Unstructure

The changing role of the employee is a topic that is gaining prominence, especially in today’s business environment. There are many angles from which we can understand this – which I’m sure will throw up a lot of interesting thoughts in this forum – but for starters, I want to discuss employee motivation, both extrinsic and intrinsic.

What is motivation? Motivation is simply the internal condition that activates behavior and gives it direction. In the context of business, it is what drives an individual to spend time and energy on a particular task or goal. It is obvious, when you look at the people who work for you, that motivation levels vary from person to person, and from job to job. So to understand why this is the case, researchers have taken two approaches: some have focused on employees’ underlying needs and wants, while others have focused on the drivers that stimulate people to work harder.

One key insight that has emerged from this research is distinction between intrinsic and extrinsic motivation. Intrinsic motivation comes from the rewards inherent to a task or activity itself—for example playing the piano, walking in the countryside, or solving a puzzle. Extrinsic motivation comes from outside the person—money is the most obvious example, but coercion and the threat of punishment are also common extrinsic motivators. Recent research by psychologists Edward Deci and Richard Ryan has extended this thinking in a couple of useful directions. One is a better understanding of the components of intrinsic motivation—the need for competence, the need for autonomy, and the need for relatedness to others. The other is the identification of a hybrid third type of motivation they labeled internalized extrinsic motivation. For example, when employees receive promotions, or recognition from their peers, these are externally granted but they are internalized as valuable by the individual, and therefore they become intrinsic. The extrinsic-intrinsic dichotomy, in other words, is really a sliding scale with various levels of internalized motivators between the two end-points.

What are the drivers of motivation? Positioned along the spectrum are three sets of mechanisms—the drivers of discretionary employee effort—that managers can put in place:

• Material drivers of discretionary effort. These are ways of providing people with material and direct rewards for their efforts. They include salary increases, promotions, bonuses, prizes. They can also include the green light given to a project, approval of a patent, or a prize for coming up with the best solution to a problem.
• Social drivers of discretionary effort. These are ways of providing people with a reason to belong to an organization. Most of us need to be part of a group or a community. That sense of belonging, of being a team player, of having a certain status within a peer group, can accord recognition, peer approval, and popularity.
• Personal drivers of discretionary effort. This refers to the ways managers structure and allocate work to make it more intrinsically appealing. This includes giving people the freedom to act, the chance to work creatively with others, the opportunity to build and demonstrate expertise, and the opportunity to contribute to a worthwhile cause. Think of artists, writers, and R & D scientists, who are often so wholly captivated by the nature of the work they do (not discounting, of course, the tortured moments of self-doubt), that the joy and satisfaction they derive is the engine that drives them.

So, do managers have to choose between using material, social, and personal drivers? Can they use all three simultaneously? Alas, the answer is not entirely straightforward. There is quite a lot of research showing that extrinsic rewards can drive out intrinsic ones. For example, one study of volunteer workers found that when they were paid for their efforts, they became increasingly materialistic and less inclined to work for free. Studies have also shown that some motivators, particularly those concerned with working conditions and pay, only have an effect up to a certain threshold. Renowned psychologist Frederick Herzberg called these “hygiene” factors because, like washing regularly, they are best suited to preventing ill-health in the workplace rather than as a means of generating good health.

These caveats apart, the three approaches suggested here are best viewed as complements. That is, if you as a manager can engineer a thoughtful combination of material, social, and personal drivers, it is highly likely that your employees will respond positively.

The manager’s job is therefore to be thoughtful about how to get the most out of people—to enable and encourage their discretionary effort. And this means making use of these three drivers in whatever combination is appropriate. It’s worth underlining the point that these three sets of drivers apply equally to full-time employees and to freelance community members. Many Human Resource managers worry about outsourcing work and using freelancers, because they feel they no longer have control over what these individuals are doing. TopCoder’s experiments in building an online community of programmers suggest a very different conclusion: you have just as many tools at your disposal for stimulating and engaging freelance workers as you do with traditional employees.

This brings us to another bit of vital research. Recent studies of engagement in the workplace suggest that no more than 20 percent of employees are actively engaged in the work they are doing. This means a whopping 80 percent are doing the bare minimum to keep their bosses happy. Of course, there are some jobs that will never be intrinsically engaging—working in a call-center and flipping hamburgers are obvious examples. But if we could just achieve a modest change in these figures, say, increasing engagement from 20 percent to 30 percent, the gains in productivity and job satisfaction would be dramatic.

How about we start a discussion on the different approaches to motivation that managers have at their disposal, and the pros and cons of each one, so that ultimately we will have a better understanding of which might be most suitable to our situation as we begin to sharpen our Management Models?