Creating a Culture of Recognition: Online Employee Recognition Platform Benefits, Keys to Success, & Pitfalls

Why Employee Recognition & Engagement is Important in Today’s Workforce

There has been overwhelming evidence in recent years that recognizing employees when they do good work is not just the right thing to do, but it also is the smart thing to do if you are interested in obtaining desired results in your organization. Seventy-three percent of managers in my doctoral study reported that they received the results they expected when they used employee recognition to reinforce performance with their employees. Organizations that have a “culture of recognition” have employees who report they are five times more likely to feel valued, seven times more likely to stay with the company, six times more likely to invest in the company, and eleven times more likely to feel completely committed in their jobs (Maritz, Inc.), which has been shown to account for 57% greater effort on the part of employees (Towers Watson Willis).

The financial benefits of recognizing employees are also clear. A recent study reported in Incentive showed a direct correlation between the perceived use of recognition in organizations and the profitability of those firms, the financial return of Fortune’s Best Places to Work has been shown to be 233% higher over a six-year period as compared with overall market returns, and companies with higher employee satisfaction scores – driven in large part by feeling valued for the work they do – have been shown to have a 700% higher shareholder return.

With the evolving shift in the employee base toward younger, more technical-savvy employees (almost 75% of employees in today’s organizations are currently Millennials and Gen Z, the two youngest generations in the workforce), the need to adapt recognition strategies to the changing expectations of today’s employees—and their preferred communication preferences—is greater than ever before.

How to Create Effective Employee Recognition

“You get what you reward” is perhaps the most proven principle of management theory that has ever been established. Hundreds of studies have systematically demonstrated that “what gets recognized, gets repeated.” Other known findings about recognition include:

The Best Recognition is Specific, Meaningful & Timely (SMT)

Specific in that stating exactly why you are recognizing someone provides practical feedback we all need at work. Meaningful in that, if done well, recognition makes an employee feel special for what he or she has achieved. Timely in that the sooner you recognize performance, the greater you reinforce that behavior and the more likely it will be repeated.

The Best Recognition is Contingent

That is, it is based on performance that matters: to the organization, the manager, and the employee. If you don’t base recognition on performance, it tends to be either random (e.g., by lottery) or based primarily on presence (e.g., years or service awards, holiday parties, or birthday celebrations). These approaches undermine the power of the principles and lead to employees having a sense of entitlement as to what is owed them that is independent of the quality of the work they are doing in their jobs on a daily basis.

The Best Recognition Behaviors are FREE

Not only is cash not the only employee motivator, but some of the most powerful forms of recognition (thanks/praise, support/involvement, autonomy/authority, learning/development, holiday parties, or birthday celebrations, etc.) have little or no cost at all! The foundation of effective recognition is behavior-based. Especially if you establish a “rhythm” of recognition that is provided to employees as deserved based on desired behavior (i.e., core values) or performance (i.e., results achieved) on a daily, weekly, and monthly basis, the chances of developing a culture of recognition are greatly enhanced.

Benefits of Using an Employee Rewards & Recognition Program

There are a significant number of benefits for using an employee rewards and recognition program today:

Consolidation of recognition programs, efforts, budgets, and administration.

Most companies are striving to consolidate their recognition and reward programs across the organization (recognition done geographically, by department, ad hoc rewards, and all other incentives) into a single over-arching system. This allows for greater effectiveness, coordination, administration, and tracking and leads to reduced redundancy, waste, and administration costs to the organization.

Flexibility in driving the changing needs of the organization and program types.

In these dynamic times, it’s important to have a recognition program that can adjust to the changing needs and priorities of the organization. Most recognition programs I’ve seen in companies tend to be “plopped” on the organization and operate independently of the needs and priorities of the organization, often spending excessive time, effort, and financial resources on activities that have little if any impact on the success of the organization, e.g., recognition that focuses on years-of-service, birthdays or holiday parties. How much better would it be to have recognition that focuses on core company values, strategic objectives, cost-saving ideas, process improvements, and/or client referrals? Recognition of these types of performance is possible with an effective online program and can all be run simultaneously, as well.

