You’ve heard it, read it, and experienced it. Recognition feels good. It inspires. It enhances the employee experience. It builds employee bonds and connections. And it has the power to engage employees.
But, not all recognition is created equal. It is possible for managers and organizations to recognize employees, spending as much as 5% (The average is 2%) of the payroll budget on recognition yet experience a low ROI.
Meanwhile, other organizations see a large and consistently high ROI on their recognition budget. Recognition ROI is usually recognized through increased employee engagement, retention, referrals, and productivity.
The O.C. Tanner Institute has studied recognition in its various forms for years and identified the three main recognition programs that employers utilize and their effectiveness on hybrid employees. Hint: one type of program outperforms the other two by double its effectiveness.
This article will cover the three pillars of recognition programs, a secret sauce that increases effectiveness, and the three ingredients every recognition should include.
Let’s get started.
The Effectiveness of Service Award Recognition
Service awards are possibly one of the earliest and most foundational aspects of most recognition programs. Even companies with little recognition budget and small programs usually take the time to award employees at service anniversaries.
And it’s an important aspect of recognition. Job searches spike 6-9% higher around work anniversaries (can use image from that article). Recognizing an employee’s years of service is critical because it helps the employee feel appreciated and creates greater bonds of loyalty.
But, not all service award recognition is the same. Placing a “5 Year” pin on an employee’s desk does not have the same impact as presenting the pin in a team meeting. A party celebrating their time with the company and allowing colleagues to stop by, chat and form greater bonds is even more effective.
Even more effective recognition creates, emphasizes, and reminds employees of the bonds they have with coworkers, their management team, and their company. (See Building Connection In The Workplace: Guide to Increasing Engagement link)
Each team is different and not all teams work in the same location or have the same schedule. But, service awards can still be customized to personalize an employee’s service. Team members can write personalized notes, share photos, stories, and express appreciation increases to about 32% chance of being engaged when service awards are instituted.
The Impact Service Awards Have on Existing Engagement, Purpose, and Success
Let’s talk about how to read this chart. This isn’t the % of workers likely to be engaged. It’s the percentage of increase that service awards have on employees.
If an employee has a 10% chance of being engaged (based on all factors at work) service awards will increase that likelihood by roughly 52%. That means they’ll have about a 15% likelihood of being engaged. A hybrid employee with a 25% chance of being engaged increases to an impact with a probability of 38% of engagement.
How “Above and Beyond” Recognition Moves Employees
The next level of recognition involves showing appreciation for the extra effort employees give to their employer and team. “Above and Beyond” recognition awards employees for giving 110% in their jobs. (Awards are Different than Rewards or Prizes)
Above and beyond recognition, or extra effort recognition programs, have double, and sometimes triple the effect on the improvement of positive indicators for employees when combined with service award recognition.
Whereas service awards increase an employee’s likelihood of engagement by 52%, Adding recognition for extra” efforts increases engagement by 126%.
Inside the Thanks Platform, teams can create photo albums, send personalized messages, and share awards to celebrate individuals. Personal, specific service celebrations don’t have to be difficult, expensive, or time-consuming to be effective and worthwhile.
This chart shows service awards’ impact on the probability of various behaviors.
The Impact that Adding “Above and Beyond” recognition Has on Employee Engagement (Combined with Service Awards)
This reflects the impact of adding “Above and Beyond” recognition to Service Awards on the probability of these various outcomes for hybrid workers.
Recognition programs that recognize employees for their years of service and their extra efforts greatly enhance the likelihood of employee engagement, purpose, and success (to name only a few. But, when one additional form of recognition is added, the likelihood again doubles in almost all measured metrics.
The Secret Sauce: “Daily Grind” Recognition
Employers who have the most successful recognition programs recognize employees’ daily efforts. The daily grind is often taken for granted, but performance rises when employers recognize employees’ consistent, dependable efforts.
One powerful tool that can boost employers’ abilities to recognize daily efforts is peer recognition. Peer recognition provides employees tools, software, and autonomy to recognize each other.
Peer recognition will likely include the fundamental elements of effective recognition we’ll cover below. And, peers often see things managers don’t.
When colleagues recognize each other for handling daily tasks’ ups and the downs of daily tasks, it both encourages and engages employees. Check out 10 Reasons Peer Recognition Drives Employee Satisfaction.
When employees are recognized for their daily, consistent work, they are more likely to build connections to their work. And, when employees understand how their efforts enhance their community, they feel greater connection and purpose with their jobs.
Let’s take a look at how adding recognition for daily efforts increases the impact the other two forms of recognition has on employees.
This reflects the impact that adding recognition of daily efforts to “Above and Beyond” and Service Awards has on the probability of these various outcomes for hybrid workers.
Three Ingredients Every Recognition Should Include
Recognition that’s most effective, whether it’s service awards, above-and-beyond, or daily grind recognition always includes three elements. It’s given in a timely manner, its genuine and it’s specific
Recognition is Timely
Recognition is most powerful when it’s given immediately. Delayed recognition loses its power to transform and inspire employees. When recognition is given quickly, the employee remembers the details of what they did and will associate the positive feelings of being recognized with those behaviors.
Even service award recognition should be done timely. Recognizing an employee for 5 years of service 6 months after they pass the 5-year mark greatly lowers and nulls the impact of the recognition on that employee. Daily grind and Extra effort recognition have, by far, the greatest impact when it’s timely.
Genuine Recognition
Recognition should be genuine and sincere. Heartfelt recognition builds connections. Sincere expressed gratitude builds team unity and increases positive feelings between participants. Timely recognition is most likely to also be genuine.
Recognition most often loses its depth of sincerity when it’s put off and the impact is forgotten or overshadowed by newer urgencies at work.
Specific Recognition
Recognition should be specific and individualized. Even Service Awards should specifically outline employee contributions and their unique talents and efforts. Daily efforts recognition that recognizes employee efforts specifically. Recognizing an employee who always answers the phone politely and was pleasant even when “so-and-so” was abrupt is more effective than saying “great job!”
Specific and detailed recognition tells employees exactly what part of their job or efforts was most appreciated. This makes it easier for them to replicate those efforts and continue to contribute in a more meaningful way.
About Thanks
Thanks is a leading provider of a recognition-based platform that increases communication, builds teamwork, and makes recognition a part of company culture. Fast, easy and simple Thanks makes it easy to bring data-driven employee recognition to your entire organization. O.C. Tanner purchased the Thanks platform in 2019 to fulfill the recognition needs of smaller businesses.
Thanks customers benefit from the same decades of research in employee motivation and company culture that O.C. Tanner enterprise clients enjoy, but in a product that is geared for fast, easy and simple deployment. Whether you’re starting a recognition program or improving and expanding on what you already have, Thanks has everything you need to engage your people with effective, scalable recognition.