Rewarding under performers for one-off achievements – does it make sense?

Rewarding under performers for one-off achievements – does it make sense?

This is one dilemma that many line managers and HR Partners face ; whether to reward an under performer for a significant achievement, as part of the employee rewards and recognition program. In most cases, the Rewards and Recognition Policies might not state anything explicitly, leaving it to the better judgement of the concerned managers.

An important point to note here is that consistent under performers might rarely be around in the system since the performance assessment process would take care of that. Hence, under performance might be a temporary phase or it could be just relative. And more than other employees, these employees need more motivation.

Managers often tend to use all available resources to motivate their employees. This might result in managers tending to ignore the under performers and focusing on the top performers when it comes to rewards and recognition. Hence a truly deserving employee might miss out on a spot award for a significant achievement, due to his or her overall performance history.

Not only is this unfair, but counterproductive as well. The manager might be missing out on an important opportunity to motivate an under performer and putting him or her back on track. Whereas a top performer, who might not truly deserve the award, might actually get it and this might cause any significant change in their motivation levels.

Hence it is our recommendation that awards especially those in the category of spot awards should be given based on the immediate achievements and not the overall track record of the employees. Awards should be treated as awards and not as proxies for the performance assessment process!

What’s the best form of employee rewards?

Employee rewards in modern day organizations has been evolving over the years – it has become more of an art than a science. Gone are those days where employees were happy receiving trophies and consumer durables.

Organizations have tried everything from trophies, company branded merchandize, durables, electronics, holiday packages, gift vouchers and even cash.  Many organizations have used training programs and conferences to motivate their high performing employees. A few of these methods have worked, most of them haven’t. What does it mean for organizations? Should they stop experimenting and continue with what they are doing? What is the best method of rewarding employees?

As you might have guessed by now, that there is no single right answer to this question! The answer is ‘it depends’. It depends on a whole host of factors ranging from the industry type to employee seniority level right down to individual employee preferences. Given the complexity of the situation, organizations are faced with the daunting task of choosing the type of reward to give their employees.

However, a couple of options seem to make sense more than others. Rather than deciding on what the employees would want, it would seem better to leave the choice to the employees themselves. Given this, cash, digital currency or popular gift vouchers would make the cut. Employees could use these rewards to purchase that they would want to rather than being locked down to the choices of the HR/ management team. These work out far better than the traditional company branded merchandize or consumer durables.

How do intangible rewards work out? It’s definitely a good idea given the overuse of the other kinds of rewards. Coffee with the CEO, Dinner with the Director, Conferences and Training programs are few of the ideas that be utilized by organizations that do not prefer monetary rewards.  In fact, we believe these types of rewards could actually get into mainstream going forward. Coupled the social recognition from colleagues, employees would find these rewards more meaningful than others.

 

How important is recognition for employee engagement?

To answer this question, let’s pose another question! What is employee engagement in the first place?

Very broadly, employee engagement is the art and science of making employees feel good – about themselves, about the organization, about working in the organization and about working with each other. This ‘feel good factor’ can be achieved through tangible and intangible means.

In today’s day and age, social recognition plays an important role in what makes us feel good. People are thirsting for likes and comments on social media like Facebook, Instagram, etc. In a similar way, employees value social recognition of their achievements at the workplace. For confidentiality and data privacy reasons, the reach of these recognition platforms might be restricted to within the four walls of the organization.

Monetary rewards can play can be an additional factor on top of the social recognition.  Even non-monetary benefits like conferences, training programs and direct interactions with the top brass might do equally well if not better!  All adds up to the ‘feel good factor’ of employee engagement.

The most critical aspect of recognition is spontaneity, appreciation as something good happens. Could be a casual pat on the back or a round of applause at team meeting – it all makes a difference, provided it’s timely. Obviously, the quantum or the perceived value of the awards needs to be calibrated with the level of achievement for it to make sense.

All said and done, recognition plays an integral part of employee engagement not matter how it is executed. At the end of day, happy employee is what matters most whether is a pat on the back, a trophy, a shopping voucher or a trip to the Bahamas!

 

Can Rewards and Recognition drive a culture change in the organization?

The short and sweet answer to this question is an absolute yes! Provided the desired behaviors that should be a part of the organizational culture are mapped correctly and rewards and recognition is used to reinforce them.

Let’s take an example – as an organization if you want to create a culture of honesty and hard work, you might want to formally recognize employees who had the option of not being fully honest in the course of their work by taking the easy way out but decided to stay on the right path even if that meant putting in a lot more effort and maybe even a slight delay in achieving their goals.

Another example could be of an organization which wants to discourage employees from staying in office till late either because they are inefficient or they want to impress their superiors. If the organization recognizes employees who are genuinely efficient – they complete their work on time and leave office on time consistently. While it might be hard to rank and stack employees based on their efficiency, there could be a self-nomination process and the claims of the nominees could be easily validated based on feedback from their managers and the attendance system data.

In fact, our view is that rewards and recognition can play a pivotal role in initiating a change in the organization culture.  It is really basic human nature to gravitate towards behaviors than give them the maximum benefits.  Organizations should include behavior or value based recognition in their employee programs in addition to the general outcome based recognition – that’s our recommendation.

Should organizations celebrate employees’ personal milestones?

Mumbai, 3:30pm, an ad agency office: In the large conference room, there is a party going on! Music, snacks, beverages, flowers and a cake! Is it someone’s birthday today? No! It’s Smita’s wedding anniversary! So her team, the HR and her boss are celebrating the occasion. The HR dials Aloke, Smita’s husband and switches on the speaker phone as Smita cuts the cake and her colleagues cheer and clap.
Switch over to Aloke’s office, a multi-national bank. All work and no play! A few colleagues who follow him on social media wished him in the morning but nothing as such happened officially. No party, no celebrations! Just like any other day at office for Aloke.

The question is whether organizations should celebrate employee’s personal milestones? If so, how far should they go? Employee’s birthday, marriage, new born,
wedding anniversary, spouse’s birthday, children’s birthdays? What else?

The simple answer is yes! If it makes the employees happy and does not cost a whole lot to the organization, then it makes absolute sense to do it! It could be a simple group mail, a post on the intranet or official social media, a small inexpensive gift or even a small party. Organizations might want to incorporate these in their employee welfare policies and budgets. HR and Managers might do well to proactively implement the policies. Even without an explicit policy, they can take the initiative to acknowledge such occasions, be it a simple bouquet and card. Such initiatives can go a long way in deepening the bond with the organization and build better bonding within the team. Today when there is so much digitization and automation, a little personal touch is really helpful in improving employee motivation.

Should organizations reward employees for their achievements outside?

Amit works for a leading multinational in Mumbai. He is a big running enthusiast. He runs races in different cities across India and the world. Recently, he successfully completed the Kenyan Ultra Marathon. He posted the pics on Facebook and Instagram, and his friends started liking and commenting on the posts. Several of his office colleagues, who follow him on social media walked up to him and congratulated him. It felt very good!
Amit’s friend Shekhar works in a start-up in Bangalore. He is also a fitness enthusiast but not as big as Amit. Somehow Amit had convinced him to join him for the Kenyan Ultra Marathon. Due to his fitness levels, he did manage to finish the race but he had severe cramps and dehydration after it. The day he re-joined office, he received a hero’s welcome – there was a flash mob, bouquets and gifts from the management; the CEO himself came and congratulated him, the HR invited him to give the entire team a pep talk about fitness which was webcast across the other locations and the video was added to the company intranet. Shekhar was overwhelmed. He started a running club along with his colleagues and employees of other organizations around his office also joined in. Amit flies down once a month to Bangalore to coach the club members. They travel across the country to participate in running events.
So, what are we saying here? Should organizations celebrate achievements of employees outside of them? Does it make sense? If so, where should one draw the line?
If one were to jot down the broad categories of external achievements possible, one can come up with a list like this:
• Scholastic achievements like getting a degree or certification
• Sports achievements like winning or participating in a major sporting event
• Artistic achievements like winning a talent hunt or performing in an event
• Social achievements such doing a project for a social cause
• Personal achievements such as getting engaged or married or spouse or children achieving something important
Our view is that as a best practice an organization irrespective of its size or origin should make some attempts to recognize employee achievement outside of its boundaries, even if monetary reward is not possible. Even an email, a mention on the intranet or a newsletter or during a floor meeting might work!
Most organizations might not have explicit policies on this, so it is up to the HR and line management to take the initiative on the same. Yes, there are qualitative calls that they need to take on the level of achievement but it’s not that big a deal. Bottom-line: its worth doing something which makes employee s feel happy and motivated and doesn’t cost the organization a bomb!

by HiFives Team
To know more about best practices of employee rewards and recognition, please visit www.hifives.in

The Future of Employee Rewards: Will be earned but not given

Employee rewards and recognition is still the work of the managers and HR in 90% of organizations much like compensation and benefits. It is yet another task, another chore, another line item in the to-do lists of managers and HR.

Nomenclature varies from organization to organization – Spot Awards, Star Employee, Performance Champion, etc. The process might also vary from one organization to another – manager nominates, functional head or a panel selects the winner, HR communicates to the winning employee, either over email or in a larger forum such as a town hall or a floor meeting. But, the overall concept of employee rewards remains the same across most organizations.

There are a few progressive organizations that believe in the concept of 360 degree recognition and invite nominations from peers and colleagues. In most cases, these nominations need to be scrutinized and accepted by the managers/ HR before it can be released to the employees.

A good number of organizations use some sort of process tools to automate the rewards and recognition based on predefined rules. These tools simply make the processes more efficient and reduce the chances of errors. There is hardly any built–in intelligence in these tools to decide winners based on continuous assessment of employee performance. They just process the requests from managers and communicate to the selected employees.

In the future, as the new generation of employees enter the workforce we have good reason to believe that the rewards and recognition scenario will also undergo a massive transformation. Employees will no longer be ‘given’ rewards by their managers and HR but will ’earn’ the rewards themselves based on their actions and performance. Systems powered by artificial intelligence will automatically assess the performance of employees based on past data and reward employees automatically objectively and fairly without manual intervention. These systems will capture data from all work tools that the employees use such as project management systems, CRM tools, issue trackers, attendance systems, learning management systems, etc. The ‘intelligent’ reward systems will be able to understand the level of challenge under which the employee is performing and the capability of the employee (based on past performance) and reward him or her accordingly.
What this means is that employees who are at higher of performance might get rewarded less for performing the same level of task as those employees who are still performing at a lower level. Of course there could be a different school of thought on that. The HR and the management will still be able to define the rewards framework, the thresholds, the levels and quantum of rewards.
This is what we believe the future of employee rewards will look like. Employees will not have to wait for their managers to reward them but will earn the rewards themselves on the go. As always, there will be progressive organizations who will adopt these concepts earlier than others. Also, a whole new generation of ‘intelligent’ reward systems that will start coming into organizations.

How to use Gamification to boost your employee referral programme

Chantelle Jones
Head of Operations at Scede.io

Introduction
How is your employee referral programme going? For a large number of companies, it’s a struggle.

However, employee referral programmes can be one of the most powerful weapons an internal recruitment or HR department can have.

Here are some of the benefits that show why an employee referral programme is so great:

46% of referred employees are likely to still be in the business after a year, as opposed to 33% of employees that have come from a career site
Employee referrals have the highest applicant to hire conversion rate – only 7% apply, but this accounts for 40% of all hires
67% of employers and recruiters said the recruiting process was shorter, and 51% said it was less expensive to recruit via referrals
So how are businesses like Deloitte, IBM and Freshbooks rocking their employee referral programme and keeping their employees engaged throughout? Although there are many great benefits to employee referral programmes, you’d be surprised at how many companies get it wrong and do not stick with it.

The answer – Gamification.

Gamification
“The application of typical elements of game playing to other areas of activity, typically as an online marketing technique to encourage engagement with a product or service.”

Getting Started:

Before you do anything, you need to get people on board with the idea. At the end of the day, if your employees aren’t bothered about your employee referral programme then you will get very little results.

Create a step by step guide for all employees. This guide will enable you to explain the rules, the game and processes, prizes, your recruitment process and the type of people you look for.

By clearly highlighting each step, you are allowing each employee to master the system and get really involved.

Perhaps give them some basic social recruitment training so they feel confident in the actions they take.

Give Feedback:

In any part of the recruitment life-cycle, feedback is one of the most important parts of the process. This is no different!

Employees won’t ‘play the game’ if they feel that their referral falls into a black hole, never to be seen again. By constantly giving feedback, you are encouraging further action to be taken by each member of your team.

By implementing a points system, each employee can see exactly what they have done and that their action has been recognized.

To keep everyone engaged and encourage everyone to participate, points should be rewarded based on effort.

Here are some ideas to get you started:

Sharing the career site blog, jobs and company culture
Proactively building a network within your industry and competitors
Providing leads on candidates who are looking to move from their present role
Recommending qualified candidates
Candidates who pass interviews
Candidates who are hired

Make it multi-player:

Just like any other game, it’s OK playing on your own, however it’s a lot more fun when you have others joining in too.

Bring out the competitive side of your team and create a leader board that you can share with your entire business.

You could even have a leader board displayed in the office if you are going through major growth.

To ramp up the competition or build on participants (not to mention to expand your network!) you can invite non-employees into your employee referral program. Consider bringing in industry influencers, former employees, business partners and vendors into the game.

They will enjoy being part of something and having the potential to win prizes. Furthermore, you will get a far wider reach of passive candidates.

Make it fun:

Allow more winners.

It’s one of the simplest but yet most powerful pieces of advice I can give for creating a successful employee referral programme.

Think about it. As an employee, you put it in all that effort, the candidate you referred has made it to the last round, and they fall at the last hurdle. What do you get for it?

That’s right, nothing. Not even a pat on the back from your boss. So why bother next time?

There are a lot of things you can do to make your employee referral programme fun for your employees and therefore boost recommendations. I would suggest speaking with your team to find out what they are motivated by.

After all, who knows what they want better than themselves?

In the meantime, here are some ideas to get you started:

Surprise your employees! Don’t be afraid to mix things up a bit. Swap and change the points system, have random raffles for people who have hit a certain points level or even have a power hour where they will get double points for the actions made within a certain time frame
Got a hard to fill role? Offer a special prize for everyone who refers a qualified candidate for that position
Make points redeemable for prizes – this gives your team an element of control (which they will like). You can start off small and inexpensive: scratch cards, vouchers and experience tickets
When people reach a particular status in the leader board they can win a fixed prize. For example, dinner for two when they reach the top 4
Encourage teamwork – have a department or office location competition to create teamwork. You can then give a collective reward to the department that contributes the most qualified candidates

Conclusion
Remember:

Remember: An employee referral programme is not something you launch, it’s something you do. In order for your program to take off, you need to constantly enrol people into the game!

Remember: Your leaders need to get involved too. Like with anything else in the working world, your Hiring Managers need to set a good example – set them monthly goals, or even separate hiring manager competitions to keep them involved.

Remember: Review your leader board often and stay on top everything. People will quickly lose interest if you don’t.

Remember: Constantly acknowledge your staff and give people feedback.

And there you have it, some key advice to help you get your employee referral program working and turning your entire workforce into recruitment superstars!

Before I go:

But before I go, I want to leave you with some ideas of how you can reward your employees. Not every business has the cash reserves for extravagant rewards.

Best reward practices:

Cash rewards
Product awards e.g. Tablets and clothes vouchers
Experience awards e.g. A theatre trip with overnight stay in hotel
Paid vacation or days in lieu
Public recognition

Disruptive New HR Tech That Can Boost Employee Engagement

The modern HR mission has shifted to focus on putting people first and employee engagement has become the yardstick of HR performance. The good news is disruptive HR technologies are redefining HR from recruitment to employee feedback—and finally making strides on boosting engagement.

After years of stagnant employee engagement scores, Gallup recently reported a slight uptick. In the latest 2017 Gallup State of the American Workplace Report,over 33% of the workforce said they felt engaged in 2016. While still low, this reflects a 3% increase from 2012 and the highest engagement number in Gallup’s 15 years of tracking this metric.

What’s driving this uptick? Specifically, Gallup highlighted a notable improvement in three elements of employee engagement: (1) learning, (2) recognition, and (3) feedback.

