Companies with higher recognition cultures have as much as 30 per cent lower voluntary attrition rates A higher recognition culture is where everybody in the organization is a stakeholder
Organizations are a larger collective of their employees. And it is the work of the employees, which resonates in the organizational performance. The relationship between ‘great work’ and organization’s performance is directly proportional and both these elements are interdependent.
People Matters in partnership with O.C. Tanner, conducted a series of roundtable conferences in the month of July on “Great recognition leading to great workplaces” with an aim to define what constitutes great work, what differentiates it from good work, and how consistent recognition of great work can trigger a ripple effect on the performance of employees and the organization as a whole.
This article aims to decode how a culture of great work can be created in organizationsby using recognition and appreciation.
What is ‘Great work’?
“Great workis making a difference that people love,” defines David Sturt, EVP, O.C. Tanner Company. Elaborating on this further, he states that two elements define great work — the value that it creates, and the love and acceptance it garners from people. Great work is achieved when a person ventures outside the boundaries of ‘good work’, and delivers what is unexpected of the person — something outside the job description! It is an inch ahead of good work, and takes the outcomes miles ahead. Great work results in high impact, creates value, and the differentiator between good and great organizations.
Leaders understand that great work is followed by an upsurge in performance, and an increased level of engagement. However, the questions that revolve in their minds are – ‘How to enable employees to do great work?’and ‘What causes employees to do great work?’ The essence of the answers lies in the ‘Great Work Study’by O.C. Tanner. According to the research, as many as 37 per cent people said that the most important thing a company could do to inspire them to do great work is “recognize them”. This percentage was the highest, and more than “promotion” and “increased salary” which only received 4 per cent and 7 per cent respectively.
Evidently, it is ‘recognition’that drives great work; and recognition occurs when great work is done. Sir Isaac Newtonwould explain this as– every act of recognition has great work as a reaction, and the process is replicated when the variables reverse position. But when was decoding Newton simple! In simpler terms, it is a sequential pattern, where both elements are interdependent and one triggers another. The longer it is operational, the greater momentum it picks; and the greater the momentum, superior is the performance.
A culture of (recognition of) great work
According to a study by Bersin & Associates, “companies with higher recognition cultures have as much as 30 per cent lower voluntary attrition rates.” So a culture of recognition in an organization not only gets the best from its employees, it is also instrumental in retaining talent. The inability of organizations to recognize great work is much more than an opportunity lost. “Being silent is the loudest message you send when you don’t recognize great work. It implies that the organization doesn’t care,” articulated Sturt in the roundtable conference. It is not about having a formal recognition program, engraining it with the organizational culture is crucial if it is to be made a magic multiplier of great work and organizational performance. A study by Bersin & Associates also reveals that 3 in 4 companies have a recognition program, but only 58 percent of employees believe and know that their organizations have these programs. That is a big discrepancy and this can only be corrected by integrating recognition programs with organizational culture.
During the conference, there was unanimity among the participants on the importance of creating a great work recognition culture; however the most concerted question was “how.”
Here is how organizations can create a culture of great work.
Architecting a culture of great work
To create a culture of great work, the recognition practice has to be fine-tuned with the rhythm of the organization. The decisive components in the process include, ‘the timing’, ‘the manner’, and ‘the stakeholders’. The timing (when it is done). Great work should be identified and recognized as and when it happens. Recognizing great work is not about periodic formalities; this must come naturally, consistently and without delay when great work is done and value is created. Companies may have a monthly session of identification and recognition of great work, and another yearly practice of rewarding great workers. Identification and appreciation must happen regularly, but rewarding needs to be intertwined with the organizational practices. Another research by Bersin & Associates shows that 70 percent of the surveyed employees stated that they are either recognized annually or not at all. In such cases, it is tough to keep a count of the missed opportunities of recognizing great work, and appreciating the effort in doing great work.
