Performance Management & Rewards

Big Rewards

Organisations are leveraging recognition programmes to drive productivity and results

By Russ Banham

As the impact of recognition programmes has grown in recent years, so has the framework behind rewarding employees for exemplary work around the globe. They go well beyond acknowledging an employee for length of service. Best-in-class programmes incent specific employee behaviors and enhance overall workforce engagement and productivity. They can also encourage greater collaboration, generate out-of-the box ideas, and enhance esprit de corps.

Just in time, too. A well-crafted recognition programme can be a great tool to reduce turnover rates. Recognising employees for their unique contributions makes them feel their work has purpose, which contributes to their self-confidence and job satisfaction.

According to Gary Beckstrand, vice president at O.C. Tanner, companies who have the most success leverage the following three opportunities to recognise their employees:

Encourage effort: Providing opportunities for peers and leaders to notice effort being applied towards a result. Typically, the person hasn’t achieved a result yet, but the effort to attain a goal is obvious and a little bit of cheering inspires the person to keep moving forward.

Reward results: Recognising a person or team for achieving results that align with the department’s or company’s goals—big or small.

Celebrate careers: Celebrating a career milestone or years of service shows appreciation for a person’s body of work over time, and for the person as a whole—who they are and how they uniquely deliver their work.

“Encouraging effort lets a person know that they are on track, increases their confidence, and allows them to minimise distractions to focus on getting the work done,” Beckstrand says. “When results are rewarded, employees want to do more great work. Periodically celebrating a person’s contributions over time creates connection to the company— a sense of belonging and loyalty to stay and continue to contribute to the organisation.”

Employee recognition programmes, originally created in the United States, are increasingly taking on a global scope. Thanks to technology, many multinational corporations now have a single platform with a portal set aside to recognise employees for length of service, high levels of performance, and to generate specific behaviors. Technology creates a common framework, but the most successful recognition programmes are linked to the local customs of each country.

“Whilst there is a consolidated framework and common platform allowing the organisation to deliver recognition, the context is cultural,” explains Mike Ryan, senior vice president of client strategy at Madison Performance Group.

“We call this ‘localisation,'” agrees Anthony Luciano, senior vice president of marketing at Engage2Excel. “You have one platform that manages the programme across all countries, but the look, feel, and the rewards themselves are structured around employees at the local level, giving them access to local brands they value.”

If a division of a company is based in China, for instance, the employee recognition site should offer an authentic experience, with images of locales and popular locations, conveyed in the local language. “We’ve discovered that the latter alone improves global participation rates in the programme by as much as 20 per cent,” Luciano says.

Benefits of a Programme

The benefits of recognition strategies far outweigh the investment. “The science is now clear that employee recognition programmes drive employee engagement, which has a positive impact on retention rates,” Luciano says. “We’re seeing more and more programmes come up around the world.”

Over the last few years, three types of employee recognition programmes have predominated: length of service, performance-based rewards, and recognising specific behaviors (such as reduced workplace accidents or a higher close rate in sales). And in many businesses, all three are part of the overall programme. What drives the structure of individual programmes? Most often, it’s workforce goals. Different metrics drive different types of rewards. Some organisations want the reward to increase productivity, whilst others are more interested in generating higher employee engagement scores.

One way to increase employee engagement is by getting the workforce involved—and social recognition programmes do just that. “The most powerful recognition programmes are peer-to-peer, social within an organisation, mobile, and highly adopted,” says Derek Irvine, vice president of client strategy and consulting at Globoforce. “As workforces become increasingly global, the ability to recognise coworkers at anytime from anywhere in the world is a key factor in achieving the highest level of success in a recognition programme.”

Ryan agrees: “It gives younger employees, in particular, the opportunity to send and receive comments from colleagues via their smartphones,” Ryan. “It takes what used to be a manager walking by a desk and saying ‘good job’ and makes it into something the enterprise can participate in, amplifying the effect of the recognition.”

Another technology-based concept is the creation of a personal “wall” on a corporate website that contains notes and pictures commemorating employees’ achievements. Employees can even finger touch the wall on their mobile devices to thank their fellow colleagues. “It’s a great way for someone to feel appreciated,” Luciano says. “It also helps to spread feelings of pride and fellowship throughout the organisation.”

Social recognition is the ideal vehicle to call out length of service achievements during shorter tenures. “Today’s younger workers are more transitory than previous generations. They also have a different take on longterm loyalty. Consequently, you need to restructure the milestones to align with their shorter-term achievements,” says Ryan.

Ryan suggests that rewards be geared to acknowledge acts just a few weeks on the job. “It could be something as simple as a badge or an icon online in the social recognition system that shows that the individual has completed something like a particular certification,” he explains. “Other employees are apprised that the person, after just two weeks of service, has proven to be a team player.”

