Create a culture that means business™
Are you an HR professional who’s eager to give your company the advantages of a technology-based social recognition program? When you make your pitch to key executives, you need a way to define and quantify the benefits of such a program. Below, we line up five positive impacts of recognizing and rewarding your employees; present these to anyone who cares about your organization, and you can’t help but win them over!
Impact on individual workers
Worldwide, only 15 percent of workers feel engaged at their workplaces, according to Gallup research , and even in the U.S. “the majority of the workforce (51 percent) is not engaged.” Hopefully, your numbers are better than this, but there’s probably still room for improvement. And what are those not-very-engaged workers up to all day? A lot of their time is spent browsing the web, looking for other jobs. One Achievers study found that 44 percent of employees who switched jobs cited lack of recognition and reward as the reason. Furthermore, Harvard Business Review points out that “40 percent of employed Americans say they’d put more energy into their work if they were recognized more often.”
Impact on managers
While social recognition programs are usually evaluated in terms of improving worker competence and attitude, it turns out that instituting a culture of recognition also has an impact on manager behavior. Managers who learn to provide their employees with well-targeted positive feedback on a frequent basis actually become better leaders. This increase in management skill will have a powerful impact throughout your organization. Additionally, when workers are more engaged, their managers feel better about being able to deliver on productivity goals. Gallup notes, “Highly engaged organizations also hold their managers accountable — not just for their team’s measured engagement level, but also for how it relates to their team’s overall performance. They ensure that managers are engaging employees from the first minute of their first day at work.”
Impact on financial success
The people in your company who work on nailing down the bottom line are used to looking at hard figures: They can tell you exactly how much effect your cloud server cost or shipping rates have on this quarter’s profits. They may not realize that it’s equally possible to attach numbers to the benefits of improved worker wellbeing. A Harvard Business Review study shows that when a program was implemented in which workers’ strengths are recognized by managers, it resulted in happier workers (of course) and also in a 14 to 29 percent increase in profit. Other studies echo the point: Gallup research shows a 21 percent increase in profitability in companies with highly engaged workforces, and in our report, we present additional research that shows how social recognition affects company valuation.
Impact on employer brand
Working in HR, you know that a big part of organizational success depends on attracting top talent to your company. In today’s competitive marketplace, you have to be able to do something that makes your brand stand out from the crowd. Gallup puts the spotlight on 39 companies, as they hand out their “Gallup Great Workplace” awards. These companies “create a culture of engagement in which employees can continuously develop and thrive,” and on average, they have 14 engaged employees for every one who’s disengaged. Aon Hewitt annually measures worldwide employee engagement, including quantifying employee advocacy and interest in staying with the current employer. In their latest report, they note that “recognition for contributions (beyond pay and benefits)” is the top driver for these metrics. Social recognition programs that enable employees to express their appreciation for each other play a major role in creating a company culture that feels welcoming and positive.
Impact on customers
Customer loyalty is an easily-measured metric, and it will reflect the increased levels of employee engagement that result from workers feeling appreciated. The Institute of Customer Service asserts this point clearly: “It is now widely accepted that employee engagement is a critical source of competitive advantage.” The customer loyalty specialists at Smile.io note, “Studies have found that companies with high employee engagement scores had twice the customer loyalty (repeat purchases, recommendations to friends) than companies with average employee engagement levels.” The great thing about having happy customers is that it sets up a positive feedback loop. Social recognition can come from satisfied customers as well as from co-workers and managers, and it will add to an employee’s overall sense that they’re engaged in meaningful activity. Finding ones’s work meaningful creates a sense of alignment with the company’s mission.
The case for social recognition
The research adds up in a nice logical progression: A social recognition program is the most powerful driver for employee engagement, and engaged employees have a substantial impact on the company’s operation and financial success. Itemizing the impacts of rewards and appreciation will help you build a water-tight case for investing in HR tech innovations. To learn more, download our report, “Building a Business Case for Social Recognition.”