Employee Appreciation and Recognition – What, why, how, when?

The What?

Employee appreciation or recognition is the act of giving positive feedback based on performance or results. It is the act of communicating to your employees that you value their contributions. Employee recognition is one of the best possible approaches for employee retention.

The Why?

Employee appreciation is paramount for creating a positive work culture and positive customer experiences. The desire to be appreciated is at the core of human nature and according to psychologists, sincere appreciation is one of the best strategies for employee retention and happiness.

According to Bersin & Associates, companies which have a culture of employee appreciation have 31% lower turnover rates. 

It is no surprise that employee appreciation is directly linked to employee engagement, job satisfaction, and  happiness at workplace. It has a direct effect on employee morale as well. When you appreciate your employees, it inspires them to work harder, it aids their professional development, and all-in-all, it creates a positive corporate culture where people love to work. 

A study by SHRM found that for 48% employees, recognition was very important.

A culture of appreciation and recognition creates a company culture where everyone gives their best. This, is a worthwhile goal to have for any organization.

The best part of employee appreciation is that is it doesn’t require any elaborate preparations, it doesn’t cost much, and is not very time consuming. However, demonstrating employee recognition creates colossal outcomes. So, is there any good reason why you wouldn’t focus on it? Any initiative which provides such disproportionate return on investment is a must do for all organizations. It is business school 101.

Appreciated employees are happy employees and happy employees are engaged employees. Engaged employees result in happy customers, and higher customer satisfaction results in more word of mouth, and ergo, more revenues.

Employee engagement activities are expensive and require weeks or months of planning. However, employee appreciation and recognition, which pretty much have the same effect on the business, can be started without spending much time, resources, or money.

Employee appreciation has been found to be directly linked to trust building as well. According to a survey, 86% employees who were recognized in the last 30 days trusted their boss while only 48% of those never recognized said they would trust their boss. 

Employee recognition and appreciation is fast emerging as a strong tool for employee engagement and professional development.

The How?

Employee appreciation can be public, or private. Public recognition, however works better. As they say – praise in public, criticize in private.

Some simple employee recognition or appreciation activities include simple gestures such as:

1. shoutouts on the company intranet

2. leaving them a recommendation or endorsement on social media (Linkedin)

3. sending them a handwritten note

4. sending them a thank you email while keeping their team members and seniors copied

5. providing them positive feedback for a job well done

All these can be done remotely as well, and you dont need to be in the office for these.

These appreciation gestures need not be shown only by managers. In fact, peer recognition has been shown to be extremely important for faster professional development of employees. It is more organic as well. A corporate culture which promotes and rewards employees for recognizing their coworkers is key to building an engaged workplace.

An SHRM survey has shown that peer to peer recognition is 35.7% more likely to have a positive impact on financial results than manager only recognition. For employee recognition to be a successful business driver, it needs to be embraced by the entire organization and not just the business owners or top management.

Many organizations have gamified employee recognition as well, with social recognition or added incentives such as:

1. employee of the week or employee of the month

2. monthly or quarterly rolling trophies

3. extra vacation days for the best performing teams

4. gift cards

5. company sponsored happy hours (beer or chips and coke, your choice)

A survey found that when employees feel their company cares about their well-being, they become 38% more engaged and are 18% more likely to go the extra mile. 

On the contrary, 54% of employees would quit a job where they are not appreciated

When?

The timing of employee appreciation is crucial. In order for it to create maximum impact, it needs to happen when the related work is still ongoing, or at best, has completed recently. It shows that the recognition is sincere when it is fresh in the minds of both you and the employees.

Pitfalls to avoid

While creating a culture of recognition and appreciation seems like a no brainer, there are certain pitfalls which must be avoided.

1. It shouldn’t become ‘I scratch your back, you scratch mine’. A peer to peer recognition program can fast descend into chaos with people recognizing their own friends. The management and the HR teams need to ensure this doesn’t happen. 

2. It can also cause what social psychologists refer to, as ‘over justification effect’ –  The shifting of one’s motivations once the expectation (incentive) changes. This can cause performance to actually reduce. To avoid this, recognition needs to be implemented in such a way that it shouldnt become an expectation.

In summary, a culture of recognition and appreciation can help with employee engagement, employee retention, and job satisfaction, which in turn will lead to customer satisfaction.

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