Understanding Employee Recognition
Employee recognition is the act of showing appreciation or gratitude to an employee for what they bring to the table. It can be given for the work they’ve done, for a special event or milestone they’ve achieved, or just to show appreciation for them as a human being.
Don’t get confused about the difference between recognition and compensation. A paycheck and benefits are extremely important and definitely play a part in retention and job satisfaction. But recognition is important for conveying value and providing positive feedback that creates a culture of gratitude and excellence.
It should be simple, not complicated; rewarding, not intimidating. Think about when you were young, and you were taught to say “thank you” after someone did something for you. Recognition is the same idea—it’s simply saying “thank you” to your staff for all that they do.
What is employee recognition?
Employee recognition is the act of showing appreciation or gratitude to an employee for what they bring to the table.
The Impact and Benefits of Employee Recognition
Implementing employee recognition programs can have a massive impact on any business. Here are just some of the measurable ones:
- Recognition lowers voluntary turnover by 31%.
- Recognition lowers frustration levels by 28.6%.
- Companies spending at least 1% of payroll on recognition see an 85% boost in employee engagement.
- 93% of employees who feel valued are motivated to do their best work.
- Over 80% of employees agree that recognition improves their experience, relationships, engagement, and happiness.
- 94% of employees who receive daily recognition are satisfied or very satisfied with their jobs.
Let’s sum it up with this: according to research, every single measure of morale, productivity, performance, satisfaction, and retention skyrocket when managers and leaders provide regular recognition.
It isn’t a fun extra that businesses can take or leave. No, recognition is the backbone of successful businesses that employees love to work at. And keep in mind that your culture is 10X more important to employees than pay. So going back to the comparison of recognition versus a paycheck—well, there is no comparison. Creating a culture of support, appreciation, and value is 10X better than a paycheck.
The Importance of Employee Recognition in Today's Workplace
The simple answer: recognizing employees helps them see that their company values them and their contributions. As mentioned above, when employees are recognized, turnover lowers, frustration goes down, engagement rises, and happiness improves.
But the main reason recognition is important is that your employees are humans, individuals who all bring unique value to your company, and they deserve to be shown gratitude. They deserve to feel accepted and appreciated. The amazing ROI of recognition is really just a happy consequence of valuing the uniqueness, skills, and personalities that your employees bring.
How Should You Give Recognition?
The good news is that you have a nearly limitless supply of ways to recognize the employees at your company. The bad news is, some of these ways may not be as effective as others. One of the best ways to encourage, promote, and grow your culture of recognition is through employee recognition programs.
Exploring Different Employee Recognition Programs
A recognition program is any program that’s set up to recognize and encourage employee achievements. But these programs are so much more than that textbook definition. Your programs should focus on what matters most at your organization. In fact, one study found that 93% of employees felt their work had greater meaning and purpose when recognition was tied to company values.
To answer the question in more solid terms, here are a few examples of recognition programs:
- Peer-to-peer and manager-to-report programs. These allow coworkers and leaders to directly recognize the people around them. They can be both monetary and non-monetary—the key for these programs is to make it easy and fun to get people involved.
- Sales incentives. Motivating your sales team while encouraging collaboration and a work-life balance can be a challenge. A program focused on recognizing the effort, teamwork, and strengths of your team can be an awesome solution.
- Wellness programs. These types of programs are great for celebrating your employees’ strivings for health. These programs can incentivize healthy behavior and reward effort for mental, emotional, and physical progress.
- Work anniversaries. Otherwise known as service awards, work anniversaries are a big deal for your employees. They’ve given you an entire year of their life, and this type of program can be a fantastic way to thank them for their effort!
These are just some examples to get your mind churning—hopefully you’ll be able to make some delicious home-churned recognition butter of your own before long! Other programs include value spotlights, employee-of-the-month programs, referral programs, and spot recognitions.
The main point of a recognition program is to get as many people involved in, and excited about, recognition as possible. You need a variety of programs so everyone can be involved—for instance, if only the sales team is really involved, they may really enjoy work but everyone else may feel left out or disengaged.
What Are Employee Recognition Programs?
A recognition program is any program that’s set up to recognize and encourage employee achievements.
Overcoming Challenges in Implenting Employee Recognition Programs
If recognition programs are so great, why doesn’t every company have a massively robust system and dozens of programs? Well, it’s not that simple. At Awardco, we’ve run into a few general challenges when talking with new clients:
- Too manual. Manual recognition takes a lot of time and a lot of work, especially if there is no way to scale up as the business grows. Processes that involve multiple people and require follow up on manual tasks are rarely as successful as they could be.
- Inconsistent organization. Every organization, HR team, and employee is different, so it makes sense that with recognition, some people are celebrated while others are overlooked. This inconsistency is a hurdle that leaders often don’t want to try and tackle.
- Insincere feelings. The act of recognizing employees through a program or system may feel insincere, especially depending on the rewards offered. If a company assumes that pins, plaques, or mugs are their only options, they may think recognition isn’t worth the investment.
- Lack of direction of purpose. If a program isn’t value- or purpose-driven, employees can see right through it, and, chances are, they won’t participate. In this case, programs quickly become another item on leaders’ to do lists for them to unenthusiastically check.
- Minimal rewards. Recognition programs that don’t really reward employees (with either actual rewards, cash, points, or just good feelings) won’t last long.
There are business size- and industry-specific challenges that many companies face as well.
Challenges of Recognition for SMBs
The main challenge small businesses run into is the time commitment. Small businesses usually have a small HR team, and these team members are already overrun with their responsibilities. They may not have time to add more boxes to tick.
Another potential challenge is budget. Many small businesses run a tight ship, and they may not have the budget to spend on lavish gifts and rewards in order to make programs worthwhile.
