Why you may Need to Re-think your Employee Rewards Program

Callie Rushton, Director of ImplementationEmployee Engagement, LeadershipLeave a Comment

It’s no surprise that when people feel valued at work, they are more likely to go that extra mile to get the job done. It’s also no surprise that any organization would want their people to be willing to put forth that kind of additional effort. The question is, how do you actually make your employees feel genuinely valued?

Fair compensation and good benefits are certainly parts of the equation. So is giving employees an opportunity to voice their ideas and concerns in a meaningful way. But perhaps most important of all is recognition.

Many employers understand this and have made an effort to institutionalize recognition in their workplaces. Leaders often think that big, fancy rewards programs are the best way to do this. These formal programs may take the form of a big bonus given at the end of the year, or a fancy annual luncheon with plaques and trophies given out to company stars. Then there are less fancy (but still formal approaches) like having honoring an Employee of the Month.

But do these things really make people feel recognized for excellent work? Do they have a tangible impact on employee engagement?

For some employees, the answer is undoubtedly yes. But for many, this formulaic approach to recognition doesn’t feel special or meaningful. In a world of work that has turned almost everything into a clear process, people may be missing the human touch when it comes to feeling appreciated.

If your rewards program isn’t having the intended effect on engagement, you might want to consider the following questions:

1) Are you catching all employees?

One of the biggest pitfalls with rewards programs is the selection of winners. Often, rewards are based on the most visible performance, so they tend to favor “sexy” jobs, like sales or product development that produce more tangible outcomes (think: this new partnership with a big client, that cool new gadget).

These deliverables probably didn’t come about in a vacuum, however. Someone contributed to managing that client relationship that the salesperson capitalized upon, or they actually came up with the idea for the gadget that the product development specialist ended up bringing to life. When only these more visible roles are recognized, others who were involved in the process may feel ignored, unappreciated, and ultimately disengaged. Those working behind the scenes may no longer be motivated to put forth their best effort, since they’re never appreciated for it anyway.

Additionally, when the same departments or individuals are rewarded over and over again, it can breed resentment among team members. For example, a call center we worked with tried out a rewards system that allowed people who exceeded their call numbers to pick their shifts going forward. While this was great for people who exceeded expectations, those who had performed to quality standards quickly became disillusioned. Part of the initial job appeal was the flexible schedule, especially for single parents and those with other obligations. When this flexibility became available only to top performers, others on the team suffered, as they were no longer able to maintain the healthy work-life balance they had originally signed on for. Engagement for this group quickly declined.

When recognizing success, it’s important to take a holistic view of how the outcome was reached and ensure that people in diverse roles have a chance to be similarly rewarded. It’s also a good idea to consider how teams may be impacted by a competitive rewards system. While competition can be motivating within job settings, be wary of how it might lead good workers to begin grumbling through the bare minimum.

2) Is the reward something that truly motivates employees?

Time and again, we’ve found that monetary rewards aren’t particularly effective for enhancing engagement. This is because cash bonuses or gift cards tend to facilitate a culture wherein staff members work solely for monetary gain, rather than from a place of deep commitment. We’ve also found that public praise at a big event might backfire for two reasons: it feel stale because the victory was achieved long ago, or it simply makes people uncomfortable, particularly those more introverted employees.

Just because an organization has a program to recognize employees doesn’t mean they actually feel recognized. How do you change this? You should probably ask your employees what is motivating for them!

Maybe it’s a handwritten note or a verbal compliment. If this is how you decide to show appreciation, be sure that your praise is specific and personalized. “Good job!” won’t cut it; you’ll want to point out exactly what it was they did well by saying something like, “I know you’ve been trying to improve your public speaking skills, and your comments in that meeting were really insightful and well-delivered! Nice work.”

There’s also the possibility that people feel most appreciated in indirect ways. If someone who is motivated by this type of recognition has just finished up a project ahead of schedule, you might consider offering them the opportunity to work on a new project, in implicit recognition of a job well done. Or perhaps you recognize how hard they have been working by giving them the option to work from home a few days a month in an effort to support their work-life balance.

Regardless of these specifics, we’ve found that what people value the most across the board is appreciation of small wins in real-time. So often we accomplish important things but don’t take a moment to stop and appreciate what just happened because people are demanding our attention elsewhere. Leaving space to celebrate the little wins, while also encouraging coworkers to recognize each other’s hard work, can help create a culture where recognition is the norm. None of this is to say that all rewards and recognition programs are bad and we should abandon them tomorrow. But it does suggest that infusing the organizational culture with more informal recognition practices may be the ticket to increasing people’s sense of feeling valued. Organizations should first think about the people being recognized, and then build or reform the rewards program based on what’s actually meaningful for employees.