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Did your organization celebrate National Employee Appreciation Day on March 1? Do you have a program in place to reward excellent work? Recognition in the workplace is crucial to building a successful business, so if you haven’t given it much thought, now may be a good time to start.
A recent Gartner report revealed that 46% of HR leaders plan to increase their investments in HR tech and recognition platforms, and if you’re wondering where those investments will go, Acumen Research and Consulting offers a hint: According to the market intelligence firm, employee recognition systems will occupy a market share of more than $34 billion by 2030.
Why the focus on employee recognition? The hope is that by boosting rewards and recognition, employee satisfaction and retention will go along for the ride.
Sounds easy, but how do you figure out what your workers really want, which program best aligns with your goals or whether the system you have in place is out of touch and pushing your employees to look elsewhere? As with most things, the best place to start is by looking within.
What Your Employees Want
Remember when it was enough to feature the “employee of the month” on a plaque or throw a pizza party for a high-performing team? Rewards have changed, but the workplace itself isn’t all that different from what it was back then, said human performance and organizational psychologist Dr. Bobby Low, head of people science at Motivosity in Lehi, Utah.
“The problem is the approaches we were using to motivate employees didn't work,” he said. “What we've learned from motivational psychology and from the research is that, as humans, there are deeper things we want from our workplace and from our environment.”
How people like to be recognized and what motivates them varies, so getting input from employees helps leaders develop an effective recognition program, added organizational consultant David Ballard.
“A lot of time, energy and money is wasted on recognition efforts that aren’t aligned with employee needs and preferences,” Ballard said.
Low offers some tips.
First, employees want to know their work is impactful, valued and seen by others. They need assurance their efforts are contributing to the company’s mission and helping their team improve, said Low. They want to build a positive relationship with their manager along with a level of autonomy and empowerment. Frequent, consistent, meaningful appreciations from a peer or manager check all those boxes, inspiring employees to repeat positive behaviors.
“It's not just the recognition; it's saying, ‘thank you’ that makes it meaningful,” said Low.
To create a positive work experience, employees also need to feel they belong, added organizational psychologist Greg Stevens, senior director of people analytics at Workhuman in Columbus, Ohio. A robust program means employees receive recognition from a variety of sources, for many reasons and calibrated to the work accomplished.
“Employees want recognition programs that both build connections and provide them with financial incentives or rewards that acknowledge them for a job well done,” said Stevens. “According to our research with Gallup, employees who receive the proper type and amount of recognition are five times more likely to feel connected to their culture, five times more likely to see a path to growth within their organization, and four times more likely to be engaged in their work.”
Consistent, ongoing cash incentives make people happy, too, he added. In fact, a recent Workhuman pulse survey found that 47% of employees prefer receiving spot bonuses throughout the year, compared to a larger lump sum delivered annually.
Related Article: How to Navigate the Relationship Between Recognition and Reward
Do Recognition Platforms Account for Human Psychology?
We’re all wired to crave acceptance and connection, and studies show that when we feel a sense of belonging, appreciation or gratitude, our brains are flooded with “feel-good chemicals” — serotonin and dopamine — which enable us to better manage stress.
Research also shows that activating the reward center of the brain — by giving or receiving a thank you, for example — boosts our overall mental well-being.
In the workplace, these feelings can help employees feel invested in an organization and its success. A 2020 study in the UK reported that 78% of respondents admitted they would work harder if they received more recognition.
Yet, while some employee recognition platforms are based on good science, others seem to ignore that evidence altogether, said Ballard.
“We know that recognition is more effective when it’s tied to a specific behavior, given soon after the behavior is exhibited, repeated frequently, is in a form valued by the recipient and provided by someone significant to that individual,” he said. “If your program and platform are based on those principles, they’re likely to produce better results. If not, then buyer beware.”
Stevens suggests companies consider programs based on five pillars of strategic recognition:
- Fulfilling, providing employees with a consistent, reliable experience of being appreciated, valued and validated.
- Authentic, with meaningful gestures of recognition relevant to each employee’s day-to-day work.
- Personalized with input from workers.
- Equitable to avoid favoritism or biases toward specific races, genders and age groups.
- Embedded to key values within the organization, making recognition an important culture-building tool.
“When recognition programs are designed this way, we’ve seen positive impacts across talent and business outcomes like greater engagement, lower regrettable attrition, better safety records in plants and greater productivity,” said Stevens.
