AC 5.2 The relationship between reward and performance and links to motivation

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As highlighted above in AC 5.1, an effective reward system encompasses both intrinsic and extrinsic rewards. Additionally, AC 5.1 noted that both extrinsic and intrinsic reward systems played a crucial role in attracting and retaining top talents. Bernazzani (2022) recognises extrinsic and intrinsic motivations as the reasons for increased employee performance. In specific, intrinsic motivation involve doing something because it personally rewards you. On the other hand, extrinsic motivation involves doing something so that you can earn a reward or avoid being punished. Relatedly, the performance of employees within a given organisation is directly related to intrinsic and extrinsic motivation. By the same token, the performance of employees can be analysed using Maslow’s Hierarchy of needs.  Maslow argued that a person could only move on to address high-level needs (such as organisation goals) only when their basic needs are adequately fulfilled. The theorists recognised physiological, safety, love, esteem, and self-actualisation as basic human needs. Regarding motivation, individuals can only be motivated to achieve more goals only when the needs mentioned above are catered for (Hopper 2020). In summary, rewards are critical in any given organisation and serve as major extrinsic and intrinsic motivation tools. When employees are well rewarded, they are motivated to push more, resulting in increased performance. Cherry (2020) introduces “the incentive theory of motivation.” According to the theory, human behaviour is motivated by a desire for an incentive. For instance, good grades are incentives that can motivate a student to study hard in school. By the same token, a salary bonus is an incentive that can motivate an employee to work hard (Armstrong 2020).

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