Do you want to motivate your employees, encourage retention and create an environment where everyone feels valued and appreciated? Company culture, competitive salary packages and employee benefits are the basics for a healthy, happy working environment. However, reward and recognition schemes can bolster enthusiasm and drive teamwork in an organisation.
Both generation Y and generation Z rank feeling valued highly for workplace satisfaction. Many professionals are willing to take a pay cut for the benefit of achieving this. However, if staff are to feel valued then there must be some recognition and reward, whether that be financial or otherwise. The key to making reward and recognition schemes work is making them thoughtful and ensuring they're properly targeted.
What Should Employee Reward And Recognition Schemes Be?
To be successful employee reward and recognition schemes should:
- Align with company values
- Be focused on fuelling positive company culture
- Be given promptly
- Come from upper management
- Be promoted within the company
- Be fair and transparent
Schemes should avoid:
- Being biased especially towards high earners, management and those with personal company connections
- Further rewarding those who already earn commission rather than rewarding those who don't
- Unhealthy competition or fuelling envy between departments or individuals
- Enveloping perks that have formally been standard into the reward scheme (potentially taking away benefits employees already have)
Employee Recognition Ideas
Company events are highly effective for teams especially because everyone works towards the same goals and they get to celebrate together which further bonds your workforce. Events as a form of reward also recognise everyone in
the team equally. We’re not suggesting that you pin your annual Christmas party on whether the company meets their sales targets - repackaging regular events as dependent on performance will likely have the opposite effect on motivating employees. However, extra events can work well as a recognition scheme. A little like the rewards given to the winning team each week on the BBC’s The Apprentice.
Avoid - team-building days that directly benefit the company and often get a mixed reception from staff.
Years Of Service
Years of service are important to mark as it lets employees know you recognise and value the time they have given to you. Gifts are the most traditional way of rewarding employees for their 5, 10, 15 and 20 years of service (or more). Naturally, the more time served, the bigger the gift. We particularly love the idea of combining a gift with a day off. In this case, you’ll want the gift to be something they can use for this such as tickets for a show or event or a wellbeing gift set with items they can use to enjoy a well-deserved day of rest.
Whilst gifts to mark work anniversaries are traditional, another common theme is the employee reflecting on their past achievements and their future at the company. Therefore, work anniversaries are a good time for a check-in. Be aware of your employees' goals, ambitions and expectations for their careers and ensure you have a plan put together for how they can work towards this in the business.
Avoid - anything that’s not personal. The point is that you value their contribution so the reward should be tailored to the individual.
Shoutouts - Internal and external
You can’t present a gift, put on an event or give a bonus out every time an employee goes above and beyond. Besides, sometimes it’s as much about recognising commitment and consistency as it is about the big achievements. Especially since some employees’ job description simply doesn’t call for making a big impact as much as it does for daily efficiency. For example, your payroll assistant or your receptionist may do exemplary jobs that go unnoticed because they aren't working to targets or bringing in new clients.
Shoutouts give everyone the opportunity for recognition and although they can spark some healthy competition they can also help employees across departments recognise and take time to appreciate the efforts of others. You can even opt for a peer-to-peer scheme when it is fellow employees who nominate one another for recognition.
Recognition can be platformed through ‘Employee Of The Week’ or ‘Employee Of The Month’ schemes. Winners can be profiled on the company's Intranet and through social media (with their permission). They may also receive a voucher or corporate gift box.
Avoid - giving shoutouts to those whose impact is more easily tracked. For instance sales team members and upper management who tend to know and get rewarded when they’re doing well. Use shoutouts to shine light upon the unsung heroes.
Reward Scheme Ideas
Recognition is important but how you reward employees can have a real impact on your company culture and whether employees feel truly valued. Everybody loves being thanked for their hard work but employment is a transaction and rewards, therefore, should reflect the effort that’s been put into achieving them. Here are a few ideas for rewards companies can offer employees:
Financial incentives are always well received. If you are in a position to do so, most employees will value financial incentives above most else. Putting a proportion of your profits back into incentivising employees benefits your business long-term and helps retain employees who have been a part of your success in the past, so that they may continue to be part of your future success.
Of course, it is easier to offer bonuses to employees with targets, which means sales teams and management often reap the majority of financial rewards in such schemes. However, with a bit of creativity, it is possible to offer bonuses to those who keep the day-to-day essential parts of your business running smoothly. If you can find a way to do this, this can help you retain talent across your business and recognise the value employees across the business bring.
Avoid - Allowing bonuses to become a source of stress. An employee’s salary should be fair to begin with so that bonuses can be something uplifting, not something employees rely on.
Pepsi once ran a campaign called the Pepsi Challenge. It claimed that 7 out of 10 tasters preferred the taste of Pepsi over its biggest rival, Coca-Cola. Coca-Cola immediately announced they were changing its formula. Pepsi gave all its employees the day off. This true story demonstrates the simplest principle of management - when your staff succeed, give them a break.
Time is our most precious commodity and giving an employee the day off may not make seem like a massive gesture but it's a fair reward. If they’ve gone the extra mile, give them some time back. Giving an employee or team the day off is especially effective because too often our experience is that the harder we work the more that’s expected. A fairer approach would be, the harder we work, the more time we should have to enjoy the other parts of our lives.
Avoid - Announcing a day off on the day or even the day before as it will likely be wasted. Give the employee or employees some notice so they can make the most of it, perhaps enjoying it with family or friends.
Company share schemes can be a great way of rewarding employees by giving them shares in the company. Not only does this help make employees feel valued but it can be highly motivating as it further binds their career success with the company's success. Share schemes can relieve pressures on companies when they’re not in a position to offer financial incentives because they’re focusing on scaling up the business. Furthermore, giving shares to employees can align them more with the interests of the shareholders, giving them a more holistic view of the company beyond their particular role.
Avoid - Giving share scheme options to employees until they have worked with the company for a while. This is a scheme where loyalty and ongoing commitment should be rewarded over short-term successes.
Why Are Recognition And Reward Schemes Effective?
Contrary to widespread belief, the need to feel valued is not about ego. It’s actually about survival and it goes back to cave-person times. From the very early days of civilisation, human beings undertook roles in society so that groups could work cohesively for the good of the tribe as a whole. Rather than leave the sick or injured behind, we began to take care of one another, understanding that there was safety in numbers. We separated roles with some hunting, some gathering and later, some farming. By sharing the workload and each finding ways to contribute we became stronger, together. Having value didn’t just feel good, it meant we had a role to play. Which meant we would be protected and looked after by the rest of the tribe. Bringing value meant we were safer and this instinct has never left us.
Now we’re not hunting, we’re working. The resources we have access to are dependent on how much value we are perceived to be bringing through our employment. Therefore, our wellbeing is still tied to our sense of value.
So, if feeling valued makes us feel safer and more secure, then it translates that not feeling valued will make us feel the opposite way. If employees are feeling undervalued and therefore potentially anxious and insecure, not only can this harm productivity but it can make employees more likely to leave the business. After all, if they’re not feeling they bring value, then that will affect their sense of belonging.
Thoughtful reward and recognition schemes can help to make employees feel valued. Furthermore, they can:
- Bring teams together
- Reflect or reinforce company values
- Encourage loyalty and retention
- Attract talent to the business
- Make work more meaningful