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Employee Recognition: How, When, And Why

Kate Williams

Last Updated:  

30 May 2024

8 min read

85%. That’s the number of employees who would be satisfied with a simple “thank you” for their efforts. But 83% of organizations still struggled with even this basic form of employee recognition in 2021. 

What is Employee Recognition?

Employee recognition is the act of publicly or privately acknowledging an employee for their contributions, achievements, or even who they are as team members. Recognition can take the form of written/verbal thank-yous, bonuses, certificates, work anniversaries, birthdays, etc. In addition, employee recognition uses positive reinforcement to build better habits, boost morale, inspire others, and make the workplace happier and more human. 

Top 3 Challenges of Employee Recognition 

  • It is inconsistent. Most companies struggled to put up a system for timely employee recognition. As a result, when employees were given praise and appreciation, it was often on their last day of work! 
  • Employee recognition schemes lack personalization. That’s because managers tend to recognize their employees the same way they want to be recognized – which might not always work. 
  • Teams struggled to follow a consistent structure for internal employee recognition. As a result, employee appreciation did not always get through.
  • It lacks strategy and comprehensiveness. Traditionally, employee recognition programs consisted of one-off appreciation events like festive gifts or years-of-service certificates. 

If these challenges happened to you, you’re not alone because 2021 was a year of massive workplace changes, and nobody aced it perfectly. But what about 2022 and beyond? The changes brought by the pandemic are here to stay, and you don’t want your employee turnover to rise because of lack of recognition, right? 

How to Start an Employee Recognition Program in 7 Steps

This is why we’ve prepared a 7-step framework for your employee recognition program. You can implement this framework as it is or make your own changes based on what your culture prioritizes the most. 

Step 1: Set an Employee Experience Roadmap

Why? Because employee appreciation, satisfaction, and recognition are all integral parts of providing a good employee experience. Your employee recognition programs will yield sustained results when your teams follow an employee experience roadmap

Now, what exactly does employee experience mean? First, it’s a shift in mentality for leaders, as they start creating an environment where people are not made to work but want to work. Second, it’s a long-term process that involves various small steps but gives an outstanding ROI. 

Your IT team can help reimagine the employee experience roadmap. They have the tools and expertise for this. 

Step 2: Choose the Right Type of Employee Recognition Program

After creating an employee experience roadmap based on your vision and goal, it’s time to start planning the program. So what’s the first step? 

Choosing the right type of employee recognition program. Why? Because every company has a different culture and expects different results. So, finalizing the type is the next step. From quirky employee awards to spot bonuses, there are plenty of employee appreciation ideas you can choose from for your program. You can also add levels to your program for manager-to-employee, employer-to-employee, peer-to-peer, or team recognition events. 

If done manually, deciding on the type of program while keeping everyone’s interests in mind can be an arduous task. But why do that when you can use enterprise survey software to collect cross-team feedback and inputs? With software like SurveySparrow, you can save time to analyze these inputs and use them to shape your program. See the difference a 14-day free trial.

Step 3: Set Your Budget 

Whatever program you choose for employee recognition, set aside a budget to meet the total expense. Whether you’re going for a monetary program or a non-monetary one with dinner included, you have to at least set aside 1% of the overall payroll towards it. This budget is also essential because you want your managers and employees to have a great time just interacting and appreciating each other. And that can happen when they’re happy and not worrying about anything else. 

Step 4: Find the Right Recognition Software and Program Head

Why software? Just look at how companies adapted to working from home almost overnight after two years of lockdowns. Virtual recognition is now a crucial part of the employee experience. Without employee recognition software and a program head who can manage it, your goal to provide the best employee experience will be short-lived. 

But how do your choose from so many options? First, you need to figure out what you need – whether that’s personalization, respondent anonymity, or something else. That’s what Godrej did, and the end result was a 70% higher response rate among their employees. 

Secondly, once you’ve picked the right software, assign an able program head that can plan, implement, and manage it expertly. The cost of bad HR practices can run into the billions, so ensure you choose someone who resonates with your vision and has the positivity and energy to run the program. 

Step 5: Define Employee Recognition Policies 

This is one of the reasons staff recognition programs fail: a lack or no policy at all! Unfortunately, even global organizations still make this mistake! They start the recognition and appreciation programs with enthusiasm but fade within a few months with no concrete results. You can avoid this by asking four simple questions:

  • What is the structure of the program going to be? 
  • How long will it go for? 
  • How will employees be recognized?
  • When should the program take place? 

You’ll form some solid policies if you have answers to these, which would help you get the results you want from them. That’s the end goal, right?

Step 6: Internal Communication is Essential

You and your teams need to be on the same page. So, once the finer details about the employee recognition program are ready, it’s time for you to vocalize it with different teams and understand how it’s beneficial for them and the organization. Again, honest interaction is the key here. 

This communication will also help your employees understand what you’re expecting from them. Because not everyone knows how to give recognition, but your open communication and constant push will help them slowly get it. And this will ultimately make your program a success.

Step 7: Measure the Impact

Finally, you need to measure the results. Is it aligning with your set goals? Where could the program improve? Does it need a change in its type? More questions will come up once you start analyzing the impact of these programs. 

