Intrinsic vs Extrinsic rewards from employee’s morale point of view

The idea of being rewarded after an achievement is instilled in our minds from quite a young age. The feeling of happiness, and the sense of fulfilment and satisfaction that the aftermath brings, shape our positive behaviour towards this concept, and, in pursuit of that feeling, we are motivated to work harder and keep improving.

Types of rewards – Intrinsic and Extrinsic 

There are two types of rewards, Intrinsic and Extrinsic, and as their names suggest, Intrinsic rewards are driven from within while Extrinsic rewards are from external sources. Those can be an appreciation from peers, a bonus, an increment, a promotion from the employer, or a gift from an organisation.

Employee’s morale, ft. Intrinsic vs Extrinsic rewards 

For an employee, both intrinsic and extrinsic rewards help boost his morale. However, intrinsic rewards are considered to be more effective. This is because this type of reward is a feeling from within. It is a sense of contentment and satisfaction that is majorly accompanied by happiness after achieving the set goal. This happens mostly when an employee is interested in the work and is focused more on learning and self-improvement. Therefore, he also enjoys the process. 

On the contrary, an extrinsic reward, usually in the material form, can eventually make the process dry and turn it into a mere task. The employee might focus more on the reward he is promised at the end of it, rather than testing his limits or unlocking possible potential. He will overlook the possibilities of his development and not explore the assigned work beyond what he needs. This hinders his creativity and the end project might appear rigid, where no inner satisfaction is achieved. Moreover, extrinsic reward may not be enough of a motivator as the person can be tired of the same treatment with no novelty whatsoever in the end. He will become bored of the cycle that repeats.

However, it cannot be denied that preferring extrinsic rewards would be a good option for achieving major targets. Materialistic motivation is enough to get the job done albeit at the cost of less enthusiasm which hinders innovation and creativity.

Conclusion

In a nutshell, it would not be wrong to say that intrinsic rewards can have long-lasting effects. The sense of autonomy and satisfaction builds self-confidence. A major positive factor of extrinsic reward is that it motivates others around the person to do their best as well. Hence, both forms of rewards hold importance. 

However, if both forms were to go hand in hand together, they could unlock an employee’s full potential and boost his morale.

Consider for instance, if someone is assigned a project. He works on it while exploring the idea and developing an interest. He is bound to enjoy the process and learn. He will be satisfied and happy with his end product which may have come out better than expected, given complete autonomy and freedom. These intrinsic rewards will keep him motivated to continue to do better ahead. The promised extrinsic reward will drive the employee to work diligently and without procrastination. Moreover, it will be a bonus for the employee who has already sought an intrinsic reward.