Aaron Kinne
7 min read
When an employee is thanked or highlighted for their efforts and accomplishments, it’s a shock of dopamine to the system. It makes them feel valued and grateful in an instant. Moments of employee recognition create magic at work.
It’s not just the kind words from a manager or colleague or even the reward component that accompanies them, it’s the impact this can have on the entire organization.
These moments can be shared with the full team, letting peers and entire departments know the great work being done and the exemplary efforts being exhibited. These moments energize and motivate employees and meaningfully convey appreciation.
Employee appreciation has a transformative power to uplift employees, inspiring them to do their best work.
When you look at the statistics around employee recognition, companies that recognize employees see a direct impact on their overall productivity. However, according to a survey by Workhuman® and Gallup, only 26% of the employees feel that they get equal recognition as their peers for similar efforts.
With that in mind, let’s take a look at some of the most commonly asked questions surrounding employee rewards and recognition.
It will help you understand how it can transform employee morale – and your bottom line.
The most successful businesses know that the more gratitude in a company, the better it performs. And the best way to infuse gratitude into company culture? Meaningful recognition from peers – connecting people to a shared purpose through a consistent stream of gratitude and acknowledgment.
Employee recognition – also known as Social Recognition® – is the act of publicly acknowledging your people for who they are and what they do. With employee appreciation, workers recognize each other and make the workplace more inclusive and human.
Employee recognition is among the most important factors in making employees feel valued, driving workplace engagement, productivity, and employee retention.
Learn more about the ROI of Social Recognition here.
At its core, employee recognition is just another word for positive feedback – feedback focused on an employee’s strengths and what they’re doing right. It’s also an expression of appreciation and gratitude.
When you recognize employees across all levels of an organization, it strengthens teams and makes work meaningful. It also makes companies more successful.
By appreciating and recognizing employees, companies observe that they are five times more likely to connect with the work culture, four times more likely to be engaged, and 56% less likely to search for other jobs.
Here are the ten common types of employee recognition methods:
Formal or public recognition is when you praise your employees in a way that gives others visibility. This could be in-person events such as conferences or meetings or online through emails and social media posts.
According to a study, 84% of companies said that social or public recognition has positively impacted their employees’ productivity.
Informal or private recognition praises the employee privately through a conversation, email, or a handwritten note. Though it may not give wider recognition, thoughtful and personalized recognition can build a great one-on-one relationship between employees and managers.
This form of recognition adds to the company’s culture as peers appreciate each other’s hard work. This could be in public or private and is meaningful because it comes from someone the employee works with daily.
Managers can promote this culture of recognition through positive discussions in team meetings.
This recognition includes public or private praise accompanied by a monetary gift, such as cash or a voucher. A monetary benefit adds even more inspiration for the employee to perform better.
As the name suggests, top-down recognition comes from the supervisor to the subordinate. For example, a project lead acknowledges a manager, and the manager further acknowledges a team member in the hierarchy.
A direct-report recognition is a form of private one-to-one acknowledgment of a team member from their manager. It demonstrates that the manager observes and appreciates the employee’s work.
This recognition does not need a special event and could come for little achievements daily. Day-to-day recognition slowly creates a culture where not only the manager but also the employees recognize one another.
This recognition is given to employees who go way beyond their call of duty and show significant initiative and desire to do their jobs well.
For example, a sales executive who goes far beyond the scope of their role to collaborate with other teams to help a client in need shows a significant proactive initiative.
Also called milestone recognition, this acknowledges the employee for completing a milestone. For example, you could acknowledge the employee for completing 10 years in the company or for closing 100 sales, generating direct revenue.
This demonstrates that you appreciate the employee’s contribution and helps keep them motivated to succeed.
It is always great to make employee recognition a celebration, especially when you are acknowledging a team. Team trophies, office or offsite parties, cupcakes or other treats, pay-it-forward initiatives, or a wall of fame are all great ways to show appreciation.
Historically, recognition has been tactile in nature, such as managers handing out gift cards from a drawer or years-of-service programs that give tenured employees items such as watches or pins.
On the other hand, comprehensive and strategic employee recognition programs leverage technology to amplify staff recognition and broadcast it throughout your company.
That way, everyone can see what your organization values, participate in congratulating and reinforcing those values, and be inspired to emulate them.