In particular, startups are spawning new HR technologies that can really help organizations move the needle on employee engagement. What are those disruptive technologies? See The HR Tech Stack Engagement Guide: New Innovations Disrupting HR.

How can you leverage these new technologies to boost engagement at your organization throughout the employee lifecycle?

Hr Engagement chart

1. First impressions count: start on day 1

The very first time you interact with your new employee—from the first recruitment touch to the first day at work—matters when it comes to nurturing strong engagement in your workforce. When companies have excellent recruitment practices, they experience a 300% revenue growth.

New personalized and data-driven recruitment tools can make sure new hires make positive associations with your organization before they even arrive. Structuring and aggregating feedback to review candidates takes the guesswork out and ensures you make unbiased decisions. A recruitment platform everyone loves to use empowers people to engage and help create a winning hiring culture.

2. Deliver new ways to learn and grow

Learning & development is one of the most effective strategies to boost engagement at your organization. Studies by Bersin by Deloitte show that organizations with strong learning cultures result in 30-50% higher engagement and retention rates. 80% of employees feel learning new skills would make them feel more engaged.

Tap into new digital learning tools that offer employees consumer-like experiences with recommendation and review systems, similar to Netflix or Amazon. Machine learning also enables in-depth data analytics on trending topics, what employees are learning, and what they want to learn next—allowing for a more personalized learning experience throughout the employee lifecycle.

With learning & growth opportunities as a recruitment driver for today’s talent, it’s important on day 1 to show your new hire you are committed to their growth and discuss personalized learning paths to reach their career goals. Throughout your employees’ lifecycle, offer continuous opportunities to learn and grow so people remain stimulated. This means giving stretch assignments and encouraging both horizontal and vertical growth at your organization while providing key learning steps to reach and excel in these new roles.

3. Think out of the box on how you recognize employees

It’s well documented that recognizing your employees for the great work they’ve done goes a long way to boosting engagement. According to Bersin by Deloitte,engagement scores improve by 14% when organizations implement meaningful rewards programs. What’s more companies with sophisticated recognition practices are 12x more likely to have strong business outcomes.

Recognize key employee career milestones throughout their lifecycle from day 1 to when they leave. With four diverse generational segments in the workplace, a one-size-fits-most recognition strategy is no longer an option. Consider your employees’ individual needs and motivators, and a platform that covers a wide selection of meaningful reward choices. Know your recognition ROI by investing in a platform that covers a complete feedback loop and ways to measure your rewarded employees against your engagement goals.

Think out of the box when doling out rewards, don’t just give them a gift card or a gift basket. Consider giving experiential rewards like skydiving or cooking classes to make the recognition more special and memorable. For example as part of onboarding, welcoming new hires with experiential employee recognition gifts like urban foodie tours can help new cohorts bond with each other as well as embed them in the larger community.

4. Listen to what your employees have to say

Open and honest two-way communication between employees and management is considered a key driver of high engagement at new tech companies, according to a Culture Amp study. HR’s job is to understand their employees just as marketing must understand their customers. New on-demand employee feedback tools designed and supported by expert psychologists and data scientists allow you to uncover insights easily as well as tailor your feedback program.

Understanding how employees want to be coached and managed or rewarded and recognized can help improve your HR practices and boost employee engagement. Frequent employee pulse surveys and exit interviews when people leave provide rich data on how you can constantly enhance your workplace culture.

New tools to help you boost engagement

The HR industry is experiencing a renaissance with a flood of new and innovative HR tools to help you boost engagement throughout the employee lifecycle—recruitment & onboardingcompensation & benefitslearning & developmentemployee recognition, and employee feedback.

Three key pillars of effective recognition

Recognition is a key component of employee retention, but what are the fundamentals of a successful program? Alan Heyward, Executive Manager, accumulate, provides his insights

Growing numbers of organisations are treating employee recognition as a key pillar of their corporate strategy, recognising its critical role in driving cultural alignment and behavioural change, developing capability, and strengthening engagement and retention.

And it’s those organisations that are applying increasing levels of sophistication to three key areas that are realising some of the most significant gains – those areas being: recognition branding, employee communications and people analytics.

  1. Develop a fun, engaging and meaningful recognition brand

While some organisations simply default to positioning their recognition activities under an extension of their corporate brand, there are plenty of organisations that have invested heavily in developing creative, aspirational and engaging brands with impressive results.

Two of our major banking clients have developed and evolved their Heroes and Legends recognition brands respectively; the former invoking heavy superhero imagery to help recognise the everyday heroes within their organisation. The latter has drawn from mythology, employing a mix of illustrative and photographic imagery to represent the hidden legends within its walls.

Additionally, a large multinational pharmaceutical client has long celebrated a small blue mascot – Charlie – as the face of recognition throughout the company; he has acted as a fun, accessible, unifying element across its highly diverse workforce.

Another example is a large retail client, which uses its playful and, at times, irreverent Seeker brand – complete with seemingly endless amounts of canine imagery and puns – as a vehicle through which to recognise and reward behaviour that supports new business lead generation across its 30,000-strong workforce.

The themes and creative execution may be fun and light-hearted but, in each case, the recognition brand is highly meaningful and has become a powerful lever that organisations can pull to help role model behaviour and effect change, and drive outstanding, measurable results.

  1. Exploit the power of communication and community

It sounds like an obvious point to make, but effective communication – in all its forms – is critical to the success of any employee recognition strategy.

While virtually a hygiene factor in the consumer marketing sphere, most of these organisations are now realising the power of targeted communications to different employee segments. Some target inactive employees who have not recognised a colleague for some time; others present affordable redemption options based on reward points balance.

Many target demographic and geographic segments: blue collar vs white collar, office-based vs remote, fluent English vs ESL, and online vs offline are just some of the variations to consider. Within these segments, A/B testing is also common; variations in subject lines, messaging, imagery and communication dates are trialled, as are the use of control groups, providing the opportunity to further enhance communication insights and effectiveness.

The more progressive organisations also target influential recognition superusers – those who regularly give and receive recognition – and empower them as recognition champions, to help drive the desired cultural change and/or alignment, and use recognition to help build stronger employee communities.

Targeted, educational communications to managers are also common, as is the sharing of personal stories and individual profiles, to celebrate achievement, and role model and reinforce desired behaviours.

The empowerment and strengthening of employee communities via social streams is another critical element of the communication mix, creating an additional layer of engagement by providing a forum for both professional conversations and personal interests.

It’s no coincidence that organisations that provide a host of excuses for communicating infrequently, if at all, have trouble realising a strong return on their recognition investments.

  1. Make data-driven decisions

As I outlined in the Engagement Report in the December HRD issue, growing numbers of organisations are tapping their employee recognition data to produce insights that help optimise the performance and efficacy of their recognition strategies, and inform their broader organisational decision-making.

For example, our Heroes client (from section 1) has analysed its HR data sets to draw a clear, positive correlation between recognition activity and overall engagement.

Our Seeker client chose to overlay a qualitative element by surveying its employees on a range of elements, allowing it to build a strong internal NPS picture, identifying opportunities to improve process and communications, while also helping to shape its overall performance and reward strategy.

Other clients are undertaking internal and external benchmarking, and feeding recognition data insights into their broader talent identification and key influencer initiatives. Some are also looking to match recognition and engagement data with sales and customer data, to create a clear picture of key loyalty drivers at critical stages of both the employee and customer life cycles.

Pulse checks, onboarding surveys and exit interviews provide additional, rich qualitative data sources to mine.

3 HABITS OF HIGHLY EFFECTIVE EMPLOYEE RECOGNITION STRATEGIES

1. Develop a differentiated, fun and meaningful recognition brand to cut through competing corporate branding and communications.

2. Target your communications to different employee segments to drive the desired behaviour. Communicate well, communicate often, via multiple channels. Leveraging the inherent strength of your employee communities is critical to the development of a strong, vibrant, sustainable culture.

3. Exploit the valuable employee data sources at your disposal to produce insights that will help optimise the performance and efficacy of your recognition strategies, and inform broader organisational decision-making.


Where data meets communication and design
There are many factors that contribute to effective retention, but it is those organisations that understand and exploit the powerful relationship between a creative, differentiated recognition brand, targeted communications and rich data insights that will ultimately steal a march on their competition when it comes to engagement, performance and retention.

accumulate, a Qantas Loyalty business, partners with many leading Australian brands to help drive employee engagement and loyalty. Talk to us today to find out more. info@accumulate.com.au

As Work Is Transforming, How Will It Be Rewarded

New skills, Millennials and the gig economy are changing the way workers are paid

By Stephen Miller, CEBSJun 13, 2016

The trend away from traditional full-time employment represents a massive shift in the workplace with profound implications, said Ravin Jesuthasan, managing director and global practice leader at Willis Towers Watson, speaking at the June 2016 Total Rewards Conference in San Diego. The annual event is sponsored by WorldatWork, an association of compensation and benefits professionals.

“We are at the beginning of a fourth industrial revolution,” marked by technological breakthroughs including artificial intelligence, robotics, ubiquitous social media and the interconnectivity of virtual everything, he explained. Then add into this transformative mix nanotechnology, 3D printing, biotechnology, and smart systems that provide guided technology for factories, farms, grids and cities.

This is disrupting industries and impacting jobs,” said Jesuthasan, resulting in:

  • Significant job creation and demand within science, technology, engineering and math (STEM) fields, but also widespread and growing job displacement in other sectors.
  • Heightened labor productivity but also widening skills gaps, revealed by a growing skilled-worker deficit and a low-skilled worker surplus. Many of those lacking in-demand skills are recent college graduates.

The disappearing jobs will greatly outnumber the creation of new positions, he noted, with losses particularly acute in office support/administration and manufacturing/production positions. Gains, however, are being seen in management, business and finance positions, as well as in the STEM-related fields. But even here, “with positions such as software developer, there are decisions about whether these should be full-time internal jobs or contracted out as task-specific outside assignments,” which can result in big savings on cost-to-hire and training expenses, and avoid the future costs of salary growth and employee benefits.

In the future, organizations will become a malleable set of functions, and deciding which ones get done inside the organization will be a key strategic question, Jesuthasan said. One consequence will be fewer employees and more partnerships with independent contractors, along the lines of the Uber/Lyft ride-hailing services “gig economy” model.

As this transition occurs, Jesuthasan noted, employee rewards are shifting “from collective and consistent to increasingly individualized and differentiated, with organizations continually optimizing the cost/value relationship with talent. And HR is tasked with navigating this new landscape.”

Consumer-Driven Total Rewards

“The increased speed at which information, people and goods move is changing the concept of what work is and how and where it gets done,” concurred Tom McMullen, vice president and reward practice leader at Korn Ferry Hay Group.

“Organizations are becoming more proactive in assessing what employees value the most—and the least—in their rewards programs, using employee surveys and focus groups,” he noted. “And they’re cutting back on rewards viewed as having less value.”

“Employee pay preferences matter more than ever when it comes to effective rewards program design,” said Dow Scott, professor of human resources and employment relations at Loyola University, Chicago. Like McMullen, he pointed to the importance of measuring employee reward preferences, “even if it means taking people off the line” to participate in focus groups.

This doesn’t mean catering to employees’ every wish and whim, Scott noted. But tailoring benefits to meet employees’ needs can help attract in-demand talent while increasing engagement and retention.

“Most HR programs in place today were created by Baby Boomers for Baby Boomers,” noted John Bremen, managing director of total rewards for the Americas at Willis Towers Watson. “The total rewards programs of tomorrow will emphasize employee choice. And the good news is that companies already are doing this,” from providing a range of employee-paid (but employer-negotiated) voluntary benefits to expanded health plan options offered through private health care exchanges.

Segmentation, personalization and customization—all terms for tailoring benefits to specific demographic groups, and even down to individual employees—are becoming bywords for how to attract and retain younger workers, several presenters noted.

As for Millennial workers (born 1980-95), who will soon be a majority in the workforce, and Generation Z (born 1996-2010), just now entering the workforce, “If we can provide what they want from work—especially career-growth trajectory—we can earn their commitment and loyalty and increase Millennial tenure to 6-7 years instead of 2-3 years,” said Mel Stark, vice president at Korn Ferry Hay Group.

Younger workers often expect a more-customized rewards package, for instance, where employees are provided a set amount of dollars to choose among benefit offerings, several presenters noted. “Yes, it’s complex, but we have so many more tools now, so that with technology we’re able to do it,” said Lori Wisper, director of rewards, talent and communication at Willis Towers Watson.

But the shift to customization “needs to be explained, otherwise employees will perceive it as a cost-cutting exercise,” cautioned Scott.

Future of Compensation

Stark and McMullen’s predictions about base pay trends, based on Korn Ferry Hay Group research, included the following:

  • Classic base pay systems will remain under stress due to shortages of STEM/skilled employees and a glut of less-skilled workers.
  • Increasingly customizing jobs for individual employees will make it difficult to match these positions with pay survey data.
  • The growing variety of employment relationships will require different pay structures.

In terms of variable pay, they said to expect:

  • A slowdown in the trend of increasing variable pay eligibility and amounts.
  • Emphasis on using variable pay to reward collaboration, such as by increasing team incentives.
  • An increase in the use of spot and peer recognition cash rewards.

Stark also foresees a swing back to concrete, measurable objectives “to make sure pay plans line up with behavior [that] management wants to support and reward.”

“It’s OK to have turnover, as long as it’s the right turnover,” said Elliot Santner, senior director of compensation and benefits at products distributor W.W. Grainger Inc. “We may lose some folks, but it should be the right folks.” That’s why, in an increasingly competitive world, rewards and incentives should be tied to recruiting and maintaining workers who meet your organization’s strategic needs.

At the same time, to attract the talent that organizations need, the importance of fairly rewarding people will increase, said McMullen. The need to ensure that pay is perceived as fair is being driven by:

  • The movement towards greater internal and external transparency in workforce pay, such as on social media websites.
  • Increasing executive pay transparency, including CEO pay ratios at public companies, which must be disclosed starting in 2017.
  • Pay equity legislation.
  • Minimum-wage and living-wage proponents.
  • Lower unemployment (at least for in-demand, skilled positions).

Finally, McMullen pointed to the growing trend of engaging and retaining talent with nonfinancial rewards, including:

  • Supporting employees’ skills growth and professional development.
  • Taking advantage of that growth by creating more flexible and personalized career paths.
  • Communicating a strong value proposition for staying with the employer (total rewards and career development).
  • Communicating a greater sense of purpose and meaning in the work.

“People want to feel connected to something bigger than themselves,” McMullen noted, and this is especially true of younger workers.

Stephen Miller, CEBS, is an online editor/manager for SHRM. Follow him on Twitter @SHRMsmiller.

How to Reward Employees on a Budget

Employee recognition for the contributions they make to the organization is a good thing. But it’s a slippery slope that needs attention.

By Inc. Staff

Everyone likes to get a pat on the back for a job well done—especially if that pat includes some type of bonus or other financial compensation or recognition before colleagues. Businesses often face the dilemma of wanting to recognize employees’ efforts and performance, but during difficult financial times they may have very limited budgetary resources to do so. However, rewarding employees and motivating performance does not always require a tremendous outlay of money. You may be surprised to learn that if you were to ask some of your employees they may actually prefer other types of recognition.

Starting an employee rewards and recognition program can be overwhelming at first. And the task can seem impossible when you are trying to figure out how to incentivize employees to perform well while staying within a tight budget. In tough economic times, however, small and mid-sized businesses must keep in focus what they want to reward while being creative in coming up with ways to keep the troops happy.

“The goal of any rewards program should be to engender the loyalty and team spirit and have a good workplace where people feel appreciated,” says Nancy M. Cooper, chair of the labor and employment group of Garvey Schubert Barer, a law firm based in Portland, Ore. “It’s also likely to help you meet business goals especially with small to mid-sized employers.”

The following article will discuss how to determine what you want to reward, different types of rewards and recognition, and pitfalls to avoid.

