The introduction of extrinsic rewards, such as pay, for work effort that had been previously intrinsically rewarding due to the pleasure associated with the content of the work itself, tends to decrease the overall level of motivation.
This has come to be called the cognitive evaluation theory. Well-researched and supported theorists have assumed that intrinsic motivations, such as achievement, etc., are independent of extrinsic motivators such as high pay, promotions, etc.
Cognitive evaluation theory suggests otherwise. When extrinsic rewards are used by organizations as payoffs for superior performance, the intrinsic rewards, which are derived from individuals doing what they like, are reduced.
The popular explanation is that the individual experiences a loss of control over his or her own behavior so that the previous intrinsic motivation diminishes.
Furthermore, the elimination of extrinsic rewards can produce a shift—from an external to an internal explanation—in an individual’s perception of causation of why he or she works on a task.
If the cognitive evaluation theory is valid, it should have major implications for managerial practices.
• If pay or other extrinsic rewards are to be effective motivators, they should be made contingent on an individual’s performance.
• Cognitive evaluation theorists would argue that this will tend only to decrease the internal satisfaction that the individual receives from doing the job.
• If correct, it would make sense to make an individual’s pay non-contingent on performance in order to avoid decreasing intrinsic motivation.
7. While supported in a number of studies, cognitive evaluation theory has also met with attacks, specifically on the methodology used and in the interpretation of the findings.
• Further research is needed to clarify some of the current ambiguity. The evidence does lead us to conclude that the interdependence of extrinsic and intrinsic rewards is a real phenomenon.
• Its impact on employee motivation at work may be considerably less than originally
• First, many of the studies testing the theory were done with students.
• Second, evidence indicates that very high intrinsic motivation levels are strongly resistant
to the detrimental impacts of extrinsic rewards.
• The theory may have limited applicability to work organizations because most low-level
jobs are not inherently satisfying enough to foster high intrinsic interest, and many managerial and professional positions offer intrinsic rewards.