Employee motivation doesn’t always come easily.
When people are working too much or feeling stuck on difficult projects, burnout and disengagement are hard to avoid. As a manager, it’s best practice to find new methods for employee motivation and performance improvement when morale lowers — or when your team just needs a boost.
One way to achieve this is by giving employees rewards that celebrate their achievements, encourage productivity, and recognize hard work.
And although tangible rewards like raises and bonuses are excellent incentives, fostering an environment where employees feel pride in their work is the best way to encourage long-term job satisfaction and consistent performance.
Intrinsic reward systems are the best way to foster a sense of pride and a more profound sense of purpose in your team.
What are intrinsic rewards? Intrinsic versus extrinsic rewards
Inefficient reward systems cause demotivation, low productivity, and a lack of commitment among employees, which have the potential to drastically affect their quality of work. Success lies in how you treat and reward them — and not every incentive will work for every team.
Although both intrinsic and extrinsic rewards contribute to employee engagement, what defines each and how to implement them differs:
Intrinsic rewards
Intrinsic rewards are the feelings of pride people experience internally when they perform meaningful tasks. These intangible and non-financial accolades come from someone’s own effort instead of external validation. The definition of intrinsic rewards says it best: they come from someone’s intrinsic feelings rather than others.
To find these rewards in the workplace, employees need to start with intrinsic motivation, working for the excitement and challenge of their role rather than external benefits.
Some intrinsic motivator examples include:
- Taking on a project because you care deeply about the goal
- Participating in professional development because you want to improve yourself
- Choosing a career path because you love it
- Filling a leadership role to inspire others
- Improving a personal budget for financial wellness
Extrinsic rewards
Extrinsic rewards are the more obvious type. They’re tangible or financial rewards such as pay raises, bonuses, and praise. These always come from an external source, such as a manager, to acknowledge and celebrate wins.
External motivation tells employees to work hard toward a particular goal, regardless of how the work makes them feel. They care about the reward rather than the work itself. But intrinsic rewards aim to foster productivity and motivation through the work itself.
Examples of extrinsic motivators include:
- Finishing a large project to get a bonus
- Working out every day to win a step competition at work
- Helping out a teammate so they’ll help you in the future
- Choosing a career path for the high salary
- Putting in extra effort to finish a project so others recognize your hard work
The benefits of intrinsic motivation on employee performance
When employees feel a sense of purpose and pride, it’s easier to engage them and foster productive habits — influencing outcomes and improving morale for everyone.
Here are five more effects intrinsic rewards have on employee performance:
1. Improves employee engagement
According to Gallup research, 70% of employees consider themselves disengaged at work. And disengaged employees are less likely to care about the quality of their work or enjoy their roles and responsibilities.
Meaningful work is one of the best motivating factors for employee work engagement because they’re more likely to associate their role as purposeful and important. When they see how their work contributes to the company and the world at large, they’re more likely to put effort into it.
A “meaningful” task doesn’t have to save the world. It could contribute to an exciting project, involve interesting research, or make someone else’s life easier. The definition of “meaningful” itself depends on the person, and working with employees to find what matters to them helps you give them a sense of satisfaction.
2. Drives productivity
Motivation and productivity go hand in hand. No employee gives 100% if they don’t care about what they’re doing, and that motivation is what combats workplace burnout and encourages high-quality outputs. Encouraging intrinsic rewards fosters the energy your team needs to work hard and be productive on the job.
3. Improves consistency
Internal motivation encourages employees to put consistent effort into their jobs, which in turn creates better work. According to Mihaly Csikszentmihalyi, a Hungarian psychologist, enjoying your work puts you in a state of flow. And when employees associate their profession with joy, entering a flow state isn’t a challenge but a natural result of motivation.
4. Boosts loyalty and retention
According to a joint report from the University of Quebec in Montreal and Harvard Business School, workplace rewards that enhance employee satisfaction foster greater contribution and loyalty. When you design reward programs that help an employee feel autonomous and competent at work, they’re more likely to both enjoy and want to stay in their positions.