Freedom of choice in accessing virtually unlimited reward options and activities.

Being online offers an expanded choice of rewards, not just “traditional” reward items such as plaques, logoed jewelry, or pins. Instead, recognition and reward items can be more impactful to your employees first, by providing them choice, and, second, by having a variety of reward options including merchandise, gift cards, activities/experiences and charity donation options. Having an online, brand-name reward selection will allow for the latest products to be added easily as they are available as well as non-merchandise items such as gift cards, travel, experiences, charity, or green options that can be easily integrated—something they will remember and speak highly of to others as well as create a lasting memory. Even virtual rewards allow employees immediate access to a reward that can be instantly redeemed. An effective online rewards platform also allows employees to create a “wish list” of rewards they would like to receive so as to make the process even more meaningful for them.

Ability to track usage and create on-demand reports to maximize leverage.

What gets measured, gets done, and an online employee recognition and rewards platform provides a better way to track and report on recognition, correlate the use of recognition with performance, and allow for better decisions and improvements to be made to the program along the way. Having an online platform can track every recognition, reward, inquiry, and transaction in the system to provide extensive data about the program. You can easily pull this information to see how the reward program is trending, identify top performers, and make correlations to your business objectives—something they will remember and speak highly of to others. This data is also critical for improving the program: Calling out recognition users to encourage participation by other as well as coaching of non-recognition users to get them to start using tools that are available. As Peter Drucker famously observed: “If you don’t measure it, you can’t manage it! Having all recognition tracked online can easily be accessed by managers so they have a way of systematically tracking their employees’ successes, as well as by the employees themselves.

Tapping into social media is favored by an increasing percentage of employees.

Social recognition is made easier through the use of social networks that are especially important and used by the younger generations. Properly utilized, these technology applications can successfully combine public recognition for positive performance (i.e., desired behaviors and results) with the latest social communication technologies that increasingly bind together a significant percentage of the employee population.

Seven Keys to Successful Employee Rewards Programs

The best online employee reward and recognition platforms have the following characteristics, each of which can be built into your program:

1. Results Driven—focused on the performance you most want to drive in your organization. 

All performance starts with clear goals and expectations, so you need to first give consideration to what performance and results you most want to achieve with your recognition and rewards program, so you can be sure that those objectives are specifically addressed in your program.

2. Employee Engaged—comprehensive in including all members of the organization.

Recognition is not just a top-down, manager-driven activity, but should encompass all levels and locations of the organization, including peer-to-peer, employee-to-manager, manager-to-manager, executive-to-employee – and even involving the organization’s customers and vendors, where possible. Recognition must be available and accessible to EVERYONE in the organization as it provides an important form of feedback and helps to build the culture of the organization, essentially one that has recognition “without borders”. Technology is the most viable way to achieve this objective and potential in today’s organizations.

3. Custom Branded—customized online platform, branded to your organization.

Whatever online solution you select needs to be customized to fit your organization seamlessly. Some organizations want to select certain options, brands, and specific ongoing information for their employee recognition platforms and the flexibility to add or modify tools that can be integrated within the program. It should also be possible to run simultaneous recognition programs with the online solution you select.

4. Relevant Communication—enhanced communication for launching (and sustaining) recognition use.

Communication is an important aspect of any employee recognition program, not just in initially launching the program, but in systematically sustaining the initiative over time. An online employee recognition solution provides a more timely and less costly answer to communicating about the program launch, but also as an ongoing hub for communication about the program, highlighting its successes and providing ongoing education and reminders that will help to sustain the program’s success.

5. Effectively Launched—making a positive transition with buy-in and excitement.

Any employee recognition platform needs a strong launch to be successful. This should include training for both the organization’s recognition program administrator as well as training for everyone who is expected to effectively use the program. In addition, it is important to provide training to managers on the importance of recognition and how they can best integrate the behavior into their daily practices at work. This is essential in that my research indicates the main reason why managers don’t use recognition is that they are not sure how to do it well.

