A startling discovery was made around the 70’s in psychological research about motivation: money doesn’t cut it. In fact, giving a small monetary reward for completing a task resulted in decrease of intrinsic motivation. Also, what seems to be more important than reward is how the person perceives meaning in the task: if a task is truly intrinsically motivating, by for example producing information about the performer himself, then extrinsic rewards such as money have little effect on subsequent motivation. It seems then, that money as a reward can meaningless or even detrimental for motivation. More recent studies have found the same with some specification.
An intricate psychological event like motivation can of course not be simplified to only an interaction between reward and choice, but research such as the ones cited above do highlight a quite obvious thing that is still, for indeterminate reasons, not completely understood in business: people need more than money to be motivated. More specifically, people need tasks that are personally meaningful.
This is a troublesome and quite inconvenient thought when building incentive systems or trying to lead people so as to increase motivation. Experience of personal meaning at work varies endlessly according to personal and quite immeasurable human logic, not to speak of feelings and emotions. There is no common algorithm available be applied to everyone because motivation is a sum of so many personal dimensions. There can be no common incentive system in the name of equality – it will fail to provide truly compelling incentive.
For corporate motivational or incentive systems to work they should be different for everyone and vary not only pay but also the content and structure of work. This is attainable in small organizations but gets too complicated in bigger ones where there is no sense in expecting leaders or corporate functions to be involved in such a level of detail.
So how can bigger companies support enduring motivation? The answer is that the company shouldn’t actually try to motivate the employees – they should provide support for employees to motivate themselves. People clearly are the best experts themselves when it comes to personal subjects such as motivation and happiness. Choosing the kinds of tasks, teams and environments that support personal motivation and wellbeing is best done by the person whose motivation and wellbeing are in question.
People are however not always fully aware of what they need in order to experience fulfilment. In fact, the bulk of career coaching centers around the question “what do I want?”. Building good self-awareness is a lifelong development process, but support is available in many forms – e.g. coaching and psychological measures can provide a wealth of tools for people to think about their happiness and increase the freedom to have an impact on personal motivation.
Thinking about motivation like this is a definite challenge for management because what is literally needed is less management. Adding freedom of choice about task content, composition of work teams as well as work environments is the only way to support people in building sustainable personal motivation. This requires that companies don’t see people and their knowhow as something they own and must “milk” but as a developing, self-organizing intelligence that is temporarily leant to the organization to achieve a specific goal. If a company is afraid of losing knowledge and strives to incorporate and detain it in itself, it will result in structures that decrease motivation and obstruct development of information. Giving more power to employees, acknowledging the importance of personal factors, sense of meaning and self awareness in motivation will result in more power in thought and action, and since money is a necessity, ultimately be a more cost-effective incentive system.