Performance-Driven Rewards

Irvine stresses the importance and significance of this type of recognition: “Recognition creates a bond between the giver and receiver (i.e. the employer and employee, or employee and colleague), that ultimately helps employees learn from successes and failures, and celebrate behaviors that embody company values,” he says. “Frequent, timely, and specific recognition encourages the right behaviors you want to see replicated in a company, and inspires a shared purpose and vision.”

Global Nuances to Consider

Some differences in approaches should be considered, depending on where you are located. For example, length of service will vary by country, and organisations should take that into consideration. In some cultures, it’s common for employees to spend their entire careers with one organisation. Similarly, the merchandise offered employees should appeal to the demographic.

“The merchandise needs to be sourced locally to ensure it is something popular in the particular country,” says Ryan. “It’s also important that the points redeemed for merchandise are based on the local standard of living. Giving someone $50 to buy products in Vietnam can be a week’s pay, whereas in Chicago it will buy dinner at a casual restaurant for two. The funding should be a logical percentage of what the employee earns overall.”

Some products need to be avoided at all costs, given the risk of offending employees. Whilst a watch is a traditional form of recognition provided employees in the U.S., Luciano points out that in China, watches, clocks, and other timepieces are signs of death, one’s life ticking away. “You also don’t want to give away a red vase in Japan and other parts of Asia, as it is associated with funerals,” he adds. “Yet the colour red is a sign of prosperity in China and should definitely be used. And no leather goods in India.”

He’s referring to the sacredness of cows in many parts of the country. “Interestingly, a great gift in India is food,” Luciano says. “It’s a sign of respect to give another person a basket of fruit or gourmet spices.”

Motivating Behaviors

Rewarding specific behaviors is beneficial to a company’s bottom line. This approach is different than programmes that recognise above-and-beyond performance by an employee, such as an innovation that results in a productive outcome. Rather, the reward is linked to a particular key performance indicator (KPI) like sales closure rates or a reduction in customer complaints, as well as various efficiency and cost-effectiveness metrics.

“Recognition is the best tool a company can provide their leaders to motivate specific employee behaviors,” reports Chris Winkelspecht, Ph.D., strategy and services director for Maritz Motivation Solutions. “Whether through an evergreen corporate programme that includes core values as recognition criteria or a short-term department-based campaign to shape a newly trained behavior, there are four factors to consider when motivating employees.”

Winkelspecht says the four factors include:

1. Define the value/behavior associated with the programme.

2. Communicate the operational definition, the recognition that can be expected, and why it is important for the business.

3. Ensure the behavior is recognised early, often, and publicly.

4. Deliver recognition that shows the recipient you know what they did, appreciates the impact of the action, and is personally meaningful.

KPIs are typically aligned with a company’s mission, values, vision, and objectives—hence they differ across organisations. “It comes down to what a company is specifically looking to achieve,” Ryan says. “Some link the reward to a traditional KPI, whilst others based them on markers they have created, such as a metric defining a high degree of collaboration or improved customer service.”

Peter Hart, CEO of Rideau Recognition Solutions, says it is important for companies to define the particular employee behaviors they need to achieve a specific KPI. “If you want to hit a golf ball [250 metres], you need to learn how to swing the club—that’s the behavior,” he explains. “Same is true in sales. If you want a salesperson to do a certain number of sales calls per day or close a specified volume of deals per month, you need to be sure they are trained to do it. To drive this behavior, you might reward the person for completing an educational programme.”

The actual rewards also have expanded beyond the usual online merchandise to reflect an individual employee’s pastimes, pursuits, and goals. Engage2Excel uses a reward as a lure to perform specific actions. “If you know someone has a hobby, we can link the reward to this hobby to incent a particular behavior,” Luciano says.

He provided the personal example of a highly productive employee on his team who wanted more training to increase her knowledge and expertise. “She never finished [university], but it was important to her to go back to school,” he says. “She was such an exemplary employee that we’ve rewarded her with an online programme to get her diploma, which has made her even more motivated.”

Makes great sense. “To tighten the bond with employees, you need to know what drives them,” he says. “Everyone is motivated differently.”

Russ Banham is a Pulitzer-nominated business journalist and author of more than two dozen books, including histories of Ford, Boeing, Airstream and other Iconic companies


Research Snapshot

Findings from Globoforce’s WorkHuman Research Institute show a direct correlation between recognition and engagement. 82% of employees said being recognised made them feel more engaged; 79% said they work harder when recognised; with an additional 78% citing increased productivity.

Increased engagement means increased employee morale: 72% of highly engaged workers said they were excited about change, and 95% of workers said they were happy at home. Additionally, 86% of employees said they felt happier and prouder at work as a result of being recognised, whilst 85% said recognition made them feel more satisfied with their jobs.

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