4 Tips to Create a Successful Employee Recognition Program

Quick look: 30% of individuals who leave a job within six months of being hired say they would have stayed longer if their former employers had recognized their efforts. However, properly recognizing employees’ hard work is often more complex than it appears. Here, explore the business advantages of expressing gratitude towards your staff, four tips on how to create an employee recognition program, and how a professional employer organization (PEO) can help.

The secret to keeping your valuable talent might be simpler than you think: showing genuine appreciation for their contributions.

According to recent research, when employees feel their efforts are “meaningfully recognized,” nearly two-thirds are less inclined to look for new job opportunities, and almost 60% are less likely to take a call from a recruiter.

Carefully crafted employee recognition programs, designed to encourage staff to excel by rewarding them for their dedication, can help achieve this. A successful program sets high behavior standards, provides workers with motivation and feedback, and publicly praises high performers by enabling business leaders, managers, and peers to thank other employees for their efforts and accomplishments.

The advantages of rewarding employees

Of course, commemorating hard work is a good thing, but the business advantages that can occur when you recognize employees may surprise you. These benefits are multifaceted and include:

• Reduced turnover: Data shows that 30% of workers who left a job within the first six months said being recognized more for their unique contributions could have encouraged them to stay longer.
• More cohesive operations: Having a well-defined employee recognition program, instead of showing appreciation in ad hoc ways, can help organizations:
  • Streamline and trace spending on rewards
  • More easily quantify the return on investment (ROI)
  • Reduce waste and increase security by eliminating one-off gift card purchases
  • Establish a common currency for reward opportunities across all departments
• Increased employee engagement: Public recognition boosts employee morale and encourages staff to connect with coworkers and the company’s values and mission.
• Cost savings and retained knowledge: Employee recognition programs can help organizations retain staff and avoid the hefty cost of replacing a worker and potentially losing institutional knowledge. Administering regular, lower-value rewards may also be less expensive than infrequent, larger ones and more strongly support a culture of recognition.
• Hiring advantages: Today’s top talent wants to know their hard work won’t go unnoticed. Sharing your employee recognition program with potential employees can increase your chances of hiring the best.

Research from Great Place to Work also reports that when each employee stands an equal chance at being recognized for their efforts, they are more than twice as likely to go above and beyond their regular duties. Further, the same research showed that staff are nearly 70% more likely to put in extra effort if they receive a genuine “thank you” from management.

4 steps to creating an employee recognition program

To take advantage of all the benefits that employee recognition programs can provide, employers must first take the time to carefully design an impactful plan. From choosing the right rewards to aligning the program to your company’s priorities, here’s how to develop a comprehensive strategy.

1. Determine what employees want

There is no one-size-fits-all reward that will appeal to every employee. Some workers prefer a gift card, while others want a public shoutout.

However, with the right research, business leaders can determine which reward options best match their workforce’s preferences. One way to do so is by administering an employee survey to identify which reward choices make the most sense for your organization to distribute.

Some common reward occasions and tactics include the following:

• Years of service award: Celebrating work anniversaries helps tenured employees stay engaged and encourages new hires to remain dedicated to their roles.
• Customer service award: Designed to reward employees in customer service roles when they receive positive customer feedback.
• Employee appreciation events: These can include company-hosted lunches, team outings, annual holiday parties, and more.
• Social media shoutouts: Leadership can encourage employees to praise each other on platforms like LinkedIn, or the company can highlight high performers on its corporate account.
• Employee of the month: Encourage peers or managers to vote for an exemplary employee and explain why they’re voting for that person.
• Peer-to-peer recognition: Enable employees to recognize each other’s accomplishments and contributions in person or via email, your organization’s collaboration tools, or a performance management platform.

2. Align the program with your company’s goals and values

At its core, an employee recognition program rewards staff members who positively impact the company. To do so, the program should revolve around the business’s goals and values and how individuals’ achievements contribute to them.

When rolling out the program, business leaders should clearly outline which core values or corporate goals they want to reward. Additionally, the program should be measurable and specific so that everyone can clearly understand why recipients are selected and their impact on their team and the overall organization. By sharing quantifiable results, the program gains more meaning.

The Society for Human Resource Management (SHRM) suggests creating a written policy, which can be included in an organization’s employee handbook, outlining the program that includes the:

• Eligibility requirements
• Approval process
• Types of awards that will be provided
• Frequency of award presentations
• Performance goals that will be measured
• Thresholds for awards

3. Identify peer and management recognition tactics

Employers should incorporate both peer-to-peer and manager-to-employee recognition tactics as they build their employee recognition programs. In particular, manager-to-employee methods should be a focus so there is no risk of leadership appearing not to appreciate their staff’s efforts. Many companies offer peer recognition programs, encouraging employees to recognize their teammates for going above and beyond.

Recognition can be given through email, phone or video calls, instant messaging, an employee engagement platform, or public shoutouts during meetings.

4. Encourage regular recognition

Thanking employees for their hard work doesn’t make much of an impact if it rarely happens. The more workers are recognized for their efforts, the more likely they are to feel appreciated, engaged, and motivated.

Business leaders should encourage staff to regularly recognize each other’s accomplishments, whether it’s on a daily, weekly, or monthly basis. And that regularity can pay off. Gallup highlights that a 15-30-minute weekly meeting between managers and their employees, featuring a moment of recognition, is the single most effective habit for developing high-performance relationships—surpassing any other leadership activity.

To ensure a culture of recognition is cultivated, the employee recognition program should be woven into the fabric of the organization at every level, from leadership meetings to new hire training sessions.

Saying “thank you” just got easier

Acknowledging your workers’ efforts may sound simple, but it takes careful planning to reap all the benefits an employee recognition program can provide. And with so many pertinent responsibilities, small- and medium-sized business (SMB) leaders may not have the time to hone their strategies to maximize improved employee retention, engagement, and attraction rates—things that can greatly benefit the company.

A professional employer organization (PEO) can help. For example, in addition to comprehensive HR, benefits, and risk and compliance services, ExtensisHR, a nationally recognized PEO, provides businesses with:

• Dedicated HR managers to help develop employee recognition strategies
• Affordable access to 15Five, an industry-leading performance management software that facilitates public and private recognition and 1-on-1 meetings where feedback and acknowledgment can be shared
• Training sessions focused on team building, management skills, teamwork strategies, and more

Your staff achieves great things and thoughtfully recognizing that can encourage them to stay at your company, instill within them a sense of pride, streamline operations, and attract more talent to your organization.

When employees feel appreciated, remarkable things can happen. Are you looking to create an employee recognition program or improve an existing one? We’re here to help—contact the experts at ExtensisHR today.