Forbes' Research Unlocks the Secret to Employee Recognition
27 October, 2014
In June 2012, Forbes contributor, Josh Bersin, who analyzes corporate HR, talent management, and leadership released the results of a comprehensive research project on employee recognition. The results were astounding.
Here's what he found:
- Employee recognition items such as gold watches, pins, thank you awards, plaques, etc. account for a $46 billion market.
- Companies spend 1-2% of payroll on these items.
- 87% of recognition programs focus on tenure (how long you have been employed with a company) and have virtually no impact on organizational performance.
- Organizations that built a "recognition-rich culture" giving regular thanks to their employees had a huge impact on business performance lowering voluntary turnover rates by 31%.
5 Best Practices of A Recognition Based Rewards Program
- Recognize people based on specific results and behaviors. Don't just give them "employee of the month". Give them an award for delivering outstanding customer service when a particular problem occurred. This creates a culture of "doing the right thing."
- Implement peer to peer recognition- not top down. Recognition from leaders has less impact than you may think. While HR Managers believe this is the key criteria for success, employees told Forbes that they feel much better when they are recognized by their peers. Why is this? Peers know what your're doing on a day to day basis, so when they "thank you" for your efforts, the impact is much more meaningful. Top down recognition is often viewed as political and it rarely reaches the "quiet but critical high performers" of the company. Modern high-performance recognition programs are "social"- they let anyone in the company recognize anyone else. The thank you's are totally public and displayed on a "leader board" so anyone can see them.
- Share recognition stories. One of the most powerful practices identified was "story telling". When someone does something great and is recognized by their peers, tell people about it. Not only should they get a reward, but you should mention them in a newsletter or company blog. These stories create employee engagement and learning.
- Make recognition easy and frequent. Make it trivially simple for employees to recognize each other. Many of the modern programs Forbes studied gave all employees a budget for "points" or "dollars". People who do great things are now visible to everyone else.
- Tie recognition to your own company values and goals. When you give some a "thank you" award, the award is tied to your company's strategy (customer service, innovation, teamwork, or even a revenue or cost cutting goal).