The Yes Blog

Motivate Employees: Why Reward and Punishment Backfire

We often get he question, “How do I motivate my employees?” In a very real way, you don’t. Motivation at its best is an inside job. And yet…

As a leader, you’re responsible for the company’s performance, and therefore, for the performance of every person in it. And yet, so often, the tools we’ve been taught to use—incentives and punishment—cause unintended sabotage.

The very strategies we intend to motivate employees often degrade the intrinsic drive that fuels the best work. By trying to motivate employees using the conventional wisdom about what works, we undermine our own intentions.

Categories of Motivation

Motivation researching sciencers (Is that a word?) have divided the drive to perform into two different categories:

  • Extrinsic Motivation: This is the push and/or pull from the outside. The external drivers of reward and punishment, incentives and consequences, the carrot and the stick. They work to motivate employees’ behavior as long as they are in place. Remove these external forces and the behavior will stop too.
  • Intrinsic Motivation: This is the deep, personal sense of interest, accomplishment, and fulfillment that comes from within. Toddlers learn to walk and practice it because they want to. A-players on our teams take on new kinds of responsibility because they want to learn, grow, and contribute to the team. Help people connect to their own internal drives, and you’ll indirectly motivate employees. Nearly all people are “batteries included.” Some need help with clearing corrosion off the terminals.

What many leaders don’t know: intrinsic motivation beats extrinsic motivation.

Every time.

That internal, natural drive leads to strong performance, greater creativity, and it’s a more enduring drive to boot!

The Cost of Reward and Punishment

The brain science is clear, and the evidence keeps mounting. Extrinsic motivators—especially when overused or applied clumsily—erode intrinsic motivation. And when intrinsic motivation fades, so does the energy, creativity, and commitment that drive extraordinary performance.

Consider this… Picture your favorite food—steak, ice cream, the juiciest peach. Imagine having it in front of you, and getting ready to dig in.

Now imagine I tell you to, “Eat it, or else.” Or even, “If you eat this, I’ll give you a hundred bucks.”

How much do you want to eat it now?

Appetite is transformed into pressure and suspicion.

Once you offer an incentive to someone for performing a job requirement (even one they are self-motivated to do), they’ll no longer do it for the sense of pride—because they want to. They’ll do it for the reward. By replacing the intrinsic motivation, your incentive has severed the link between the behavior and intrinsic motivation. Your employee will be looking for the reward rather than the fulfillment, like a dog who’s been taught to sit, only for a treat. And that link will be hard to reestablish. (Read about “motivation crowding theory” here.)

Punishment (which differs from consequences in ways I’ll describe below) also severs that intrinsic link. Furthermore, punishment builds resentment that erodes trust and respect in your relationship. Once you punish me—even once—I won’t work for the internal sense of satisfaction. Nor will I work for the benefit of our relationship. From then on, I’ll perform to avoid your stick. (And I’ll start looking for a new job.)

Watch Your Cynicism

I can hear the thoughts… “If I don’t wield the carrot and stick, then I won’t get the performance I need.”

Guard against assigning ill intent to the folks on your team. That’s your brain’s natural negativity bias, not the truth. And it’ll sabotage you as a leader if you’re not careful.

When you catch yourself believing ill of someone on your team, ask yourself, “What story can I tell myself that puts this behavior in a positive light?” People want to perform. Excellence is its own reward. Even apathy and cynicism are simply symptoms of fear that cover up the intrinsic human love of greatness.

What we admire in pop culture tells us something about how we’re wired. We admire exceptional athletes, excellent musicians, movie heroes who strive and grow. Even most people who express deep cynicism admire the uncynical.

Harvard’s Dr. J. Stuart Ablon says it best: “People do well when they can. It’s a skill problem, not a will problem.”

When leaders resort to dangling carrots or brandishing sticks, we miss the real opportunity: building skills, supporting accomplishment, and fostering an environment where fulfillment raises people’s internal drive to perform.

To Motivate Employees, What’s a Leader to Do?

So, if incentives and punishments backfire, what’s the alternative? How can leaders motivate employees without eroding the intrinsic drive that leads to greatness?

