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!

 

Frequent recognition might work better than annual increments

Frequent and timely appreciation from the supervisor might have a greater impact on employee motivation than even annual increments – according to a research study by a prominent HR consulting firm. Annual increments are supposed to aggregate employee performance over the year, rank and stack it against their peers and then reward the employee with an appropriate percentage hike. This is too much to expect from a single exercise no matter how thorough it is. It tends to disregard small ‘wins’ which could add up to bigger things and focuses on the high impact stuff. Hence, employees working on mundane stuff tend to get overshadowed by others working on big, visible projects (might backfire as well!). Plus, the increments themselves might not be differentiating enough.
The most important factor is the impact on employee motivation and performance improvement. Typically, annual increments either leave one with a bitter taste in the mouth or a rosy view of one’s performance. It hides more than it reveals!

Hence more frequent recognition by one’s manager is more effective for the employee’s development and performance improvement. However, most organizations continue to focus their HR efforts on annual reviews and increments – a few progressive organizations have started creating more noise around regular feedback and appreciation through things like Spot Awards, Floor Meetings, Thank You Cards or simply a Pat on the Back!

-by HiFives

Cash or kind – what works better?

Do you remember the last time when you got a Rs 5,000 cash award in your pay cheque? No? That will be the most likely answer unless you are one of those who scrutinizes the salary slip every month in the hope that there might be something extra! Well, for the most of us the cash award just disappears without a trace in the salary slip. We won’t even remember that we got something extra – even less chances of remembering how we spent it!

What if, you had got Rs 5,000 worth of products of your choice instead of the cash award  -some trendy gadget or a home appliance? You are more likely to remember about the award every time you see the product you got, right?

Well, non-monetary awards seem to have better recall value than cash awards. Apart from the fact that you might end up saving some taxes as well. Kind seems kinder than cash when it comes to rewards!

-by HiFives