Rewards and Intrinsic Motivation: Resolving the Controversy [Paperback]

As a parent, children's karate instructor, and 10 yr veteran sales compensation consultant, I found this book to be both enlightening and a bit of "preaching to the choir." Given my profession and hobby, I can't help but concur that rewards are valuable motivating tools. I've seen it in practical action too many times to give much credence to the theory that all rewards are harmful.

The key value that Cameron and Pierce bring to the debate in this book is the understanding of the ways in which rewards can be harmful (e.g., when the reward actually carries the message of failure) and what is required to make them successful. If you are dealing with children, an important take away from the book is that "tangible rewards that are offered for mastery, effort, and meeting challenges have positive effects on performance, perceived competence, and interest" (build the rewards in small increments, allowing the child to build success upon success) and for employees, a key take away is to "tie material incentives to specific, reasonable and attainable standards of performance."

I do have a couple critiques to make, one stylistic and one substantive. First the substantive. Cameron and Pierce discuss the outcome of testing which shows "when rewards are given for exceeding the performance level of others, the results show a significant positive effect on free choice" [Free Choice for the studies is the observable proxy for intrinsic motivation]. What this does not address is the impact on those who were "exceeded." I've worked with companies who use K-performer or other forced ranking systems to calculate incentive payouts and universally find these systems to be more harmful than motivational when used for the PRIMARY calculation of incentive pay. They create feelings of inadequacy and resentment in those who are ranked below the standard and are generally destructive of any team atmosphere which may be desired. The only time these systems can be beneficial is when used for a short-term SPIFF (contest type program of short duration with modest payout relative to the core incentive plan), but then care must be taken not to create so much emphasis on the SPIFF that the main incentive program is subverted in importance to your employees. Cameron and Pierce talk elsewhere about the harmful effect of a less than maximum award, as this carries the message of failure rather than success, but they do not directly tie this conclusion with the observation that for one party to exceed the performance of others, there must be others who are being given the message of failure. This is every manager's challenge - to develop an incentive or reward program that creates an atmosphere of success and healthy competition for as many employees as possible, and to prevent the very real consequences of a negative reward system (tuning out, giving up, rebellion) on those who are not receiving 100% payout.

The stylistic critique is that much of the book is redundant and it could have been quite a bit shorter. Cameron and Pierce repeat the same findings and conclusions throughout the book. A single summary at the end would have sufficed. Anyone looking primarily for practical advice on using rewards to enhance motivation should go right to Chapter 11: The Effective Use of Rewards in Everyday Life.

For any manager who may have been caught unawares by an employee who cites studies challenging the effectiveness of rewards, or by any parent dealing with a school system who either over-uses, under-uses, or misuses rewards this book is a helpful introduction to the debate that has been raging for the last 40 years.

If you are looking for an accurate review of the evidence relating to the relationship between motivation and reward, Cameron and Pierce's book will in all likelihood be of little value to you. Why is this? The quick answer is that the research is poorly done, employing many dubious practices. How do I come to this judgment? I base it on a number of sources.

First comes a study by leading researchers in the area of rewards and motivation (Deci et al, in the Review of Educational Research, Spring 2001, Vol 71, No 1, pp 1-27 and pp.43-51), the arguments of Cameron and Pierce that form the basis for this book were found to (a) use inappropriate control groups, (b) misclassify studies (unsurprisingly, this is typically to the benefit of C&P's arguments), (c) use improper measures of intrinsic motivation, (d) include irrelevant experimental conditions and exclude relevant ones, (e) collapsed significantly different experimental conditions without proper moderation (pp. 44). In short, C&P manipulate the data in unacceptable ways to give the best possible result for their side of the argument, contrary to some long established, scientifically sanctioned, practices.

As the Deci et al paper notes, C&P presented an analysis of data that was "scientifically inappropriate" (p.46) at best, and of questionable motivation at worst; that is, C&P have an apparent inability to learn from their mistakes, or to correct misleading or incorrect statements in their work, even though their work has been subject to very convincing (and in my view, conclusive) criticism over a period of years. In my view, work that massages the data, choosing studies if they support their already formed conclusions and rejecting studies if they go against them, works that ignore large chunks of the argument of researchers who have argued for different conclusions are of little value if you are looking for the facts of the effect of rewards on intrinsic motivation.

Don't take my word for it - have a look for yourself. All of this is documented in a series of debates in The Psychological Bulletin, vol 125, No 6, pp 627-668 for Deci et al's original review, and pp. 692-700 for their critiques of the C&P methodology. Even more importantly, for those looking for more than just name-calling between rival researchers, is the fact that the Deci critiques were corroborated by a team of researchers from Stanford University, again, in The Psychological Bulletin, 1999, Vol 125, No 6, 669-676. In a study that supported the findings of Deci et al, from above, the Stanford team stated unequivocally that the method used by C&P

- produces "simplistic overall conclusions" (p.674),

- "tells us essentially nothing about the phenomenon of the actual literature under review [the literature of the effect of rewards on intrinsic motivation, that is]" (p.672),

- that it is precisely the use of this inappropriate method that "produced the anomalous conclusion that negative effects of extrinsic rewards are merely a myth" (pp.672-673).

Hardly a ringing endorsement of the Cameron and Pierce work. If you want an appropriate reference, you should probably start with the Deci et al Review of Educational Research article above. I found it useful and clearly written. I'd advise you to give the Cameron and Pierce's work a miss: from its selective and scientifically inappropriate massaging of the data right down to its conclusions that fly in the face of the "very robust" findings of an intrinsic motivation literature that is now "very large" (from the Deci critique of C&P, p.698, above), it is a seriously misleading body of writing that is likely to confuse even a sophisticated reader.

This book presents study findings and provides an in-depth discussion on the question of whether or not extrinsic rewards negatively affect intrinsic motivation. The authors conclude, on the basis of over 100 experimental investigations, that there is no support to the claim that rewards produce significant and substantial decreases in people's intrinsic interest. They also conclude that rewards can be used to enhance performance and motivation. This is a scholarly work of outstanding quality and clearly addresses a controversy that, to this day, divides people in management. As a management consultant specializing in compensation, I highly recommend this book to every practitioner, academic and author/expert who would rid the world of pay for performance; I hope they have the intrinsic motivation to read it with an open mind-if so, I believe they will be rewarded for their effort.