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How can you ensure your employee recognition program is successful? Your employees may be aware of the program, but awareness alone won’t magically improve their performance and engagement. “More than 80 percent of American employees say they do not feel recognized or rewarded, despite the fact that U.S. companies are spending more than a fifth of their budgets on wages,” according to a recent study by Harvard Business School. If you only recognize and reward your employees occasionally, you’re just wasting time and resources. Adoption of your employee recognition program can be strong, but employees just being aware of the program doesn’t move the needle when it comes to improving their behavior and engagement levels. Recognition can be short lived and in order to have a lasting impact on your workers’ engagement and morale, you need to offer frequent acknowledgment of their efforts. For that reason, you must engineer your employee recognition program around streamlining ways for people to appreciate each other every day. Here are the two foundations of frequent employee recognition that will help you do just that:
1. Rewards must be decoupled from recognition
We always see these two words together, but they are two separate events — and they must operate independently in order to bring the greatest effect. Your recognition strategy should lead with non-monetary recognition. The reason for this is that people want — and need — more from their jobs than just income. “Cash matters in people’s lives, but it’s not all that matters,” according to Harvard Business School researcher Amy Whillans.“What really matters in the workplace is helping employees feel appreciated.”
Social recognition — that is, having colleagues and managers express their appreciation for a specific effort — is enormously powerful in building engagement and improving performance. The impacts of social recognition are very similar to monetary recognition as long as the recognition is specific and transparent when it comes to describing the behavior demonstrated. Employees who receive frequent recognition are more likely to stay with their company, and are more aligned with company goals. Achievers research has found that 44 percent of employees who switched jobs cited lack of recognition and reward as the reason. Furthermore, the ROI of peer appreciation extends to overall organizational success. When companies use a social recognition program, they are four times as likely to improve their stock prices, and twice as likely to have higher NPS scores. Having employees guide employees with peer-to-peer and non-monetary recognition can make a significant impact on continuous participation in your recognition program. Streamlining social recognition means that people can give each other frequent expressions of appreciation.
2. Rewards should be low dollar value
Does this seem counterintuitive? If so, you may have to reconsider your thinking around rewards; remember, rewards have to be frequent in order to be effective, and your budget isn’t limitless. You have to look into the best ways to optimize your rewards budget and start reevaluating how to maximize your budget. When you set the reward amount lower per recognition, it naturally has the effect of encouraging more frequent recognition. Lead with low-dollar rewards to see how you can get the most bang for your buck. One way to facilitate frequent small rewards that still amount to meaningful items is to use a point system. The team at Discover found that the points-based Achievers recognition program is “a big driver in results and behaviors and it fosters a sense of unity within the organization.” After launching their recognition and rewards program with Achievers, an Employee Success Platform, they found that their sales increased, customer satisfaction improved, and voluntary attrition decreased.
Point accrual also generates its own anticipatory excitement, which encourages employees to find reasons to recognize each other more often. By consolidating all types of recognitions into a unified point system, including years of service and specific achievements, employees can easily build up substantial point balances. They’ll enjoy looking forward to redeeming their points for a reward that’s personally meaningful to them, rather than just being handed another Starbucks card or generic mug. In this way, the employee recognition program underlines their unique individual value to the organization.
Employee recognition programs that work
When General Motors (GM) sought to transform their company culture, across workers on six continents, they turned to Achievers. They wanted to align their workforce, so that everyone would be on the same page as far as company values and mission, and they knew that Achievers had a solution that works across borders and time zones. They launched our point-based employee recognition program to 67,000 employees in 26 countries. Eighty-seven percent of these workers were active on the platform within the first month, sending over 80,000 recognitions in that period. GM’s people leaders have embraced the program, sending out an average of 4 recognitions each month, and 8 out of 10 managers also send out at least one recognition every month. In an engagement survey after six months, recognition was one of the top five improved areas.
Quest Diagnostics, which processes almost half a million medical tests each day, had brought a new CEO on board. His first goal was to build a culture of positivity. After introducing their employee recognition program, powered by Achievers, nearly 100 percent of managers became involved with sending recognitions, and they send them out almost daily, on average. A 25 percent reduction in employee turnover resulted, among staff of the managers who sent out the most recognitions. Watch this video below to learn more about Quest Diagnostics’ success story:
The Very Group
When U.K. retailer The Very Group (formerly Shop Direct) had to reinvent itself for the digital marketplace, employees felt frustrated and undervalued. After kicking off their employee recognition program with Achievers, The Very Group saw employment increase by 17 percent. Fully 97 percent of employees activated the program, and they’ve been sending out an average of 7.6 recognitions per month.
CHRISTUS St. Michael Health System
This Texas-based healthcare provider was looking for an effective way to boost employee engagement and increase worker retention. They wanted to let every employee know how valuable their contribution is, and create a culture of positivity throughout the organization. The results speak for themselves: Employee turnover shrank to 6.4 percent after introducing the Achievers Employee Success Platform, and that’s in an industry with an average turnover of over 19 percent.
Recognition frequency is key
Frequency is the most important factor in determining whether your employee recognition program will succeed. Choosing the right employee recognition platform that streamlines and encourages frequent, ongoing appreciation within your organization is the most direct way to achieve that success. To learn more, access our webinar recording, “Why Most Recognition Programs Fail and How to Fix It.”