Behind every unmotivated employee is a leadership problem waiting to be solved. Yet many leaders see motivation as a game of rewards and punishment. Forget the cash. Forget the threats. To engage today’s workforce, a leader is well advised to seek the heart of what moves people: their three basic psychological needs. What About Sales Incentives? Variable compensation—commissions, bonuses, incentives, and so on—is a given in sales organizations.

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Self-Determination Theory recognizes the reality of externalmotivators in a sales environment, and advises that to support internal motivation in salespeople, how the leader uses these incentives makes all the difference. Salespeople can suffer serious psychological harm if sales leaders overemphasize incentives to pressure or “motivate” people to reach sales goals. In these cases, salespeople experience stress and burnout, focus less on customers and more on money, and can resort to unethical actions to gain the rewards Observing these problems, many leaders assume thatemployees, having secured food and shelter, become passive. So these leaders try to control employees with threats of punishment or with external rewards, including bonuses, wage incentives, or promotions.

While it’s safe to say that many leaders will continue using these methods to motivate employees, literally scores of peer-reviewed studies since the 1970s have confirmed the negative impact of external rewards. Among the startling findings: 1. Rewards consistently undermine sustained, longterm motivation and performance.

Rewards for something employees already like to do especially undermine motivation and performance. 3. Rewards make it more difficult for employees to be creative and solve complex problems. Consider a simple example. In the 1993 Wimbledon final, Jana Novotna led the great Steffi Graf 6-7, 6-1, and was serving at 40-30 for a 5-1 lead in the final set. But Novotna double-faulted, then lost the game, and 10 minutes later lost the match. Any or all of the SDT findings may have figured into Novatna’s collapse:

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