Rewarding Employees on a Budget: Your Goals

Your purpose in creating an employee rewards program may be to create some acknowledgment and motivation for your company team. The purpose behind a recognition program is to help motivate your employees to earn the rewards and ultimately help you meet business goals. Here are steps you can take to design an effective employee rewards program:

  • Identify what you want to reinforce. The first step you need to take is to identify the activity or activities that you seek to reward. This can include job performance, such as achievement of sales targets or product development goals or meeting customer timetables ahead of schedule. You can also choose to reward behavior, such as exceptional customer service or team work or leadership. “Before an effective reward or recognition program can be developed, you need to really understand what you want to reinforce,” Cooper says. “Do you want to reward positive performance so that employees will strive to succeed? Do you want to reward stellar behavior that serves the best interests of the company? Do you want to reward employees who put forward suggestions that improve the functioning of the company or save the company money? Do you want to reward individual employees or teams?” Once you establish what it is you want to reward, those things should become the focus of the program.
  • Motivate your employees. The goals of your employee rewards program can only be met if you get staff “buy in” or participation. “Let the employees know that you are establishing a recognition program,” Cooper says. “Let them know that the budget is tight, but it is important to you that there be recognition of their good work and top-of-the-line efforts.” One of the best ways to find out what motivates your employees is to ask them — and that also may help you determine what types of rewards to offer. If you have budget constraints, let employees know so that they are more creative with their suggestions. “The loyalty that is established through recognizing the little — and not-so-little — contributions made by your employees is one of the best side effects of a reward program,’ Cooper ads.
  • Make sure it works for the company. There’s no point in starting a recognition program that is not going to motivate employees or help you achieve business goals. So in addition making it work for employees, you have to make sure that it works for the good of the company. That’s why it’s so important to put thought into the methods of recognition you use and how effective and practical they are for the company. What works for one company may not work for another. “You should customize the reward to make sure it works with and is accepted by your company culture,” Cooper says.

Dig Deeper: Personalizing Recognition

Rewarding Employees on a Budget: Types of Rewards

There’s an old saying in business that money speaks louder than words. Hence the traditional practice in business of rewarding exemplary employee behavior with bonuses, raises, stock options and other types of financial remuneration. But money is not the only way to recognize employees and surveys have found that some workers actually prefer a more personal “thank you” note, being singled out in front of colleagues, or other forms of recognition.

During a recession or prolonged economic downturn, however, financial rewards may be highly prized by your staff. “Given the current downturn, I can’t tell every company that money won’t help,” says Cindy Ventrice, author of Make Their Day! Employee Recognition That Works (Berrett-Koehler Publishers 2009). “In many cases, employees are being under paid or have experienced furloughs or cut backs in pay.”

However, when people feel that they are being fairly compensated, then the best rewards for performance or behavior don’t line your pocketbook or wallet. “The recognition that sticks with people doesn’t have much to do with money,” Ventrice says.

People like recognition. People enjoy being thanked for their work. In fiscally tough times, financial rewards are not always feasible. “A lot of the employers I work with say, ‘We are afraid we’re going to lose people if we can’t give people the raises or the bonuses,'” Cooper says. “But they are finding ways to make their employees more loyal than ever. Employers have to be more creative about how they go about recognizing the good work.” There a number of ways this can be done, with little or no financial investment. Some types of ideas include:

  • Opportunities. Sometimes the most meaningful form of recognition involves some type of opportunity as proof that an employee is valued by an organization. Opportunities can range from being asked to sit on a panel discussion on your manager’s behalf, an educational or mentoring opportunity, or being sent to an industry conference, Ventrice says.
  • Exposure. Another meaningful form of employee recognition is giving that person exposure to the rest of the staff, to important clients, or to others in their field. This can include everything from being pointed out as the most creative software developer of the month on an in-house bulletin board to being invited to lunch with the boss and one of the company’s key clients. Create an employee-of-the-month parking space. Another idea: “Elect employees to a ‘Wall of Fame,'” Cooper says. “This is a public space in the company where photos of employees who have accomplished something truly special are displayed, along with the details of what they have done.”
  • Experience. Sometimes the most sincere form of flattery is being trusted with more challenging work. “I’ve heard a lot of people say they were given a new responsibility or they were taking on another customer as a new challenge,” Ventrice says. “People have to be aware that the underpinning of recognition is a respectful relationship.” If the company trusts you with new challenges, or tells you that you’re too valuable to take vacation at the same time as a senior manager — that may be all the recognition you need.
  • Praise. Something as simple as writing a personal thank-you note to an employee for a job well done can leave a lasting impression. “Several times a week I hear stories from people who say, ‘Here is the most meaningful recognition I have ever received.’ And it’s a hand-written note,” Ventrice says. Personal thank-yous can be very powerful. Some people keep them for 10 years. Other people have taken a bar napkin featuring scribbles form the boss and had it framed.
  • Personal appreciation. Other meaningful ways of rewarding employees involve customizing a personal sign of appreciation. Ventrice says one manager told her of an experience with an employee who was logging so many hours that he said jokingly one day, “I do so much for you that you should be buying me an SUV.” So the manager went out and bought a toy SUV and gave it to the employee and said, “You really do a lot and if I could buy you an SUV, I would. Let this remind you how valued you are.”
  • Allow flexibility in an employee’s schedule. Extra efforts can also be rewarded with understanding of the family/life balance that many workers are trying to achieve. That can range from allowing an employee to telecommute one day a week in exchange for high performance to allowing them flexibility to start earlier and leave earlier.
  • Gift card rewards. Use a limited budget for employee rewards to buy a series of gift cards at popular coffee shops, book stores, or online retailers and let the employee choose one when they have done something positive or noteworthy. These can also be administered by co-workers to employees who have exhibited positive behaviors, either helping other staff members, going the extra mile in serving a customer or by their team work.

Employee rewards that commemorate years of service or milestones tend not to work. “They get handled badly in so many organizations,” Ventrice says. “HR is typically responsible for sending out the plaque. It goes out three months to three years late. It goes through an interoffice envelop instead of being presented by a manager.” It’s a sign that no one really cares, Ventrice says.

The most important thing to remember about a recognition and reward program is that you are trying to build a team environment, stimulate employee interest, and create positive behaviors, Cooper says. “This doesn’t always take a lot of money,” she adds. “It does take some creativity, some listening and the ability to say thank you to those who do the work, provide excellent customer service and make your company the valuable asset that it is.”

Dig Deeper: Building a Culture of Employee Appreciation

Rewarding Employees on a Budget: Pitfalls to Avoid

There are both legal and moral minefields to try to avoid when starting an employee rewards program. You need to really think this through, understand your motivation, and communicate to managers how to distribute rewards so that every employee has an equal chance.

“It is important to be consistent in how the rewards and recognition are handled,” Cooper says. “Be sure you train your managers to not give the award to the same person time after time. Develop guidelines that outline how often rewards or perks are given out, and the value of them. Be sure that the system does not just turn into a popularity contest.” Here are some of the do’s and don’ts when starting an employee rewards program:

  • Don’t let it become a popularity contest. If co-workers are able to nominate each other, you need to take steps to make sure that the same clique of friends isn’t just always nominating each other. You want to take steps to make sure any recognition is actually being given based on merit. Some possible steps might be to make nomination forms include a description of the meritorious behavior and make co-workers sign the forms so that managers at least know who is nominating whom
  • Don’t give the perception of playing favorites. If the nominations are coming from management, be careful to spread the joy around. “There is a danger of giving the perception that the same group of people is being rewarded all the time or that only favorites are rewarded and that there is no real chance for anybody else to be considered,” Ventrice says. If an employee is prone to think they are being treated differently based on some factor other than work performance, this may feed that insecurity and suspicion.
  • Do communicate the criteria. When advertising the program to employees make sure you spell out very clearly what the rewards are based on, what criteria is used to choose winners, and how everyone in the company is eligible.
  • Do your homework when building the program. Put together a recognition team made up of managers and supervisors in different roles throughout the company. Get the team to come up with ideas, survey employees, and monitor how the program is working. Make sure managers are trained in how to administer the awards so the program works to improve overall performance.
  • Do start small with gift cards or a program to reward a specific behavior or goal. The safest types of programs that don’t get a company into trouble are programs that start small, such as distributing gift cards worth $5 or $10 attached to them as spot awards. You may want to focus on one goal initially, such as boosting service, and reinforce when rewarding employees that they helped the business meet this goal.

Employee rewards don’t only have to single out the individual either, Ventrice says. You can set team goals for certain groups or the entire company and when you achieve those have some type of celebration. “I know some manufacturing companies that set goals and called everyone out to the front lawn and made the announcement that they had met the goal,” Ventrice says. “They had a big pizza delivery and everyone celebrated. It doesn’t have to be anything big or anything that they know is coming. It’s about putting fun and excitement into meeting the types of challenges we need to meet to be successful in the current economy.”

Take Employee Recognition to the Next Level

Employee recognition for the contributions they make to the organization is a good thing. But it’s a slippery slope that needs attention.

By Dr. Paul White

 

Building a vibrant workplace requires a foundation of trust, respect, and honest communication. It also requires employee appreciation.

Over 200,000 global employees were studied by the Boston Consulting Group, and the top reason they reported enjoying their work was, “feeling appreciated”. Number 2 was having a good relationship with their supervisor, and number 4 was that they had a good relationship with their colleagues. Financial compensation didn’t appear until number 8!

Four out of five employees (81%) say they are motivated to work harder when their boss shows appreciation for their work. Unfortunately, many managers don’t respond to this need and those who do, choose employee recognition programs.

Traditional recognition programs breed cynicism and apathy and come across as a one-size-fits-all approach. When I talk with employees, front-line supervisors, and mid level managers about their companies’ efforts to improve staff morale, usually through employee recognition programs, the most common responses I get are negative:

“They don’t care about us; they just do this recognition stuff to make themselves look good,” said one employee.

“It’s just a bunch of ‘going through the motions,’” said another. “The people who give the awards don’t even know who I am.”

WHAT’S WRONG WITH RECOGNITION?

This doesn’t mean there hasn’t been a positive impact from recognizing employees’ efforts and achievements. Research has shown the effects of recognition done wellare decreased absenteeism, increased productivity, reduced staff turnover, and improved customer satisfaction.

While the prevalence of employee recognition programs has grown tremendously (in at least 80% of all organizations in the U.S. currently), employee engagement has barely increased at all (around 30 to 33% of the workforce report they are engaged).

Probably the most cynical environments I’ve experienced recently are medical settings and hospitals, public schools, and government agencies. Why might this be?

It appears that in many of these institutions they’ve tried to communicate recognition and praise, or have provided training on “how to build a positive team,” and it has been largely done through a program-based approach. This leads, almost by definition, to a perceived belief of insincerity on the part of the participants.

When employees do not believe that others are genuine or sincere in their communication of appreciation, reactions include cynicism, lack of trust, disbelief, skepticism, resentment…etc…

Why is this? Largely because people have not been communicated to with genuineappreciation.

WHY IS RECOGNITION OFTEN VIEWED AS INAUTHENTIC?

As I have explored the underlying issues with employee appreciation and recognition, the following themes have become clear. Employees question the genuineness of recognition when it is:

Commanded. Everyone has to participate whether they like it or not.

Organizationally Driven. The “recognition” comes from a divisional manager who has no relationship with the recipient.

Impersonal. A lot of recognition is communicated to groups: “Way to go, team! Great job!” But the message says nothing about the team member who stayed late to make sure the product would ship on time.

Generic. The number of negative stories I have heard is amazing — like when everyone in a large organization received the same Christmas card with the same (low dollar value) gift card enclosed.

Fake. When discussing reasons why recognition is seen as inauthentic, one astute (and brave) training participant stated: “Sometimes it’s because they don’t mean it.”

If you’re having problems in getting buy-in of your recognition program, you may want to investigate the perceptions of your employees and supervisors.

PUBLIC PRAISE AND OTHER THINGS EMPLOYEES DISLIKE…

The way many recognition programs are carried out helps feed employee aversion. Among them:

Public recognition. I ask groups, “How many of you would prefer not to go up in front of a group to receive an award or be recognized?” Regularly, 40 to 50 percent of the group raises their hand. (In some groups — administrators, librarians — it’s more like 80 to 90 percent.) One woman stated, “They can give me an award, but they’ll have to drag me up there to get it!” If the purpose is to encourage an employee, shouldn’t it be done in a manner they prefer?

Emphasis on verbal praise. While our trainings indicate that using words to communicate appreciation is actually the preferred method for a little less than half of participants, there is a fairly large subset that doesn’t trust words. Their mantras are: “Don’t tell me, show me,” or “Words are cheap.” They believe in action and tangible proof. Many of these individuals don’t want recognition or praise; they want help getting the job done.

Reliance on rewards. Virtually every employee recognition program has a heavy reliance on rewards as a key component. Unfortunately, our research shows that less than 10 percent of employees desire tangible rewards as the primary way to be recognized. In fact, we have noticed the number of employees desiring tangible gifts as the primary way to be appreciated actually seems to be declining. While most people like receiving some type of gift, if it is not also accompanied by sincere words, quality time, or helping them out, the gift is viewed as superficial and disingenuous.

SO WHAT SHOULD WE DO?

Ultimately, the question is “What should we do in response to this growing problem of perceived authenticity?” I think it needs to be answered at two levels: individually and corporately.

As Jim Collins stated in his bestseller, Good to Great, companies that are successful are willing to “face the brutal facts of reality.” If recognition in the workplace is viewed as superficial and fake, we better figure out why and then address the issues.

Unfortunately, some leaders seem to have the attitude of legendary comedian George Burns: “The secret of success is sincerity. If you can fake that, you’ve got it made.” They want to act like they care about their employees. The problem is, faking it doesn’t work, and undermines any trust the leader may have with their staff.

While we can’t control the perceptions of others, we are in control of our own behaviors and attitudes. Individually, we should each strive to be genuine and authentic in our communication with others — don’t give praise when we don’t mean it, and seek to communicate in the ways meaningful to the recipient.

Corporately, each organization needs to take a hard look at their employee appreciation activities and take the time to obtain input and feedback from their staff about their perception of the employee recognition program and activities. Ask yourselves:

Are there processes or procedures that foster a sense of inauthenticity?

How much of our employee appreciation is personal (vs. organizational), individual (vs. group-based), and communicated in the ways important to the recipient (vs. generic)?

Recognizing employees for the contributions they make to the organization is a good thing. But we are on a slippery slope that needs attention, lest our efforts crumble into a pile of devalued activities that will either be increasingly scoffed at — or discarded completely in the future.


Also shared on 15Five.

Ways to Increase Employee Motivation Using Rewards

Seeking to increase employee motivation using rewards can sometimes be a daunting task for managers. But it shouldn’t be. When armed with the right information and the proper techniques, managers can be experts at enhancing motivation using rewards in no time.

Mangers who are developing, revamping or currently implementing an employee rewards program should consider these 20 tips:

1. Involve all employees in the development, implementation and revision of rewards programs

Involving all employees (or representatives from different positions) will encourage communication between employees and management about the rewards process. It will also ensure that both employees and upper management are onboard with the reward system.

2. Ensure that employees view the rewards as worth the effort

Including employees in the reward program development process is critical to ensuring that they value the rewards and see them as worth the effort. Managers should value employee input and select rewards accordingly. Employees who see the rewards as worth the effort will be more motivated to work hard to obtain them.

3. Make sure that employees understand how to earn the rewards

Managers should clearly delineate how employees can earn rewards. When employees have a comprehensive understanding of what is expected of them, they will be more capable of achieving performance standards.

4. Set reasonable and transparent performance standards for rewards

Employees must see the rewards as attainable in order for them to engage in the necessary effort to obtain them. Check in with employees to ensure that they believe the rewards are within their reach. Also, providing the employees with a dashboard where they can view their performance in real time will allow them to accurately assess their own performance and have realistic expectations for rewards.

5. Base reward determinations on objective performance data

When rewards are distributed based on objective data, employees are more likely to view the process as fair and are also more likely to have a concrete understanding of what is expected of them. This will increase their motivation to achieve the desired performance results.

6. Make sure employees view the reward system as fair

When employees view the reward system as fair, they will be more engaged in trying to obtain the reward. Rewards should be distributed consistently according to pre-determined policies. Never engage in favoritism or cut corners as this will have a detrimental impact on employee performance.

7. Always link rewards to performance

In order for rewards to have the most impact on influencing employee performance, they must be directly linked to the desired behavior. Tie praise, recognition, cash rewards and non-cash rewards to specific results. When employees understand the connection between their reward and their performance, they will be motivated to perform optimally in the future.