5. Streamlines the learning process
Although extrinsic rewards motivate employees to gain new skills for tangible benefits, intrinsic motivation can make the learning process more enjoyable because the drive is more personal. Employees who find interest in their tasks and feel like you recognize their performance might be more eager to develop new skills and see purpose in that work.
5 intrinsic rewards examples
If you’ve been offering extrinsic rewards to celebrate employee achievements and notice they’re still lacking motivation and morale, it could be a sign to make a change. Encouraging employees to focus on the inside might be tricky, especially when intrinsic rewards are harder to define than their counterparts.
Here are five examples of intrinsic rewards to give you inspiration and a better idea of how these reward systems work:
1. Focus on meaningful tasks
Instead of assuming what your employees find meaningful, try asking them what they find most important about their role and why. You can do this in 1:1 meetings or through an employee feedback form. This tells your team you respect their opinions while informing you on which tasks bring them a sense of purpose and which tasks they deem unnecessary.
Example: Tom works as a sales supervisor in a suit store and says that the most meaningful part of his job is giving specialized sales training to new and old hires. Tom’s manager decides to include him in planning training sessions and ask him to lead his own presentations. With these new tasks, Tom is motivated and eager to start his new responsibilities and prove to himself he can do it.
2. Grant your employees autonomy
Self-determination theory states that doing meaningful, autonomous work improves motivation and satisfaction. When you give employees work to complete on their own, they increase both self-motivation and well-being. You show them you trust them to get the job done, and they get to do something they care about.
If you’re a marketing manager responsible for delegating tasks to an intern, instead of designing campaigns yourself, let them pitch and plan their own projects. Tell them what outcome you want them to achieve and grant them the creative freedom to develop ideas independently. The outcome might surprise you.
Example: Frieda works as a content creator for a marketing agency and is responsible for taking photos and scheduling social media content. Her manager lets her choose her daily tasks because she’s already proven her reliability. Frieda’s manager notices that she’s more productive on her own and decides to allow her to plan her day as long as she completes everything on time.
3. Build their skills and competence
Ask your employees what they need to feel more confident. Maybe a group skill-building session will help everyone grow together, or a new project management tool will streamline the organizational process. This might cost money and time, but it’s worth it in the long run to invest in your staff.
Example: Lucy is a software engineer who specializes in developing mobile applications. This year, her company switched software programs to develop higher-quality applications for clients. This poses a learning curve and a new challenge. To ensure Lucy feels confident in using the new software, her manager provides specialized training. She loves learning, and the drive to improve motivates her to perform even better.
4. Make their progress measurable
Employees can’t find internal motivation if they don’t know what they’re working toward. Try developing SMART goals, conducting performance reviews, and providing feedback to encourage your employees’ productivity and motivation. This provides insight into whether they’re progressing in their role and if they need additional support to develop their skills.
Example: Ted lacks motivation in his current role as a copywriter. He feels unsure if his skills are improving and whether or not he’s contributing anything of value to the team. His manager begins conducting performance reviews that break down Ted’s competencies and highlight his weaknesses. Now he knows where to improve, motivating him to work toward a specific goal.
5. Instill a sense of pride
Employees who don’t feel like their managers appreciate them may view their role as a dead-end job and resign for a better option. But intrinsic rewards can help them get out of that slump and recognize opportunities for growth.
To foster an environment where your employees feel pride in their work, don’t just focus on how they should improve. Try complementing their performance and celebrating what they do well. This will make them feel proud of their efforts and improve their ability to take constructive criticism later on.
Example: Jasmine works as a product developer, pitching new ideas every week. They don’t always earn a positive reaction, which puts her down. Her manager focuses on her best work instead, letting her acknowledge what she does well and find internal validation. This builds her self-confidence and helps her find intrinsic motivation to improve.
Bring out the best in your employees
The key to building employee motivation and bringing out their best performance is cultivating a supportive environment, no matter what kind of workplace you’re in. But external rewards can’t always do the job, especially when employee morale is low.
Instead, consider offering intrinsic rewards so employees find confidence from the inside. They’ll find more satisfaction in their jobs and access inner motivation that pushes them to new heights.
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