Employee recognition – why is it so important?

Building a committed and loyal team is crucial, especially nowadays, when it is becoming increasingly difficult to recruit and retain qualified staff. This goal cannot be achieved without appreciating employee contribution to the development of the company. However, it is also important to remember that employee recognition must be effective and adapted to the reality of hybrid work.

This article will explain the following:

• Who is responsible for building a culture of appreciation and why is it important?
• What are the forms of employee recognition and what is essential when introducing recognition programs?
• What are the classic forms of employee recognition and what forms are adapted to the pandemic reality?

What is employee recognition?

Learning all about employee recognition can help you understand its importance. Recognizing employees is the act of acknowledging and appreciating employee contributions. It can take various forms, which should be adapted to the way the organization operates, with particular emphasis on employee needs. Employee recognition may be focused on reinforcing positive behavior (good standards & practices, goal achievement) or other actions which exceed expectations.

Building a culture of recognition in an organization involves implementing various employee recognition programs. Although designing these types of mechanisms is the task of HR departments, their implementation lies primarily with managers and supervisors. These mechanisms should also lead to the encouragement of employees to recognize each other’s achievements. Consequently, each team member becomes a participant in the recognition process.

Why are recognition and appreciation so important?

Recognition affects a number of psychological aspects. Among employees, it increases commitment and generates greater efficiency, productivity, and retention. Moreover, proper appreciation raises morale, builds relationships, motivates personnel, and creates good corporate culture.

The huge impact of this phenomenon is confirmed by numerous studies, including the following:

• According to the 2016 data from the Human Resource Management Society, 79% of employees work harder if their efforts are properly appreciated [1].
• A Gallup survey suggests that employee commitment increases their productivity and profitability by 21% [2].
• The Achievers Workforce Institute found that half of the employees whose work was properly appreciated in the previous week were more committed [3].
• As many as 91% of employees in the USA say that a strong recognition culture makes them want to work in the company [4].
• These are key results, especially important nowadays when it is difficult to recruit and retain valuable employees [5].

Forms of recognition and appreciation of employees in the workplace

Good work appreciation can be divided into formal and informal. Formal activities may be undertaken at the corporate or team level (management training is particularly important here). For this form to be successful, it is necessary to select the criteria and the form of recognition. It is a difficult task, because attractive rewards may result in intense – or even unexpected – employee activity aimed at accomplishing the assigned tasks. It is, therefore, necessary to estimate the potential results and ensure that the undertaken activities are in line with the business strategy.

When determining recognition criteria, it is worth following the method of forming SMART goals. Goals set for employees must be Specific, Measurable, Attractive, Realistic, and Timed (e.g. weekly, monthly, quarterly). It is also important to establish a nomination or review process that is comprehensible and fair. It must also be efficient to provide employees with feedback on an ongoing basis.

Well-implemented formal appreciation can be shown in the example of activities in the area of Learning & Development. By using a Learning Management System (LMS), companies can define the courses required to achieve employee development goals. An appropriate Learning Management System allows organizations to easily define such goals, while the achievement of target competencies is confirmed by obtaining certificates. As a result, the employee faces realistic tasks that directly and positively influence the business strategy. L&D directly translates into corporate profit and individual growth, as well as promotes appreciation of employee contributions.

There are also numerous informal recognition programs, namely the spontaneous, sincere, and personal expressions of gratitude that do not require additional resources for implementation. It is worth considering this aspect when onboarding or training managers and building their awareness of this key area – getting to know the team and their needs. Many people feel great after verbal praise, in private or in public. However, it may not be comfortable for everyone. It might be prudent to learn about various ways of appreciating employees and defining, together with the HR department, a directory that is consistent with the corporate culture and company needs.

Ideas for and examples of employee appreciation

There are a number of ways to appreciate employees. The most popular ones are positive feedback and cash prizes (including the possibility to donate a specific amount for a good cause) or prizes (e.g. trophies or a selection of attractive experiences). However, other choices also include those received from the superior (emphasizing the supervisor’s role in the process), a team award (for subject recognition), a peer award (emphasizing those involved in the process), and modern ways of recognition – providing a new perspective on the mechanisms of building a culture of appreciation.

From the supervisor

The superior may offer the following:

• a lunch together;
• a Q&A meeting giving a wider perspective;
• dedicated mentoring or project support from higher management (an opportunity to learn about the better practices);
• “5 minutes of appreciation” at corporate meetings, based on formal or informal criteria.

Team reward

Entire teams can be offered

• a lunch;
• integration output, preferably involving attractive activities;
• a volunteer day,
• leaving the office early (happy hour) or coming to work later (a lazy morning);
• a day off;
• a weekend trip.

Peer reward

This area might include the following:

• a team trophy (an item regularly awarded by voting in a team or in the whole company);
• virtual or physical sticky notes, the so-called kudos with words of gratitude;
• a platform for appreciating employees or a dedicated channel for the internal messenger;
• praise in the company system or social media;
• sweets or pastries as a thank-you gesture.

Modern ways of recognition

The above-mentioned methods can be classified as classic forms of appreciation. However, the modern workplace should be adapted to remote or hybrid work. Awarding prizes no longer takes place in an informal office setting. It is necessary to implement appropriate steps and systems that will allow employees to also be appreciated remotely (and meaningfully, one might add!). That is where an LMS comes in handy. E-learning platforms allow companies to introduce elements of gamification, follow detailed reports and statistics, publish relevant graphics on internal channels, or brag about the obtained certificates on internal messengers or social media. Additionally, e-learning eliminates the problems that result from switching to remote work – the platform is available at any time and from anywhere in the world, as long as there is Internet access.

At the same time, by investing in the area of Learning & Development in the organization, companies can make sure that employees feel taken care of, recognized, and properly rewarded.