8. Recognize small and large accomplishments

Employees should be rewarded when they meet large goals as well as smaller milestones. This will ensure that they receive recognition for their progress and that their behavior is consistent with company expectations.

9. Reward teamwork and cooperation

Team-based incentives were found to be more effective at increasing performance than individual incentives. If team-based rewards are not already included in the company strategy, they should be. Additionally, the resources devoted to team-based rewards should be substantial. This could have a significant impact on cooperation, employee cohesiveness and the company’s bottom line.

10. Never take a good performance for granted

It can be easy to stop rewarding top performers, but this could be a fatal flaw. In order to keep top talent on the team, ensure that your company continues to acknowledge and reward an excellent performance.

11. Provide rewards immediately after the employee achieves the desired behavior

There is a temporal component to the effect of the reward. The longer the delay in providing the reward after the employee’s achievement, the less of an impact it has shaping subsequent behavior. Reward behavior that meets performance standards immediately.

12. Match the reward to the employee

Allow each employee to select their own reward or decide what rewards employees should receive under predefined circumstances. This will enhance their commitment to achieving the reward by engaging in the required behavior. Understanding the needs of employees is central to this process.

Of note, the reward that each employee wants may not necessarily be the reward with the most motivational influence. A recent study found that the majority of employees prefer cash rewards; however, many employees will perform better in pursuit of non-cash rewards of similar value (Jeffrey). Managers seeking to gain the biggest impact from their rewards programs should include both cash and non-monetary rewards for performance.

13. Offer financial rewards, non-monetary rewards and recognition

Reward systems that include a combination of cash and non-monetary rewards as well as social awards (e.g. recognition and praise) have the greatest impact on employee performance. Pay cash bonuses in a lump sum to maximize their effect as money only motivates when it is a significant amount.

14. When employees learn an unfamiliar task, distribute rewards based on a continuous reinforcement schedule

The most effective way to encourage learning a new task is by reinforcing employee behavior on a continuous schedule. This can require considerable effort when executed by a manager, however, using an employee reward software program is a more feasible and cost effective solution.

15. Once the behavior becomes a habit, distribute rewards based on a variable ratio or variable interval schedule

Variable ratio and variable interval schedules of reinforcement result in the most significant behavior change once the behavior becomes a habit. This change in behavior is also more resistant to weakening. Therefore, one of these reinforcement schedules should dictate the reward distribution process after the behavior has become a habit.

16. Do not disclose the cash value of non-monetary tangible rewards

Employees who are unaware of the exact cash value of non-monetary rewards are more motivated by them. Do not disclose the amount unless necessary.

17. Use long-term rewards programs

Long-term rewards programs have the greatest effect on employee performance and the resulting gains last longer.

18. Balance competitive reward programs with non-competitive programs

Competitive incentive programs are just as effective as non-competitive reward programs in increasing performance. An effective rewards strategy should include both.

19. Make rewards an integral part of the company’s strategy

Rewards are invaluable in aligning employee behavior with the organization’s business strategy. Ensure that rewarded behavior is in line with company standards, objectives and strategy.

20. Change the rewards frequently

When the reward is changed frequently, employees will be more surprised and the process will be more exciting. When employees are excited about rewards, they will work harder to achieve them.

Following the 20 aforementioned tips will help managers get the most bang for their buck from their employee rewards program.

Works Cited:

[1] Jeffrey, S.A. (2009). Justifiability and the motivational power of tangible noncash incentives. Human Performance, 22, 143–155.

[2] LaMere, J. M., Dickinson, A. M., Henry, G., Henry, M., & Poling, A. D. (1996). Effects of a multicomponent monetary incentive program on the performance of truck drivers. Behavior Modification, 20, 385-405.

[3] Skinner, B.F. (1938). The Behavior of Organisms. New York: Appleton-Century-Crofts.

[4] “Incentive Pay Plans: Which Ones Work and Why,” HR Focus, April 2001, p. 3.
Kreitner and Kinicki. (2004). Organizational Behavior. Boston. MA: McGraw Hill, Irwin.

Best ways to reward customer-facing employees

Any employee who deals with customers on a regular basis has probably earned a ticket straight to Heaven. But you still have to reward them well now for all the thankless work they do.

Customer-facing employees — your service reps, inside salespeople, receptionists, delivery people, etc. — probably get more than their fair share of negative or monotonous feedback from customers. That’s why they need special employee rewards to boost their morale.

Give them credit

These ideas can help build an effective employee rewards program:

  • Give them say in the rewards. Ask employees at least once a year what they’d like as rewards. Example: Send out a simple form asking employees to list their favorite restaurants, post-work activities and events, hobbies and dream destinations. What’s most important is that the rewards are customized to the group, or even better, to individual employee preferences.
  • Simplify the decision. Managers should reward employees for exceptional work. But to take rewards to a whole new level, ask employees to nominate colleagues for things they’ve done (and that you, as the manager, didn’t even know occurred). Outline the levels of quality, productivity and service that warrant rewards and recognition. And ask another manager to oversee the final decisions so there isn’t any chance of favoritism.
  • Speed up the process. Limit the amount of time a reward program or special event runs so employees never lose their interest in doing well and receiving rewards. A month is ideal for a special promotion. Any program longer than that will lose momentum. Also, hand out rewards and recognition within a couple of days after the event finishes.
  • Publicize what you do. Increase the effects of your morale boosting rewards by spreading the wordon what was accomplished and who did well. Post it online, in company newsletters and on the walls in public areas.

by 

Employee of the Month? Pros and Cons

Employee of the month- a term everyone knows about and everyone is striving to get at least once. After all, who does not like recognition? We all are fond of being praised and appreciated by others, didn’t we all worked hard to top in class. Organizations realized this could be a good tool for employee motivation. The employee who performs the best as per the standards are given the ’employee of the month’ award. Though the concept sounds interesting, it is not as simple as it looks. It certainly has its share of advantages and disadvantages. Let’s have a look at each of it in detail.

What is ‘Employee of the Month’?

The employee of the month is a recognition given to an outstanding performer. It may be in a form of gift, Gift certificate or a certificate with Thank you note. Some organizations have a wall of fame and the picture and name of the outstanding performer is put up there.

Few companies have started with this form of recognition, but scraped it of within few months, whereas few companies still think it is the best form of recognition and motivation. Thus, companies have been successful and unsuccessful while attempting to use employee of the month award.

Why Employee Recognition is Necessary?

HR policies in organizations are well framed, the expectations are clearly jotted down in the job description, also if the performance is not as expected then we have performance improvement plans, wherein employee is given a period and asked to perform well. If he fails then that may lead to his termination. Therefore, if disciplinary actions are well stated for poor performance there should necessarily exist something for a good performance.
Say, there are two employees , one is a hard worker and other is a average performer, if both of them are getting same benefit then the hard worker will feel demotivated. Thus, recognition in the form of ‘employee of the month award’ is a ‘pat on back’ gesture and a form of appreciation for the hard work. If employer wants a continued excellence, recognition is of utmost importance.

Advantages of Employee of the Month:

1. Healthy Competition:

An award for best performance will make the employees strive hard to do their assigned tasks in the best way. In sales, a person with highest sales figure, satisfied customers and good networking will have a chance of getting the award. Many a times, organizations keep incentives as a form of motivation.

2. Employee retention:

It helps to retain employees, as employee of the month award is a great accomplishment and a good point to add in the resume. Employee of the month or any other methods of employee recognition help for employee retention. When hard work is appreciated, employees are happy and when they are happy, they do not want to leave the organization

3. Employee Engagement:

Employee engagement means the sense of belongings to the organizations. An engaged employee sees the organizations goals and visions as its own, and takes effort to increase organizations reputation and interests. He is fully absorbed and enthusiastic for his work.
Employee of the month increases employee engagement as a person works well when there is a reward and recognition at the end.

4. Optimum productivity:

Organizations pay to get their work done, if the work done by the employees is the best, then ultimately organization is making profit. In addition, a reward in return to an employee makes him happy too. Thus, it is a win- win situation for both employee and the employer.

A perfectly set up incentive system and recognition methods will be a fair method to praise the employees who are doing well.

Disadvantages of Employee of the Month:

Though it has certain benefits, it is harmful if not executed well. Many companies have scrapped of the employee of the month program.

1. While making one person happy you make others unhappier:

Once an industry expert said, ‘one does not compare the cooking of our mom with your girlfriend and reward the ones who performs the best’ because while making one person happy you are making the other one unhappier. Mom and girlfriend both are dear to you, comparing them will cause unnecessary discord.

However, it sounds a bit offbeat to compare a personal relations with professional setup, but it does relate. As an organization, all employees are dear to you and are an asset to the company. It may cause discord and employees may harbor bad feelings. In a group of 100 people, if one is rewarded, then the 99 others are demotivated.

2. Causes internal discord within the organization:

While selecting the employee of the month, the selection is often subjective, the results, which are quantifiable, are focused more, but there can be people whose results are not quantifiable but they are the one who had an original idea, had guided and motivated the team to work harder. These efforts may have happened behind the scenes, but are appreciable and valuable support to organization too. Hence, putting up one person on top may make other people resentful and they may feel that the organization is being impartial. It is hard to evaluate the efforts taken by employees; one cannot monitor them all the time. Hence, the whole employee of the month award goes in vain.

Organizations need their work force to work with their strengths and weaknesses together and bring out a favorable result. However, once the employees are competing against each other the overall outcome is not good.

3. Focus shifts only on the benefits:

There should be perfect balance in everything; employees must focus on their work and overall growth of the organization. When awards and incentives are kept, the whole focus is shifted to achieving it and employees may ignore other necessary tasks. Employees are required to understand the companies’ vision and shared goals and work together accordingly.

By setting up rewards, companies are unable to inculcate the intrinsic motivation in the employee. Intrinsic motivation means, feeling motivated on their own without any extra means. Extrinsic motivating factors, condition employees to think ‘what will I get in return’, which is the most disengaged form of an employee.

4. Verbal Appreciation more effective:

One company sent a handwritten note from CEO to employee’s mother and his wife stating how great he is working and how great they are to have him in their team, this is the excellent form of reward; one can get for their good work. This way employer is not making others demotivated and the person who deserves to be appreciated gets the reward.

Thus, the key should be to make the best employee know that you are grateful without putting him as a focal point of all. If organization is confused about whom to appreciate, best way is to thank the whole team.

5. Employees may allege the employer of favoritism:

If the people who decide the employee of the month have his or her relatives working in the company, then he will be alleged for favoritism

Thus we saw that there is a high probability that employee of the month award could go wrong. Here are few steps that one can follow to get it right.

Steps for Good ‘Employee of the Month’ Plan:

1. Define the aim:

We saw Employee of the month award can help in employee retention, employee engagement and for increasing productivity. One must have one HR objective in mind and set the award accordingly. Any employee recognition and other HR activities must have its objective aligned to the business goal.

2. Prepare a blueprint:

One needs to decide the basic outline and the mechanism of the reward program and delegate the responsibilities. It can require people who will coordinate, gather and compile the votes.

3. Setting voting system:

The main point here is the voting criteria. Involve employees to set up the voting criteria, as it will make the process transparent and will assure them fair judgment. The objective must align to the business goal, if you are aiming on high productivity or sales target, then the criteria must be set on target achievement, revenue collection, relationship building and proactivity. Other issues must also be addressed like who can vote, when they will vote, procedure to vote and the like. Most importantly, all should know about the procedure.

4. Set the rewards:

Decide the rewards, for some team and for some objective, monetary gifts can be useful. However, some might feel an extra training to be a good reward or a day off from work as a good form of reward. Hence, choose wisely, it is best to have discussion about it with the team itself.

5. Follow-up:

No system is full proof, one needs to do many trails and errors as per the requirement, assess the satisfaction level/productivity or employee engagement of the employees. Have a check whether the objective that was set is being met. Directly communicate with employees and try to get an open feedback from them.

It is advised to first identify the need and the objective of employee recognition and accordingly choose the path. Employee of the month is a good way for motivating, though it is necessary to see it is not affecting negatively.

Few Best Practices for Employee Recognition:

Apart from employee of the month following ideas can also help for employee recognition.

1. Verbal praises:

Personally thanking the employee goes a long way. Thank an employee in front of superiors; introduce him or her to clients or to the higher authority of the company. Take efforts to highlight the excellent work done by the employee in important presentations and meetings. Give due credit to the deserved employee.

2. Thank you cards:

Send thank you cards to employees along with some gift cards or a flower bouquet. It does not cost much and does an impeccable job of employee recognition and appreciation. You can get the thank you cards printed, or if the time permits, sending a hand written thank you note is very valuable to employee.

3. Hall of fame:

One can display the picture of best performers on bulletin board or display pictures in the internal company website. Congratulate and thank them well. The recognition among all employees gives a boost to the performer.

4. Prepaid gift cards:

Gift cards from retail stores or petrol card is a best token of appreciation. Reason being its utility. A person can gift himself whatever he wants, when a gift card is given to him.

5. Staff celebration:

Have office get together and have some fun activities, or food parties, take this chance to appreciate all the team members and thank them for all the efforts that they put in.

6. Movie or event tickets:

After a long and tiring month of work, an employee needs some relaxation, a free movie ticket for couple or a favorite band or sports event will make him relax and have some fun. Activity like this promotes work life balance, as he gets to spend quality time with family on behalf of the organization he works with.

7. Volunteer Hours for Paid Days Off:

Give a day off for volunteer work, it is self-satisfying and also acts as a corporate social responsibility. Ask employees to visit old age homes or orphanage and do some good deed. The time they spend there can be considered as office working hours.

8. Retreats and Team Building Events:

Have some sports events and team building activities, which will help people, relax and be less formal. One can also take the team to an outing where food, sports, CEO Addressing, music can be arranged, it is a great way to unwind and be stress free. One can get refreshed and rejoin work with new vigour and enthusiasm.

9. Special skill based training:

Offer free training for knowledge enhancements or reimburse the cost of the training an employee wants to learn. Appreciate the zeal of learning and improvement.

10. Job rotation based on special skill of employee:

An employee with some special skill can be asked to guide some other group of employee. This activity will help him feel special due to the knowledge sharing and he will be recognized as a mentor by other staff members, which ultimately gives him a boost.

Employee Recognition: Low Cost, High Impact

by Annamarie Mann and Nate Dvorak

STORY HIGHLIGHTS

  • Top performers need to know their efforts are recognized and valued
  • Employee recognition isn’t one-size-fits-all
  • Money isn’t the only, or even the top, form of recognition

In today’s war for talent, organizations and leaders are looking for strategies to attract and retain their top performers while increasing organic growth and employee productivity. From offering new perks to designing flexible workplaces, company efforts to optimize the workplace are as strong as ever.

But in their search for new ideas and approaches, organizations could be overlooking one of the most easily executed strategies: employee recognition.

According to Gallup’s analysis, only one in three workers in the U.S. strongly agree that they received recognition or praise for doing good work in the past seven days. At any given company, it’s not uncommon for employees to feel that their best efforts are routinely ignored. Further, employees who do not feel adequately recognized are twice as likely to say they’ll quit in the next year.

This element of engagement and performance might be one of the greatest missed opportunities for leaders and managers.

Workplace recognition motivates, provides a sense of accomplishment and makes employees feel valued for their work. Recognition not only boosts individual employee engagement, but it also has been found to increase productivity and loyalty to the company, leading to higher retention.

Beyond communicating appreciation and providing motivation to the recognized employee, the act of recognition also sends messages to other employees about what success looks like. In this way, recognition is both a tool for personal reward and an opportunity to reinforce the desired culture of the organization to other employees.

Acknowledging the Individual

Gallup’s data reveal that the most effective recognition is honest, authentic and individualized to how each employee wants to be recognized. Acknowledging employees’ best work can be a low-cost endeavor — it can be as small as a personal note or a thank-you card. But the key is to know what makes it meaningful and memorable for the employee, and who is doing the recognizing.

