Motivation 101: Why Rewards Don’t Work, but Satisfying 3 Critical Needs Does

In today’s world, much of the effort to motivate others is based on an outdated model of carrots and sticks. Extrinsic rewards often do very little to satisfy, and may even damage, our deeper psychological needs of Autonomy, Relatedness, and Competency. Dive in to understand our critical needs, why autonomy and meaning in work is so essential, and how extrinsic rewards can interfere with achieving competency.

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How do we get ourselves going on a task that we don’t really feel like doing? How do we set the right environment so that others feel self-motivated to accomplish tasks in our organization? In my previous article on leadership styles, I showed that we can classify people on a matrix of motivation and ability. Probably the biggest leadership challenge would be dealing with the lower right corner– a low motivation, but highly experienced and knowledgeable, worker. How would we help workers in that situation move up the motivation scale toward star performer?


According to one highly respected theory of motivation, called self-determination theory, two concepts act on our organization’s environment and people to influence productivity and well-being: basic human psychological needs, and a spectrum of motivation types. These two factors interact with the structural environment and individual characteristics in an organization to determine quality and quantity of production, as well as the well-being and happiness of individuals. The environmental structure includes the policies and rules, the system of compensation, promotion, rewards and punishments, and the social atmosphere. Individuals differ in two main areas — their degree of self-regulation and their goals and desires. The individual differences in self-regulation are divided into people who tend to be 1) proactive, or autonomous; 2) controlled by external factors such as rewards to guide behavior; or 3) impersonal and reactive, believing that getting what they want is beyond their direct control.  Goals and desires can be divided into extrinsic and intrinsic, and mostly fit into seven categories of wealth, fame, attractive image (all extrinsic goals), personal development, meaningful relationships, community contributions, and physical fitness.


To get more innovative, higher quality, or more efficient production, and to get greater worker satisfaction, we can observe, understand, and positively influence others by:

  • Satisfying the basic psychological needs of Autonomy, Relatedness, and Competency.
  • Helping people move toward more self-regulated, autonomous motivation.

In this article, we’ll first explore the psychological needs of Autonomy, Relatedness, and Competency. In subsequent articles, we’ll cover the various types of motivation, and how we can positively influence the work environment, to set the right conditions for self-regulated, self-motivated workers.

Our 3 Basic Psychological Needs

Many studies show us that we are motivated, and happy, when we:

  1. Feel we have choices over our lives. (Known as Autonomy)
  2. Feel that we are connected with other people, that we can care about others and feel that others care about us, and that we are related to a higher purpose. (Known as Relatedness)
  3. Feel that we are effective and growing in our lives. (Known as Competency)


We can intuitively see our needs for these three things by observing little babies and children. Have you ever tried to feed a baby sitting in a high chair, squirming because he feels constrained and controlled, always trying to grab the spoon to feed himself? His impulse is to want to do it for himself. Watching toddlers play, one sees a remarkable fascination with learning to do things, increasing their competence. And when they do learn something new, there is a raw excitement to share that new competency with meaningful others—to show off to Mommy or Daddy. This feeling of pride and excitement is even more intense when they have learned to do something helpful to others, when they feel they have contributed to the family. These basic needs don’t change when we grow up, no matter what our culture. The following breaks down what we mean by each category of psychological need.


Autonomy means that we perceive that we have a choice, and are given a voice, in the organization. We need to feel that we are the source of our own actions, not being coerced by some force outside of our own will. Daniel Pink, in his highly-recommended work Drive: The Surprising Truth About What Motivates Us, points out that we have, or can give others, choices in at least these four areas:

  • Task — what things we work on
  • Time – when we do things and for how long
  • Technique – how we do things
  • Team – with whom we do things

Autonomy doesn’t mean acting independently with disregard for others, and so it is not equivalent to individual independence. We can, and often should, make choices that make us interdependent with others in our teams.

