In 1973, psychologists Mark Lepper, David Greene, and Richard Nisbett conducted an experiment at a Stanford nursery school. They selected children who already enjoyed drawing with felt-tip pens and divided them into three groups. The first group was promised a reward in advance for drawing—a certificate with a gold seal. The second group received the same certificate unexpectedly, after drawing. The third group received nothing.
A few weeks later, the pens were placed in the room again, where the children were free to choose their activity. Those who had been promised a reward in advance drew noticeably less than the others. The other two groups drew about as much as they had before.
The effect was called overjustification. The mechanism lies in how a person explains their own behavior to themselves. When there is no reward, there is only one explanation: I find this interesting. When a promised reward appears, a second, more obvious explanation emerges: I am doing this for the reward. And as soon as the reward disappears, the reason to continue disappears as well—even though the interest was originally there.
An important detail that is often overlooked: a promised tangible reward given for the mere fact of completion undermines intrinsic motivation. An unexpected reward does not. Verbal praise, as a rule, does not, and sometimes even reinforces it. And if a task is inherently boring, there is nothing to undermine: the reward simply makes it tolerable.
For bonus systems, this is an inconvenient conclusion. A bonus for participating in mentorship, a reward for initiative, points for internal training—all of this can turn what people used to do out of their own interest into a transaction. And when the program is cut, the behavior does not return to its original level: it drops lower than it was before the launch.
This is not an argument against money. A fair, competitive base salary takes the compensation question off the table and allows people to focus on the work rather than the pay. Problems begin where a bonus is tied to activities that were already driven by intrinsic interest.
What helps:
paying for results rather than for the mere fact of participation;
using recognition and unexpected rewards where motivation already exists;
avoiding material incentives for behavior that worked fine without them—first checking if there is a problem they actually solve;
and remembering that cancelling a bonus is harder than introducing one.
Sometimes the best thing you can do with an employee's interest is not to try to buy it.