Employers Embrace Peer-to-Peer Recognition

At many companies, traditional top-down recognition by managers isn’t enough anymore. Employees also want acknowledgment from the peers they work with every day. This newer, more collaborative approach can have many benefits: It instills a sense of team spirit, motivates employees to do great work, and promotes openness and transparency. And recognition from peers may come as a surprise, which can have a very powerful impact.

The recognition program at Colorado’s Douglas County library system includes a peer component. Employees nominate colleagues for their accomplishments, and every year a special committee chooses individuals or teams to be recognized. Those honored this year include two librarians who created a storytime experience for special-needs children; four who developed an improved inventory process; and one who helped create a website describing volunteer opportunities in the county.

The library system honors the selected employees during a recognition dinner and gives each one a paid day off, says Art Glover, SPHR, associate director of human resources at Douglas County Libraries and a member of the Society for Human Resource Management (SHRM) HR Disciplines Special Expertise Panel. In addition, each winner’s favorite library book is adorned with a label recognizing him or her.

It’s an example of an effective low-tech approach to peer recognition. Other companies are experimenting with social-media-inspired approaches using specialized software from vendors.

Peer-to-Peer’s Appeal

In the last three Trends in Employee Recognition survey reports by WorldatWork, peer-to-peer programs have ranked as the third most common type of recognition program among employers. Peer-to-peer recognition ranked behind recognition for “length of service” and for “above-and-beyond performance.” Of the employers surveyed, 42 percent used peer-to-peer recognition programs in 2013.

Over the past five years, Roy Saunderson has seen a slow but steady increase in requests for peer recognition programs. Saunderson is chief learning officer of the Recognition Management Institute, the consulting and education division of Rideau Inc.

Rideau helps clients develop their programs. Its technology lets employees praise peers via e-cards and highlight their accomplishments on a Facebook-style recognition newsfeed that exists behind the company firewall. The feed can be set to allow everyone within the organization to view the posts or just the immediate team.

Many companies have downsized in recent years and have fewer managers, says Saunderson, so it makes sense for peers to recognize one another.

Moreover, in some cases managers may be thousands of miles away from the employees they supervise. Peer-to-peer feedback can be helpful and informative in those situations, says Derek Irvine, vice president of client strategy and consulting at Globoforce, an employee recognition vendor. Peers working at the same location generally are familiar with one another’s work, he says, so they’re well-positioned to give feedback and recognition. One of Globoforce’s tools lets employees view peer recognition on an internal feed. Other employees can add congratulations and comments.

Irvine doesn’t recommend eliminating traditional top-down recognition programs, though, because they give employees valuable feedback directly from their managers. Rather, he says, peer programs should be used in conjunction with recognition by managers.

The two youngest generations in the workforce may be contributing to the popularity of peer-to-peer recognition, according to Achievers Corp., an employee recognition software and services vendor. In a report on engaging Generation X and Millennial employees, Achievers describes peer recognition as a grassroots technique that involves the entire workforce. “With peer-to-peer recognition, everyone has a chance to offer feedback—which taps into the need for Gen X and Millennial employees to have their voices heard,” the report states.

Technology-based peer recognition systems are often accessible on mobile devices and appeal to younger workers and others who are savvy about social media and mobile technology.

Mixed Research Results

Businesses with peer recognition programs have reported positive outcomes. The 2012 Employee Recognition Surveyreport, conducted by SHRM and commissioned by Globoforce, found that

57 percent of HR professionals in companies that introduced peer-to-peer recognition programs reported higher levels of employee engagement, compared with 46 percent of those without such programs. Also, 28 percent of companies that began using peer systems experienced improved retention, compared with 21 percent of those that did not implement such systems.

However, a 2014 survey cast some doubt on the value of these programs. In a survey on employee recognition conducted on behalf of the American Psychological Association (APA), only 16 percent of employees said peer-to-peer recognition was important to them.

Notably, the youngest group (respondents ages 18 to 34) was most likely to embrace peer programs, according to the APA survey: 21 percent of respondents in that age group cared about peer-to-peer recognition. Meanwhile, only 15 percent of those in the 35- to 44-year-old demographic cared about it. So this form of recognition may become increasingly important as younger generations move into the workforce over the coming years.

Employer Goals

Vendors claim that companies are increasingly using peer-to-peer recognition to meet a variety of goals, including improving retention, reinforcing company values and boosting employee engagement.

“Goals are dictated by the individual company and the type of culture they choose to have,” says Tai Aguirre, director of business development at Taico Incentive Services, which provides consulting services and software to help employers develop their own unique incentive programs.

Over the past five years, turnover at the Douglas County library system generally has been below the average for Colorado businesses, and Glover thinks the peer recognition program has contributed to that trend. For instance, in 2013 the library system’s turnover rate was 13 percent, compared with 17 percent for businesses in the state as a whole.

Jason Harney, marketing and product director at recognition and rewards vendor Workstars, says peer recognition can help bring company values to life. He likens his company’s system to “a Twitter feed [highlighting] everything positive that’s taken place in your business.” The technology empowers workers to observe and appreciate all the positives, Harney says.

Peer-to-peer programs provide “full visibility and transparency” into what’s occurring among co-workers, says Patrick Quirk, president and CEO of Achievers. As part of the Achievers system, recognition appears on a social newsfeed that the entire company can see.

At business services and consulting company FCC Services, employees can write notes to peers expressing appreciation for their work, says Human Resources Director Linda Murphy, PHR. A key aim is boosting employee engagement. In addition to being posted on a bulletin board, the notes are entered into a quarterly drawing; the author and recipient of the note each receive a $25 gift card if their note is pulled.

At online shoe and clothing retailer Zappos, meanwhile, one peer program allows employees to give “Zollars” to co-workers. Recipients can use the currency in several ways, including buying items at the “Zollar Store” or donating to a charitable cause.

Peer recognition can mean a lot to people because it often comes from the heart. While managers are expected to provide feedback, peers are under no such obligation, notes Kelly Wolske, senior trainer at Zappos—and in some instances they may even view one another as competitors. It’s an easy way to make rewards more accessible and meaningful to everyone.

Toni Vranjes is a freelance business writer in San Pedro, Calif.