In a recent Gallup workplace survey, employees were asked to recall who gave them their most meaningful and memorable recognition. The data revealed the most memorable recognition comes most often from an employee’s manager (28%), followed by a high-level leader or CEO (24%), the manager’s manager (12%), a customer (10%) and peers (9%). Worth mentioning, 17% cited “other” as the source of their most memorable recognition.

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What’s most surprising about these findings? Nearly one-quarter said the most memorable recognition comes from a high-level leader or CEO. Employees will remember personal feedback from the CEO — even a small amount of time a high-ranking leader takes to show appreciation can yield a positive impression on an employee. In fact, acknowledgment from a CEO could become a career highlight.

When asked what types of recognition were the most memorable, respondents emphasized six methods in particular — and money isn’t the only (or the top) form of recognition:

  • public recognition or acknowledgment via an award, certificate or commendation
  • private recognition from a boss, peer or customer
  • receiving or obtaining a high level of achievement through evaluations or reviews
  • promotion or increase in scope of work or responsibility to show trust
  • monetary award such as a trip, prize or pay increase
  • personal satisfaction or pride in work

Recognition From All Sides

The best managers promote a recognition-rich environment, with praise coming from every direction and everyone aware of how others like to receive appreciation. This type of employee feedback should be frequent — Gallup recommends every seven days — and timely to ensure that the employee knows the significance of the recent achievement and to reinforce company values.

The criteria for recognition should align with the purposebrand and culture of the company and should reflect its aspirational identity to inspire others. Rewarding employees who are not top performers could adversely affect high performers’ motivation. As such, companies need to state specific standards for awards to avoid any backlash.

Great managers know that they can never give too much recognition as long as it’s honest and deserved. Acknowledging an employee’s best work goes a long way toward making him or her feel valued and can lead to other desirable workplace outcomes.

Make the Job a Game

“How can my people get so excited about guys hitting a ball with a wooden club and not care half as much about the phenomenal parts they are building for interplanetary rockets?” A senior officer of an aerospace company asked me that question during a World Series.

How indeed?

The fact is that most working people can be highly enthusiastic about all sorts of things in their lives yet go to work with no sense of enthusiasm or fun. People love to play, but work for the most part isn’t much fun. Sixty-nine percent of the heads of households in the U.S. play computer and video games. And 97% of young people — your emerging talent pool — play them. A working population that derives its excitement from video and computer games and communicates via texts and tweets is not going to function well in the majority of our workplaces, which are too often hangovers from an earlier era.

The Humdrum Organization Life

No manager ever says, “Let’s make our company a humdrum place to work.” Nevertheless most do a superb job of achieving that result. For example:

  • Endless sameness. People come to work and, without climactic events, do essentially the same thing every day forever — like a mountain climber who never sees a peak ahead.
  • Little sense of personal achievement. Most people lack sharply measured goals. They can work diligently every day but never have a significant success — or failure.
  • No celebrations. Individuals throughout the organization may contribute to some very crucial project. But when the project succeeds — and there is a new jet engine or a new drug — very few of those people will enjoy the exhilaration of a personal win.
  • Long time spans. In their personal lives people enjoy activities with shorter and shorter time spans — sports events, computer games, texting and so on — whereas at work they must live through glacial planning cycles.

It is easy for organizations to evolve into these patterns and remain frozen in them forever. Few senior executives even consider the possibilities of redesigning work to make it more fun and more productive.

Crises Provide a Hint

Consider, however: When there are sudden customer orders that must get shipped, or power outages, or fires and other emergencies, most employees come to life and get things done with spirit and enthusiasm.

When 33 miners were trapped in a cave-in in Chile in 2010, the experts estimated that, with luck, they might possibly be rescued in four months. The rescue crews in fact got them all to the surface in two months. When Apollo 13 was aborted, programmers re-wrote some software in three days instead of the usual three months.

These must-do situations all have some common elements that evoke the remarkable performance:

  • A sharply focused, urgent goal
  • A very tight deadline
  • Autonomous team encouraged to experiment
  • Results clearly noticed and celebrated

Our experience shows that by designing jobs with these game-like characteristics and infusing a spirit of fun it is possible to enliven work and produce the kind of high-level, zesty behavior provoked by crises.

Spice the Culture 
Here’s how it can work with virtually any job: No matter how long-term a goal may be, carve off some sub-goals that have to be accomplished in a short time — 10 or 15 weeks not 6 months or a year. For each goal a team should be asked to plan an approach and carry it out. The whole effort should encourage some fun and creativity along the way. People should be encouraged to experiment. Success at the end should be celebrated.

Georgia Pacific launched a number of experiments to discover how to improve mill productivity. For example, the operators in one paper mill decided to test a process change: Typically each operator would, when required, have to change the large rollers on the paper-making machine for which he was responsible. It was a tough, slow job. The operators were certain that the job could be sped up by calling a fellow operator to come and help. Because the person at the very next machine might not be available, there would have to be considerable flexibility on who was called to help. They proved easily that they could deal with taking this kind of initiative. After a few demonstrated successes, dozens and then hundreds of such projects cumulated into the company-wide mill improvement process that yielded hundreds of millions of dollars.

In the same way, before installing a large new system, a team can test the idea. At VIA Rail, Canada’s passenger rail system, the design of a new inventory control system (for food service cars) was going painfully slowly. Even though the system had been only partially installed, the chief of passenger service told his commissary people to stop waiting for the new system to solve the problem. He asked them to use the best data they had in hand and to estimate what the system, if completed, would dictate they do. And with that, they were actually to reduce the inventory levels by a significant amount in a matter of weeks. The team was not only able to achieve the result, but it discovered a number of ways to strengthen the new system that was being installed.

Avery Dennison used the approach to accelerate growth. Several divisions each selected a few new-product projects that were lumbering along multi-year tracks. The game was to have teams achieve a sale or submitted proposal within 100 days on each of these long-term projects. Every one of 13 such experiments delivered tangible results. And the team members were proud and enthusiastic about their achievements.

Other such projects have focused on less-then-100-day improvements in quality in an iron ore processing plant, speeding the order-to-payment cycle in a manufacturing company, and reducing the time and cost of doing processing assessments for tax purposes. In companies that have tried out such “games,” non-involved employees often actually request to be included.

A zesty high-achieving work life does not need to be the monopoly of astronauts, entrepreneurs, movie actors, and NFL quarterbacks. Almost every humdrum job can be redesigned to include these game-like qualities.

 

About the author:

Robert H. Schaffer (rschaffer@schafferresults.com) is the founder of Schaffer Consulting in Stamford, Connecticut. He is also a coauthor of Rapid Results! How 100-Day Projects Build the Capacity for Large-Scale Change (Jossey-Bass, 2005).

Non Monetary Recognition is Better than Cash

Monetary rewards are not the answer to recognizing and encouraging success, and can actually undermine motivation. Extensive research backs this up. According to a study by the London School of Economics: “We find that financial incentives can result in a negative impact on overall performance.” Gadgets, trips, or other monetary incentives don’t make a lasting impression, or benefit the organization as a whole. “Over-reliance on pay and promotion as motivators leads to an organizational culture that is very transactional and disengaged,” says Susan David, co-director of the Harvard/McLean Institute of Coaching.

Non monetary recognition, on the other hand, does not affect employee behavior the same way that monetary rewards do. Here are five reasons why:

1. Recognition helps build an employee’s brand

Recognition, when it’s done well, is public. You can praise an employee on the front page of the corporate intranet. This can help elevate an employee’s status among her peers. Cash rewards, on the other hand, need to be kept private. There’s a strong taboo about discussing pay scales in the workplace, meaning that you can’t post an employee’s bonus payments in public. Yes, an employee with a fat bonus can put a payment down on a new Lexus, but that brings us to point #2.

2. Recognition is guilt-free for both parties

Monetary rewards feel good for a moment. But once the money is in the bank many employees become conflicted. Is the money still a reward for good work? Or does it really need to go to roof repairs, paying down a credit card or get tucked away for the kids’ college funds?

Non-monetary recognition, on the other hand, can be enjoyed by employees with no strings attached. It goes straight into their emotional expense accounts and doesn’t have to be used to repay past debts.

Learn how a non-monetary recognition program inside SharePoint helped a newly-merged company achieve a single conversation around achievement and accomplishment.

3. Recognition goes above and beyond employee expectations

Cash is expected. It is part of the contract you make when you hire an employee. If you offer bonuses for performance, those also become expected. It’s just part of the salary package. Something that you owe your employees.

Non-monetary recognition, on the other hand, can be perceived as a gift – something that you give an employee for significant reasons beyond just showing up and clocking in.

4. Recognition creates meaning for employees

Non monetary recognition reaps greater performance benefits than cash | TemboSocial

Doing meaningful work is deeply important to most people. Cash payouts don’t create meaning. In fact if an employee gets a bonus when he knows he only contributed 50% of his best effort it can make the workplace feel capricious. “They don’t know what they’re doing here – and look how much they pay me to do it!”

Non monetary recognition, on the other hand, is all about meaning. It says “I saw how much work you put into the Jones account, and that means a lot to me.”

5. Recognition is human

People don’t want to spend their whole lives cranking widgets, even if that’s their job. They want to be part of a bigger social enterprise. When you recognize their contributions like when you thank Sally for her 99.9% widget success rate, you are building a personal connection with an employee. She is now a vital part of your team and your tribe.

Cash, on the other hand, can be dehumanizing. Just like the episode of Seinfeld where Jerry gave Elaine a stack of bills for her birthday, cash can leave employees feeling used. It can leave a lingering sense of “sure, they pay me, but they don’t really know me.”

When it’s working as it should, recognition transforms your company’s culture. People bond to each other, and watch each other’s backs. They get engaged and look for new ways to contribute.

Social Employee Recognition – the heart of your talent management strategy

Social Employee Recognition is now becoming a critical part of an organisation’s talent management strategy. It can impact every employee, every day, and revolve around all of your TM initiatives.

‘Employee recognition’ goes back to the early 1900’s when Ford Motor’s Founder, Henry Ford, was experiencing significant turnover impacting the production of vehicles.  He needed to ensure employees on the front-line met production quotas. In order to do so, he rewarded employees for their length of service with gifts to retain and engage them.

The world has since changed.  Rewarding an employee for their length of service and engaging their ‘hands’ on the production line doesn’t work for today’s employees.  It’s now more important to engage people’s hearts and minds through recognition.  The problem is durable – we will always be challenged with ways to engage and retain employees, but the solutions are changing as quickly as our workforce is.

One of those solutions is Social Employee Recognition.  It’s real and it’s impactful.  In fact, it sits on Gartner’s Hype Cycle of HCM Technologies which is poised to hit mainstream adoption in the next few years.  Read on to quickly familiarise yourself with this concept in the age-old W5H format and see why it has the ability to impact daily talent management.

WHAT is it?

Social Employee Recognition is ‘peer recognition’ through technology that enables frequent and in-the-moment appreciation of company behaviours, values, and results that organisations want to see more of.  It uses social principles that take recognition from what was traditionally a one-to-one act of appreciation to a one-to-many approach, breaking barriers of traditional recognition programmes and helping enact company strategies to improve employee and company performance.

Simple enough, right?  But, WHY should you care?

Social Employee Recognition is becoming the heart of progressive integrated talent management strategies, supporting and complimenting all elements – namely performance management, learning and development and talent acquisition.  Also, recognition has proven to positively impact employee engagement and retention. Recent Harvard Business Review research found recognition as the most impactful employee engagement driver.

Beyond recognition stimulating intrinsic motivation to help positively impact engagement and retention, it also impacts performance.  When authentic moments of recognition happen repeatedly in organisations, those behaviours and results get repeated.

WHERE does this get implemented?

Company wide.  Organisations are challenged with disparate recognition programmes across different locations and departments leading to inconsistencies in the employee experience.  Companies have found power in the ability to have a consistent message to employees that align to the organisational values, and to help enact company and talent management strategies.

WHO cares? And WHO does it impact?

This type of strategy MUST be inclusive – giving every employee the trust and opportunity to participate.  A platform where employees are getting recognised on an ongoing basis is one employees ACTUALLY like to use.  The result is HR technology that employees love to use, with insight into talent that managers need to be better leaders, and produces a return on investment that executives crave.

WHEN should I consider this?

Your competitors already are.  As technology supports advance analytics, mobile use for anywhere access, and seamless integration into other HR systems, companies are beginning to see value in streamlining and maximising the impact of their traditional reward spend.  As the battle for talent increases with the UK economy improving, it’s important now more than ever to engage, retain and attract key talent.

I’m convinced! HOW do I move forward?

Before considering implementation, the most important task is starting with a foundation of behaviours from your talent management construct (values, competencies or results) that your company wants to see more of.  Without establishing what recognition will be based on, all of the new trends and technology will not make it successful.  Technology is an enabler. Success includes the right balance between human connection and technology.

More questions?

If you’re interested in learning more or even considering a social recognition strategy, check a Brandon Hall report entitled Building the Business Case for Social Recognition Solutions – one of the more comprehensive (and recent) research on this topic.

You can also get more information about these types of solutions from Achievers, who have helped hundreds of global organisations implement social employee recognition into their talent management strategy resulting in dramatic employee and business success.

About the author

Rob Catalano

Rob Catalano is passionate about helping companies succeed – by leveraging technology to make employees successful.

Gamification is the Future of the Workplace

Five statistics that suggest gamification is the future of the workplace, plus the psychological theory of why gamification works.

What motivates employees at work? Recognition, rewards and a sense of competition are all strong motivators.

Gamification works because it taps into each of these motivators to keep employees engaged. This convergence of technology and productivity is where game mechanics are used in a non-gaming context.

Traditionally, you can’t get further away from a ‘game’ than at work. However, in many companies, there’s a big problem with lack of employee engagement. If employees aren’t motivated to do their best, businesses will lose out.

This is where gamification comes in.

The Psychology of Gamification: Why It Works

According to Gamification by Design co-author Gabe Zichermann, “gamification is 75 percent psychology and 25 percent technology.”

So, what a gamification tool does is tap into the psychological behaviors that govern the day-to-day decisions we make – providing a platform for competition, sharing your achievements and managing the progress of your work.

The purpose of gamification, from an employer’s point of view, is to encourage the behavior you want. However, behavior is a hard thing to change.

According to Professor B.J. Fogg, an experimental psychologist at Stanford University, there are three elements that must converge in order for a change in behavior to occur: motivation, ability, and trigger. What’s most important is that all three things have to happen at the same time.

Successful gamification tools work because they:

  • Give users the motivation to do something (the chance to win, receive rewards or gain recognition)
  • Give users the ability to carry out a task – by facilitating it, or breaking each task into bite-size chunks, increasing the perceived capability for the user
  • Give the user a trigger or cue to complete the action

If all these conditions are met, gamification can change behavior, create motivation and keep employees engaged.

The following statistics prove that gamification is taking the modern workplace by storm.

70% of business transformation efforts fail due to lack of engagement.

First, let’s start with a statistic that demonstrates why gamification is needed in the workplace. Businesses need to adapt to changing technology, market conditions, and consumer behavior, but can’t if they have an unmotivated team that are unwilling to change.

Companies need to provide incentives and employ the same techniques game designers use to keep players interested, in order to achieve the engagement needed for the transformation of business operations.

By the end of 2015, 40% of Global 1000 organizations will use gamification as the primary mechanism to transform business operations.

The popularity of gamification as a way to engage employees is growing. With 40 percent of the top organizations in the world using gamification this year – the percentage only looks set to grow in the next few years.

The worldwide gamification market will grow from $242 million in 2012 to $2.8 billion in 2016.

During this time, gamification tools aimed at businesses will also eclipse those aimed at consumers, showing not only a growth in the market but the value of gamification in the workplace.

53 percent of technology stakeholders said that by 2020, the use of gamification will be widespread.

While not a huge percentage, it still shows that just over half of technology stakeholders believe gamification to be the future of not only the workplace but of education and health too. The other 42 percent still predicted that gamification would play an important role in 2020, but would not be as widespread.

Stewart Agency managed to double the number of emails they collected over two years, in just three months with gamification.

Statistics about the growth of the gamification market may be impressive, but it’s not as impressive as seeing statistics showing the success of gamification in practice.

Stewart Agency wanted their team to collect more email addresses when talking to leads. To do this, they needed to motivate their team to want to change their behavior. They incentivized this with a competition, awarding sales people based on how many email addresses they could collect over several months.