The manner (how it is done). The RoI of recognition programs reaches an optimum level when every act of great work is recognized. The defining aspectis doing it publicly. It should be integrated with team meetings by sharing the great work stories of the employee(s) being recognized. It has a ripple effect on the fellow team members (leaders and peers alike) who get motivated to be the protagonist of such great work stories. According to the Great Work Study by O.C. Tanner, 35 percent of respondents cited that they themselves would use recognition to motivate their peers. It loses value when it is made into a one-off formal program. Formal projects are either shrugged off as soft HR activities or struggle in engaging employees. The non-motivated employees await programs to fizzle out, and practices triggered by formal programs turn into mere formalities in some time.
The stakeholders (who is involved). The answer to this question is straight-forward. It is ‘Everybody’. A higher recognition culture is where everybody in the organization is a stakeholder. So every employee, starting from top management to the bottom of the organization’s pyramid must recognize and appreciate great work. Best cultures are created from the top. Recognition from the CEO to someone lower down the hierarchy initiates a chain reaction, and it trickles further down in the organization. Constant identification and recognition of great work by (all) employees reinforces the culture of great work.
David Sturt of O.C. Tanner highlights a four-step approach that can be followed to create a culture of recognition of great work—educate, encourage effort, reward results, and celebrate careers.
Educate. Leaders must teach employees what great work entails, how it aligns with the company objectives, and adds value in coherence with the organization goals. The next step is to educate and train managers to recognize great work of employees in their teams, share their stories in team meetings, and encourage them to replicate the practice.
Encourage effort. Once people switch to ‘practice mode’ from ‘knowledge mode’, the onus is on leaders as well as peers to encourage the effort. It is the encouragement from leadership that has a greater impact though. Employees who are embarking on the journey of risk-taking must be encouraged to do it, and managers and leaders must be the ever-present support system. If a cost benefit analysis of this step was to be done, it would all point towards the ‘benefits’ direction. There is absolutely no cost involved in encouraging, but the gains are immense in the long-term. It also motivates employees to continue exceeding the boundaries and strive to do great work.
Reward results. If efforts lead to results, they should be rewarded. Recognition must be done in proportion to the value created. So, there should be different rewards for different instances of great work. Creating categories of recognition, and tying them to the scale of great work is the key. The top rewards can translate into recognitions during bigger occasions or events, where a collective of great work is recognized, and individual recognition can be done every month, and incorporated into the culture. The objective is not to miss out on any act which created a value for your organization. Rewarding great work may not always call for a literal ceremony, but it must be done ceremoniously so that it becomes a ritual in the organization. Multiple researches indicate that people desire non-monetary awards.
Celebrate careers. Continue recognizing great work and integrate the practice while celebrating career milestones. Involve top management in the act, along with all the stakeholders and grab that opportunity to share a bucket of specific great work stories of the individual. This has a motivation impact at three levels — it significantly multiplies the impact for the employee being recognized, the CEO is encouraged with the prospect of the great work being done in the organization, and the fellow compatriots feel motivated to stay at the company and do great work.
In theory, recognizing great work is crucial; in practice, it is decisive too; in reality, it doesn’t entirely materialize. A disproportionate amount of effort is put in conceptualizing and executing a recognition program but more often than not, it is shrugged off as a soft HR activity. But if the definition of great work is comprehended accurately and the recognition programsare aligned with the organization’s goals, there is no reason for recognition programs to not have a return on investment. The roadmap to make it successful is to measure it at the program level, cultural level, and most importantly business level. That is the intersection of the Venn diagram of business and HR. If the HR leader can integrate it in the culture and show measurable outcomes to the CEO, the recognition of great work is bound to bolster organization’s performance.
The Great Work Study
O.C. Tanner’s The Great Work Study is the largest-ever study of award-winning work comprising
• 302 Fortune 100 senior executives
• 10,000 cases of award-winning work
• 250 interviews with difference makers
• 1,013 leaders, employees, recipients
BehavIors that enable great work
• Ask the right question
• See for yourself
• You are 17x more likely to create passion for the work
• Talk to your outer circle
• Employees who talked to their outer circle were 3.4x more likely to impact finances
• Improve the mix
• Deliver the difference