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Traditionally, extrinsic motivation has been used to motivate employees: Payments, rewards, control, or punishments. Within economies transitioning from assembly lines to service industries, the importance of intrinsic motivation rises:

• The further jobs move away from pure assembly lines, the harder it becomes to measure individual productivity. This effect is most pronounced for knowledge workers and amplified in teamwork. A lack of objective or universally accepted criteria for measuring individual productivity may make individual rewards arbitrary.

• Intrinsic motivation is strong. It takes extraordinary external incentives to achieve a motivation level comparable to that of people who enjoy what they do.

• Since by definition intrinsic motivation does not rely on financial incentives, it is cheap.

• Advances in information and communications technology and infrastructure make it easier than ever to match supply and demand, increasing the likelihood that a position can be filled by an intrinsically motivated individual.

However, intrinsic motivation is no panacea for employee motivation. Problems include:

• For many commercially viable activities it may not be possible to find any or enough intrinsically motivated people.

• Intrinsically motivated employees need to eat, too. Other forms of compensation remain necessary.

• Intrinsic motivation is hard to boost or create. If possible at all, it may involve changing job descriptions and business processes.

• Intrinsic motivation is easily destroyed. For instance, additional extrinsic motivation is known to have a negative impact on intrinsic motivation in many cases, perceived injustice in awarding such external incentives even more so.