Humans need some measure of self-determination for our good health, even when we know that we are unable to completely control our environment or other people. This truth was shown in the extreme in the concentration camps of Nazi Germany, where Holocaust survivor Viktor Frankl discovered that the one thing we can always exercise autonomous control over is our attitude. Dr. Frankl, author of Man’s Search for Meaning and founder of a school of thought that promotes striving for meaning as the primary human motivator, remarked “Everything can be taken from a man but one thing; the last of the human freedoms—to choose one’s attitude in any given set of circumstances, to choose one’s own way.” So, even in the most dire of circumstances, humans can always find a measure of autonomy that provides basic motivation for action.



Our need for relatedness can be divided into two areas: Relationship to Others and Relationship to Meaning.

Relationship to Others

We have a basic need to be able to care about others, and feel that others care about us. We need to have a circle of trusted people in which we feel safe and can express and expect sincerity—no hidden motives or agendas, no strings attached. When we are confident in our circle of trust that fellow members aren’t going to betray us, that we don’t face internal threats, we can work together to concentrate our resources on defending against challenges and threats outside of the circle. (Author Simon Sinek addresses this topic in his work Leader Eat Last.) There is, in fact, a bio-chemical reason for our relationship need. As covered in my article about the chemistry of trust, our bodies produce hormones, oxytocin and serotonin, when we are in trusting relationships, and these contribute to a sense of well-being.

We can foster relationship to others in organizations by providing:

  • positive social experiences
  • appreciation
  • opportunities to have fun
  • recognition
  • thankfulness
  • pleasant physical gestures such as smiles, head nods, etc.
  • opportunities for others to exercise their strengths to contribute

Relationship to Meaning

“One cannot lead a life that is truly excellent without feeling that one belongs to something greater and more permanent than oneself.” Mihaly Csikszentmihalyi, positive psychologist and author


Common sense and research supports that people need meaning for their well-being and productivity. Psychologist, author and noted speaker Dr. Dan Ariely has demonstrated the importance of meaning via some interesting experiments. In the first, he offered money, starting at $3, for a volunteer to build a Lego figure called a “Bionicle.” (Please see the example of a Bionicle below). If the volunteer agreed, when they finished assembling the figure, it was put on the floor under the table where the experiment was being run. Then the volunteer was continuously offered 30 cents less for each subsequent Bionicle built, each one being kept in the same place after assembly. This continued until the monetary reward became so low that the volunteer declined to make any more. Even though the volunteers understood that the completed Bionicles would be disassembled for the next person, they had some meaning imparted to their work because the figures were kept intact, in front of them, as if the completed figure had some value.

In the second phase of the experiment, the money offered was the same for each piece, but after the first one was completed, while the volunteer was assembling the next Bionicle, the experimenter took apart the previously assembled one in front of the volunteer. This served to deprive the work of any meaning.

1 Bionic Experiment

The results of this experiment indicate a significant decrease in production motivation when work seems to have no meaning. The first group of volunteers made an average of 11 figures before stopping, while the second group made only 7. This low number held true even for people who admitted that they normally enjoyed putting together Lego figures. As Dr. Ariely says, “…with this manipulation of breaking things in front of people’s eyes, we basically crushed any joy that they could get out of this activity.”

2 Bionic Experiment

In another set of experiments, Dr. Ariely’s team presented volunteers with a sheet of random letters, and offered a certain amount of money to mark pairs of identical letters that appeared side-by-side on the list. (Please see the illustration below). The volunteers were split into three groups. In the first, after marking a sheet, the subjects would put their name on the sheet, hand it to the experimenter, who would study it briefly, say a reassuring “Uh-huh,” and then place it on a pile of sheets on the table. In the second set, the volunteers did not write their names on the sheet, handing it to the experimenter, who did not scan the sheet at all, but immediately put it down into the pile. The third group, upon handing the finished sheet to the experimenter, watched as it was put directly into a paper shredding machine without being examined.

3 Random Letter Match

The interesting result of this experiment is not so much the large difference in motivation to continue working between an acknowledged effort and a shredded effort. It turns out that having one’s work ignored was nearly equivalent to having it shredded in front of their face. The positive takeaway, though, is that even a small amount of acknowledging one’s effort gives meaning to the work, and dramatically improves performance.

