| Organizational Behavior |

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Intrinsic and extrinsic rewards can both help to motivate employees’ performance, when they are applied correctly. By rewarding an employee with positive feedback or praising them for a job well done you appeal to their internal or intrinsic values. But, if you were to rewards the employee with money or a promotion you are showing their extrinsic value. I feel that if you were to combine both intrinsic and extrinsic rewards it would help create overall satisfaction by satisfying both intrinsic and extrinsic rewards.
Intrinsic and extrinsic rewards are different because intrinsic rewards are earned internally through self gratification, while extrinsic rewards come from outside sources such as financial, material and social rewards. An example of an intrinsic reward would be receiving positive feedback and praise from a manager for a job well done, while an extrinsic reward would be a cash bonus for doing a job well-done. Extrinsic and intrinsic rewards can also be similar, because extrinsic rewards can lead to an intrinsic reward. For example, an employer could use an extrinsic reward to motivate the employee to acquire new skills or knowledge. Once these new skills have been acquired, the employee becomes more intrinsically motivated to pursue what the employer is offering. To accomplish this, my employer offers each employee an opportunity to further their education and receive the degree an employee may have started by since has put off. They do this by offering their employees tuition reimbursement.
I have observed both extrinsic and intrinsic rewards while working at my current job. Recently we have taken a new approach to our yearly merit increases by adopting pay for performance rather than a standard amount. To do this, each employee sets three to four goals they would like to accomplish throughout the year. Once