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There Are Many Ways to Show Appreciation
Recognition and rewards can be cash-based, such as pay raises and bonuses, or non-monetary, such as awards, recognition events, expressions of gratitude from peers or supervisors, being highlighted in a company newsletter or being chosen for a desirable project or assignment. Recognition can also focus on individual, team or organization-wide performance.
There’s a wide range in the quality, features and analytics of recognition platforms. Some are now focusing on company-wide recognition versus top-down pats on the back, encouraging coworkers to shout out a team member’s good work.
But even the best programs will be ineffective in the absence of good strategy, implementation and evaluation.
“Recognition platforms are just tools. Employers should start by determining what they’re trying to accomplish, the strategies that will best help them get there and how they’ll measure success,” said Ballard. “The best choice will be one that makes it easier to achieve those goals, while being user-friendly, cost-effective and providing analytics to help you make good decisions and improve your recognition program over time.”
Regardless of which technology you implement, your recognition program will only be as effective as the level of participation from everybody in the organization saying thank you, noted Low. Too many technology platforms have become vehicles to give people swag or gift cards. “What gets lost in the exercise is the actual meaning and reason behind why you're giving people stuff.”
For example, one of Motivosity’s taglines is, “Thanks matters,” and Low says it’s meant to flood organizations with gratitude and appreciation at every level.
Related Article: Want to Keep Your Best Employees? Value Their Expertise
Do You Really Need a Rewards Platform to Build Culture and Foster Inclusivity?
Of course, leaders can create a positive work environment without an engineered tool, but Low says at large companies, it’s challenging to thank 1,000 people on a regular basis with a personal phone call or meaningful gesture.
“That effort takes lots of time and energy, so having a technology to help speed that up allows you to scale,” he explained. “Beyond just leaders leveraging it, we've specifically engineered the technology to recruit every person in the organization to say thank you. We've put in a lot of behavioral nudges and behavioral science to recruit everybody to participate.”
For example, in addition to push notifications, users get $5 to give away to someone they appreciate before the end of each month. If you don’t use it, it disappears.
“That little nudge motivates us to seek out opportunities to say thank you,” he said. “I can't think of a better way to build inclusivity than give everybody $5 and let them give it to their peers and team members to say thank you for the good work being done. And when you give that to leaders and managers and let them do it from a top-down perspective, it has a big impact.”
Stevens says that advancements in recognition technology, specifically in the realm of AI, can also be a valuable tool to promote inclusivity.
“For example, AI can be used to help employees understand if they’re unintentionally exhibiting biases or microaggressions when delivering recognition moments and offer constructive feedback to make the recognition process more inclusive in both the short and long term,” he said.
Leaders Can Set a Good Example
Managers can also use the recognition platform themselves to reinforce the message that appreciation goes a long way. “People may need training and reminders to use it routinely,” Ballard said.
It’s important to monitor use of the platform, so you can quickly address any barriers or issues of equity and inclusion that may arise. For example, do your onsite and remote employees have uneven access? Are any departments or business units not using the platform? Does it use responsive web design, so employees who primarily use mobile devices can navigate it easily? Are there firewall issues that block access for some people? Are there language or accessibility issues that need to be addressed?
“Problems like these may not be obvious until you see actual utilization data and analytics,” said Ballard.
Recognition programs are most successful when everyone actively participates and is empowered to recognize the great work going on around them.
“Leaders have an important role in ensuring that level of empowerment and modeling the behaviors they want to see in their teams,” Stevens explained. “By using the technologies at their disposal and rooting recognition programs within the five key pillars, business leaders can foster inclusivity in an impactful way, and strengthen cultural bonds in the workplace.”
Related Article: How to Equitably Handle Employee Recognition in a Hybrid Workplace
Recognizing Good Work Is Easier When You Have Clear Goals
In the psychological contract between employee and employer, there’s an expectation of reciprocity, Ballard said. And it’s that the reward and recognition we receive will be on par with the effort we put into our work.
When employees feel valued, he added, they usually have higher job satisfaction, motivation and work effort, and are less likely to leave the organization. So, rather than list employee recognition as one item on a long to-do list, think of it as a way to bring out your team’s best performance so they’re inspired to help boost your organization’s bottom line.
To have the most positive cultural impact, leaders should work to tie their recognition program and platform with the organization’s broader mission and core values, employee well-being efforts and human capital practices.
“A program that’s out of sync or in conflict with the way the organization operates is unlikely to produce the desired outcomes and could even backfire and result in cynicism and negativity,” Ballard said.
By learning what motivates your team and using recognition not as a perk but as a key tool, you, as a leader, can reinforce great workplace behavior and advance company objectives.
