4 Factors to Consider When Building an Employee Recognition Program

Employee Recognition Program

Employees who are recognized for their efforts far and away outperform those who are not.

Companies with official employee recognition programs have 31 percent lower turnover rates, according to a Forbes report. That could equal thousands of dollars saved in the long run when you consider how much a disgruntled former employee costs. The Society for Human Resource Management says a business takes a hit costing an average of $3,337.00 (PDF) for every unhappy worker that leaves.

Also, there is a science and psychology behind employee recognition programs.

All human beings have a need to feel important and valued, not only in their personal relationships, but also at work. When you have an employee recognition program in place, you are literally stimulating people on a psychological and scientific level that will greatly enhance their job performance.

It’s estimated that the work incentive industry is now a booming $27 billion dollar a year sector, so that should give you an indication of just how valuable and important these programs have become to the growth of the U.S. economy.

Here are 4 factors to consider when crafting your employee recognition program:

1. Recognize People for Specific Attributes

Giving out an Employee of the Month Award is a decent idea, but giving a more specific reward for providing legendary customer service makes more sense. Other employees, upon seeing such recognition, may want to rise to the occasion, too, and provide excellent customer service.

2. Allow Peer-to-Peer Recognition

Peer-to-peer recognition is more social in nature, and it helps build camaraderie among staff. When anyone can give props to a peer publically, it means much more to your talent than when some shadowy figurehead from the top of the company presents praise at an annual awards banquet.

3. Use Stories to Call Out Individuals in the Company Newsletter or Blog

When recognition is tied into a specific story, staff will have an actual context to which they can relate. In turn, this will inspire others to start sharing their own success stories that can be used to inspire and train others in the organization. You might also want to consider a weekly conference call where everyone takes time to give a shout out to their peers for handling an especially difficult or challenging situation or customer.

4. Honor Employees, but Also Their Achievements

Be sure to recognize your team members when the excel, but be sure to tie the recognition to the corporation’s philosophy or annual goals.

If, for example, a bean counter discovers a way to save the company thousands of dollars each month, that person should be praised because this action conforms to the organization’s goal to cut costs.

If an engineer created a better mouse trap, and innovation is one of the company’s core values, then use that new product as an excuse to promote this fact.

Generally speaking, when it comes to administering your company’s work incentive program, make sure you have a committee to evaluate the success of the endeavor.

One key measurable will be total participation level. If the participation levels are not strong, then you could opt to use the services of a company that specializes in these types of programs to receive a greater return on your investment.

Medals Table Photo via Shutterstock


Amy Blackburn Amy Blackburn is a writer for Stoner Bunting Gift Cards, a nationwide leader in employee recognition gift card programs based in Lancaster, Pennsylvania. Amy stresses the importance of relationships with clients as the key to continued success.

5 Reactions
  1. It has to be specific. After all, just throwing around compliments does not mean anything. You should recognize people for their contributions and that will surely boost their morale.

    • Hi Aira,

      Thank you for the feedback! I agree recognizing individuals for their contributions most certainly helps to boost morale.

  2. A healthy balance of a structured recognition platform along with flexible, in-the-moment praise is a great mix for keeping appreciation at the forefront of company culture. It allows room for all deserving employees to get some kind of appreciation on a regular basis and top honors for top performing employees. I liked point #3 about using stories to highlight achievement, and it goes along with Aira’s comment about being specific. Great article. Sharing this.