A Guide to Employee Rewards and Recognition Programs

Recognizing and rewarding performers and encouraging good future efforts is a long-term strategy for gaining loyalty and keeping a valuable workforce. Most startups fear going through this route because they may perceive it to be expensive and this would hamper their growth objectives. The good news is that non-financial benefits are just as important as financial incentives. In fact, many employees specifically prefer them.

Employee rewards and recognition

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Acknowledging work pays off in the long run, and the time spent recognizing it will probably lead to a more thoughtful and personal approach. So it’s an effective way to motivate your employees. Here is a guide to employee rewards and recognition program. Keep reading;

Designing Rewards and Recognition Programs

Creating a rewards and recognitions program is a 360-degree approach that should involve the management and employees. Because the programs are developed for employees, they should be allowed to share their views and provide feedback.

Here are the three steps to a successful reward and recognition program;

1. Identify What Motivates Employees

Developing rewards and recognition programs involves identifying what motivates your employees. Good recognition starts with collecting feedback from your employees and evaluating whether the current reward systems motivate them. Talk to them and ask for their ideas on what they’d like to be included in a reward system.

Based on your findings, you can develop a customized recognition system depending on the motivators and preferences of the employees.

2. Communicate

Once you’ve decided on the best reward system for employees, the next step is to communicate the criteria along with behaviours, qualities, or aspects that warrant a reward. Effective communication helps employees to understand the nitty gritty of the reward system and how to perceive the expected outcomes. It also ensures timely recognition of employees, which is vital for the effective running of the program.

Some companies may use supervisors’ performance reviews to decide who to recognize. Managers should cascade this information to the employees so that they can know the evaluation criteria.

3. Implementation

Implementing the recognition program is the next step in making it work. Start by allowing it to run and make changes when needed. When creating a recognition system, leave room for future adjustments because circumstances and situations may change. Additionally, enable employees to give feedback from time to time and modify the system after evaluation.

Examples Of Employee Rewards and Recognition Programs

The need for recognition in the workplace is a recipe for success as it motivates employees to work harder to achieve their objectives. There are various ways to recognize employees, through words and actions.

1. Recognition Through Words

Words may seem trivial; however, they are the most obvious signs of recognizing an employee at the workplace. Every day in an employee’s work life, the little details count and motivate them to put more effort into their work. Words such as “Bravo”, “Thank You”, and “Congratulations” are powerful and simple phrases that you can use to recognize your employees.

2. Recognition by Acts

Showing recognition also means appreciating your employee through actions. Minor acts of kindness can allow your employees to learn, develop and exceed expectations. Because work locations, environments, job levels, and types may vary, a reward program that incorporates both cash and non-cash incentives can accommodate the needs of all employees. Remuneration, performance bonuses, and pay increases are essential levers for recognizing and motivating teams.

Employee Recognition Programs Increases Business Productivity

Implementing employee recognition programs can dramatically impact your company’s fortunes in a big way. A report by Gallup shows that adequate motivation enhances motivation and workplace retention. Highly engaged teams can increase profitability and improve customer relations and overall turnover. These aspects ensure stability, growth, and profitability.

In the second quarter of 2021, the same report shows that up to 36% of employees are involved in their work which greatly impacts their work efficiency. Through recognition, employees can see what achievement looks like and are motivated to work harder.

A highly motivated team will presumably stay longer in your organization because they take pride in being part of the team. Low employee turnover can save your company in terms of training costs and time spent hunting for few workers.

Besides, a company with low employee retention may suffer long-term, and customer numbers may dwindle. Another report by Gallup shows that employee recognition can save companies up to $16.1 million through retention.

A 2021 study shows that intrinsic rewards or employee incentives can elicit positive reactions and motivate them to improve their work. Also, a reward system can minimize employee issues such as absenteeism and lack of commitment.


Employee rewards and recognition programs are most effective if you align them with your company’s culture, goals, mission, and vision. This way, your employees can identify with them since they connect to the company’s values. The rewards should be timely and delivered soon upon achievement by an employee.


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