Effective Employee Recognition for Your Business

A generic approach to recognizing employee performance can deprive companies of the very benefits reward programs are trying to obtain.

Effective Employee Recognition for Your Business

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Most employers operate employee recognition programs, marking everything from good performance to job longevity. But that doesn’t automatically produce engaged employees. There can still sometimes be a disconnect between employer and employee.

The solution to closing the gap? To use a clothing metaphor, organizations need to focus less on a generic, one-size-fits-all approach and more on rewards tailored toward the things that make employees feel purposeful, important and significant, says Kathie Sorensen, an employee and management development consultant.

“According to our research, an employee wants to be known as a unique human being, not copywriter No. 3 or accountant No. 4,” says Sorensen, a co-owner of the Coffman Organization. She also wrote a book (with Coffman Organization co-owner Curt Coffman) entitled Culture Eats Strategy for Lunch: The Secret of Extraordinary Results

“One size doesn’t fit all,” Sorensen says. “That kind of recognition rarely gives you the kind of lift that you’re after. I like recognition programs that are flexible enough and adaptable enough that the local manager can use them in a way that fits each person — it gives them a lot of different ways to recognize people.”

The power of meaningful and strategic employee recognition programs is undeniable, as seen in various studies. One study showed that companies with effective programs enjoyed 31% lower turnover than those with ineffective programs. Another determined that 65% of employees leave an organization because they don’t feel appreciated for doing good work. Yet another showed that employee recognition is a top engagement driver. In addition, evidence shows that recognition programs can boost productivity and innovation, decrease employee absenteeism and stress, improve customer retention and encourage positive behaviors.

“Organizations get more of what they reinforce,” Sorensen says. 

Yet despite the overwhelming evidence, many companies don’t even offer recognition programs. These kinds of organizations tend to focus more on pointing out what employees do wrong instead of recognizing what they do correctly.

“That’s the antithesis of a strength philosophy,” Sorensen says. “Sometimes companies get obsessed with weakness correction — the notion that if I point out your weaknesses and help you correct them, then I’ve somehow contributed to your development and success. But just not being wrong doesn’t make you great. A culture like that makes it hard for employees to take risks because they’d rather be safe than wrong. So people feel stifled, even though we want them to create new processes and new ideas about products and services. 

“If you really want excellence, you have to pay attention to it — start to recognize what’s going right and see glimmers of excellence all around you. It’s not as if too much recognition will spoil employees or stop them from working harder.”

Then there are the companies that do offer recognition programs, but their very creators torpedo them. How? They insist on rewarding employees with meaningless things that don’t resonate with the people they’re designed to motivate. And much of that stems from managers who don’t, as Coffman puts it, “attend to the essence of what employees are.” In other words, they focus more on recognizing what an employee did instead of rewarding them with something that’s truly important to them.

Moreover, these misguided efforts usually occur because managers don’t develop good relationships with employees — and don’t delve even a little into their interests and personal goals.

“It’s one of the simplest and most powerful tools managers have,” Sorensen says. “Have you ever been in a restaurant and the waiter knows who you are and brings your favorite drink before you even ask for it? That’s what I’m talking about.” 

That’s not to say managers should start serving employees martinis and margaritas. But managers who get to know their employees well can develop keen insights into things they find valuable. For example, a good manager would never “reward” a harried, time-pressed worker with four children by taking them on a business trip, for instance. A gift certificate to a family restaurant, tickets to a nice entertainment event or an unexpected day off might be far more appreciated. On the other hand, a business trip might really resonate with a young, single employee who the manager knows is very interested in developing broader work experience and getting promoted. 

“It’s not rocket science,” Sorensen says. “You only get a return on your (recognition program) investment if you pay attention to the things that help you leverage the energy of people.” 

Managers should also carefully consider who presents the award or reward. Some people might prefer recognition from their immediate supervisor, while others might be thrilled if the company owner stepped in to make the presentation.

“For some employees, recognition from a customer trumps everything else,” Sorensen says.

In addition, some employees may enjoy a public presentation, while others may prefer getting recognized during a private, one-on-one session. 

The bottom line: If your company offers a generic recognition program, it’s time to take a different tack. By the same token, management needs to promote people-oriented managers who are capable of getting to really know their direct reports. Those two endeavors will lead to a recognition program that’s tailored to fit individual employees, which beats an off-the-rack approach every time.



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