Making work more human through employee recognition drives results by capturing, amplifying, and echoing public recognition moments across the organization. Social recognition is different from traditional recognition because it’s:
Culture-based programs, ones that allow for peer-to-peer recognition, are better for the bottom line. Peer-to-peer programs create a stronger sense of belonging, and compared to “e-thanks,” programs funded at 1% or more of payroll are 86% more likely to be rated as good or excellent.
With its strong impact on engagement, employee recognition drives business outcomes in a direct and compelling way. The key to achieving positive results in an employee recognition program is having the correct volume of reach, frequency, and value.
A consistent stream of positive interactions fuels unparalleled, provocative workplace data and human insights. It draws on your entire organization as a community – unlocking human potential and innovating people to do the best work of their lives. The data proves it over and over again.
Typical traits of an effective employee recognition program include:
Recognition programs are successful when they align with the mission, goals, and values of the organization. It is important to align the recognition with the goals the management considers important.
Employees should get the reward close to the event or desired behavior. This builds a strong bond between the employee’s action and the result for which they are getting the recognition.
Adapt simple and uncomplicated recognition methods that do not require a great administrative effort yet meet the goals of the recognition exercise.
Make the recognition criteria specific and measurable. You could have KPIs and specific metrics to understand which employees are performing better. At the same time, make the recognition criteria flexible enough to accommodate new ideas and feedback.
Recognition programs should be inclusive of every employee irrespective of gender, religion, race, or other personal characteristics. Companies must also provide equal opportunities to people with disabilities and those who have the relevant experience and education to fulfill the requirements of a job.
Regularly evaluate the success of recognition programs and events. It is best to take feedback from the employees about how effective and fair the recognitions are.
Ask them if they find the programs meaningful and do they want them differently. Ensure appropriate lines of communication and that the program is meeting its objectives.
Employee feedback and regular evaluations help you improve the recognition programs. A monthly or quarterly evaluation in consultation with the management and the employees should suffice.
Ensure that you deliver the recognition thoughtfully. A simple yet thoughtful recognition moment from a manager can sometimes be better than an expensive gift that was delivered poorly.
Check out this video to see how an employee recognition platform powered by Workhuman® can connect your organization.
How much is employee turnover costing your business?
A Korn Ferry study estimates the cost of replacing an employee is 50-150% of the employee’s salary. For specialist, senior, and executive positions, the cost per employee rises to 213% of the salary.
See how recognition can positively impact your workforce by downloading Workhuman’s report.
When you factor in the intellectual loss and the time and productivity lost to vacancies and onboarding, you begin to see just how significant the “hidden costs” of employee turnover really are.
Research and employee surveys overwhelmingly show that recognized workers are more likely to stick with you. In the SHRM/Workhuman Employee Recognition Survey, 68% of organizations with employee recognition reported a direct positive impact on retention.
IBM’s WorkTrends study showed that “intention to leave is twice as high among employees who do not receive recognition (51%) compared to those who do (25%).” That’s because employees want to be acknowledged for who they are and what they do.
As the research shows, employee recognition measurably and positively impacts engagement. Engagement leads directly to improvements to the top and bottom lines, such as increased productivity, customer loyalty, sales, and profits.
Here are real-life success stories some of the top companies in the world have achieved, thanks to an effective, strategic employee recognition program:
Watch how Cisco used peer-to-peer recognition to empower employees and drive engagement.
A well-designed, strategic recognition program can produce a similar impact on your employees and create a positive company culture.
The first step in getting recognition ideas or feedback is having a one-on-one conversation between the manager and the employee.
Each employee has a different appreciation language. While some prefer public recognition, others prefer private one-on-one recognition from the manager.
This will depend on your team and the recognition program. But some of the common questions are:
Defining a budget for employee appreciation is important. You can consider the following things to make one:
Employee recognition should be a special moment that is important for both the company and the worker. Reward employees for exceptional effort, quality work, and accomplishments throughout the year.
Effective employee recognition should be specific and timely to maximize its impact. It is important to constantly innovate, improve, and decide the proper frequency of praise within the employee recognition program.
Employee recognition is a critical aspect of any HR policy. A well-managed employee recognition program will have a direct impact on the individual and company’s productivity, engagement, and success. The company must start with a clear directive to manage and consistently improve it.
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