Though not extensively researched, third-party employee competency certifications are increasingly important to organizations. Certifications are double-edged: they may serve to reduce transaction costs, enhance performance, and foster employee development; but they can also be used as “credentials” to gain prestige, rewards, or influence. The authors suggest that excessive use for this latter purpose can undermine their contribution to performance. In this article, a strategy to counter this tendency is proposed. Drawing on “self-determination theory” and Hackman—Oldham's job design theory, two propositions are developed (a) certifications acquired and used primarily for “internalized” reasons are more likely to lead to ongoing learning, improved performance, and employee development; and (b) strategies are available to organizations, occupations, and certifying bodies to present certifications in such a way as to encourage internal motivations. The article ends with suggestions for future research.
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