Even with the most sophisticated AI tools and software, at the heart of every business are human resources or people, and people are intrinsically wired to want to feel valued and appreciated.
As companies become more competitive and work to attract top talent, the way they acknowledge, recognize, and reward their employees becomes more important. Because of this, a key role for HR and managers is to create and implement an effective employee recognition program and foster a workplace recognition culture.
What is Employee Recognition?
Employee recognition is acknowledging an employee’s work and contribution to the company. It’s about appreciating your staff’s hard work and dedication and the effort they put into their job. Recognition can also mean acknowledging an employee’s loyalty and years of service.
In most cases, recognition is carried out by management and supervisors, but recognition can also come from peers and colleagues who work closely with each other. Some companies may encourage employees to praise and recognize each other, which can boost morale since employees who work together have a better idea of each other’s hard work and efforts.
Types of Employee Recognition
There are several ways to recognize employees, such as top-down and peer recognition, but how you recognize an employee depends on the situation. It’s also important to note that employees seek recognition that feels personal, as opposed to generic recognition that companies were able to get away with years ago.
Many people assume that the only way for people to feel valued is by monetary rewards or lavish gifts. Sometimes, a simple ‘thank you’ and an acknowledgment of their achievements are sufficient to make an employee feel valued and recognized.
Each person and team is different, so it’s the management’s job to know what motivates their team and adapt their recognition program accordingly.
Common types of employee recognition include:
Managers, supervisors, or peers can privately recognize someone by thanking them for their efforts and praising their achievements one-on-one. You can also verbally acknowledge an employee publicly during a meeting or event with their colleagues and seniors present.
Acknowledging an employee’s contribution by sending them an email or letter is a great form of recognition since an employee can go back to it and reread it. Written recognition usually verifies that they’re doing a good job and is a relatively cost-effective method to recognize employees.
Probably the oldest form of employee recognition, formal recognition is typically structured. Usually, formal recognition is part of a company’s recognition program. In most cases, employees are aware of the program and may work towards being recognized.
Common formal recognition programs may include employee of the month rewards, challenges that staff have to work towards, and performance reviews.
Another common type of formal recognition is work anniversaries, where employees are rewarded for being with the company for a certain number of years. Depending on the company, employees may be rewarded with paid time off, a bonus, or a gift for five, ten, or twenty years of service.
Often overlooked, informal recognition can do wonders to boost morale. Informal recognition is typically spontaneously praising an employee for their efforts. You can do this in person one-on-one, in a meeting, or via text.
Informal recognition is a fantastic way of showing employees that even their small, day-to-day efforts don’t go unnoticed since it’s not possible to reward every action that goes into making a business a success.
Monetary compensation for good work makes employees feel valued and that their efforts are appreciated. Typical bonuses include compensation, quarterly or year-end performance bonuses, and thirteenth checks.
Bonuses are a great way to create a high-performance culture since employees are rewarded with something tangible when they achieve their goals.
Besides bonuses, companies may offer other rewards to show appreciation for their staff. This can include paid time off, gifts, and prizes. Some companies may incentivize employees to work towards something or create an online employee rewards program.
For example, a popular incentive is creating a sales challenge where the sales rep with the highest sales may be awarded an all-expenses paid trip. This type of recognition is particularly effective for competitive employees.
Each type of recognition is essential and can be used in different scenarios to reward various achievements and efforts. Still, it’s crucial to pay attention when you recognize employees.
Big events like year-end functions, quarterly meetings, and town hall meetings may provide a good platform to award larger achievements or give formal recognition. Managers can use smaller staff meetings to praise employees for completing small projects well and on time.
Benefits of Employee Recognition
When people feel that their efforts are appreciated, they are more likely to be happy at work, and job satisfaction can play a significant role in the productivity and success of an organization.
Still, it’s crucial to remember employees are not all the same, and everyone reacts differently and may be motivated and inspired by different things. On the whole, some benefits of recognizing and rewarding employees include the following:
- High-performance culture
- Attraction top talent
- Lower staff turnover and increased loyalty
- Increased motivation
- Increased productivity
- High rates of job satisfaction
- Improves overall morale
Managing Employee Recognition
Apart from informal recognition, employee recognition should be consistent and implemented with a plan. It’s helpful to develop an employee recognition program that allows you to take a strategic approach to rewarding employees.
It’s a good idea to use appreciation software to track rewards, recognition, and milestones so that everyone in the company is aware of their colleagues’ achievements.
When creating an employee recognition program, you must consider the following:
- Communicate clear goals
An employee recognition program should have clear goals that are communicated to the staff so they know what they’re working towards.
- Consistent and timeous
Ensure that recognition is carried out consistently and timeously, as this is the most effective. It’s best to reward employees soon after reaching a goal or dedicate recognition to specific times, like once a quarter. Being inconsistent with handing out rewards can cause staff to become disillusioned.
It may be easier to incentivize some staff over others, but this is a sure way to demotivate employees. When developing a recognition program, be sure that there’s something for everyone to work towards.
For example, a recognition program only about achieving sales will disengage everyone except the sales team. If your company has a sales challenge, finding other ways to recognize employees in other departments is a good idea.
It’s natural for people to want to feel appreciated. To this end, employee recognition is crucial in keeping employees happy and motivated because a happy staff is a driving force toward the success of a business.
- Quantumworkplace: The Importance of Employee Recognition: Statistics and Research
- Surfoffice: 12 Types of Recognition and Rewards
- Greatplacetowork: Creating a Culture of Recognition
- Applauz.me: The Importance of Employee Recognition
- Bonus.ly: Types of Employee Recognition and Rewards
- USBank: 5 steps for creating an employee recognition program
- Bonus.ly: How Do I Build a Successful Employee Recognition Program?
- Achievers: How to Build an Employee Recognition Program