Over the years, employee recognition has become a crucial part of any organization. However, simply having an employee recognition program is different from having an effective one. This is because what feels like appreciation to one employee might be meaningless to another. With this in mind, there is a huge gap in employee recognition within organizations. The employee recognition gap is the difference between what employers think is meaningful recognition for their employees’ efforts from what employees expect. Failure to bridge the significant employee recognition gap results in unhappy employees, which could severely hinder your company’s success. This gap will lead to:
- High turnover rates
- Low productivity
- Disengaged workforce
- Low morale
- Lack of coordination within departments
Many companies spend billions trying to fill the recognition gap with cash rewards, merchandise, and awards. However, research still shows that employees are dissatisfied with the recognition they are receiving. This indicates that companies are using employee recognition programs but are not doing enough to appreciate their employees.
So, what is the best way of recognizing your employees? What are employee recognition programs, and why do they matter? How do you create a successful and sustainable employee recognition program? We are here to answer all your questions and help you learn how you can make your employees feel valued and appreciated with effective employee recognition software.
What are Employee Recognition Programs?
An employee recognition program is an employer’s initiative to reward employees for their outstanding work, new achievements, and anniversaries milestones. Recognition can be something as simple as an open acknowledgment or praise of an employee’s achievement. Organizations use it to motivate employees or enforce desirable behaviors within the workplace. To ensure employee satisfaction, your company should focus on a more holistic approach when designing your employee recognition program.
In the past, employee recognition programs mainly focused on motivating employees. They included:
- The employee of the month programs
- Incentive programs
- Gift card programs
Today, employee recognition programs are more than just employee compensation and benefits. Companies have understood that employee recognition plays a crucial role in employee engagement and fostering positive workplace culture, among other benefits that can bring success to any organization. To achieve this, you’ll have to use effective employee recognition software to develop meaningful rewards that help employees feel appreciated. So, where do you begin to build a successful employee recognition program? Read on to learn how you can create effective employee recognition programs and how they can benefit your company.
Why Does the Employee Recognition Gap Exist?
Employee recognition programs try to bridge the great employee recognition gap. But why exactly does the employee recognition gap exist? The employee recognition gap exists because employers and other company executives do not understand what actually motivates their workforce. They assume that recognition means the same to everyone. These assumptions have led to incentives that are stuck in older strategies and methodologies.
True employee recognition is more complex than just thanking employees for their years of service. The mistake many business leaders make is investing in outdated incentives without taking the time to understand what their employees actually need.
To employees, recognition involves having systems and practices that reassure them of their value to their company. It should show them that they have a purpose and that their success matters. Employees feel appreciated when their managers hold meaningful discussions and talk with them about their work.
When a staff member does something good, your feedback should naturally surface during the discussion of their work. However, managers who fail to work closely with their employees, making it difficult for them to acknowledge and validate their contributions may end up relying on tangible rewards. The employee recognition gap exists because:
- Recognition is more than praise
- Recognition is more than merchandise
- Recognition is more than money
- Recognition requires involvement
- Recognition is partnering
Filling the employee recognition gap requires making employee recognition a practice that’s integrated into your culture, rather than simply giving an award.
The Benefits of Filling the Gap
Employees want to be recognized for their extra efforts and accomplishments. Therefore, having an effective employee recognition program can help fill the gap by making your employees feel valued. This will motivate them to keep up with their excellent work and continue contributing to the success of their team and your business in general. So, why is employee recognition indispensable? Here are the benefits of filling the employee recognition gap by regularly giving your employees authentic and deserved recognition.
Foster good workplace culture
Company culture is an essential part of your brand — a valuable asset to both your customers and employees. When your company values align with your employees’ values, they will feel valued and empowered. Employee recognition programs can help you improve your company’s culture. Recognizing your employees for certain behaviors and contributions will create a happy and healthy environment. Your company will become a place they want to work at and be part of. This will create a positive workplace culture where employees feel good about the work they’re doing.
Increased productivity
Recognizing your employees for their contributions and efforts will motivate and encourage them to be more productive. You’ll have motivated employees who know what they have to do to be recognized. Chances are that they will keep performing well because their contributions won’t go unnoticed. A Deloitte research shows that recognition improves employee engagement, productivity, and performance by 14%. There is nothing more important than having an engaged workforce. It significantly reduces absenteeism and increases productivity. Motivated employees are more creative and think outside the box, knowing they’ll be recognized.
Improves teamwork and collaboration
Employee recognition programs motivate employees to achieve goals by bringing teams and departments together. They emphasize peer-to-peer recognition by ensuring that an employee’s contributions to a team’s success are recognized and appreciated. Team members will have a sense of purpose that will encourage them to commit themselves to producing meaningful results and contribute to their teams’ success. This promotes cohesion and unity among teams in your organization. This is especially important in the age of remote and hybrid work.