These companies may run into problems with buy-in as well. They can struggle to get employees to participate, and they may also struggle to get leadership to buy-in on investing money into recognition.
Challenges of Recognition for Mid-Market and Enterprise
A difficult hurdle to overcome for larger companies can be the price. With hundreds or thousands of employees, it can be expensive to make recognition programs and provide rewards for everyone.
Buy-in is another problem that larger companies can face, but in a different way than SMBs. For example, with thousands of employees, how do large businesses ensure that everyone is involved and using the program? How do they get everyone excited to participate so they see the best ROI? Large companies of course have to get leadership buy-in as well, which can be difficult.
Large companies may assume that recognition won’t be rewarding enough for their plans. After all, enterprise companies are known for creative, far-reaching solutions, and they may fear that recognition will be too narrow when it comes to rewards.
What Are the Benefits of Recognition Programs?
Now that we’ve talked about the potential challenges of implementing recognition programs, let’s lay your fears and worries to rest by going over the awesome benefits.
Specific Solutions for Specific Challenges
There are three main ways to find the peace of mind and confidence you need to obtain buy-in into employee recognition.
Inspiring Employee Recognition Examples and Ideas
8 Employee Reward and Recognition Program Examples
- Service awards
- Value-driven spot recognition
- Peer recognition
- High performer nomination
- Health and wellness
- Employee Appreciation Day
- Team accomplishments
You may already have ways to recognize top performers or celebrate holidays, but in order to reach everyone in your organization, you’ll need a holistic system with several targeted programs. Now let’s dive into each of these for a little more detail.
Traditionally, service awards have been things like an acrylic trophy after ten years or a commemorative pin after five. However, in our modern world, service awards need to change and improve. In fact, generic rewards that aren’t personalized to each employee’s interests and personalities can actually be harmful rather than helpful.
To ensure that your employees feel like valued individuals instead of an unimportant cog in an uncaring machine, you need to give them a reward that is meaningful. And even though traditional service awards are given out every five years or so, every single year an employee stays with you is worthy of celebration! Especially because the median tenure at a company is about 4 years—so instead of waiting until year five to recognize someone, start at year one and boost your retention.
Value-Driven Spot Recognition
This program allows leaders to recognize a team member whenever they do something great or noteworthy. Send a note, give a high five, leave a comment, or give them a genuine compliment. Any sort of meaningful on-the-spot recognition will make employees feel good, so you really can’t go wrong here. Here are a few things to keep in mind:
- Be timely. Don’t recognize someone for something they did a few weeks ago. Give them a shout out as soon as you can, and they’ll be much more likely to repeat the behavior.
- Be specific. The more specific you can be, the better. If you want specific behaviors to continue, you need to acknowledge and show appreciation for those specific actions.
- Make it simple. Awardco integrates with Slack, Microsoft Teams, and more to make recognizing people easier than ever. The easier spot recognitions are, the more people will do them.
Incentives are a great way to…well, incentivize people to hit their goals, perform at a certain level, or pick up a certain behavior. Whether you set up a sales incentive, an incentive to take a security training course, or an incentive to post a company review on Glassdoor, these are great for getting employees involved and excited.
As a manager and leader, you can do a lot for your employees. However, peer-to-peer recognition is a vital part of any recognition program as well. Because peers work closely together and see each other often, they probably know each others’ strengths and contributions better than anyone. Peer recognitions are great for letting coworkers compliment each other.
High Performer Nominations
This could be an employee-of-the-month program, but it doesn’t have to be. You could reward this every quarter and make the award really impressive. You can also change the name to fit your culture, such as the “Super Squad,” “A Team,” or “Groovy Gang.”
Health and Wellness Programs
Creating a wellness program is a great idea for any company. Employees need to take care of their bodies and their minds in order to perform at their best level, and a wellness program can incentivize healthy behaviors, such as walking a certain amount each week, eating healthier, or meditating each day.
Employee Appreciation Day
Did you know that Employee Appreciation Day is the first Friday in March every single year? This is the perfect opportunity to do something special for your employees! Make the day meaningful by offering specific recognitions for each employee that highlight the value they bring. Here are some other ideas:
- Have managers recognize the individuals on their teams
- Buy lunch for the whole company
- Hand out company swag
- Award points on the Awardco platform
Individual recognitions and spotlights are amazing, but so many projects are a team effort—so let teams celebrate together. Recognize entire teams and reward them all with points, food, or similar things so that everyone can feel good about their contributions.
What Kind of Recognition Do Employees Want?
It’s easy to think of recognition in broad strokes, but every employee is different, which means everyone wants to be valued, complimented, and recognized in different ways. Here are some things to keep in mind so that everyone is satisfied with your programs:
- Recognize often. The first thing to keep in mind is that all employees want recognition. Period. Don’t be afraid to recognize too much—just because a task is commonplace or monotonous doesn’t mean an employee isn’t giving their all every day.
- Decide on public or private. Don’t pull employees in front of a crowd if that will embarrass them. And don’t avoid public shoutouts for those who enjoy the spotlight! Get to know your employees to make recognition as effective as possible.
- Start where you are. Don’t wait until you have the “perfect” recognition plan in place. 82% of employees want more recognition, so just start where you’re at. Give out compliments, write some notes, hand out bonuses or points—these are all great places to start.
Employee recognition isn’t a puzzle to figure out or a hurdle to overcome. It’s all about recognizing the value that each of us brings to the table and conveying appreciation and gratitude.
You know more about employee recognition and you know the awesome ROI of implementing more programs in your business. So now what? Well, considering Awardco lets you create custom programs, offer expansive rewards, automate processes, and recreate your culture, we say the next best step is to chat with us. Let’s make recognition a part of your company!