Give Us 5 Minutes, We’ll Give You the Truth about Employee Recognition Programs


Secrets to Starting Employee Recognition Programs that Work

Does your small business have an employee recognition program? If not, it could be time to consider one. The war for talent is being waged harder than ever, reports a study of HR professionals from SHRM/Globoforce. Nearly half of respondents in the survey say their biggest management challenges are employee retention and turnover.

To overcome these challenges, companies in the survey are turning to employee recognition programs to help employees feel valued. Making your company a good place to work not only helps retain your existing employees, but also makes it more likely that when you do need to hire, your current employees will refer friends and associates. This can give your company an edge over bigger competitors for qualified employees.

Secrets of Employee Recognition Programs That Work

But there are some important things to keep in mind when developing a recognition program. Here’s what you need to know.

  • Your employee recognition program should help achieve business goals. Employee recognition isn’t just feel-good mumbo-jumbo. By reducing turnover, increasing employee engagement and helping to create a more positive work environment, a good employee recognition program offers many business benefits. It reduces costs of recruiting and hiring, helps eliminate the time and expense of training new employees, and improves company productivity.
  • You should tie your employee recognition program to your company’s values. Managers with this type of recognition program are much more likely to feel that their programs are working well or very well. What’s more, values-based employee recognition programs are nearly twice as likely to help advance business goals. In comparison, the study found, recognition programs that don’t relate to the business’s values are more likely to be started for cost-cutting reasons, and to lack a clear purpose and direction.
  • Be willing to spend some money for employee recognition. If you’re sending your employees congratulatory emails or e-cards, or otherwise chintzing out on recognition, it’s time to ante up. Recognition programs that are funded at one percent or more of a company’s payroll are 86 percent more likely to succeed than projects with little or no budget. It doesn’t take a lot of money to give valued employees a boost.
  • Unofficial recognition matters, too. In addition to an official employee recognition program, the report reinforces the importance of frequent, informal reinforcement in improving employee satisfaction. Whether it’s a manager praising an employee for work well done, or one employee complimenting another for stepping in to handle a project, these small moments of recognition can make a big difference in the overall culture of your company.
  • Recognize life events. There’s another type of recognition that has nothing to do with job performance, but is also important to employee satisfaction. Three out of five companies (60 percent) help employees celebrate life events — such as getting married, birthdays, buying their first home or having a baby. When employees are satisfied with how life events are celebrated at their workplace, they’re almost twice as likely to say it’s a good place to work.

Overall, the report concludes, we’re entering an era with a more “human-centered” approach to employee satisfaction, retention and recruitment. That’s nothing new for small business owners. When you have a small company where you know every employee, there’s no reason not to treat your employees as people

Photo via Shutterstock

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Rieva Lesonsky


Rieva Lesonsky Rieva Lesonsky is a Columnist for Small Business Trends covering employment, retail trends and women in business. She is CEO of GrowBiz Media, a media company that helps entrepreneurs start and grow their businesses. Follow her on Google+ and visit her blog, SmallBizDaily, to get the scoop on business trends and free TrendCast reports.

4 Reactions

  1. Aira Bongco

    This is great because it greatly boosts the morale of the team and your employees.

  2. These are great to commend your employees for their hard work. The reward will also motivate them to do better in their job.

  3. There is a reason why programs like these exists. It helps not just the employee but the company as well.

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