4 Random Letter Match

You can watch Dr. Ariely explain these two experiments, as well as others related to revelations about motivation, in the following TED talk:

In a previous article about writing a personal purpose statement, I discussed the three basic ways people see work: as a job, a career, or a calling. Those viewing work as simply a job are focused on the material benefit. People seeing work as a career tend to have lower quality motivations that are external to their own will, such as seeking self-esteem and social standing. People who work persistently to align their work with their natural interests and meaning internalize their motivation, and come to view their work as a calling. Research has shown that people who find meaning, challenge, and enjoyment in their work are much more engaged—that is to say, they are more emotionally and mindfully committed to contributing to the organization and its goals. Having a strong sense of meaning in our work helps us to see it as a calling, making us more satisfied and motivated.

Attitudes Toward Work

What does it actually mean to have meaning? Researchers have found that work is more meaningful when it:

  • positively and significantly impacts the well-being of others
  • aligns with important virtues or personal values
  • has a long-term positive impact
  • builds positive relationships and community


The final piece of the psychological-needs puzzle is our drive for demonstrating competence to ourselves and to others. One of the founders of Self-Determination Theory, Edward L. Deci, asserts that human beings have an “inherent tendency to seek out novelty and challenges, to extend and exercise their capacities, to explore, and to learn.” We don’t have to get to perfection, but it is important for our well-being to feel that we are growing over time, consistently improving our skills. Again, body chemistry plays a part here. The positive effects of Serotonin kick in when we have a sense of pride and accomplishment. When we hit goals that we’ve set to improve our performance and skills, we get shots of Dopamine, which is a pleasure-creating hormone.

The drive for competence is internal and can also be self-sustaining, even without external rewards. In fact, there is ample evidence that offering external rewards in many cases has a negative impact on creativity and performance. Author Dan Pink, in one of 10 most-watched TED talks of all time, describes a curious experiment result that throws a revolutionary light on competence, rewards, and motivation. In this experiment, volunteers were asked to solve a problem: Given a candle, a box of thumb-tacks, and a book of matches sitting on a table next to a wall, they had to attach the candle to the wall without letting the wax drip onto the table when lit. (Please see the illustration below).

The volunteers were divided into two groups. Individuals in the first group were simply told that they would be timed as they found the solution in order to establish a baseline of how long the problem would take to solve. The second group members were offered financial incentives. Those in the top 25% fastest times for solution were to receive $5, and the one with the top time of the day scored $20.

1 Candle Problem

Contrary to all expectations, those in the group incentivized with cash rewards performed substantially worse! They took an average of 3.5 minutes longer to solve this problem. The problem requires “thinking outside of the box” …in this case, literally. The problem solver must see the box, that at first simply looks like a container for the tacks, as a part of the solution. The easiest answer is to tack the box to the wall and then fix the candle inside the box. Promising the reward interfered with the volunteers’ abilities to create new solutions. Rewards tend to narrow one’s focus, which may be suitable for purely mechanical tasks. But scientists have conducted many similar trials since this experiment was conducted several decades ago, measuring the effect of external rewards on performance, or competency. The results have consistently shown that for any task that requires even the most rudimentary of cognitive skills, larger rewards lead to lower competence and performance. The drive for competence is a naturally occurring need, and best cultivated internally to provide the best quality motivation.

2 Candle Problem.jpg

You can see Dan Pink’s popular TED talk here:


In today’s world, much of the practice of trying to motivate workers is based on an outdated model of carrots and sticks, using external rewards to try to improve performance and satisfy needs. But external rewards, after having enough to satisfy basic physical needs, do very little to satisfy, and may even damage, our deeper psychological needs of Autonomy, Relatedness, and Competency. We need to feel that we have choices in our lives, to feel related to others in a circle of trust and related to a greater purpose, and feel that we are improving our competencies from day to day. To move people from “apathetic and unmotivated” to “enthusiastically engaged,” we should always keep in the important role of Autonomy, Relatedness, and Competency. In our next leadership installment, we’ll look at Types of Motivation, and practical things we can do to help ourselves and others meet the basic psychological needs, and develop more autonomous, effective motivation. Stay tuned!


Copyright © 2017 by Robert Cummings All rights reserved.


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