Probably the most common criticism of gamification is the over-application of basic mechanics such as Points, Badges and Leaderboards (PBL). Stephen Conway from Swinburne University of Technology describes this process 'zombification', because it treats the user as a senseless being in search of extrinsic rewards.
Extrinsic rewards are things humans seek to get something else. For example, you work so you can get paid. Money is an extrinsic reward. Or, you do the dishes to that you do not get in trouble from a parent or spouse, rather than because of the satisfaction you get from a clean kitchen.
Intrinsic rewards are things we seek because they give us pleasure, pure and simple. For example, hugging a puppy. You do that because they are cute and squishy. This is an intrinsic motivator.
The reality is that most of the activities we do have an element of extrinsic and intrinsic value. For example, you may go to work because you love your job (intrinsic) and because it helps you pay the bills (extrinsic). You clean the kitchen because you love the feeling of tidiness (intrinsic) and because you want a compliment from your spouse or parent.
Ok, so why is this important?
The problem is that if you replace intrinsic motivations with extrinsic ones, the original intrinsic motivation can stop. That is the danger in a zombification approach to gamification - a focus on extrinsic motivations can have a crowding out effect on intrinsic motivations. This is especially important when gamifying team behaviours and building culture. A focus on hard metrics like sales and percentages can lead to disengagement.
The antidote to zombification is user-centered design. Rather than viewing the thing you are gamifying through the lens of the organisation and hard metrics, a design process needs to be taken to understand the intrinsic motivations of the users. The mechanics and dynamics in the gamification design then need to be carefully balanced to ensure a mix of intrinsic and extrinsic rewards that are right for that particular group of players. When gamification is designed and implemented well, it can lead to transformative changes in a team.
Conway, S. (2014). Zombification? Gamification, motivation, and the user. Journal of Gaming; Virtual Worlds. 129-141.