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Extrinsic and Intrinsic Rewards

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Extrinsic and Intrinsic Rewards

In this paper I will answer the following questions: 1. Compare and contrast extrinsic and intrinsic rewards within the workplace. 2. How have you observed extrinsic and intrinsic rewards working well? 3. How can managers and leaders improve extrinsic reward and pay for performance plan?
Introduction
Motivation in an organization is a key element to increase overall operational efficacy. Proper motivation keeps employees working at high productivity levels, increases morale and increases retention of valuable employees. All of those dimensions are critical to a successful operational structure. In addition, these are also central elements in ensuring that when organizational change is necessary, the conditions to make switches will be as conducive as possible to desired outcomes1 . How to motivate diversified workforces and engage staff is the subject of ongoing studies and examinations of management tactics. Motivation is facilitated by the managers and leaders of an organization and can be divided into intrinsic and extrinsic categories. Both intrinsic and extrinsic rewards when used properly motivate employees to reach optimal success in the work place.
Compare and contrast extrinsic and intrinsic rewards within the workplace. Extrinsic rewards are usually financial. They are generally awarded to employees from managers in the form of pay raises, bonuses, benefits and title. These rewards are external to the work itself and the size of them is entirely controlled by the manger/company. Intrinsic motivation can be defined as “internal desires to perform a particular task” 2. These forms of motivation are not tangible. Kenneth Thomas 3 outlines four proven efficacious intrinsic reward categories: sense of meaningfulness, sense of choice, sense of competence and sense of

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