Reward employees effectively
to reach their full potential
The best rewards for development
American psychologist B.F. Skinner showed early in the last century that humans respond to punishment and reward. That is, our brains are programmed in such a way that good behavior is repeated and bad behavior is unlearned. Many organizations are therefore looking for ways to reward employees in a way that improves their performance and reveals their potential.
Effective rewarding
When a person receives a reward, the amount of dopamine in the brain increases. This creates feelings of pleasure and satisfaction. This has a reinforcing effect: behavior that produces something positive is more likely to be repeated.
Michael Bloomberg, founder of financial media company Bloomberg and former mayor of New York, takes a surprisingly different view of rewards. In “The 100 Greatest Living Business Minds,” he explains that valuing employees who take risks is the backbone of his organization. It’s not missed targets that frustrate him, but missed opportunities. Innovation, he says, requires people who are daring and supportive when something goes wrong. Comfort hinders growth; boldness opens the door to innovation.
Intrinsic and extrinsic rewards
Research from Istanbul University supports Bloomberg’s particular view of rewards and confirms that rewards go beyond salary or a bonus. There are two types of rewards: intrinsic and extrinsic.
Intrinsic reward comes from within. You derive pleasure from the activity itself and experience satisfaction because the work aligns with your motivations. Extrinsic rewards come from outside, such as promotions, pay raises or an annual bonus. Extrinsic rewards have distinct disadvantages. It often lowers job satisfaction because a person performs the work for the reward and not because of the work itself. Also, an extrinsic system can feel manipulative. That affects employee engagement and weakens long-term motivation.
The research shows that rewards become especially effective when the form matches the employee. Therefore, the modern approach emphasizes intrinsic factors. Bloomberg emphasizes qualities such as creativity, initiative and perseverance. These qualities determine your value, not just your expertise. Freelancers also experience this dynamic. They do not automatically grow in pay. They increase their market value by delivering quality. That incentive encourages development and professionalism.
Want to discover how to use rewards as an engine for growth? Then check out the training courses High Performance Leadership, Learning & Development within Organizations or Leadership Based on Ownership.
