Employee Recognition in the Workplace

A White Paper provided by Ledgent Technology & Engineering

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Technology firms have gained quite a reputation over the years for offering their employees bountiful and increasingly over-the-top perks. Free food, yoga classes and gaming lounges may contribute to a company’s unique personality, but studies have shown these perks do not take the place of recognition when it comes to making an employee feel valued.

Whether you’re a firm that can afford alluring “extras” or operate within a more modest budget, you have this in common with organizations throughout the nation and across industries: recognizing employees is critical to your overall success.

According to a survey by Ceridian, recognition and rewards for performance drive employee engagement. “A robust rewards program is an important engagement tool for employers,” says Dave MacKay, President of Ceridian HCM.

As an organization, Ledgent Technology has dedicated ourselves to understanding employee engagement. Our own internal research reveals the same results as Ceridian’s and others: recognition has a direct correlation with engagement.

But what is the best way to recognize your team members? Recognition should be a balance: sincere and unique, while still playing an active structured role in your organization. While spontaneous “thank you’s” are appreciated by all, recognition is a critical element in your overall system for creating and maintaining an engaged workforce. Through daily actions and structured programs, you can create a self-sustaining culture of recognition.

Guiding Recognition

Richard S. Wellins, co-author of Your First Leadership Job: How Catalyst Leaders Bring Out the Best in Others, states, “[Recognition is] so simple, but our research shows that one- to two-thirds of leaders are not good at acknowledging good work.” He goes on to explain that leaders often worry that praise will seem unprofessional, or that employees will become complacent or overconfident. “It isn’t and they won’t.”

With the competition for top technology talent, your organization can’t afford to lose employees because they feel their efforts have gone unrecognized. A lack of acknowledgment has a direct impact on productivity: 40% of employed Americans say they’d put more energy into their work if they were recognized more often, while 50% of employees who don’t feel valued plan to look for another job within the next year.

Your employees are what make your business possible, but do they know that?

While many organizations may consider themselves too small to boast huge recognition programs and bonuses, small acts and the spirit of recognition can go farther than you think. A study by KRC Research discovered 6 in 10 employed Americans say they are more motivated by recognition than they are money. Another study found that 83% said recognition for contributions is more fulfilling than any reward or gift.

David Novak, the cofounder and former CEO of Yum! Brands, and author of O Great One! A Little Story About the Awesome Power of Recognition believes in inspiring people through joyful, personal acts of recognition that deepen relationships. “In simply showing employees how much they are appreciated and recognizing their great work and ideas, leaders can create an energized work environment,” says Novak. Recognition is a simple way to demonstrate to your employees the role they, and their contributions, play in moving the organization forward. This increases both their pride and sense of ownership.

“Organizations can revitalize company culture and connect people back to the company,” says Novak. “[Recognition creates] a catalyst for bottom line results and widespread confidence that everyone is important in the organization.”

Recognition » Engagement » $

Engagement is on every leader’s mind because engaged workers tend to be better workers. Recognition is but a single element of engagement. Engaged workers are passionate and enthusiastic, consistently outperforming non-engaged employees. They provide better service to your internal and external customers, and are better teammates.

Employees with low engagement levels are linked to higher turnover, higher absenteeism, and lower profitability. Quantum Workplace determined that hostile employees are four times more likely than engaged employees to claim that they didn’t receive enough recognition.

High engagement levels often stem from employees who feel valued and cared for. Employee recognition is one of the key drivers of employee engagement across industries and job classifications.

“Every time Ledgent Technology completes internal engagement surveys,” says Lori Eade, Manager of Customer Experience at Roth Staffing Companies (parent company of Ledgent Technology). “We see a direct correlation between how ‘recognized’ and valued a coworker feels and his or her overall engagement. All types of coworkers—from senior leadership to our entry-level positions—rank ‘I have been recognized for doing good work’ near the top of their workplace needs list.”

The Basics

Each organization and department should develop programs and practices that suit its unique team members and industry, yet there are certain philosophies and methods that remain constant. These include:

  • Pay increases and cash bonuses
  • Verbal and written praise
  • Compassionate leadership

Pay Increases & Cash Bonuses

Compensation is always a factor when it comes to employee satisfaction, and that’s okay. Quantum Workplace reports that approximately 60% of survey respondents ranked pay increases as one of the most important forms of recognition. For those workplaces that have the ability to provide financial rewards to top performing employees, develop a plan to reward coworkers once they hit certain individual and/or group goals.

Pioneer of Netfilx’s iconic company culture, Patty McCord, states, “If your company has a performance bonus plan, go up to a random employee and ask, ‘Do you know specifically what you should be doing right now to increase your bonus?’ If he or she can’t answer, the HR team isn’t making things as clear as they need to be.”

Everyone in your department or team should know exactly what will earn them those financial rewards. Transparency is key to ensuring that everyone understands which goals to strive for and how to earn rewards fairly. With a clear path towards rewards, this level of transparency can also reduce jealousy amongst teammates.

