Rewards at work: a cautionary tale


Rewards at work: a cautionary tale

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I had the recent privilege of consulting to a company that specializes in employee recognition- the tangible kind of recognition where good performance is rewarded with personalized mugs, plaques or any number of concrete goodies from their expansive inventory. Their business is going well partially because many companies don’t take the time to properly evaluate and recognize the work of their employees. However, I pointed out to my client, ominous storm clouds on the horizon.


Before sharing my weather forecast, let me provide my take on how psychology develops its theories and clinical principles. Theories of human motivation can serve as a useful example. It was only three academic generations ago that virtually every psychological therapy either unearthed, or more likely imagined, repressed aggressive or sexual drives as psychoanalytic motives for whatever problem lay on the couch.


When psychoanalysts were eventually challenged by the first behaviour therapists, every problem was reinterpreted as a product of some historical reinforcement. The client’s problem was now seen as either the product of an experience that acted as a reinforcer, or as one that relieved anxiety. This reinforcement perspective fuelled the performance management revolution that promoted a well-constructed work environment filled with rewards as the key to a motivated workforce.


Those who continued to conceptualize climbing the corporate ladder as a phallic conquest were doomed.


I was trained somewhat later, during the ascendancy of the so-called cognitive revolution that transformed behavioural conditioning into something more cerebral by stressing the individual’s expectation of that a specific behaviour would elicit a desired reward. In this worldview, workers could not simply be manipulated like rats with cheese equivalents. According to this new and “correct” view, these workers needed to “buy-in” to any reward system in a way that both valued the rewards and created a clear path to those rewards.


Consultants who maintained that the corner office would motivate everyone were likely unemployed.


Over the last ten or fifteen years, a “new” approach- self-determination theory (SDT) has emerged.  As is our discipline’s pattern, new connotes not only improved but were also “right” in contrast to previous approaches now seen as “wrong.” Whereas research on self-determination theory began in academia studying discrete behaviours in confined laboratory situations, it has now moved towards naturalistic conditions, many of which involve the workplace.


Psychological research undergoes abrupt shifts. In contrast to the harder sciences that add new knowledge to a morphed, and generally accepted body of discipline knowledge, we tend to throw out the old and embrace the new. We even have a name for this- paradigm shift.


What does this have to do with my client’s business model? Simply put, the company’s current focus on so-called extrinsic or external rewards to motivate workers is now seen not only as out-dated but as counter-productive.


According to SDT, motivational processes must tap three core psychological needs that exist in all human beings: autonomy, competence, and relatedness. Since the 1980s, hundreds of studies led by Deci and Ryan have reliably linked these three core needs to human well-being. Simply put, environments that are detrimental to these three needs are also detrimental to human happiness.


Importantly, when an activity makes people feel autonomous, competent, and related to others, they are more motivated to pursue it. Workplaces that respect and encourage these three psychological needs in employees have been shown to have a more productive, motivated, and satisfied workforce.


Does all this mean that prizes, bonuses and corner-offices are off the table as rewards for exceptional performance?


In my opinion, no. I think that companies should use these reinforcement tools wisely and integrate them into a culture that provides managerial support for workers to achieve goals in their own creative ways while relating to sympathetic bosses and friendly co-workers.


However, it does imply that my client’s website requires some serious re-writing.


PS The material in this post was significantly improved with the help of two McGill graduate students, Thomas Khullar & Kimberly Carrière.