The gamification of the sales process worked – in less than two months, they had almost doubled the number of emails they collected over three years.

Gamification is not only the future of the workplace – it’s how businesses are succeeding right now. NewVoiceMedia’s Motivate for your sales or customer service team can engage them in their job, encouraging best practices and pushing your team that bit further.

Do you think gamification is the future of the workplace? Are you already using gamification techniques in your organization? Share your thoughts and experiences below.

 

Employee recognition has changed

Employee recognition programs, once considered a “nice” but non-essential component of human resources, have changed dramatically over the past five years. This shift parallels a growing understanding of the importance of retaining top-performing employees and re-engineering employee recognition as a core business function.

What’s behind this change? Numerous studies demonstrate “that when companies include employee recognition as a line-item, employee behavior increases across engagement, productivity, retention, customer service, and morale.”

What trends have emerged in the recent past and what do they tell us about how employee recognition programs will be defined in 2017 and beyond? Here’s a look at how thinking has changed and the implications it has for your business today:

1. Employee recognition is being integrated into human capital management strategies

There’s a new strategic value being placed on not just motivating the team, but discerning more precisely the types of behavior that translate into business success. Increasingly, recognition programs are seen as valuable coaching opportunities that reinforce desired employee behaviors — which can result into more effective sales, enhanced customer experiences and longer-lasting customer loyalty.

2. Employee recognition takes place on a continuous basis, not once a quarter or at the end of the year

In past years, many businesses hosted an annual employee recognition day, in which prizes were handed out for individual achievements. Over time, thinking has evolved into a prevailing sense that frequentemployee recognition is a much more effective tool for reinforcing the behaviors businesses desire. Consistent praise has a more beneficial effect than intermittent recognition.

3. Peer-to-peer recognition is on the rise

Employees value praise from managers and others high up in the organization, but they greatly appreciate peer recognition as well. Social media can serve as a useful resource for employees to recognize one another’s efforts (status updates on LinkedIn and Facebook, for example, where people can leave comments and words of praise). Peer recognition also leads to a stronger sense of being part of a hard-working and high-achieving team.

4. New talent looks for cultures of recognition

In the red-hot competition for qualified new hires, it’s becoming clear that jobseekers respond favorably to businesses that actively promote a culture of recognition. Businesses with cultures that “clearly value innovation, people development and strategic thinking attract higher quality employees,” notes business author Rob Peters. “Intelligent organizations utilize recognition as a way to regularly advance the aspects that make up a high performing culture.”

5. Recognition is becoming more specific and personal

Handing out generic-sounding awards misses the mark when it comes to motivating employees to higher levels of excellence. If the reason behind recognition is vague or ambiguous, the objective of encouraging similar behavior among fellow employees gets lost. People want to know specifically the types of positive behavior their employers value. Rather than handing out a one-size-fits-all employee of the month award, “giving a more specific reward for providing legendary customer service makes more sense,” contends marketing expert Amy Blackburn. “Other employees, upon seeing such recognition, may want to rise to the occasion, too, and provide excellent customer service.”

6. Employee recognition programs play up the “fun” angle

Recognizing employees for individual or team achievements shouldn’t be a staid or solemn affair. The goal is advancing employee engagement, which is far more likely to come about as a result of informal and upbeat ways of recognizing outstanding on-the-job behaviors.

According to a recent study, businesses with “effective recognition programs have a 31 percent lower voluntary turnover than organizations with ineffective recognition programs.” This, in itself, is a compelling reason to find out more about trends in employee recognition programs and see how you can incorporate those trends into your own efforts to salute hard-working and dedicated employees.

Author:  Julie Feece, Vice President North America – Marketing for RPG Card Services 

 

 

 

Gamification: Playing Your Way to Better Employee Engagement

47% better performance compared to others.

25-65% less turnover.

37% fewer absences.

According to a recent Gallup poll, those are just a few of the benefits of excellent employee engagement.

But while the benefits are clear, less than 50% of executives know how to improve it. Enter gamification. 

Gamification: a growing HR trend

Gamification is a growing trend in employee engagement that uses a digital environment to help employees reach certain goals and objectives. The employee plays a game that offers points, status, and rewards as they improve the skills, goals, or objectives the company is trying to meet.

The theory is that everyone likes games and that we all like a bit of friendly competition and the rewards that come with it.

With increased social media usage, the popularity of mobile apps, and the increase in complexity in mobile technology, people stay connected and play games more than ever before. Gamification is a natural fit into the worlds of many employees. It can make them more engaged and productive in a fun, easy, and accessible way. Around 55% of American workers say they would like to work for a company that uses gamification (Dupress).

The art of gamification

Some people may hear the word game and imagine mindlessly using an app or view it as a waste of time. But do not let the word gamification fool you. The games are fun, but they are business-oriented. Some people might want to view it as a form of behavior modification using technology. But that does not have the same ring to it as gamification.

This digital system can be superior in many ways:

It can reach everyone in the entire company with the click of a button.

It has a much smaller cost compared to physical rewards and motivators.

The rewards and achievements are displayed and longer lasting.

It provides instant feedback.

Gamification is good at engaging and motivating employees. They learn new skills, new behaviors, and new ways of solving problems. The system of rewards and achievements in the games activates reward pathways in the limbic system and amygdala, creating change in the brain, as we discovered in our Neuroscience for business series recently.

Gamification uses consistent positive feedback to increase motivation. It breaks down complex tasks into simple tasks that the brain can learn over time, without as much stress or fatigue. It also taps into the brain’s ancestral status and power reward system.

Many times classic rewards systems can suffer from habituation. Once the brain adjusts to a certain reward, the reward no longer has the same impact, lessening the amount of motivation it gives the person. Games can easily create a system of increasing levels of power and status as users progress through the levels. The brain is continually reactivated at each new level of reward.

Game set-up

Gamification, at its most effective, has certain qualities that help make it more engaging, according to Bunchball founder, Rajat.

  • Collaboration
  • Community
  • Competition
  • Points
  • Leveling up
  • Goals
  • Badges
  • Fast feedback
  • Transparency
  • Onboarding

If you have every played on a tablet or a phone app, you will recognize most, if not all of those. Often the most addictive games are the ones that do those things the best. When looking for an app or game to use, make sure to try it first and see if it has all those qualities.

When starting out, make sure there is a point person who can advocate for the use of the gamification system. Also, make sure to have a designer who specializes in gamification. Using data from employee surveys or interviews, make sure to choose an area where engagement needs improvements and create a plan of action for those specific needs.

When an app is in place, it is crucial to have the consent of all employees who are playing it. Employers cannot force them to play and expect to get good results. Sometimes fun things are less fun when they are a requirement. Research shows that gamification actually decreasesengagement when employees are required to play a game.

The consent explains that employees need to understand and focus on the game, know the rules of the game, and view the game as fair. Other factors that improve the success of the game are valued rewards, clear rules, and dedicated management. It is important to base the achievements and the rewards in the game on an increase in skills, not just random factors or time spent playing. Employees who spend a lot of time playing, with few results should not get the same rewards as someone who is more skilled in a shorter amount of time. This can make the game seem unfair, demotivating people.

Also, it is crucial to promote the social aspect of the game. People like to promote themselves and show off a bit when then earn a reward or get a trophy. The social aspect can make the game more valuable as it can encourage others to work harder using a dose of healthy competition.

The entire game set-up has to follow a strategy. Rewards that have no meaning, confusing gameplay, or management that does not value the use of the game will result in employees that do not value the game or use it.

Focus areas where you can use gamification

Gamification systems are useful in many areas of an organization.

Learning and Development

New or experienced employees can use games to learn new skills. The gamification of learning platforms can improve retention and results.

Customer Support

Achievements and rewards through gamification can encourage employees to help customers with more efficiency and quality. They also motivate employees to share new solutions and ideas with other team members.

Improving Sales

Gamification can improve collaboration between salespeople. It rewards not just the final sale, but all the steps it takes to get to the final sale.

Teamwork

Teams can use games to share information and learn from each other even though they may be in different offices around the world.

Marketing

Employers can motivate employees to share information about the company on social media.

Inventory Management

Gamification rewards efficient processing and shipping practices.

Human Resources

When using gamification, HR professionals can track performance reviews, develop leadership skills, provide peer appreciation, engaged applicants, and increase referrals.

Product Development

Games can help employees complete projects on time, collaborate, and be more efficient.

Creativity

Employers can reward employees for thinking of innovative ideas.

Corporate Culture

Gamification can help spread the culture of the company through different projects and programs. It can help employees find opportunities to involve themselves in shaping the company culture. Moreover, it can make information about the company and its values more accessible.

Gamification in use

In 2009, telecommunications company Telus had an engagement score of 54%. But the company thought it could do better. Using technology and gamification, the company saw increases in employee engagement, profits, and customer satisfaction.

Among other things, they used two video games to teach empathy. In one, employees played a speed skating game in which they had to train their skaters using the company’s leadership techniques. The company held weekly skating competitions that were based more on leadership than on perfect skating skills.

The other game put employees in the role of a store worker who has to interact with customers. The object of the game was to be able to teach employees in an office what it is like to be an employee who works with customers.

Due to initiatives like these, their engagement score rose from 54% in 2009 to 87% in 2015.

They had a sick-day rate of 7.5 days per employee, compared to the average of 11.1 days.

Since 2000 they have increased their shareholder return by 338%. In 2015, they were the number one telecommunications company, placed 82 points above the number two company.

In 2012, Freshdesk let their employees earn badges based on their performance at Help Desk tasks. The company first gave cash rewards for being at the top of a pubic leaderboard. This actually made productivity worse, so they changed the system to one of challenges and achievements.

Ford Motor Company integrated games into their learning and development system and saw a 417% increase in its use. Employees were more engaged, sales went up, and customers were more satisfied.

While playing games may seem strange, the results are clear. It may be time to join the fun and turn on a game at work. Whether you are more old school or prefer human interaction to digital apps.

 

About the Author: 

Andy Nelson
Andy has degrees in psychology and mental health and has been working to help people find success and happiness in their professional and personal lives. He finds his own happiness through writing fiction adventures, sitting in the park with a good book, or catching the latest movie or TV show with friends.

Why is Employee Peer Recognition Important?

Employee peer recognition is one of the most important building blocks in building a fantastic company culture. In most organisations, management oversees more employees and bigger departments.

These managers often run the risk of constantly finding solutions to every problem, taking on a heavy workload and leaving little or no time for employee development. When managers are focused on making sure nothing is going wrong, it can be difficult to see what is going right and employees tend to be neglected.

“Appraisals are where you get together with your team leader and agree what an outstanding member of the team you are, how much your contribution has been valued, what massive potential you have and, in recognition of all this, would you mind having your salary halved.”

– Theodore Roosevelt

This is why employee peer recognition deserves attention. Recognition is easy to give and employees love to receive praise for their efforts or moral support. The hard part about giving recognition is remembering to give them a ‘pat on the back’ when recognition is due.

Employee peer recognition can take many forms and does not always have to be in writing. It sets a positive tone for company culture as it reminds the employees of the company of what they are working towards and most importantly strengthens the bonds between colleagues and team.

The importance of employee peer recognition

Besides getting recognition from upper management, employees also want acknowledgment from the peers they work with every day. Recognition from peers may come as a surprise, which can have a very powerful impact.

“Motivation is a fire from within. If someone else tries to light t

There are many factors that are important when it comes to employee peer recognition.

  • It creates a sense of team spirit among the company. Employee peer recognition creates opportunities for departments and employees to come together and work in unison towards a common goal of the company.
  • Employee peer recognition motivates employees to do great work and perform even better in their next task. When working together as a team, employees tend to develop a new or more productive way to achieve the company goals.
  • It lowers the employee turnover as employees tend to stay with the company that looks after them. The years of service that include co-worker participation, emotion and recognition yield more powerful result.
  • Employee peer recognition creates a sense of belonging among the employees as well as a sense of job security, knowing that the employee’s efforts or hard word is not wasted. This will drive them to work harder on the next task.

“People may take a job for more money, but they often leave it for more recognition.”

– Bob Nelson

An effective employee peer recognition program

Employee peer recognition allows employees to thank and reward one another for their contributions at work. Look out for peers who give recognition often as it shows great leadership qualities. It motivates employee engagement and increases retention by encouraging meaningful workplace relationships.

There are 3 rules for a peer recognition program to be effective:

Be Authentic

Give credit when it is due and not because you have to. Recognition boosts morale and creates team spirit but it needs to be authentic. Employees need consistent and timely feedback. No employee wants to wait for months to hear that they did a great job. Employees can provide immediate responses to things going well or performance areas that need a boost. Instant authentic feedback encourages employees to work with a purpose.

Be Respectful
So much as everyone loves the attention and being centre stage, there will be others who do not like to be part of the limelight. Respect your colleagues and their cultural differences.

This may be as simple as keeping the thank you that you give private, or low key.
Be Engaged
Thinking and waiting for someone else to recognise your colleague’s work and progress for you is not going to work. Be proactive and engage in your company’s peer recognition programme. Look out for emails or notices and read about your colleagues’ achievements and the positive impact they are making to the company.

“It takes an engaged, motivated and committed workforce to deliver a first-class product or service and build a successful, sustainable enterprise.”

– Richard Branson

For other examples of ways to motivate your employees, read our post, How to motivate your employees in 12 easy steps.

In Summary

Employee peer recognition is important to any organisation, as peers know what their colleagues are going through at work on a day-to-day basis. So when they are being recognised for their efforts, the impact is much more meaningful.

Remember not to just go through the motions or make this a checklist to be completed every month. Put a smile on your employees’ face and make it relevant to them. Try to align your recognition with company values but do not just focus on the business goals.

Best of luck creating an environment of spontaneous gratitude!

Reward Employees for going Social

Typically when candidates consider a job position, they compare the compensation and benefit packages of various employers. You don’t have to be a very large business to offer admirable rewards, as there are small innovations that can make a big difference. The key to great rewards is to make them stimulating while maintaining the brand. Today, social media is becoming an increasingly significant tool for employees to work together with one another. Also, individual social profiles many times often work as advertisements for the company, displaying what its team members have on offer for potential customers.

It helps to encourage your employees to engage more positively on social networks by way of training, tangible rewards and gamification. Employees can collaborate with each other while showing outsiders the kind of innovation that is taking place inside the company walls. Most of the employees use LinkedIn, Facebook and other social networks for business and personal purposes. Employees can develop their personal as well as the company brand by crafting a Pinterest profile or attracting a large Twitter following. Rewards and incentives can help incentivize employees to engage more on social media and collaborate through different networks. With enhanced engagement, companies can create a happier workforce.

-by HiFives

Are Mobile Apps for Rewards and Recognition really important?

Is having a mobile app for rewards and recognition system really important?  When you and your manager walk out of a meeting you can recognize his work personally right there but let us see an instance if the person you want to recognize is in another country or city. It is possible that the employee has very little or no access to a computer. Mobile is important as a tool for the success of a project that has a large number of offline employees. Maintaining the best practice of timely recognition, mobile apps allow for employers to recognize others anywhere on the globe just with their smart phones.

Are mobile apps needed for reward or recognition or is it one of those solutions looking for a problem?  Is it just a marketing gimmick or an actually useful tool to reward and recognize people that will really be used by people constructively and they need it?  It has been projected by several surveys that mobile access to the Internet will surpass the desktop web in a few years and 3 billion or more of the adult population in the world will be enabled to conduct business via mobile. There is data to suggest that Mobile phones will leave behind PCs as the most popular web access devices in the world.

-by HiFives

Do Employee Rewards and Recognition make sense?

Modern employee rewards and recognition programs are increasingly being reinvented to encompass not just traditional practices of compensating and thanking employees and are also venturing into newer pastures such as emotional and physical well-being of people defined as “Total Rewards”. The key purpose of reward and recognition is to convey to the employee that their contributions to the organization are valuable.  This is important for the employee as it makes them feel respected, validated and vital. Experience, as well as studies shows that there is a significant correlation between reward and recognition with satisfaction and motivation.

