and Intrinsic Motivation, he calls them Core Drives, which we use to explain further in this article:
Extrinsic Motivation:
Core Drive 2: Development and Accomplishment 
Core Drive 4: Ownership and Possession
Core Drive 6: Scarcity and Impatience
Intrinsic Motivation:
Core Drive 3: Empowerment of Creativity and Feedback
Core Drive 5: Social Influence and Relatedness
Core Drive 7: Unpredictability and Curiousity
To avoid falling into motivational traps, Michael Wu, Chief Scientist at Lithium Technologies, who talked about sustainability in gamification initiatives, companies should attract people into an experience by introducing extrinsic rewards first before transitioning their interest through intrinsic rewards and top it off with intrinsic motivation to ensure long-term engagement. By leveraging on this process, the users will start to have fun with the activity and enjoy it so much to a point where they voluntarily want to replicate the experience without expecting any reward in the process. 

Realizing this process, the CEO of a reputable logistic company in Malaysia used it to promote a healthy lifestyle in his company culture. He created Gymax Idols, a weight management program for his employees that was model after The Biggest Loser. The winner of Gymax Idols, was selected based on attendance and efforts put in and at the end of the year will be rewarded with a fully sponsored holiday plus pocket money with annual leaves waived trip to Australia, London, or New Zealand. 
The program has been going on for the last 4 years and due to its success, the company has instilled a healthy lifestyle culture. The outcome was so impactful that job seekers were attracted to being part of the company. In fact, Gymax Idols was one of the main reasons why Mr. Oscar, an employee of the logistic company joined it. He needed that extrinsic motivation to push himself to lead a healthy lifestyle. After Gymax Idols was over that year, he was still determined to keep going with the lifestyle for himself. The duration of the program has instilled a habitual healthy lifestyle for him. 

What the CEO did reflected Michael Wu's point on the people engagement process. The CEO started Gymax Idols by offering extrinsic rewards (a fully paid holiday trip to exotic places like Australia, New Zealand, London and etc). This type of extrinsic reward is classified as Core Drive 4: Ownership & Possession, where the employees are motivated towards a goal to lead a healthy lifestyle by working out at the gym and eating healthy so that they can win the trip. 
Every season, a Gymax Idol is chosen among the participants and the recognition and bragging rights achieved by the winners are a form of intrinsic reward that is classified as Core Drive 2: Development & Accomplishment. After 5 seasons of Gymax Idols, the use of both extrinsic rewards as well as intrinsic rewards given to the participants slowly transitioned into an intrinsic motivation that led to behavioural change where Core Drive 5: Social Influence & Relatedness, an intrinsic motivation, started to take over. Mr. Oscar who kept working out and led a healthy lifestyle even though Gymax Idols was over for that season exemplified this. 
Unlike games, that are designed to experience fun, gamification is different at work because you still need to meet the business objectives and is measurable according to the business metrics. If you can’t measure it, you can’t manage it. To ensure the gamification strategy applied in the Gymax Idols is measurable, the logistic company conducted annual body checkups that measured employees' BMI, cholesterol level, and fat percentage. In actual fact, the measurable outcomes of Gymax Idols reflect back to one of the core values of the logistic company - Health. 
In conclusion, extrinsic rewards can drive intrinsic motivation and behavioural change if there is a transitional process involve in the implementation. Feeding extrinsic rewards without a proper plan of transition can kill intrinsic motivation. Typically the transition process to produce behavioural change happens after 90 days of implementation. As such, organisations need to plan accordingly if they plan to instill extrinsic rewards in their employees to avoid affecting the quality of work and overpowering existing intrinsic motivation.  

Join the Gamification in HR Workshop that will be held on 14 & 15 March 2017 to learn about the application of gamification in the workplace.

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Established in 2008, Talent Intelligence focuses on competency training and HR consulting services with gamification solutions embedded in experiential digital learning and employee engagement. Its content and structural gamification will engage learners beyond traditional ways for better knowledge retention, sustainable engagement, drive behavioral change, and build new habits. Together as leaders alike, it will build a sustainable talent ecosystem in Asia.