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What is Employee Recognition? Why it Matters, and How to Make it Count?

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Human Resources

07 April 2022

Think about the last time you had a challenging project at work. It took a lot of effort, careful planning, and perfect execution. Yet, you managed to mold it into something you were proud of. That feeling of accomplishment is beautiful, but it’s multiplied when others notice it.

When employees feel valued at work, it boosts motivation, productivity, and even company loyalty. It’s how humans work. All of us want to feel valuable and important. And that is also applicable to our work life. A recent survey found that employee recognition was most important to 37% of employees.

That’s why employee recognition is so critical! This is especially important with remote work, where it’s so easy to feel your work is meaningless.

But to be successful, recognition should be done properly. As simple as it may sound, there are plenty of nuances to consider to make it count. Here, we will explore what employee recognition is, why it is so essential, and how to make it count!

Without further ado, let’s dive in!

What is Employee Recognition ?

Employee recognition is an act that rewards and respects employees’ achievements and their valuable contributions. By recognizing your employees effectively, you encourage and reinforce actions and behaviors that increase productivity and create a better working environment.

Employee recognition can be formal and informal. Let’s discuss both :

Informal recognition

A simple thank you can do magic!

Informal recognition consists of the often spontaneous simple thank you and expressions of appreciation for a job well done. As the name implies, it is not structured. Spontaneous and unplanned, it is used to emphasize behavior or achievement worthy of mention.

The vast majority of an organization's recognition activity should be informal. And there are some good reasons behind that!

Psychologist Paul White explains that when employees think managers use recognition to boost productivity and profits, it produces distrust. This cynicism leads to a decay of faith in leadership.

Formal Recognition

Formal recognition is different from informal recognition since it is usually supported by a defined structure and process. The employees who participate in it understand perfectly well what behaviors they must adopt and what actions they must do to earn a reward.

For example, think about customer support employees who need to reduce the average duration of their conversation. At the beginning of each month, the manager sets a simple goal – make conversations short and effective. The employee who manages to cut the lengths of conversations and remain helpful gets a monthly bonus or a gift card from the company.

This encourages others to work harder and achieve the same or even better results!

Why Does Employee Recognition Matter?

We have discussed the definition of employee recognition. Yet, why should companies spend their money and energy on promoting employee recognition culture and programs?

Well, the answer to this question is straightforward. The organizations that regularly acknowledge the achievements of their employees far outperform those that don't.

Effective employee recognition practices positively affect productivity, motivation, and loyalty.

Let’s just look at numbers!

Recognition increases employee engagement, productivity, and performance by 14%, according to Deloitte. When employees feel appreciated and valued, they feel happier. And happy people work better! According to the Society for Human Resource Management, 79% of employees work harder due to recognition in the workplace.

Employee recognition benefits not only productivity but also helps to build a better working environment. The act of appreciating others naturally connects people more closely, at work and home. According to a recent study, 70% of employees say recognition makes them feel emotionally connected to peers. Another 70% say recognition makes them happier, even when working from home.

Despite these facts, one survey found that 65% of employees haven’t received any form of recognition for good work in the last year. This increases stress levels and often causes employees to search for a new jobs.

How to Show Recognition to Employees

There are many ways to praise and acknowledge employees for their good work. Knowing your employees will better help you gauge which type of employee recognition is best for your team.

Host Recognition Meetings

Peer-to-peer recognition is essential for creating relationships within the company and making employees feel appreciated. Hosting monthly recognition meetings encourages team members to come together and recognize one another’s achievements.

Recognize Small Achievements

COVID-19 changed everything and business as usual does not apply to these strange and stressful times. For many during this crisis, completing an ordinary daily task is an extraordinary accomplishment. Make sure you acknowledge this, especially for employees who have families and take care of children while working from home.

Promote Professional Development

Yet another great way to make your employees feel valuable is to encourage continued professional growth.

Discuss with individual team members what courses they would like to take and offer them for free. Showing your employees, you care about their personal and professional growth during this time when they might feel meaningless and lost is crucial.

To Sum

As we have seen, employee recognition is crucial for your team’s happiness and motivation. This, in turn, translates to increased success and productivity for your company.

There are many ways to acknowledge positive behavior and accomplishments, from saying simple thank you to giving monthly bonuses. Think about what you can do with given budgetary and human restrictions.

It doesn’t have to be grandiose! Be sincere and supportive! That’s what matters the most!


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