Organizations and departments with tighter budgets may have to do some rearranging to free up the cash flow required to financially reward top performers. One strategy is to poll coworkers and ask their opinion: would they rather have weekly company lunches or see that money go toward sporadic cash bonuses for top performers? Receiving feedback can guide your workplace’s recognition budget and ensure that coworkers feel like their voices are heard.

Verbal and Written Praise

According to the Society for Human Resource Management (SHRM), employees may feel more committed to their organization if they believe that their efforts are valued. Amongst engaged employees, 63% are satisfied with their management’s recognition of employee job performance.

Ledgent Technology’s research has determined that all types of employees rank praise and recognition from their direct managers as important to their workplace satisfaction. Be sure to encourage all types of praise-based recognition such as:

  • Verbal recognition in a group setting like companywide or team meetings
  • Verbal praise from individual to individual
  • Written recognition via email, notes, or a recognition white board/leaderboard (either hung in the office or hosted online)

However, you do not need to pass around gold stars for every single action. Be sure to define the difference between responsibilities and accomplishments.

Nurture a culture of abundant recognition by promoting all forms of praise such as peer-to-peer, top-down, bottom-up, within teams, and across departments. Workplaces where coworkers are encouraged to praise and thank a fellow coworker often experience a self-sustaining cycle of praise and good deeds: coworkers go above and beyond to create remarkable experiences, another employee appreciates and recognizes that coworker’s efforts, and both employees are motivated to create more remarkable experiences that result in praise.

It seems so simple. Just give verbal and written praise. The truth is most employees do not receive genuine, thoughtful words of gratitude and appreciation at work. Only 10% of people say “thank you” to their colleagues on a given day, and 60% of people never express gratitude at work.

“I believe in saying ‘thank you’ daily, but making sure it is sincere,” says Accounting Director Kari Braun. “When an employee goes above and beyond, I leave them a handwritten thank you card that night so they have time to read it first thing the next morning, and I might slip in a small gift card… If we have to stay late, I buy them Starbucks and I remember what their favorite drink is.”

Compassionate Leadership

According to managers, the number one reason an employee leaves a position is pay. But according to employees, it’s the manager. If you want a workplace that is abundant in recognition, it begins with your leaders – all the way up to the top. Leaders set the tone for your entire organization. “I know that when I utter more words of recognition, it’s contagious,” says VP of Marketing Staci Johnson. “I hear peer-to-peer recognition increase as a result.”

Gratitude and recognition can create a ripple effect. Receiving a brief written expression of gratitude motivates individuals to assist not only the author of the card, but others as well. Make compassion and recognition key components in your leadership development training.

Leaders and managers should make recognition a part of their routine. Here is a sample “schedule” of how often and what type of personal recognition to give:

  • Monthly: Send a simple personal email of gratitude. Don’t be sappy, just a sincere “Thank You.
  • Bi-monthly: Hand write Thank You notes to team members
  • Semi-monthly: Mention publicly how fantastic an employee is
  • Annually: Send a hand-written card to their homes, unexpectedly, just to tell them you appreciate them

Here are three tools your managers need to be consistent and frequent with recognition:

  • AN EASY WAY to recognize great work

Online portals can be messy, experiment with quicker methods like physical “recognition dollars” that can be given to employees and retrieved for rewards.

  • KNOW what is appropriate

Define what deserves recognition and company and department goals. Make these visible and all employees aware of what they’re working towards. (Be sure to include cultural practices as well.)

  • A VARIETY of tools and ideas

Recognition is not one size fits all, some employees prefer public, verbal recognition, while others may prefer a personal and private nod. Be sure managers are equipped with various tools to recognize their team.

The Privilege of Recognition

A manager or organization shouldn’t give recognition just to increase engagement numbers. You should do it because it’s the right thing to do. Your employees are what keep your business thriving. Express that to them. “Recognition is a privilege of leadership,” says Novak. “Great leaders celebrate other people’s ideas even more than their own, and do it in a way that is real and from the heart.”



About Ledgent Technology

Ledgent Technology specializes in the placement of full-time and contract professionals in roles ranging from IT support to software development. We are a division of Roth Staffing Companies, one of the largest privately-held staffing companies in the country, operating from more than 100 locations in 20 states and the District of Columbia via six specialized business lines: Ledgent TechnologyUltimate Staffing Services (the 11th largest office/clerical staffing company in the country), Ledgent Finance & Accounting, Adams & Martin Group (legal staffing), and affiliates Ultimate Locum Tenens and About Talent (a workforce solutions company).

Roth Staffing Companies stands as the only firm in the industry ever ranked #1 on the Inc. 500 list of fastest-growing, privately-owned companies, and is the only one to receive all of the industry’s most prestigious honors in a single year, accomplishing this feat for two consecutive years.  The organization is consistently ranked among the 50 largest staffing companies in the country.