The Negative Effects of Reward Systems

Paper Summary:

This paper examines how human resource managers are constantly looking for new ways to motivate employees and how most companies use reward systems as a means for motivation. It attempts to show how, although some employers believe that rewards are the key to productivity, quality, and a staff of satisfied employees, reward systems punish employees in a number of ways. It looks at how, according to Alfie Kohn, author of "Punished by Rewards", there are five ways that reward systems work against an employee's intrinsic motivation.

Outline
Introduction
Rewards and Punishment
Rewards Rupture Relationships
Rewards Ignore Reasons
Rewards Discourage Risk-Taking
Rewards Reduce Interest
Theory X and Theory Y
Changing Reward Systems

From the Paper:

"When using rewards such as selling promotions and commissions, a company should expect to see the predictable results of competition. Instead of sharing successful selling tactics with one another, employees will keep their ideas to themselves in fear that they will help someone else succeed at their expense (Keenan, 1994). The reduction in teamwork means a reduction in quality and productivity for the organization as a whole, but there are other reasons to expect a decline in performance competition generates anxiety and stressed out employees are less productive (Keenan, 1994). In some organizations the results of sales contests are predictable, employees become unmotivated if it becomes obvious to them who will most likely win the contest regardless of their personal effort (Keenan, 1994)."

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