Get a better handle on what motivates you by learning more about incentive theory

The path to career success is filled with obstacles and challenges. It sometimes takes a tremendous amount of focus to maintain your motivation and continue to pursue your goals. But what about those times when you're low on inspiration and drive and struggling to find the motivation you need to persevere? If you're a manager responsible for motivating your team, how do you help them to overcome those same challenges? Learning how to apply the incentive theory of motivation can be a great solution.

In this post, we'll examine incentive theory, give a brief overview of some alternative motivation theories, and provide examples of effective workplace incentives. We'll also explore some tips that you can use to leverage the incentive motivation theory to advance your own career.

What is the incentive theory?

At its core, incentive theory posits that human behaviors can be influenced by external incentives, which may take the form of either positive or negative consequences. According to this theory, people can be motivated to engage in certain behaviors by external incentives that either promise positive benefits or threaten negative consequences.

Children learn about this concept early on in life. If they burn their fingers on a hot stove, they are incentivized to avoid that appliance. If they are given treats or praise for keeping their rooms clean, they may learn to become tidier and more organized individuals. Later in life, they may be motivated by the prospect of classroom rewards, trophies in sporting events, or other positive incentives. They may also be motivated to avoid bad behavior by negative incentives like parental discipline or a trip to the Principal's office at school.

Other motivation theories

While the incentive theory of motivation remains popular, it does have its detractors. Opponents of the theory often suggest that it's too general and all-encompassing. Many argue that it ignores internal motivators like human emotion, different cultural preferences, and each person's personal values. They also sometimes note that there's not a single set of incentives that will appeal to every person. For these detractors, other theories of motivation are often more appealing.

Instinct theory

One alternative theory suggests that people's motivations are largely programmed by evolution and biology. This theory argues that people really have no control over what motivates them, since they are innately driven to make decisions that fulfill basic needs like food, security, reproduction, and shelter.

Drive-reduction theory

The drive-reduction theory focuses on the human need for stability. Just as the human body is programmed to seek homeostasis - a stable equilibrium for all bodily systems - people are themselves naturally disposed to meet their needs and achieve a homeostatic balance.

Arousal or excitement theory

Like the incentive theory, this theory suggests that people actively gravitate toward situations and activities that enable them to heighten or maintain a desired level of excitement or arousal. For most people, the goal is to achieve a perfect balance of excitement that eliminates boredom while avoiding overstimulation.

What types of incentives are effective in the workplace?

Within the workplace, incentives can be either positive or negative – just as they are throughout every aspect of life. Those positive incentives tend to be focused on rewards or benefits that employees are eager to obtain in exchange for meeting performance expectations, following company policies, and enhancing their value to the company. Negative incentives include all those corrective actions that employers use to discourage bad behavior and poor performance. Let's look at a few examples of each type:

Increased compensation

Whether it is higher wages, improved benefits, or regular performance-based bonuses, added compensation can be a powerful motivating factor for many employees. Experience has demonstrated that many employees will work harder in exchange for the promise of higher wages, which is why so many employers rely on compensation incentives to motivate their teams.


Companies with great leadership teams know how to use recognition to motivate workers. Praise, public recognition, and awards can be a great way to keep an entire team motivated to raise their own performance expectations. Done properly, recognition incentives can help to foster a workplace culture that prizes a strong work ethic and the pursuit of common goals.

Job security

Effective use of constructive feedback, regular performance reviews, and investment in each employee's development can be a powerful incentive too. Additionally, companies can demonstrate their commitment to their team's professional development through training and educational opportunities that enhance their skills. This type of engagement by employers can help to signal job security, which is another important tool to motivate employees.


For anyone interested in steady career advancement, the promise of a potential promotion can be a strong incentive to exceed expectations. Promotions represent career growth and a clear sense of job security. They often include increased pay as well, which further increases their value as an incentive.


The incentive theory of motivation also includes negative incentives, of course, and one of those involves the potential for a demotion or other role assignment. Employees who understand that poor performance or other negative workplace behaviors might result in a loss of status, responsibility, or even pay can be motivated to focus even more on meeting company expectations.

Disciplinary measures

Companies that use disciplinary systems like progressive discipline understand the corrective value of negative consequences. Employees who know that there is a fair, easy-to-understand, and consistently enforced system of disciplinary measures used to correct bad behavior will be motivated to follow rules, maintain performance standards, and provide value to the company.


Termination is the ultimate negative consequence, which is why the possibility of being fired for bad behavior or poor performance can have a noticeable impact on any employee's behavior. It is also the final step in any system of progressive discipline.

How can you use incentive theory to advance your career?

Of course, it's one thing to gain insight into how the incentive theory of motivation works within a workplace setting. It's quite another to figure out how it can benefit you as an employee – or a manager or other leader in the workforce. How can you use this theory to improve your own workplace performance or inspire your team to be more productive and efficient? We've put together some simple tips that you can use to apply this theory in your own career.

Identify the things that motivate you

To benefit from the incentive theory of motivation, you need to have enough self-awareness to recognize the things that motivate you to be your best. What do you prioritize in your life? Work-life balance? More compensation? Acclaim from your peers or industry? Until you understand what motivates you, you can't truly optimize the benefits of any incentive offerings. If you're in management, do this same assessment with your employees to find out what motivates them.

Determine which company incentives align with your need for motivation

Once you know your motivations, or those of your team, the next task is to identify the types of incentives that the company can provide. Is there a steady path for career advancement? More flexible scheduling or the possibility of a hybrid work option? How easy is it to earn a raise or promotion? What type of feedback process does management use to encourage and reward high performing team members? You need to be able to match available incentives to your motivational needs, if you want those incentives to have the desired impact.

Visualize yourself obtaining that reward

Any time you have a goal, it is important to be able to imagine how you'll feel when you achieve it. The same idea holds true for incentives. If you want an incentive to have the desired motivational effect, you need to be able to picture yourself earning that reward. Then think about all the things you need to do to make that happen.

Plan your success

Negative incentives don't really require much thought. After all, once you know the performance and behavioral expectations, all you need to do is to meet them. Positive incentives are a different matter entirely. To achieve those incentives, you need a solid plan that outlines every step you'll take to obtain those rewards. Figure out each step you need to take to reach your objective, then follow that plan with fierce determination until you obtain the reward you're seeking.

For more on goals, read our great post, “Top 15 Professional Goals and How to Achieve Them.”

Reach for your goals

Whether you're a manager trying to figure out the best way to motivate your team or a career-focused individual in need of your own motivation, a better understanding of the incentive theory can help. By learning how incentive theory can be applied in your own life and career, you can fuel your motivation and ensure that you have the drive you need to reach your goals.

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