In the 1950s a researcher named Frederick Herzberg studied 200 engineers and accountants in the US. He asked them a few simple questions and came up with what is one of the most widely-accepted theories on job satisfaction called Two Factor Theory.In his cracking TED Talk Dan Pink delves into some of the behavioral research that explores the consequences of using extrinsic factors such as monetary rewards as motivational tools:
His theory breaks job satisfaction into two factors:
Hygiene factors are necessary to ensure employees don’t become dissatisfied, but they don’t contribute to higher levels of motivation. Motivation factors are what create motivation and job satisfaction by fulfilling a person’s need for meaning and personal growth.
- hygiene factors such as working conditions, quality of supervision, salary, safety, and company policies
- motivation factors such as achievement, recognition, responsibility, the work itself, personal growth, and advancement
Bottom line: extrinsic rewards tend to narrow focus and hamper creativity.