The priority isn’t the award, it’s the recognition experience
If recognition programs are seen as time-consuming, or “just another HR program,” or “too difficult”, the chances of them being implemented consistently become low. If it’s not consistent, it won’t be effective. And if it’s not effective, it’s not relevant. Many companies initiate recognition programs because their competitors do it.
However, today many organizations are also leveraging analytics and research to make recognition solutions more effective. Research shows that an effective recognition program pays for itself many times over. The global research we did for our New York Times Bestselling book, The Carrot Principle, proved that effective recognition increases employee engagement and decreases employee turnover. Which MD wouldn’t invest 0.5 percent of payroll to get a 10 percent increase in engagement or decrease in turnover? Once you get past “why” recognition is done, it is important to focus on “how” it’s done. Imagine the negative impact that would have if a ten-year employee received a long-service award from a Manager who just walked by, set it on their desk, said, “Here’s your service award,” and walked off. That manager just told that employee, and everyone around them, the company doesn’t really care. On the other hand, if analytics is used to inform managers on to how they should approach rewarding employees, especially those managers that deal across countries and across cultures, it has a powerful impact on the effectiveness of the solution.
When analytics supports decision making, it is not just useful to identify teams and individuals performing well, it is also useful to understand the various factors that drives success. The first step towards developing or buying a recognition system is to make sure that it’s easy, intuitive, and comprehensive. While the system is crucial to implement a reward program, the most important step is training employees and managers on how, when, and why to use it. Making it customized and personal is as easy as opening up systems to all employees so they can recognize each other. They know better than the senior leadership about who is doing a good job on a day-to-day basis. The senior leadership’s job is to make sure the appropriate values are set, to set a good example by recognizing others, and then to ensure recognition is happening consistently. Consistency creates effectiveness.
Despite the buzz around gamification, one must be wary of ‘gamifying’ recognition. When systems are used to create competition in recognition, the sad result is insincerity. Managers and employees all feel like they are giving and getting recognition as a game, not as a sincere show of appreciation for effort or results. Insincerity means ineffective recognition solutions.
The future trends in rewards are likely to be focused on the following points:
- Impact: Companies can no longer afford to do recognition just to be “nice,” it’s about engaging employees and communicating values.
- Symbolism: Awards that tie the company to the achievement and to that specific employee.
- Ease: For solutions to be effective, they have to be easy for managers and employees to consistently use.
- Inclusion: Inclusion of all employees, not just one group; and include families of employees whenever possible.
A software program for rewards isn’t going to have a big impact on the business. It is better than doing nothing and you’ll probably see a bump in the company measures. But that bump doesn’t last long. To be really effective, a recognition program has to become a part of the culture. It has to reinforce the values of the company. And the place where that happens most frequently is between manager and employee. So it’s important to train managers. Recognition takes the values of a company from the Board room to the lunch room.
All recognition companies can provide vouchers that offer access to thousands of awards, or experiences that can create memories, or merchandise awards the recipient might remember where it came from. The priority isn’t the award, it’s the recognition experience. The award should be appropriate to the achievement, and your system should help you determine that, but the power lies in what experience the manager gives. The goal is that the recipient will remember what they did to earn the award(s) and their associates will want to emulate the behavior. This is how values are reinforced and cultures are created. The best way to do that is with recognition solutions that strongly represent the company.