Don’t make any sudden changes without a thorough analysis. An employee recognition program is, in essence, an organizational culture shift. Moreover, it is a large-scale project that will have an even more enormous impact on the workforce. Incremental changes over a period make it easier for your employees to adjust and give more time for program data collection. 

When should an employee be recognized?

At the individual level

According to some studies, employees want some sort of recognition or reward every 7 days. You don’t need to turn that into a rigid schedule because that’s an additional burden among your various responsibilities. The key is to make sure you recognize often. For example, you can make it a habit to appreciate employees in multiple ways every week at the minimum or two, three weeks at the max. 

You can also take the load off your managers by formalizing peer-to-peer recognition. This allows any team member to publicly appreciate their co-worker. This can be even for seemingly minor things, like showing up on time every day. It won’t take more than a minute, but it’ll add up to a huge impact.

At the team level

Most organizations of any size will have a monthly all-hands meeting. This is an ideal time to recognize successful projects (individuals or teams). 

You can even set a reward, like team badges, a spot bonus, or a team outing. Such rewards are a powerful motivator. Recognizing the whole team also strengthens their bond, which leads to better work relationships and productivity. 

4 Recognition Tips for Team Leads

Recognize in Public – Public recognition has a more extensive impact than private appreciation. Why? It makes your employee’s day and motivates other employees to strive towards something similar – a win-win for everyone! So set up opportunities wherever possible to publicly appreciate good performers. This can be through custom award ceremonies, team challenges, gifting programs, and so on. 

Recognize Often – In the age of instant reactions and remote work tools, you don’t need to wait for a formal performance appraisal to recognize an employee! Instead, take a couple of minutes to reach out and appreciate a job well done, whether that’s through a Slack message, email, or call. If you’re working with a freelancer, write them a recommendation on LinkedIn talking about what a pleasure they were to work with on Project A. 

Always Appreciate What Should be Appreciated – Whether that’s doing some outstanding work, handling a project well, or bringing in more customers. If they are doing anything worth appreciating, appreciate them right away. The more time passes between the performance and the recognition, the lower its impact on the employee. So, recognize good work right away, and do that again grandly when hosting the recognition program. Sounds like a good plan?

Don’t Criticize After Giving Praise –  If you’re recognizing their work and decisions, do just that. If you want to critique their work or judgments, do that in a separate conversation or save the criticism for the performance appraisal. A good rule of thumb is praising the employee in public and criticizing in private. This tactic is less likely to get a defensive reaction when you provide negative feedback. 

Why Should You Invest in Employee Recognition Going Forward?

The pandemic changed the way people and organizations worked, and this change is here to stay. The Work From Home (WFH) culture is a prime example of that. Employee well-being was, and still is, a significant problem with this new work culture. And employee recognition, experience, and satisfaction play a huge role in making WFH a success going forward.

Apart from this, there are more reasons why an employee recognition program is a must-have in 2021 and beyond. 

#1. Happy customers!

Isn’t it obvious? You’ll get happy customers if your employees are recognized and appreciated. A happy employee cares about keeping your customers happy, old and new. As a result, companies that invest in employee recognition programs have witnessed a massive spike in customer satisfaction.

#2. Decreased Employee Turnover  

It costs 6 to 9 months’ salary to replace a single employee. Another fact: over 32% of workers left their jobs because they were unsatisfied with the recognition for their contributions. Do the math, and it becomes clear – a good employee recognition program is a must-have. 

#3. Improved Employee Well Being 

The coronavirus flipped our lives 360 degrees and changed the way we work in just a couple of months. The anxiety, fear, uncertainty, and isolation have affected all of us. For example, 42% of employees reported high stress levels because of current events, personal finances, and job responsibilities. 

So how can you, as a leader, help here? One way is by giving your employees the best experience and deserved recognition. We’re not telling you to go overboard for it. Just have a well-structured employee recognition program to appreciate their efforts and show them your gratitude. This is all that every employee seeks from their employers in these challenging times. 

#4. Supercharged Team Productivity

78% of workers have stated that being appreciated at work motivates them at their job and increases productivity massively. And more productivity means more customers, more profits, and eventually… more growth!  

Wrapping up

Employee experience and recognition were rarely a subject of discussion in the past. Managers and heads focused on the output and final result instead of individual performance. If a team had achieved the targets, they were simply given a more challenging target next time. That’s how things worked. 

But times have changed in 2021. Employees now are vocal about their experience while working for someone, and getting the correct recognition forms an integral part of that. Leaders have also realized the importance of employee recognition in helping them reach their goals. Modern solutions allow them to recognize and appreciate employees with more visibility. And everyone wants to have an engaged workforce who’re satisfied at work. 

Although a simple “thank you” is a good start, building a solid and well-managed employee recognition program gives massive rewards in the future. Of course, it takes time and effort to plan this, but it’s totally worth it. We hope this detailed guide will help you create a better organizational culture, one kudos at a time!

Kate Williams

Product Marketing Manager at SurveySparrow

Excels in empowering visionary companies through storytelling and strategic go-to-market planning. With extensive experience in product marketing and customer experience management, she is an accomplished author, podcast host, and mentor, sharing her expertise across diverse platforms and audiences.

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