The importance of rewarding employees for high performance has long been recognized as a powerful management strategy to stimulate better morale and boost greater retention in an organization.
When properly executed, employee recognition programs not only positively impact recipients, but also influence their peers. While some may be incentivized to win awards themselves, others may simply appreciate that they are part of an organization that honors and respects its best workers.
Why Employee Recognition Programs Work
The psychology behind why employee recognition programs work is simple: people like to feel appreciated for the good work that they do. At the end of the day, employees aren’t just thrilled at the reward itself but at the fact that the company they worked for recognized their hard work.
The power of positive employee recognition, according to Susan M. Heathfield, writing for The Balance “can ensure a positive, productive, innovative organizational climate. Provide employee recognition to say thank you and to encourage more of the actions and thinking that you believe will make your organization successful.”
3 Ways to Appreciate Employees
Here are 3 ways that you, as a business owner, can show your staff your appreciation for a job well done:
Employee recognition awards positively charge a culture’s corporate atmosphere because they are a way for leaders to honor significant professional milestones achieved by their top business performers. It is particularly powerful if the awards are presented in a ceremonious way through a banquet at a restaurant or a special awards night after office hours.
Awards can be given in the form of Certificates, Cups, Lapel Pins, Medals, and Trophies. They can be given to both individuals and teams. Awards can be given for a wide range of accomplishments; for instance, Achievement Awards, Employee Service, Teamwork Awards, Employee of the Month, and Retirement Awards.
2. Paid Time off
For smaller accomplishments, like an exceptional high sales volume or handling a difficult customer service issue particularly well, small tokens of recognition are also motivating. Giving an employee who works long hours, paid time off, may seem like a small gesture, but it can mean a lot to the recipient.
An Employee Bonus Program is an effective way to reinforce positive performance. Its money well spent because it reduces turnover, and the last thing you want is for your stars to take their talent elsewhere.
Some people are so good at their jobs that they can’t be replaced. For instance: your business may have a star sales person who can outsell the entire sales department combined; or your business may have an IT employee who can solve your technology problems better than any outside consultants you’ve hired.
Keeping your top people onboard by paying them a bonus is far less expensive than the cost of lost productivity when a position is vacant. It’s far less expensive than going through the expense of a recruiting process, which involves advertising, resume scanning, interviewing, and running background checks. And it’s far less expensive than onboarding and then training a brand new employee.
When it comes to bonuses, you have many options to choose from, including profit sharing, year-end bonuses, and production-based bonuses. Moreover, not all bonuses need to be in cash. Allowing an employee the opportunity to telecommute might be a bonus. Presenting someone with a gift card could also be considered a bonus.
How to Start an Employee Recognition Program
When you first launch an employee recognition program, you probably imagine that it will quickly increase companywide performance. However, when you first introduce an employee recognition program, it may take a while for employees to warm up to it if you had no previous history of programs to keep employees motivated.
Some proven methods of rolling out an effective incentive plan is to reward small wins, avoid subtly harassing employees who remain indifferent, make all reward ceremonies or events fun rather than somber, keep the meritocracy process simple to understand, and stick with an employee recognition program even if its initially regarded with suspicion.
Rewarding employees is not only effective in mid-sized or large companies but can often work remarkably well for a small business, too. Such Programs can also work in all kinds of industries. However, to truly make employee recognition and reward work, you need to proceed with caution. Doing it all wrong will lead your business to a point of no return.
Regardless, rewarding your employees in the right way offers plenty of upsides for the future of your company. Invest your time and money to make it right, and you’ll reap the reward.