The 2026 IRF Trends Report highlights how incentive professionals are navigating rising costs, geopolitical uncertainty,...
Research / Academic Research in Action: Designing Incentives That Spark Flow
by Allan Schweyer, Chief Academic Advisor, IRF
Bottom line: The “rewards kill intrinsic motivation” narrative is a dramatic oversimplification. Under the conditions that characterize well-designed incentive programs: performance-contingent, competence-affirming, choice-based, and novel, tangible rewards support rather than undermine the intrinsic motivation that enables flow.
“Flow” is the state of complete, energized absorption in a task that produces peak performance and is widely considered the ultimate manifestation of intrinsic motivation. Because of this, many assume that external incentives and rewards are irrelevant to flow, or worse, that they undermine it. A convergence of recent research tells a different story: the supposed conflict between incentives and intrinsic motivation is largely a myth under real-world conditions. While there’s nothing you can do that will turn on a flow state like a light switch, well-designed incentive programs can actively create the conditions that may spark flow in workers.
Mihaly Csikszentmihalyi, the psychologist who pioneered the concept, described flow as “a state of unselfconscious and complete immersion in a pursuit that, although requiring high levels of skill and concentration, results in a sense of effortless action and control.” Athletes call it “being in the zone.” At work, it represents the apex of engagement, a state in which high performance is achieved through heightened awareness, attention, and creativity.
The first comprehensive meta-analysis of work-related flow (Liu et al., 2023) confirmed that flow at work is positively associated with:
Perhaps most intriguing is that Csikszentmihalyi’s finding that people experience more flow at work than during leisure. This suggests that many of the conditions for flow are already in place, and that relatively modest interventions could tip the balance.
The belief that external rewards undermine intrinsic motivation—and therefore flow—has been enormously influential. It traces to landmark experiments by Deci (1971) and Lepper et al. (1973), in which children given rewards for activities they already enjoyed subsequently showed less interest in those activities. This “undermining effect” has shaped decades of thinking about reward design. However, successive meta-analyses have substantially narrowed the scope of this effect:
Even Deci and Ryan themselves clarified in 2020 that self-determination theory does not argue that all extrinsic rewards are harmful. The critical distinction is between “controlling” rewards (purely transactional, contingent on compliance) and “autonomy-supportive” rewards that affirm competence and allow choice. When people internalize the value behind a reward, extrinsic and intrinsic motivation coexist productively.
Research has identified several conditions that enable flow states. A review of 252 empirical studies (Peifer et al., 2022) and the work of researchers including Kotler, Sawyer, and Bakker confirm that the most important flow triggers include: clear goals, challenge-skill balance, immediate feedback, autonomy, novelty, and social connection. Each of these maps directly onto elements of effective incentive program design.
Research on non-cash rewards reveals that tangible and experiential rewards share characteristics with known flow triggers in ways that cash rewards do not:
1. Set Clear, Calibrated Goals at Multiple Levels: Flow requires goals that stretch but do not overwhelm. Design programs with tiered targets: an attainable baseline that builds confidence, a stretch goal that challenges, and a breakthrough level that excites top performers. This calibration creates the challenge-skill balance that is the single most validated antecedent of flow (Fong et al., 2015). Avoid one-size-fits-all thresholds; where possible, personalize targets to individual or team capability.
2. Build in Real-Time Feedback Loops: Flow depends on knowing how you’re doing while you’re doing it. Invest in dashboards, progress trackers, and real-time leaderboards that let participants see their standing against goals. Pair these with frequent manager recognition. The Deci et al. (1999) meta-analysis confirmed that verbal praise enhances intrinsic motivation, and recognition provides the competence-affirming feedback that sustains flow.
3. Maximize Choice and Autonomy in Rewards: Autonomy is both a basic psychological need and a core flow trigger. Offer reward catalogs, experience menus, or points-based systems that let earners choose their own rewards. Allow flexibility in how goals are pursued. When people feel in control of both the journey and the destination, they are more likely to enter flow and more likely to perceive the reward as competence-affirming rather than controlling.
4. Prioritize Experiential and Tangible Non-Cash Rewards: Cash rewards encourage calculative thinking, the opposite of the absorbed, emotional state associated with flow. Tangible and experiential rewards engage affect-based processing (Jeffrey, 2009), resist hedonic adaptation, and contain built-in flow triggers: novelty, hedonic engagement, physical involvement, and social connection. Group incentive travel, for example, can activate nearly every flow trigger on the list, including novel environments, embodied activity, shared experiences, and high engagement.
5. Design Team Incentives Around Group Flow Conditions: Group flow (Sawyer, 2007; van den Hout, 2018) requires shared clear goals, close communication, equal participation, and mutual commitment. Structure team incentive programs to foster these conditions: set team-level goals, encourage collaborative problem-solving, and reward group outcomes. Group travel and team recognition events create the shared experiences and social bonds that are prerequisites for team flow.
6. Use Novelty and Surprise Strategically: Novelty triggers dopamine release, which tightens focus and primes the brain for flow. Rotate reward offerings regularly. Introduce surprise bonuses or spot awards. Choose travel destinations and/or experiences that are new to participants. The Cerasoli et al. (2014) meta-analysis found that unexpected rewards do not produce the undermining effect, they enhance motivation.
7. Invest in Competence-Building Rewards: Flow requires that skills meet the challenge. Rewards for learning and professional development, including courses, certifications, conference attendance, and coaching build the competence that enables progressively more challenging goals and more frequent flow. This creates a virtuous cycle: learning builds skill, skill enables harder challenges, harder challenges produce more flow, and flow produces higher performance that earns further rewards.
8. Fund Wellness Programs That Set the Stage for Flow: Research on the neuroscience of flow shows that physical movement, mindfulness practices, and time in nature can prime the brain for flow states. Incentive programs that reward participation in wellness activities like exercise challenges, meditation programs, and nature retreats are not just good for health; they are conditioning the nervous system for the focused, calm engagement that characterizes flow.
9. Frame Rewards as Competence-Affirming, Not Controlling: How a reward is communicated matters as much as what it is. Eisenberger & Aselage (2009) found that when rewards are explicitly framed as recognition of creative or high-quality work, they increase intrinsic interest and subsequent performance. Clearly articulate why rewards are given: “This recognizes the quality and creativity of your work” is competence-affirming; “Complete X tasks to earn Y” is transactional. The former supports flow; the latter may not.
10. Measure Flow as a Program Outcome: The recently validated Flow@Work engagement survey (2025) and van den Hout’s Team Flow Monitor (2026) provide practical tools for assessing flow states in the workplace. Consider incorporating flow measures into incentive program evaluation alongside traditional metrics. If programs designed around flow principles produce measurable increases in flow states and those states predict the performance, creativity, and retention outcomes the research confirms, then incentive professionals will have a powerful new framework for demonstrating program ROI.
****
Flow is not a mystical state reserved for elite athletes and artists. It is a well-researched psychological phenomenon that occurs most frequently at work, predicts the outcomes organizations care most about, and can be deliberately enabled through the conditions that good incentive programs already create. The incentive professional’s opportunity is to design programs that don’t just reward performance but create the conditions in which peak performance naturally emerges.
This Academic Research in Action explores how cognitive biases shape the effectiveness of incentive and recognition programs. It highlights why well‑intentioned designs often fall short and emphasizes the need for behaviorally informed approaches that account for how people actually interpret rewards.
We explore recent research that underscores the critical role of sincere, timely, and personalized recognition in enhancing workplace performance.
