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Why and How Intrinsic and Extrinsic Motivation Matters in Business?

Posted on:September 22, 2023 at 01:00 PM

In the life of any entrepreneur, particularly for those at startups, motivation stands as a cornerstone for driving progress and producing outstanding results. When I was obtaining my MS Degree in Personality Psychology, I took a course on self-determination theory developed by psychologists Deci and Ryan.

This theory centers around two types of motivation — extrinsic and intrinsic. The former revolves around performing one activity to achieve another, essentially a means to an end. For instance, working in a job to earn the necessary money to launch your own startup – that’s extrinsic motivation. Intrinsic motivation, on the other hand, emerges from inner passion, forming the fuel for doing what you love simply because you want to.

As you might imagine, fostering intrinsic motivation is challenging. Society often erects barriers rather than building bridges, and many experiments reveal how environmental factors can transform genuine intrinsic motivation into its extrinsic form. I was really shocked by how a gift to a child can convert intrinsic motivation for altruism to extrinsic motivation of getting a reward.

From my perspective, understanding this balance and interplay between extrinsic and intrinsic motivation is a critical lens for any leader managing creative individuals. Hence, I highly recommend the free course on Coursera by the creators of self-determination theory.

This course offers a deep dive into how motivation works and provides practical strategies to nurture the spark of our intrinsic desires. I believe the lessons from this course can light the path for startups and leaders alike, helping drive passion, productivity, and progress into the future. Do yourself a favour and check it out. It’s truly one of the most useful and practical psychological theories I’ve ever faced.