Of all your company assets, your employees have the highest profit potential, but returns don’t come without investment. Companies that express their gratitude to staff have a 31% reduction in turnover and more engaged talent. Recognition has become so profitable that your average company spends about 2% of its salaries on awards and gratitude gifts. An international study by the Tanner Institute found that recognition was the most effective way employers could inspire better work, and you needn’t have a giant budget to benefit.
Rewards systems are not all created equal, though. Recognition can fit into four separate types:
- Physical rewards
The vast majority of corporations reward tenure, and while it’s a core way to show appreciation, it’s unlikely to drive higher profits. Morale boosts need to have a direct impact on your revenue, and specific employee awards for express behaviors are far more influential in achieving a corporate culture sparkling enough to vie with the Googolplex’s. Financial reward has its place, too, but recognition is a core part of staff retention programs because it’s more effective. People respond to emotions, which are driven by positive affirmation, not bank balances.
Specificity is the key to building a culture that’s as vibrant as it is rewarding. Keep your employee awards regular, specific, and personal, and you’ll soon reap rewards. For example, a “Good judgement call” plaque is more effective than an “employee of the month” award.
Human Resources through Peer-to-Peer Recognition
Recognition from business leaders will always attract a grinning staff complement, but peer-to-peer programs have an irreplaceable social element. Consider giving your staff the ability to choose what’s engraved on employee awards and who receives them. The easier you make it for your staff to recognize others, the more dynamic your human resources management will become.
The Goal Driven Corporation
If your staff are sales people, rewarding creative innovation won’t do much for your ultimate results. As with all things entrepreneurial, understanding your goals is the first necessary step towards running a rewards program that works. Deloitte, a frequent winner of Forbes “best employer” awards, runs a recognition program that's tied closely to its strategy. They need to encourage innovation, teamwork, and service excellence, so their awards are always related to those objectives.
A little personal attention goes a long way. When staff birthdays or vacations are acknowledged, they learn that they, as individuals, are imperative to your business. Printing innovation has made this much easier to achieve. With a negligible investment, a generic bottle of wine becomes a personalized gift with unique etching. Thoughtfulness has never been easier to achieve.
The way your office and workspace is managed is imperative to morale, inspired work, and creativity. After a harsh deadline, workers need the extra energy boost that comes with an office party to get them through the rest of the month. A costume party with prizes will inject a fresh dose of inspiration into your culture at the end of the year. Rewarding hard and consistent workers also achieves what monitoring can’t: ever-present discipline even when staff are working alone.
The Biology of Success
Scientists are continuously unveiling new data about the science of recognition. New research shows that appreciation boosts staff’s oxytocin levels, which in turn improves performance and trustworthiness. Studies also show that there is a 46% reduction in attrition in companies that nurture rewards programs. People are the most responsive assets you have. Even seemingly small rewards have a drastic impact, creating a firecracker framework that eases you towards greater success.