Among the most critical characteristics of any successful rewards and recognition program is equity and fairness with a sense of evenhandedness. Fairness has to be within the organization as well as in comparison to analogous companies on the marketplace. Rewards and recognition have to include a number of aspects. To begin with assured compensation and salary with annual or special increment is a must but performance based incentives, which can be in cash or kind, motivate employees and they enjoy their work. Reward and recognition practices followed in an organization have shown to motivate employees to offer their individual best as well as endorse the sentiment of working together as one team.

-by HiFives

Integrate employee rewards into the Total Reward framework

Total rewards framework includes several employment factors like benefits, compensation and work life facilities that can be strategically applied together to get the desired employee attraction, retention and motivation. Most employers around the globe see great value in integrating employee rewards into the total rewards framework. The basic of total rewards is about retaining employees and their financial performance. Top talent internationally cites total rewards as vital to their job and enthusiasm levels. It is also seen that enhancing employee perception of total rewards impacts effort, motivation and Intent to Stay. It is crucial to establish a compelling total rewards framework and it is not enough to just communicate without a strategy.

Organizational success is driven through better talent attraction, engagement and retention but typically companies are not as overt as they can be when defining the reward framework. Having a balanced total rewards framework is especially vital in the present economic environment where companies have to measure people cost, behaviors and productivity cautiously to make sure that their objectives are stated clearly and aligned with business. Intent and design, no matter how considerate, will not be successful if they are not set on a strong foundation.  An integrated total rewards framework is advantageous for the employers as well as the employees.

-by HiFives

Finding it tough to decide on employee rewards tools?

It is not unfair to say that if rewards or recognition offered to employees were altered, it would bring corresponding transformation in productivity, work motivation and satisfaction. Rewards is a wide concept that is increasingly being re-defined to encompass not just the traditional methods of compensating employees, but also newer aspects such as emotional and physical well-being. A broad range of characteristics and employee rewards tools have to be considered before implementing a total rewards plan. This would include defining metrics and understanding objectives to design a plan that measures and tracks accomplishments against defined goals and expectations.

Most organizations tend to depend on external benchmarking to ensure the competiveness of rewards offered by them but some work out their own employee rewards tools to get relevant data and stay competitive. This can be done through developing an array of reward and recognition programs, cheering peer recognition, offering performance awards at individual as well as team levels, applauding employees for showcasing the values of the company values and so on. It has been seen that recognition has a direct impact on behavior reinforced in an organization, which makes it very essential for businesses to ponder over the areas for which they wish to reward their employees.

-by HiFives

Are you losing out with no employee rewards program?

It is of utmost importance that organizations have an employee rewards program and they define the metrics for the same to achieve desirable outcomes.  Rewards program not only acknowledge employees for their loyalty but also help in developing a climate of appreciation. It can recognize good work and extra effort more often and in unique ways. To ensure effective rewards and recognition systems for an organization, they need to be effective while reinforcing the values and goals of the company. Employee rewards programs encourage employees to act in line with the objectives all along emphasizing on the importance of achieving the goals.

Rewards programs in many ways, aids the organization to fulfill employees need for recognition, appreciation and positive support. Reward aims at offering competitive packages, sharing the success and efforts of people fairly and generously. These programs often ensure that employees get to know how their performance is related to the success of the organization and their compensation. This benchmarking should not be limited just to the salary but also to rewards and other kinds of benefits. When you design an employee rewards program, it helps carry out the need of the worker to be rewarded for their competence effort and contribution to the organization.

-by HiFives

Influence of Rewards on Employee Satisfaction

Motivated and satisfied employees are a very valuable asset to any organization. Rewards can create the much needed impact, especially for companies facing issues related to employee job performance and satisfaction. Studies show that rewards influence an enhanced level of job satisfaction. There are numerous changes in the business world today and every organization has to depend greatly on positive employee performance which is directly related to satisfaction. Reward programs have their merits in developing a highly satisfied workforce, making rewards a key tool to ensure employee satisfaction.

When it comes to rewards, different employee has different perceptions, some consider cash to be sufficient, while others look for luxury enticements such as holidays, cars or apartments and there are also a few who look for non-material incentives. It is one of the most difficult jobs for any company to design an effective reward system for their employees. It is not easy to achieve employee satisfaction with rewards. Today managers have to understand the expectations, desires and requirements of its employees better. The bottom line is that company’s reward system should be such that it attracts new workforce into the firm as well as motivates existing employees to perform better.

 

-by HiFives

Design your Employee Rewards Program

Numerous surveys from around the world have consistently shown that most employees want more than just paycheck for their jobs. They want to feel safe and appreciated for the work to do. A good employee rewards and recognition program must provide employees with several other feel good aspects. An employee must feel that he or she is getting a reasonable return for their efforts and have to be motivated to continue to augment their performance

Here are some guidelines for employee to help them design a reward and recognition program for their department. All employees must be considered eligible for the program.

Spell out the criteria for employee rewards.

  • Reward all who meet with your set criteria.
  • Personalize employee rewards.
  • Cultivate an atmosphere of self-esteem.
  • Promote built-in rewards.
  • Design rewards for the complete team.
  • Encourage a “thank you” culture.
  • Keep in mind that you will get what you give or reward.
  • Employee incentives can be given in other forms than cash. For example, top performers can be given less supervised higher responsibility, which is a reward in itself. Some other rewards be like more time off, flexible schedules or choice in taking up assignments.

It is significant that employees realize that they are being rewarded for working hard as well as getting results.

-by HiFives

Non-Monetary Employee rewards – anyone?

Cash or non cash rewards…this has generated a lot of debate for the incentive program practitioners and their patrons. What is the value of tangible, non-monetary incentives as compared to hard cash? The immediate answer could be cash, but there are many who back the concept of non-monetary employee rewards. There are sort after non- cash rewards that directly influence the perceived value of the same and enhance the worth of earning the reward as they are earned and not bought.

There is an interesting dynamic when non-cash reward is received in the form of lifestyle item, an activity or travel, which is deemed as pleasurable experience. Among the most significant rewards received by an employee is the acknowledgement for a job well done, from supervisor, peers, managers or even friend and family. Social reinforcement is achieved when others know about the appreciation. In fact non-cash rewards can sometimes be more effective as compared to cash rewards in this situation, as the receiver does not have to promote that he has earned it, making it truly special. The reward becomes extraordinary, if the individual is less likely to buy it. It augments the value of earning the reward and employees puts in additional effort to receive it. Non-cash reward can be services and items that individuals are not likely to buy, attracting the attention of their colleagues and thus amplifying the trophy value of the employee reward.

-by HiFives

Integrated Rewards Strategy for Planning Employee Benefits 

Some employers prefer to set their benefits and compensation at the competitive market average while others fix it at different percentiles above the given average. The benchmark is based on the general strategy of the company. There are many mature organizations who take a broadminded position on the benefit programs integrated with their reward strategy.  An emergent organization may focus more on short-term variable rewards plan to safeguard resources.

An integrated rewards strategy offers benefits to both the employees and the employers. Some of them

It allows employers to drive organizational success by way of better talent attraction, commitment and retention

  • Forms a guide for investment decisions while enabling informed options for the employee
  • Helps to elucidate employer-employee relationship
  • It can aid create a distinctive employment brand
  • Integrated rewards approach can enhance the return on rewards and generate better enterprise value.

It is seen that often the environment in which employee benefits works in erratic and for strategic reasons, it is important to ensure a systematic process when planning, designing and administrating employees’ benefits. Moderate to high rewards with uncertain expectations can lead to a culture of prerogative, which can result in poor performance and attrition.

Low rewards with high expectations is a talent deterrent.

-by HiFives

Existing Employee Rewards Program – evaluation made simple

Company offers compensation to its employees in return for the work they perform. There are some who believe that compensation and pay is one and the same thing but the fact is that compensation is much more than the money given by an employer. Compensation practices of any organization has far-reaching consequences on its competitive advantage and rewards play a major role in attracting, motivating and retaining competent employees. Rewards and pay, both are important to both new as well as existing employees.

Reward received is a great motivator for most people. With a job evaluation system, you can ensure that all important deliverables of the job are captured and can be incorporated into a rewards program that is easy to deliver. Reward helps people to satisfy their ego or self-esteem requirements. Organizations need to develop a rewards strategy that is based on the business plan and cycle of the business. A strong movement is seen towards rewards that are tied to performance. Here the bonus is not a part of her or his basic pay but has to be re-earned every year with their performance.

Today most organizations are making considerable changes in their employee rewards program to better fit the dynamic, exceedingly competitive business environment.

 

-by HiFives

How rewards impact Employee Satisfaction

Company’s wealth lies in its people and channelizing their effort and performance can be quite challenging. It is a truism that incentive and rewards contribute superciliously in enhancing and harnessing the best from the employees. Fitting rewards as well as compensation programs can be very important for employee satisfaction. In fact job satisfaction depends much on the level of fundamental and extraneous outcomes and how they are viewed by the employees. Results may have different values for different individuals. For some, challenging and responsible assignment can have negative or neutral value based on their experience and education. These differences account for different levels of employee satisfaction for essentially the same task.

The salaries have to be fair and according to the contribution made by the employees. A good way to align company’s interest with the employee is by initiating a profit-sharing plan, where in the employees earn a bonus according to the profit generated. Employer as well as the employee basically works for a common goal that is profit and this offers a higher sense of ownership along with an exciting financial gain. Non monetary rewards such as paid off time, training programs, recognition, etc. are very beneficial tools for employee satisfaction. Key objective should be to reward employees fairly, justifiably and consistently in correlation to the significance of their contribution to the business and performance.

 

-by HiFives

The Essentials of a Reward and Recognition Program

Incorporating reward and recognition has become increasingly critical in current business environment. Employers need to design R&R programs that are adaptable to the pace of their growing business, as well as fine-tune to the ubiquitous economic climate. A superior reward and recognition system should motivate employees at the same time align their goals with that of the organization. Given the cost of reward and recognition programs it is imperative that organizations articulate a lucid deliberated strategy that reflects the requirements of its business and its people.

In these ever-changing economic scenarios, it has become more important than ever for businesses to evaluate their traditional approach to R&R and draw up reward and recognition practices as a business driver. This involves providing acknowledgement for quality work, while getting the most out of their rewards budgets.

Businesses can structure their philosophy by exploring formal and informal, monetary as well as non-monetary reward programs for the employees. Creating a reward and recognition program as a process that links organization goals with the requirement s of the employees, while upholding market competitiveness. It is imperative to address and recognize the workforce with an impartial and consistent approach.

-by HiFives

Reward to motivate!

It is not very simple to comprehend what motivates employees in an organization to perform better. Work motivation is a blend of energy that comes from within as well as from beyond a person to initiate work.  Motivation involves offering employees an incentive in the form of reward or recognition to do better. There are times when suitable incentives should prevail over the actions needed to achieve incentives. Employee motivation reflects overall assessment of the job through attitude, emotion and behavior along with their work experience.

Typically motivation is a combination of three psychological processes, encouragement, direction and intensity or the energy that is put into their work. Employee motivation can be inherent like the desire for a person to succeed or extrinsic which comprises of external including monetary incentives, rewards and recognition. Trying to enhance employee motivation by way of rewards or recognition can sometimes be an intimidating job for managers. But this can be made simple with correct information and the right techniques. It will not take much time for the managers to become competent at augmenting motivation with rewards. With the involvement of all the employees or representatives, managers can initiate better communication to design a rewards process. This will make sure that the management as well as the employees are on the same page.

 

-by HiFives

Reward your B team!

The winner takes all! This is a common phenomenon in most organizations – the ‘A listers’ end up getting the fattest bonuses, heftiest pay hikes, fastest promotions and the meatiest roles. And the next level performers get virtually nothing (except for possibly single digit hikes and tenure driven promotions). More often than not this so called ‘B team’ is what lends solidity to the organization – steady performance over time and loyalty towards the organization. However, organizations tend to alienate themselves from the ‘B team’ by focusing too much on the ‘A listers’, finally demotivating them resulting in under-performance and finally exit for better pay elsewhere.

While ‘A listers’ definitely deserve a lot of credit and cannot be denied the rewards due to them, organizations should use recognition as a way of keeping the ‘B team’ motivated. Genuine display of appreciation for their contribution, supplemented by the organization’s rewards and recognition program (Spot Awards, Employee of the Month/ Quarter, Top Contributor, Project Awards, etc.) can go a long way in communicating the right message to them – “yes, the ‘B Team’ is valued by the organization!”.

-by HiFives

What do organizations do to reward their employees?

Employee rewards and recognition is one key areas in HR that remains a laggard when it comes to the adoption of modern processes and use of technology. Traditional rewards practices are not only cumbersome to administer, but they also do very little in terms of employee engagement. Especially given that 60-80% of the workforce in most organizations is under 35 and is well exposed to online shopping, social media and mobile apps.

Following are actual instances of traditional rewards practices deployed in organizations – the chances are that these might be out of sync with the needs and aspirations of the workforce:

  • One organization rewards its employees shopping vouchers – managers who want to reward their team members fill out request forms and send them to the admin team which consolidates such requests and forwards it to the procurement team. The procurement team in turn forwards the order to the vendor who supplies the vouchers. The vouchers are then inwarded by the facilities team and distributed to the employees through their managers. For employees in other locations, the vouchers are couriered.
  • A third organization has built an in-house R&R tool to reward points to employees and redeem them online. However, the redemption catalogue has only a dozen products – bags, sippers, coffee mugs, etc., all branded with the company logo. Redemption orders are consolidated every week and forwarded to a vendor who customizes these items and delivers them to the office once a month. The facilities helpdesk then distributes the items to the employees.
  • Another one runs an employee birthday program in which the employee gets an e-card and a shopping voucher. One of the members of the HR team religiously mails out the birthday e-cards every day based on a schedule. The concerned employees are expected to collect their shopping vouchers from the facilities helpdesk. If the employee fails to collect the voucher within a month, a reminder email is sent out.
  • Another organization gives out engraved pens to its employees on their service anniversaries – $50 pen for completing 5 years, $100 for 10 years, $150 for 15 years and so on.
  • A fifth one procures electronics and household appliances such as LCDs, home theaters, washing machines and refrigerators as part of its rewards program. The choice of brand and model is decided by the organization. The employee is left with the onerous task of transporting the product home.

What’s common to all of the above practices?

  • They offer little or no choice to the employees
  • There are extensive delays in getting the products to the employees
  • The overall employee experience is hardly smooth
  • Administration, logistics and distribution consumes significant organization bandwidth (read costs)

If your organization has similar rewards practices, you need to think twice!

-by HiFives

Would you build your own internal R&R tool?

Well, you might especially if you are a large technology company and you can spare a few tech resources for 6 months or so, you might be able to build your own in-house R&R tool complete with different award types and points based reward system. You might also be able to include a redemption store with select products such as company branded merchandize and gift vouchers. Your line managers would be able to use the tool to reward their team members with points; team members can then redeem their points against the catalogue of products which are finally delivered by a third-party vendor.

Simple enough! So what are the advantages?

  • To start off with, the tool seems to come at no incremental cost to the company
  • It is completely customized with the company branding and the required workflows
  • It might integrate better with existing corporate systems and the intranet
  • Since the tool is managed by an internal team, making changes seems easy

Sounds great? Are there any challenges?

  • Resources for building and maintaining internal tools might not be as easy to get and they might come at some (opportunity) cost internally
  • Internal tools might lack the flexibility for making changes for future requirements
  • They might not incorporate best practices from the industry (they might just get stuck in time)
  • Choice, convenience and experience might be compromised especially when it comes to redemption
  • It might take a lot of bandwidth from the HR team to manage the tool and the entire process in-house

Taking a balanced view of things; while in the short run it might make sense to go ahead and build your own R&R tool especially if you have the available resources; but in the longer run it might not turn out to be such a wise investment. You decide!

-by HiFives

 

Running a global employee rewards and recognition program

Today most companies are operating multi-location, multi-country business operations – with this comes the challenge of managing employee engagement across locations. Hence, rewards and recognition programs being a critical part of employee engagement need to be designed and rolled out globally.

Designing and running a global R&R program has its own set of challenges. Firstly, purchasing power differences across countries need to be factored into the rewards budgets – rather than having a uniform budget. Using an index such as purchasing power parity (PPP) to calibrate the budgets might actually help. Global rewards platforms need to be designed to take care of this.