Boosts employee wellbeing and health
Productivity goes hand in hand with an employee’s health and wellbeing. An effective employee recognition program improves your employee’s mental and general health. It is a reliable tool for curbing stress that arises from strenuous work. It creates a feel-good factor in your employees’ minds, allowing them to have a positive attitude towards their work. Prioritizing employee mental health and wellbeing promotes an innovative and creative workforce with lower absenteeism rates. Recognition programs cater to your employees’ wellbeing, making them feel more connected to their work and the organization.
Better employee retention
An effective employee recognition program helps employees to take pride in their work. It will create a positive environment with happy employees who care more about their work and company. This significantly reduces employee turnover. When you have a hostile working environment, employees will leave for better opportunities. This will substantially affect your company. The costs of hiring and training new employees are higher than utilizing your existing ones. A great employee recognition program increases employee retention, allowing your company to continuously provide high-quality products and services. Implementing successful employee recognition programs can reduce turnover and help you keep your productive workforce.
Improved customer satisfaction
It goes without saying that happy employees make happy clients. When you have happy employees, they will provide better customer service and support. Strenuous work in poor working conditions demotivates your employees. When tensions are high, it creates a stressful and pressured environment that will lead to poor service delivery. With an employee recognition program, you’ll have a conducive environment with happy employees who’ll do an excellent job at serving your clients. This will strengthen employee-customer relationships, which will, in turn, boost sales and increase profits.
What Should Employee Recognition Programs Do?
An employee recognition program should have an impact on your business by reinforcing company-specific behaviors, practices, and activities that enhance employee performance and bring more positive results to your business. Therefore, your recognition program should be impactful, engaging, and help increase retention. You can implement one or more employee recognition programs that consider the various employee achievements and milestones. Your recognition program should help you assure your employees that their personal contributions bring value to your company.
Generally, employee recognition programs should:
- Encourage engagement: An employee recognition program will keep your employees engaged in their work. It motivates and significantly improves the overall engagement rates of your employees, boosting productivity and encouraging creativity.
- Attracts top talent: An optimized employee recognition program helps build a workplace culture that attracts the most talented employees to your company. Top skills in your business are vital in helping your brand stand out. When highly gifted workers look for a job, they’ll want to join a workplace that recognizes its employees for their contributions. Therefore, an effective recognition strategy will significantly help you recruit the best workforce in the market.
- Improve retention rates: These programs should create a conducive working environment where workers feel recognized for their work and accomplishments. This increases the retention of quality employees and reduces turnover rates. You cannot underestimate the recruitment cost you’ll save by ensuring a high retention rate.
- Boost performance: Optimized employee recognition programs motivate and make employees feel like part of your organization — a family-like place. When employees are recognized and appreciated, it encourages them to aim higher and achieve higher goals. This significantly improves an employee’s performance and morale.
- Enhances your company culture: With an augmented recognition program, employers take time to acknowledge their employees’ efforts, showing that the company cares for them. This brings workers, employers, and teams together, fostering better working relationships.
How Do You Build a Holistic Employee Recognition Program?
A company can only make the best out of its employees with an effective employee recognition program. Therefore, when a recognition program fails to work, the most likely cause is that it wasn’t built properly. You need to consider the various needs of your employees. When the standards are set too high, it’ll demoralize your employees. This is also the case when you reward your employees for meeting basic job expectations.
You can build a holistic employee recognition program by:
- Defining realistic but challenging performance standards
- Regularly improving your recognition program to keep up with your employee’s motivation
- Avoiding a one size fits all approach.
- Incorporating reliable job performance measurement criterion
- Providing motivating and cost-effective rewards
- Focusing on desirable actions and behaviors required to meet your business objectives
- Developing specific guidelines to ensure the recognition programs run smoothly and are accepted
- Implementing multiple recognition programs to meet various needs
- Creating a committee to evaluate recognition criteria that consider the interests of your employees
Employee Recognition Program Best Practices
By now, you can clearly see how crucial and beneficial employee recognition is. So, how do you build an effective one? There are various practices you can adopt when creating an employee recognition program that’ll help you make the most out of valuing your employees.
Let’s look at some of the best practices for an employee recognition program.
Take a more inclusive approach to recognition
HR managers should ensure that all workers are given an equal opportunity to give and receive recognition, irrespective of their level or department. They should all receive credit for their outstanding work, and the criteria used should favor all workers. Having transparent and equitable recognition software will give your employees a sense of belonging and incentivize them to work extra hard.
Have a clear objective
Rather than having a generic recognition program, you should have clear objectives. Generic recognition programs do not show your employees that they are valued. Before implementing an employee recognition system, it should first answer the following questions:
- Why does your organization need it?
- What behaviors or actions will be rewarded?