6. Meaningful Rewards—available reward options that best fit your employees’ preferences.

One of the benefits of an online employee recognition and rewards program is the expansive potential of providing access to almost any type of reward imagined. Select those categories that most appeal to your employee population, which increasingly goes beyond merchandise to include activities/experiences, charitable giving, “green” options, and learning and development opportunities.

7. Periodic Assessment—for changing and building on the program’s success. 

To keep your recognition initiative fresh and vibrant, you need to constantly improve upon it, adding new elements as needed and eliminating those elements that have run their course before they become stale. This will help make the program a dynamic long-term, strategic initiative as opposed to a “flavor of the month” that most employees are wary of.

What to Avoid When Setting Up Your Employee Rewards Recognition Platform

• Getting online access to all employees. In many organizations (manufacturing, retail, hospitality, etc.) all employees do not necessarily have access to a computer that is not required for their jobs. A common solution to this challenge is to use savings from the recognition program conversion to purchase kiosks that are readily available to employees in their departments, allowing them time on the job to periodically access those kiosks. something they will remember and speak highly of to others. This data is also critical for improving the program: Calling out recognition users to encourage participation by other as well as coaching of non-recognition users to get them to start using tools that are available. As Peter Drucker famously observed: “If you don’t measure it, you can’t manage it!
  
  
• Online employee recognition is more than being online, more than just having a website. Some incentive providers use technology just to provide a rewards platform. Employees go online, select their reward (using points or not), and then have it redeemed (i.e., sent to them). Look for a company that can provide a wider range of rewards and an ability to allow employees choice in the selection and timing of rewards for better merchandise, experiences, gift cards, etc. – as well as technology for virtual redemptions (i.e. online gift cards for immediate delivery as well as technology to donate points to a charity of your choice and automatically receive a tax receipt) – all making the recognition and rewards experience more personal and meaningful to employees. Also, look for an online solution that offers a robust recognition and communication platform as well as the capacity and flexibility to integrate a variety of tools into the program.
  
  
• Minimize upfront costs and only pay for rewards and services as they are used. Many incentive companies require a substantial upfront investment, essentially to cover the development of the desired software solution. This should not be necessary in that technology is now readily available where many of the applications are already developed. Also, select an incentive company that is invested in your program’s success, e.g., they don’t make money if the program is not used and successful.
  
  
• Getting managers and employees to use the online program. One of the greatest recognition obstacles I’ve seen in organizations is getting managers to use employee recognition tools that are provided to them. This is a function of knowing about the tools and how to use those, but more fundamentally it is in developing the values in managers that lead to the behavior of recognizing employees as a viable business strategy. To this point, it is important to provide managers with effective training that can help raise their awareness and abilities in providing recognition to their employees. The Society for Human Resource Management (SHRM) reports that 81% of organizations currently do not provide such recognition training for their managers and, as a result, even excellent recognition tools and programs will not be apt to be used by their managers.
  
  
• Don’t lose the “personal touch” of face-to-face recognition. Sometimes when going to an online recognition solution employees notice a loss of personal thanks as they shift to receiving praise via the Internet. It’s important to emphasize that online employee recognition should augment, not replace, face-to-face recognition. The awareness of achievements can be heightened by the use of online recognition which should then also be acknowledged with the next in-person employee contact. Online employee recognition can also be used to trigger nominations for more formal recognition programs in the organization and in this way help to amplify and leverage the grass-roots recognition that is occurring.

Summary

The move to an online employee recognition and rewards platform helps an organization better manage its recognition and reward programs in a way that enhances effectiveness in driving desired behaviors and results while minimizing both the costs of the program and its risks of failure. This article highlighted the primary benefits of online employee recognition and rewards platforms, outlined seven keys to a successful employee rewards program, and discussed common pitfalls to avoid.