  1. Learn What Drives Them: There are universal human drives—curiosity, accomplishment, companionship and relationship, building things, tribalism, family protection, to name a few. Learn what drives each of your people. Help connect their work to what inherently motivates them the most.
  2. Ritualize High-Fives: Recognition doesn’t need to come with fanfare or a trophy. A simple “Thank you” or “Great job” with a little enthusiasm can work wonders. Make your appreciation frequent, genuine, and specific. Encourage expressions of appreciation and recognition throughout the team, peer to peer as well.
  3. Connect Them to Results: In a lot of modern jobs, people are at a distance from the end user of your products or services. That fact means a lot of folks are amputated from the most fulfilling part of work. An architecture firm and past client of ours asked us to help them figure out why there was so much turnover among their interns. We learned about a major project that they’d built nearby, now in use—a beautiful, vibrant building—that many interns had spent countless hours working on. And they’d never visited. For them, it remained a paper project. We’ve got to see what we’ve built. And we’ve got to connect with the humans our work affects.

And the admonition here against reward is not universal. Reward, if doled out right, can be reinforcing and motivating in ways that don’t sever the intrinsic motivation. While effective feedback is tied to very specific behaviors, “You did X,” effective rewards are — counterintuitively — more haphazard. “You’ve been doing such a great job and demonstrating such exceptional commitment. So, I want to give you this reward as a token of my [general] appreciation.”

An Enlightening Experiment

At a recent Executive Round Table, I opened the session with a virtual high-five.

I gave a heartfelt, genuine “thank you” to the seasoned CEOs in the Zoom room just for their showing up on time. No reward… Just praise, encouragement, and gratitude. “You are some busy people. Employees, clients, vendors, and fires from all directions are clamoring for your attention. And here you are, at an event you don’t need to be at, on time—to invest in yourselves and your business. Thank you, and well done!”

Cheesy? Maybe.

After all, these CEOs are independent, self-motivated, high-performing grown-ups who don’t need my approval…

But then I asked them how they felt.

The responses were striking. Every single one of them said they felt more energized, more appreciated, already glad to be there, and—here’s the kicker—more willing to do something uncomfortable if I asked them to.

One of them even said they had been second-guessing coming to the call—and their ambivalence immediately ended.

Now, keep in mind: many of these CEOs had never even met me before. It’s not like they came in caring what I thought of them. There was no relationship capital to draw on. If that’s the influence my praise and appreciation had on these powerful people, imagine the impact on your team—the people who already look up to you and crave your approval—if you did something as simple as regularly giving them heartfelt high-fives.

A Quick Aside About Consequences

Don’t take my admonitions against punishment to mean I’m advising against consequences.

In fact, too many leaders insulate people from the natural consequences of their gaps in performance.

So what’s the distinction I’m making here?

What’s Punishment?

It’s action taken to affect another person that’s rooted in anger or retribution. “You did wrong, so you have to pay for that past behavior. I will take my pound of flesh.”

Punishment is making someone pay for their actions in the past. For instance, “You did wrong. I’m going to raise my voice so you KNOW just how wrong.” Or, “I’m going to take shifts off your work schedule, so you really feel the hurt.” Even the cold shoulder is a common workplace punishment.

And Consequences?

Consequences by contrast are natural results of actions. That toddler we talked about… When their legs don’t keep up with their momentum, they fall over. X leads to Y. Cause and effect.

When a sales rep’s behavior offends a client, as a consequence, the client may take their business elsewhere. Natural result.

If you’re late for your flight, you miss the plane. The flight didn’t leave without you in retribution. It has a schedule. Missing the flight and being left behind is a natural consequence.

We worked with a leadership team where people were habitually and consistently late for meetings—wasting everyone’s time. The CEO said, “Ok. From now on, this meeting is like a bus. We’re leaving on time, and the door will be locked when the clock turns to 9:30.”

As a natural consequence, a couple of leaders missed their window to get into the meeting—and they missed it.

That natural consequence motivated them—intrinsically—to be on time, and they stopped being late. They wanted to be sure to be included, and they wanted not to let the rest of the team down.

There’s no “payback” in locking the door. There’s just care for the meeting’s effectiveness, efficiency, and the honoring of the people who are there.

Over time, they adjusted the practice, and made an exception for people running late who texted in advance.

This encouraged thoughtfulness and proactive communication, intrinsically motivating both on-time arrival and caring communication.

The Heart of the Matter

Motivation is not about dangling carrots or brandishing sticks. It’s about creating an environment where people can tap into their own sense of pride, accomplishment, and purpose. It’s about fostering trust, recognizing effort, and collaborating to overcome obstacles.

How many high-fives have you given this week? Whether literal or figurative, they can be the spark that shifts someone’s entire outlook. So, go ahead. Give it a try. You might just be amazed at the results.


Learn more about the link between commitment, accountability, and intrinsic motivation at this link.

Want support boosting accountability, intrinsic motivation, and initiative-taking in your organization? Give us a shout.