Trends in Employee Recognition Programs

By Kathy Gurchiek May 21, 2015

A growing number of organizations are relying on employee recognition programs that help drive organizational results, according to a new report, Trends in Employee Recognition, released in May 2015.

Motivating specific behavior continued to be among the top five goals, which also included singling out employees’ length of service, above-and-beyond performance, peer-to-peer recognition and retirement.

The findings are from a survey conducted in February and March 2015 that found that employee recognition programs remain an important part of the total rewards toolkit, with 89 percent of organizations having such programs in place.

WorldatWork conducted the survey with 489 of its members in the U.S., Canada and other countries.

Other trends the report identified:

The prevalence of written strategies for employee recognition programs has increased.

68 percent of organizations have between three and six different recognition programs. The average number an organization offers has been trending upward since 2013.

Improving biometric indices through wellness initiatives debuted as sixth on the list of top goals for recognition programs. More than two-thirds of organizations with such a program have had it in place for one to five years.

Motivating Specific Behaviors

“Tenure has been No. 1” as a means of recognizing employees since the inception of the survey in 2001, said Rose Stanley, CEBS, senior practice leader at WorldatWork.

However, the percentage of organizations offering recognition programs that motivate specific behaviors has grown steadily since WorldatWork began asking about it—from 25 percent in 2008 to 34 percent in 2011, to 41 percent in 2013 and up to 51 percent in 2015.

“We are seeing organizations becoming more thoughtful about linking the behavior they’re looking for to drive the results” they want, she noted.

HR continues to be responsible for administering the majority of recognition programs, but Stanley pointed out that it’s HR’s role to help mentor managers to understand how they can use those programs with the employees they oversee.

“Who’s giving out the recognition?” Stanley asked. “It’s not HR, it’s managers. [Once] managers understand how they use those recognition programs in order to drive behavior ... then you start to see some results.”

However, only 12 percent of organizations provide formal training for managers in using recognition programs.

Result-Driven Recognition

The prevalence of written strategies has increased as the number of result-driven recognition programs in use has climbed. Fifty-three percent of organizations reported having a written strategy behind their recognition programs, and nearly all (97 percent) said their recognition program strategies align with the organizational strategy.

“What we’re seeing is that organizations are trying to be very strategic in their recognition,” Stanley said.

WorldatWork identified and analyzed four kinds of result-driven programs—above-and-beyond performance programs, peer-to-peer recognition programs, programs motivating specific behaviors, and programs to improve biometric indices through wellness initiatives—to understand their effectiveness.

“If [organizations] don’t have any of these types of recognition programs in their strategy,” Stanley told SHRM Online, “they really need to start putting them in.” That’s because recognition “plays a role in creating an atmosphere of higher engagement, motivation and overall job satisfaction,” she noted in a news release.

Only 13 percent of organizations responding to the survey offer all four of these result-driven recognition programs and around one-fourth offer one to three such programs.

However, with every additional result-driven program offered, “there appears to be a connection to the perception that these programs, in general, are meeting goals or objectives,” according to the report. “Reports of success go up by 6 to 12 percentage points each time the number of programs used goes up.”

It’s unknown if that is because there is greater clarity around result-driven programs and so they are better communicated and easier to measure than programs such as “Employee of the Month,” WorldatWork noted in the report.

Kathy Gurchiek is the associate editor of HR News.

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