Second and probably the most crucial element is factoring in the cultural differences between various regions in the selection of rewards. Hence, redemption and fulfilment needs to be localized as much as possible. Employees can opt for rewards that suit their culture and preferences. Also, the pricing of products might differ widely between regions even for standard branded products. Hence global rewards platforms need to be able to seamlessly handle redemption of rewards across locations.

-by HiFives

SMART Rewards for smarter employee engagement

Take a look at these 5 scenarios

1. Tim gets the Star of the Month award for his ‘immense overall contribution’ to the business.

2. Each employee is handed a box of chocolates after completing their certification program.

3. Hari receives a shopping voucher for INR 1000 for successfully completing his six sigma project that will save the organization several million dollars in the years to come.

4. “I would like to recognize the efforts of all team members; Nancy, Bill, Shailesh, Peter and everyone else”

5. Henry gets his Pillar of the Organization trophy 6 months after his 10th work anniversary.

Do they sound familiar? What’s wrong? They are definitely not best practices for employee rewards and recognition!

Rewards and Recognition need to be SMART:

1. Specific – A specific behavior, performance or outcome needs to be rewarded and not simply ‘immense overall contribution’

2. Memorable –  Something the employee appreciates and recalls for a long time (box of chocolates, anyone?).

3. Appropriate – Value (monetary or emotional) of the reward should be commensurate with the importance of the behavior being rewarded (INR 1000 for multi-million dollar impact?).

4. Real – A genuine appreciation of the work done and not just a nicety, quickly forgotten (everyone else?)

5. Timely – As little delay as possible between the event being rewarded and the reward itself (6 months?).

5 simple principles that can make reward programs more effective in any organization!

-by HiFives

Company logo merchandize as rewards – end of an era!

For a really long time, it was believed that employees would really appreciate merchandize with company branding as rewards as these would actually help reinforce the company brand. So organizations would order truckloads of bags, coffee mugs, pens, T-shirts and other such items with company logo and use them liberally in R&R programs. They would also create a company brand store often with an online avatar where employees could order such products often with their rewards points and sometimes with cash or credit cards.

Sadly, the novelty of such programs have already worn out for most employees (sometimes it lasts only for a few weeks after joining, when the new recruits would like to flaunt their company logo merchandize to their peers in other companies). The younger crop of employees tend to prefer trendier products as rewards – gadgets, fashion accessories, holiday packages, shopping vouchers, etc. – in general the freedom to choose. They tend to get bored with the same stuff recycled each time and the concept of forced loyalty to a brand, doesn’t matter if it is their employer’s. The older generation prefer products with utility – applicances, consumer electronics, kitchen and dining products, toys, home decor, etc. In case, the reward amount is large they actually don’t mind getting it in cash.

All in all, the era of company logo merchandize seems to be well and truly over especially when it comes to rewards and recognition!

-by HiFives

Gamification is the new name of the game!

Gamification is the new buzzword that is doing the rounds of corporate corridors these days. Simply put, gamification is all about creating a game-like situation in a non-game environment, be it work, education or retail.

The percentage of Gen Z in the workforce is on the rise – a generation brought up on a heavy diet of computers, internet, mobile phones, social media and gaming. Not surprisingly, keeping them motivated in the workplace is a challenge that all organizations are increasingly facing.

That’s where gamification comes to the rescue – if play is serious work for them, why not make work a kind of play? Organizations have started exploring the concept of gamification of work – typically to pep up relatively uninteresting and repetitive tasks and to create an environment of fun, excitement, competition and team work, while achieving work-related goals.

Sales and collections contests are nothing new – they are typical examples of work gamification. Current trends in work gamification involves use of themes (film, animation, fantasy, etc.), scores (points, coins, etc.), badges, rewards and leaderboards. Gamification can be used in various processes including customer service, operations, projects, compliance, finance, etc. to infuse new excitement at work leading to better achievement of goals.

Now, no one can say that all work and no play makes Jack (or anyone else) a dull boy!

-by HiFives

R&R on Social Media – the great debate!

Many organizations are still trying to figure out how to incorporate social media in their HR policies. One such aspect is posting or allowing employees to post the awards they have received from the organization on their social media pages.

social media

For employees who spend hours on social media every day – posting, liking, commenting, sharing and chatting with their friend, this is a big deal! Employees would love to flaunt their awards on social media and soak up all the adulation (likes and comments) they might receive from their friends. The satisfaction garnered from this social recognition might be far greater than that from the actual monetary value of the award itself! Plus think of all the employer branding and referrals that this might generate!

What’s the flip side? For starts, it might expose confidential information to the world – names of clients, important project, etc. With hundreds of friends on social media and thousands of friends of friends, one cannot be sure that this information will not fall into wrong hands – competitors, clients, regulatory authorities and head hunters, just to name a few. Of course, the employee himself or herself will be seen as someone with high potential and may be approached by a competitor!

Well, the debate continues…

-by HiFives

God of small things

It is not just the big, blockbuster performances that make a difference to the organization but a myriad of small, behind-the-scene activities that can all add up to create significant business impact.

Here’s a brief list of what such activities could be:

  • Specific core work-related tasks executed well – exceeding expectations of clients/ internal stakeholders
  • Awareness of EHS, IT Security and other policy guidelines
  • Participating in cross-functional activities such as training, knowledge management or best-practice sharing
  • Useful suggestions to improve enabling processes such as Facilities Management, Admin, Finance, etc.

And possibly several dozen other things. Each of these acheivements on its own may not mean much in the larger organizational context but when put together they do make a difference to the organization!

However, most reward systems tend to ignore such small achievements and instead focus on big, high impact ones. These smaller acheivements too deserve to be rewarded in some way.

A few progressive organizations have created comprehensive reward systems that identify and reward such achievements apart from the blockbuster ones – typically a point-based system that award employees small number of points for such activities and allow them to accumulate these points over time. So an employee who demonstrates reasonable level of performance at work, is well aware of organizational policies, is involved in cross-functional activities and makes valuable suggestions to improve organizational processes can hope to accumulate over a month or a quarter at least 50-75% of the points received by his or her peers for their superlative achievements. This keeps them motivated to keep doing the small stuff well while aspiring to get into the big league! Doesn’t that make sense?

-by HiFives

What’s this brouhaha about peer-to-peer recognition?

Simply put, it is the practice of recognizing colleagues outside of one’s reporting/operating structure like recognizing some specific help on a work-related area provided by a colleague from a different team or a support/ enabling function. While such practice is quite commonplace in most organizations and is generally done over email (or sticky notes), progressive organizations are trying to institutionalize and promote this practice by creating a policy around it. They are putting in place platforms that enable employees to recognize each other seamlessly, promoting the initiative internally and even rewarding the winners. This way they are fostering a culture of collaboration, boundary-less behavior and positive team spirit. Those organizations that are yet to take these baby steps towards peer-to-peer recognition are probably wondering whether such systems can be ‘gamed’ by the more ‘visible’ or ‘social’ employees and hence can be counter-productive! Yes, that might be a possibility in the short-term; however, in the long term such issues can be weeded out. Like any other corporate initiative this too needs the right amount of executive sponsorship, visibility and persistence!

-by HiFives

Leveraging Employee Personal Milestones in Rewards and Gifting Programs

Important personal milestones in the employees’ lives such as birthdays, weddings, anniversaries,etc. offer a good opportunity for reward/ gifting intervention on the part of the organization. As these events mean a lot to the employee, remembering, wishing and gifting the employee on these occasions have great impact on the motivation levels of the employee. Organizations that run these birthday and wedding/ anniversary gifting programs have seen good results. However, it is no mean task to execute these programs with hundreds or thousands of employees. Hence organizations need to leverage technology and third-party providers to run such programs.

-by HiFives

Why cash is not the king when it comes to rewards!

Imagine two scenarios – one, you get a Rs.1000 cash award credited to your salary (after tax);  two, you get a Rs 1000 worth of goodies as award. Which one are you likely to remember more?

The goodies obviously! One big reason why non-cash awards seem to work better – cash awards seem to disappear somewhere in your pay slip, which most of us rarely bother to check unless there is a major upside or downside.

Add to this the fact that taxes will take a big bite out of your cash award, whereas non-cash awards have a built-in tax shelter (within Rs.5000 limit per year).

-by HiFives

Festival Gifting round the corner – the nightmare begins!

Festival gifting to employees is a big event for organizations. Given the importance of these festivals in India, it is a good opportunity to appreciate employees and to reach out to their families. Traditionally gift hampers or dinnerware have been popular choices. However, the execution is a nightmare for the HR/ Admin – from decision-making, procurement to actual distribution of these products. It takes quite a bit of administrative effort in executing these programs, especially coordinating with external vendors and the internal distribution. The complexity only increases with the number of locations and headcount. All of this results in delay in getting the gifts to the employees – even then the employees might have preferred something else!

-by HiFives

Freedom of choice – critical factor for success of a rewards program

HR teams across organizations end up spending a lot of time on deciding the ‘right’ reward items. There are a few usual suspects – iPods, Shopper’s Stop, Lifestyle or Landmark vouchers, laptop backpacks or high-end pens, depending on the budget and the occasion. These are time-tested formulae what seem to work like Bollywood masala movies!

Wrong! Ask the employees – they are really tired of getting these same products over and over again. Not everyone needs an iPod or cares about owning an expensive pen! They would probably be happier if they get to chose what they want – could be something they need immediately for their day-to-day needs like a rice cooker or a mixer grinder or something they want to gift to their parents like a mobile phone or a DTH connection. Giving employees the freedom of choice for deciding their own rewards might be one of the best ways to unlock the full potential of a rewards program!

-by HiFives

Employee Rewards Program – the devil is in the execution!

Organizations often initiate various rewards and gifting programs with a great deal of excitement and fanfare. These could be like celebrating employee birthdays, service anniversaries or simply spot awards. The programs get the necessary executive and budgetary approvals and are launched to the employees.

The execution of these programs is typically operations intensive – requires collation of data, followup with multiple internal teams and third parties and day-to-day management. The onus of execution most often lies with the HR. With all the other critical activities on the plate of the HR Team such as appraisals, compensation reviews and talent planning, these reward programs end up being put on the backburner. As a result, a lot of well-intentioned reward programs tend to fail. Backlog of rewards to be distributed pile up and the program soon meets the fate of a lot of other flavour-of-the-season corporate initiatives.

In my opinion, the critical missing piece in the design of such rewards programs is the execution plan – how does one minimize the operational hassles and the administrative overheads while executing the program on a day-to-day basis so that they are sustainable and produce the desired returns?

-by HiFives

Rewards and Recognition – the winner takes all! Is it fair?

Rewards and Recognition is an integral part of every organization’s HR policy. What started off as the management’s expression of appreciation of a job well done has evolved quite a bit and acquired the overall flavor of an organization culture of appreciation and recognition. However, it comes with its own set of challenges especially when implemented in a monetary form; more prominent for high value awards. Typically the employees who are likely to receive maximum recognition or the highest recognition are possibly the highest performing ones. It is not surprising that they are the ones who would get the highest salary increments and promotions!

Whether the winner takes all phenomenon is fair or not is question to be asked. It seems only logical that the highest performing employees would end up getting the maximum recognition and rewards. The caveat to this is that it might demotivate other employees who are possibly average performers or borderline cases. The bigger sin by managers or even entire organizations is to use a kind of quota system to ‘allocate’ rewards and recognition to employees. An employee who is an average performer might end up getting a reward to ‘compensate’ for the lack of a hefty increment or a promotion! Or vice-versa! Now this is a cardinal sin! This makes the whole practice of rewards and recognition a total sham!

A better approach would be to design rewards and recognition policies to appreciate small achievements and behaviors in everyday work that align with the company values such as customer orientation, innovation, integrity or initiative – anything small but significant from an organizational people road-map. It might not be directly linked to KRAs and hence unlikely to lead of other forms of ‘rewards’ like bonus, salary hike or promotion. This needs to be incorporated in the design of the policy rather than the implementation of it. Those employees who deserve recognition should get recognized in any case; however the employee should not be ‘rewarded’ or ‘recognized’ for the same achievement or behavior in multiple forms. Now, that might not be fair!

 

Automated Performance Assessment –The Rise of the Machines

April 20, 2018: It’s the Judgement Day today in Sparrow Solutions today – the annual appraisal ratings will be released in the organization today. For most employees, it’s the day when their efforts throughout the year will be recognized and eventually be rewarded through increments, bonuses, and promotions. A few employees fear the worst that they might be asked to leave due to under-performance. Every year the bottom 10% of employees is asked to leave the organization due to poor performance. It’s a tough call but it has to be done. But one wonders why should the organization wait for a whole year to figure that someone is under-performing and corrective action needs to be taken? On the other hand, an employee who is an overachiever needs to wait until the end of the year to be rewarded and given the next level of challenges.

The other big flaw in the system today is that the qualitative assessment of performance leaves a lot of room for biases to creep in. Plus, in most organizations, the HR team and the people managers spend an inordinate amount of time in discussing and debating about the performance ratings. Add to that the time spent in collating and presenting the data. All of this hampers productivity and delays actual action.

In all organizations, there is a big push towards making data-driven decisions even in people matters. The big data approach to performance appraisals could increase efficiency, cut down on the manual effort, reduce bias and the cycle time of performance appraisals. We should be looking at continuous performance assessment and corrective actions.

As employees work in the organization, they leave a trail of data in their everyday work tools be it Project Management System, CRM, ERP, Time and Attendance System, etc. Automated performance management systems of the future will monitor employee performance on a continuous basis, based on the data derived from these systems. These systems will score the employee’s performance based on various parameters linked to business results and suggest corrective actions or even initiate actions itself. Actions could range from playing a motivational video, recommending a training course, connecting with an internal subject matter expert on chat to even recommending a change in job profile of the employee.

The biggest advantage of such systems would be the continuous assessment of employee performance. Corrective actions can be taken immediately, so no need to wait until the appraisal cycle. Be it training, reskilling, role enhancement (read as a promotion) or role change – can be initiated immediately. The system will have predefined thresholds for each action. The system will learn from past experiences of such interventions and their effectiveness, and tweak its algorithm for more effective interventions. The system can also keep track of employee motivation and take corrective action before it starts affecting productivity.

In today’s business environment, every second count. And keeping pace with the business changes is the need of the hour. Hence, such performance measurement and development systems can make employees and organizations more responsive to chances. It will result in higher productivity, greater business impact and higher employee satisfaction. The amount of time spent by the management and HR in the formal appraisal process can be cut down drastically further increasing productivity. Think of start-ups and small companies that are growing rapidly, which need to be extremely responsive to the business environment. But at the same time, they will always be short on HR resources to manage their people and performance. The other advantage is that these systems remove supervisor bias and errors.

While it might take some time before the system can speak out ‘you are promoted’ or ‘you are terminated’ but we are definitely going to see more intelligent learning systems for employee performance management very soon.

Peer Recognition – putting it all together

With the increasing influence of social media in our lives, it has become imperative that corporates give more than a lip service to peer recognition. The earliest form of peer-to –peer recognition is the ‘Thank You’ note that a colleague can pin on to your dashboard. In the digital world, the ‘Thank You’ notes have been replaced by ‘Thank You’ e-Cards.
Peer-to-peer recognition, also known as 360 degree recognition was thought of as a harmless and costless way of motivating employees, till a few progressive organizations started taking this to the next level. They started inviting nominations for awards from peers, not just managers. Practically, anyone in the organization could nominate anyone. However, this started leading to malpractices of ‘I scratch your back, you scratch mine’ or gaming the system. This is precisely the number one reason why most organizations have stayed away from any serious peer-to-peer recognition keeping in mind the philosophy ‘the manager knows best’. Again, a few progressive organizations have taken the lead to bring in manager or HR moderation to remove any such bias. Smart recognition systems might have built-in rules to detect and prevent such ‘games’ and ‘biases’.
Peer recognition or peer based recognition is here to stay because in today’s corporate world, employees work with their colleagues in their own teams or across different teams much more than they work with their own reporting managers. In many cases, employee might work out of remote locations such as client sites or the field. They might not even meet or interact with their managers on a regular basis. So, peers are most often the best source of getting feedback about the employee’s performance on the job and to recognize the same!