Incentive and Motivation – What’s the difference?

Incentive and Motivation – What’s the difference? We’ve got a vested interest in understanding, naturally. When it comes to incentives and motivation – how would you define the differences?  They tend to come hand in hand as one, but like a riddle, they don’t work without each other and they are separate entities.

Motivation is the behaviour

Motivation is behaviour. Just like wanting that last KitKat or thinking ‘I need to get to the gym’ motivation is a behaviour led process leading to action. From the word motive, motivation is the process that we use to accomplish goals.

“The term motivation refers to factors that activate, direct, and sustain goal-directed behaviour… Motives are the “whys” of behaviour – the needs or wants that drive behaviour and explain what we do. We don’t actually observe a motive; rather, we infer that one exists based on the behaviour we observe.”(Nevid, 2013)

It’s the drive that gets us off the sofa and onto the treadmill, or to stay a little longer at work. Just like willpower, self-control and controlling urges, getting motivated isn’t a set point. Some people will be motivated by different things, and motivation is equally awkward because it fits into both unconscious and conscious decision making.

Motivation = Emotion

According to The Motivational Dynamic:

“A presumed “motivational subsystem of the brain” has not been identified as yet. Some particular behaviours have been linked to particular brain regions. Hypotheses have been made regarding particular cellular and molecular mechanisms that appear to be linked to specific behaviours. We call these ‘motivated’ or tendency, but an integrated and general theory continues to elude science. It is about “emotion”: its motivational psychology is characterised by a number of competing mini-theories and not at all by a single systematic doctrine.”

Motivation can be affected by peers – what you think you should be doing, unconscious goals – things you do without really analysing them, and outright self-reward – looking for or working towards a determined incentive or a reward. Don’t forget that a paycheck is itself an extrinsic reward or incentive.

So where are we all with incentives and motivation? And what should we be aiming for?

Incentives are your tools 

The key thought behind any ‘incentive’ should be that incentives are the ‘tools’ you can use to create action and that they can be motivational, but it’s all about balance. Too much focus on external incentives and you could tip people into externalised motivation (driven only by the carrot) and too little and you don’t see the growth, passion and results they help achieve.

For example, if you love work, go the extra mile, pull in amazing deals, beam with a smile and don’t get rewarded, get watched like a hawk, overlooked or ignored – you’re going to go into a ‘slump’. Why pull out all the stops when a standard day will do? Who cares if you miss a few things anyway? An incentive may pull you out briefly, but you’ll be rewarded for something you find limited pleasure in.  Without fixing and tending to the individual’s core reasons to be motivated – their desire to have a certain job, to help people, to make themselves proud – and instead you lay on the incentives, you’re no better than if you hadn’t tried.

In other words, incentives aren’t a plaster – and the moment motivation becomes externalised (led by the carrot alone – without regard for the pleasure or satisfaction that drives you) it can be hard to get back into a rhythm. Your motivation has become externalised.

When we talk about how incentives can affect motivation, we tend to look at the good side – a great day out, a duvet day, a gift card – but we also forget that for some people, an incentive and a motivator can be the ‘stick’.  (The fact is, it’s easier to dole out the right level of the carrot than risk overdoing it with the stick.)

Watch out for the overjustification effect 

The difficulty is that motivation is all self-led. What that means is you could offer a whopping salary, a range of benefits and perks – but if you don’t manage to tap into the person’s genuine goals and desires, you aren’t going to move them much. In other words, tip the scale and start offering excessive rewards and you can decrease intrinsic motivation.

This is known as the overjustification effect – where something you used to be internally motivated to pursue becomes a chore. You may have seen this from people who make their hobby their career and find their joy in the task ebbs away. Theories also suggest that when people are over-rewarded, people tend to pay more attention to these external rewards rather than their own enjoyment of the activity.

It’s why words like ‘recognition’, ‘accomplishment’, ‘development’ and ‘freedom’ come up time and time again. When it comes to changing behaviour, it’s not a ‘set and forget’. Each individual has needs and desires that you need to discover and there are plenty of routes to do that. It’s why learning and development are so key, the reason wellbeing and health in the workplace matters and why even changing a working space or undertaking volunteering or job swapping is mentioned time and time again.

Incentives are still critical 

On the other side, you can’t call a salary and flexible working a ‘motivator’ and leave it there. Herzberg’s theory that’s pretty reasonable suggests that things like appropriate pay, fair, clear, flexible working hours and fringe benefits like healthcare are all hygiene factors -essential for even the idea of existence of motivation at workplace but they do not lead to positive satisfaction for the long-term and cannot be regarded as motivators, which would be the sense of achievement, growth, recognition and meaningfulness of work.  The benefits of an incentive are the missing pieces of the puzzle. They make work brilliant – they build enthusiasm, boost loyalty and retention and also give a shot to the arm for performance and development. a program might generate positive word of mouth, which is always valuable when it comes to company reputation.

A HBR report shows that sales force compensation represents the single largest marketing investment for most B2B companies. In aggregate, U.S. companies alone spend more than $800 billion on it each year—three times more than they spend on advertising.

It’s all about smart management – so the same faces don’t win time and time again. So your ‘mid-level’ or even disengaged employees have a shot at bat. So everyone bumps up their efforts – not just for the carrot of the prize, but in spite of it.

A true, knowledgeable commitment to both your hygiene factors and your incentives and perks will pay out in the long-term, while attracting other valuable employees to your company to build your best team.

A commitment to both your hygiene factors and your incentives and perks will pay out in the long-term while attracting other valuable employees to your company to build your best team.

It’s a hard balancing act – and that’s why we have legions of HR managers, reward managers and benefit pros all out there, doing the hard lessons and living this day in day out.

Recommended Reading