Written by Mike Allan

Motivation. It’s the fuel that gets us all moving toward our goals. It’s what wakes us up to face the day each morning and what lives in our dreams when we go to sleep at night. If we could bottle it, patent it and put it on a shelf, we’d all be millionaires.

But is motivation something that dwells only within an individual, or can we (as HR Professionals) guide it, shape it and bend it to our will? Can employee incentives really motivate lasting changes in behavior? To answer this question, we need to delve more deeply in to the science behind motivation.

According to the interim results from the Hbc 2007 HR INCENTIVE SURVEY (hbccards.com/survey), the number one ‘Point of Pain’ among HR Professionals who have responded to date is low motivation. Obviously, motivational issues are a major concern to HR professionals and ways of improving motivation among employees are highly sought after.

There are really two types of motivators intrinsic and extrinsic.

Extrinsic motivators are things that are external to one’s self. They are outside forces such as money, promotions, rewards, etc. Intrinsic motivators are forces internal to one’s self. Things like self esteem, satisfaction, pleasure, etc.

Intrinsic motivators are generally considered much more powerful because, like almost everything involving human beings, we give weight to what manifests from within ourselves more than manifests from outside. In short, they are more powerful, because they are more personal.

When we talk about incentives in the HR world, we are almost always talking about extrinsic motivators such as cash, prizes, points or the like. We have all been taught to believe that extrinsic rewards alone can motivate action.

In fact, there is good evidence to suggest that the opposite is often true. Adding an extrinsic reward (such as cash) to an action that was previously performed for intrinsic reasons (say, a passion for craftsmanship) can often reduce the desired behavior.

The reason could be as simple as this. By taking an activity that was previously engaged in for intrinsic reasons (more powerful) and adding an extrinsic incentive (less powerful) we have somehow ‘cheapened’ that activity in the mind of the individual being affected. As an example, think of anyone you know who works in a job they’re passionate about, versus someone who works purely for the money.

So does this mean the idea of providing employee incentives is ineffective? Not at all!

Extrinsic rewards are easily assignable to other individuals, but are not as powerful. Intrinsic rewards are extremely powerful motivators, but because they come from within, they’re inherently difficult to assign to other individuals.

So, we need to find a way to tie extrinsic incentives we can assign to our employees with the intrinsic benefits that motivate them on an individual basis. Viola!!! An Employee Incentives program this is both easily assignable and yet individually powerful at the same time!

Let’s look at an example using a typical employee. For argument’s sake, let’s call him Bob. It’s quite easy to provide a temporary boost in motivation by providing Bob an extrinsic reward such as a cash bonus, time off or a gift card he can redeem for whatever he’d like. However, we have yet to tap into Bob’s deeper, more powerful motivation hot buttons by attaching this extrinsic reward to something that will motivate Bob on a personal level.

And therein lies on of the biggest (and most overlooked) opportunities in the world of corporate incentives today, linking the extrinsic rewards we offer our employees and customer, to a more personal, more powerful intrinsic benefit that will provide stronger and longer lasting motivation for improvement.

Lets go back to the example of our now model employee, Bob. If Bob receives a $100 cash bonus each time he meets his monthly quota for sales, he quickly learns the cause and effect relationship and will strive to meet this minimum goal each month.

You’re probably saying to yourself, “that’s good, isn’t it?”. Well, yes and no. We are in fact, creating effective change in Bob’s behavior and achieving our collective goals. However, we’ve failed to affect change on a deeper, more personal level — we’ve failed to tie the extrinsic benefit of a cash bonus to a more personal, more powerful intrinsic benefit.

So what could we have done differently? Well, for starters, we could think very carefully about the ‘other’ reasons Bob might actually want to contribute to the goal. How about the ‘thrill of the kill,’ the rush that comes from making the deal? The desire to be recognized and praised in front of his peers? Any of these intrinsic motivators could be trigger-points for Bob that will provide more powerful and longer lasting motivation then cash alone.

The problem is, how do we tie these powerful, personal motivators (which we can’t control), to a less powerful but easily shaped extrinsic motivator such as a monetary reward (which we can control).

The answer lies in the concepts of sentiment and context.

Context is simply the situational relevance of the incentive received. In other words, what are the specifics of the situation that resulted in the reward being given and received. Was it for reaching a specific sales target? Referring a new employee? Closing a huge account? In order for Bob to be motivated by the incentive to perform similar acts in the future, he needs to be completely clear on the context in which the incentive was given.

The second and much more important component of the incentive is the sentiment. The sentiment is essentially the feelings, emotions and thoughts we are intending to evoke in the recipient, by giving the incentive. It is the sentiment that is missing from most of the corporate incentives work being done today. In short, it’s not enough to help Bob understand the reason the incentive was given, he must also deeply feel the intrinsic benefit of achieving the goal.

So, how do we do this? Simple – Personalization. By personalizing the incentive to the experience, we can tie the extrinsic benefit of the incentive itself, with the intrinsic benefits that will truly motivate and even inspire Bob over the long term.

To understand how this might work in Bob’s case, let’s look at a specific example, using a gift card as the incentive.

Let’s say our collective goal is for Bob to lead his sales team to their best year ever, surpassing all previous records. Let’s also say that we’ve broken this lofty goal down into a series of more bit-sized monthly goals and that we’re willing to provide a monthly incentive of a gift card loaded with a percentage of the increase in sales over last year’s figures for that month (a great extrinsic incentive).

There is no doubt that this extrinsic incentive alone might provide certain level of additional motivation for Bob to at least achieve the minimal level of sales required. However, there’s more we can do in this case. We can tap into Bob’s inherent desire to lead and succeed, by reminding him of why he’s reached the level he’s at and why he wants to take it to the next level as well, not just for the benefit of the organization, but for himself as well.

The sentiment we wish to invoke in this case might be the passion he feels for the ‘thrill of the kill’ that got him into this game in the first place – and the same passion that has brought him to this point in his career up until now. We can invoke these feelings and tie them to the desired actions by simply acknowledging the context for which the incentive was given, and weaving them together with the sentiment we’re hoping to invoke.

Say, for example, that we replace the generic gift card we were planning to give Bob for meeting his monthly targets, with a more personalized gift card and signed, personalized letter that both reiterate the context and sentiment we’re looking for.

Going back for a moment to the Hbc 2007 HR INCENTIVE SURVEY, the majority of respondents have stated they ‘strongly agree’ that offering more personalized incentives would Increase the employee’s goodwill/appreciation for the reward. They also ‘strongly agree’ that more personalization would increase the employee’s motivation to perform well in the future. Clearly, personalization is catching-on in the world of employee incentives, and HR professionals are beginning to respond accordingly.

There are virtually as many contexts and sentiments for providing incentives as our creative minds can conceive, including examples from these universal categories:

1. apologies/win-backs

2. congratulations

3. holidays

4. introductions

5. milestones

6. thank yous, and

7. welcomes

Remember, the time the extrinsic benefit reaches fruition is at the time of redemption of the incentive (in this case, the gift card). In other words, the goodwill created by the incentive is fully realized when the recipient actually redeems the gift card, much more so then when it is received. It is important that the desired sentiment is reinforced at this point as well, if we hope to permanently make the connection between the context and the sentiment. This is the true power the personalized gift card can provide.

So remember, when searching for a way to motivate your employees that is both powerful and long lasting; don’t overlook the effect of personalization. By personalizing both the context and sentiment of the incentive, you’ll magnify the effect of your incentive and reap a far greater return in the long run.

Published in Workplace News. July/August 2007. Volume 13. Issue 4

The Hbc 2007 HR Incentives Survey results are in