- How will you appreciate your employees?
- How often will recognition occur?
- How will it impact your employees and organization?
This will help you describe what a person did, why they exceeded expectations, and why they need to be recognized.
Make recognition personal
An employee is part of your organization’s family. Therefore, appreciation should not feel like a transaction, forced, or normal. The recognition program should cater to all your employees at a personal level. You can use recognition to show your employees that you appreciate who they are and what goes on in their lives. You can utilize the many personal milestones like birthdays or anniversaries that deserve acknowledgment. A simple congratulatory note or personalized message can go a long way.
Give your employees a voice and choice
Rather than assuming that you know what your employees need, you should allow them to pick their own way of celebrating their hard work. Options can make all the difference. A gift card may delight one employee and sit in the wallet of another.
Make recognition frequent
Your team does great work all throughout the year. Therefore, you should appreciate your employees early and more frequently to build momentum and enthusiasm. When you see something good, no matter how small, you should give credit as soon as possible. Appreciating the small contributions of your employees motivates them to stay on track and focused. You can create a culture of praise by encouraging it peer-to-peer recognition for even their small inputs and efforts.
Tie to your company values
You should align your recognition program to your company’s core values and purpose. It should show your employees that they are doing an excellent job in line with your organization’s culture.
Employee Recognition Program Examples and Ideas
Successful employee recognition programs involve finding the right rewards to give your employees. Your first thought might be to provide monetary rewards, but that’s not the only option. There are many other different ways you can recognize and appreciate your employees and show them that you care. We have compiled some great ideas to get you thinking about how your company can acknowledge and empower your workforce.
Monetary employee recognition
These are monetary or tangible rewards given to employees for their contributions. Monetary recognition rewards include:
- Paid vacations
- Spa day
- Commissions
- Retail gift cards like premium music subscriptions
- Retirement and healthcare plans
- Tickets to a concert, festival, or sporting event
- Salary increase
- Bonuses
- Paid memberships
- Electronic gifts like smartphones
- Paid career development seminars, classes, or coaching sessions
Non-monetary programs
Most employees appreciate being recognized using non-monetary rewards. These can include:
- Personalized trophies or awards
- New office space
- Yearbook publications
- Job security and enrichment
- Parking space
- Free lunch
- Job promotion
- Achievement certificate
Verbal and written appreciation
Verbal compliments can be used in various work situations. Giving your employees a “Thank You” note will motivate them and show them that their efforts did not go unnoticed. It is also a great recognition tool for introverted employees.
Peer-to-peer and manager-to-employee recognition programs
Peer-to-peer recognition comes from a person that an employee works with. They frequently interact with them and understand the nature of their work. Employees value recognition when their value is authenticated by those who know and understand their job. Managers should also recognize their employees for their outstanding work. Recognition programs are great tools for rewarding the positive impact of your employees.
Public recognition
Employees feel more valued when they are recognized publicly rather than being praised alone. Therefore, you should let everyone at your company know about their colleague’s achievements. You can appreciate your employees publicly by:
- Sending out an internal employee newsletter
- Giving praise during company meetings
- Posting on social media platforms
- Recognizing them at company events
- Mentioning them in press releases
- Posting a recognition on your company’s wall of fame
- Giving praise through an internal communication channel
Private recognition
If your employees prefer to be recognized privately, you can appreciate them for their efforts by:
- Writing a “Thank You” note
- Sending an appreciation mail
- Sending a gift card to their home address
Not only should recognition be fun and rewarding, it needs to be well-received. Your employee’s recognition experience should be memorable and meaningful. Remote and hybrid work means you may need to get more creative in your approach. Partnering with an employee recognition platform with a global presence can take the guesswork out, and offer a variety of solutions to recognize your remote and in-person teams in meaningful and thoughtful ways.
Milestone-based recognition
Employees are rewarded for reaching certain milestones within your company. These are related to an employee’s achievements from their first day at the organization. These can include:
- Work anniversaries
- Scheduled employee reviews
- Project completion
- Hitting sales targets
This can also include the many different employee events in the employee’s lifecycle, including birthdays, appreciation days, or the first day at work.
The Bottom Line
Recognizing your employees not only feels good, it’s good for business too. Therefore, you should strive for a successful employee recognition program that rewards employees for their performances that positively impact your company. By making recognition part of your company’s culture, you’ll build a happy, motivated, and connected workforce that will want to work hard for your company. With technology transforming how companies operate, companies can leverage recognition software. That makes it easier for employees and managers to recognize other employees’ efforts and contributions as they happen. Therefore, whether you’re implementing a new recognition system or would like to improve the existing one, Refresh is here to help you make the most out of it. We can help you save time and resources by implementing an effective employee recognition software that will leave your employees feeling valued by your company. Contact us today.