A business with a high-performance workforce that wants to stay with the company and be part of its success…
Sounds like a dream?
It’s actually very possible.
Worryingly, 43% of some 36 000 employees interviewed by the HR specialist firm O.C. Tanner believe employee recognition at work is little more than an empty gesture, and that it is largely meaningless, with 71% saying that ‘not feeling valued’ was the primary reason they left their previous job.
As I’ve discussed before, and underscored by the O.C. Tanner survey, a strong company culture pays off handsomely. Companies in this study were tracked over an 11-year period, finding that those with a strong culture averaged more than 4x the revenue growth, 7x the net income growth and over 12x the stock price growth of those without.
And, central to a strong culture is how employees feel about it, with this report by the MIT Sloan Management Review looking at business culture in the context of how employees rate the companies for which they (have) work(ed) highlighting the top 10 issues that matter most to employees.
Significantly, the most important element, and by some considerable margin, was “Respect.” People don’t want to feel like they’re just a number, or a faceless cog in a giant wheel, but that what they do matters and is recognised. And this need for respect is evident at all levels in organisations, from entry-level to the very top.
Taken together with the second most-important element, “Support,” it’s clear why those 71% of employees left because they did not feel valued – it boils down to respect and support, or a lack thereof.
Fortunately, though, this can be addressed, and it’s not difficult to start by doing something that really does make a difference – recognising people for the work they’re doing. In a survey by OnePoll on behalf of Bonusly, nearly two-thirds of respondents said they would work harder if they believed their efforts were noticed by management, something borne out by research from Quantum Workplace which showed employees are 2.7 times more likely to be highly engaged when they believe management will recognise them.
So, what should an employee recognition program look like, and what are the key parameters?
- Genuine – any such program needs employees to feel that it is genuine, and not just a grudge ‘tick the box’ exercise for staff.
- Company-wide – often, existing recognition programs have been focused on the easily-measured, revenue-generating staff: sales people. Many companies show recognition for sales people that reach their targets, but it’s critical to have a program that recognises people across the organisation, in all roles, and not just for work-related issues.
- Regular – an annual ‘big bang’ recognition event simply doesn’t work. Recognition needs to be an ongoing process, personalised, and with elements of both monetary and non-monetary rewards. And the rewards don’t have to be huge, with O.C. Tanner establishing that those with a monetary value of between $50 and $250 are most effective and that awards larger than this don’t provide an increase in engagement.
When designing a recognition program, consider including the following elements:
- Work-related – not just the more usual target-related issues, but more; somebody who stayed late to finish an urgent task, overcame some significant hurdles to close a sale or bring in an overdue payment, came up with an idea to improve a process or save the business time and/or money in some way, helped a colleague outside their normal work to complete something, and so on.
- Personal – birthdays (don’t ask them to buy cake for everyone as so often happens – it’s THEIR birthday, after all), wedding anniversaries, marriages, births of children, and other significant life events, perhaps even acknowledging a partner on their birthday and/or anniversary, and work anniversaries, too.
Consider, too, a program which enables employees to volunteer to support community or charity events for a number of hours a year. This not only adds value to the community in which the company operates but increases the sense of well-being among those who do take part as they feel they’re making a difference to people outside the company who need help.
I know the value of recognition programs from my own experience. Some 25+ years ago, I introduced wide recognition program which incorporated much of this in the business I was leading (and I’ve used much of it subsequently in other businesses where I’ve been acting in an interim capacity). The elements of the programs I’ve introduced included:
- A suggestions ‘box’ (electronic) to encourage people to tell us about things that could improve processes, products, etc., with rewards for all appropriate suggestions, varying from small (perhaps a meal for 2) to significant for those ‘game-changer’ ideas.
- A scheme for all employees to nominate others (excluding their own management, for obvious reasons) for ‘going the extra mile’ in a variety of ways; the awards here being for the best 3 each month.
- A system to recognise staff as widely as possible for achieving goals, so setting KPIs and acknowledging those who had exceeded theirs. This didn’t result directly in additional rewards as these were built into the KPI system.
- Recognition of significant life events for staff (and their partners where appropriate), ranging from cards to gift hampers.
- Monthly ‘meet the execs’ breakfasts, with 15-20 people from all levels of the company (drawn randomly, but no more than once in a year for any one person) in the boardroom for a breakfast meeting at which any questions could be asked of the CEO/board members present and would be answered, within the disclosure limits of the company.
- We also supported a few community charities, typically with donations, and gave regular updates to staff on these initiatives.
Awards and public acknowledgement were typically done at monthly ‘all hands’ events where we fed back on overall company progress and so provided the widest audience for acknowledgement, but we didn’t typically wait for this event to engage 1-to-1 with those who had achieved something special, whether work-related or personal, as it’s important to have that personal interaction, too, and to do so publicly, in front of their colleagues, rather than quietly in an office.
The results from this were evident in the company morale and performance, really reinforcing what these (subsequent) surveys are showing.
To these I would, today, look at a really strong onboarding program, not only ensuring that all materials to allow a new employee to fell like a fully-functioning member of the team from the outset, perhaps with something like a ‘meet the team’ lunch and assigning a mentor for the first couple of weeks, in addition to the more normal things to do with starting in a new company. And have the mundane things like a PC already set up with software, logins, etc., business cards (where appropriate) already printed, and so on, rather than a flurry of belated activity in the first week.
And this is not just for junior staff starting, but for more senior ones, too – mid-level managers often feel somewhat adrift in a new company as they’re assumed to not need as much attention as a junior staff member, being more experienced, but do need to feel integrated from the outset, too.
These programs really are worthwhile. Research, such as that I’ve referenced earlier, shows some impressive statistics, including:
- Overall employee experience and workplace culture improve by up to 6 times;
- 80% few cases of burnout reported;
- A nearly-60% drop in employees planning to look for another job, and lower recruitment costs for any new staff that are needed;
- A 22% decrease in absenteeism, coupled with marked increases in productivity;
- And 30% of employees reporting that they plan to remain with their current employer for at least five years.
So, couple a significant decrease in the high costs associated with high staff with the great increases in growth, profitability and company value of those companies with strong cultures, and there’s every reason to ensure you have an environment like this in your business.
In fact, you can’t afford not to…
And remember that, as Zig Ziglar said, “Research indicates that workers have three prime needs: Interesting work, recognition for doing a good job, and being let in on things that are going on in the company.”
And, from Stephen Covey, “Always treat your employees exactly as you want them to treat your best customers.”
Following a career spanning >50 years in the technology industry across three continents, with three decades in CxO roles leading significant, sustained growth in revenue and profitability, I now work with successful owner-led businesses to further enhance their growth, profitability and business value.
If you’d like to discuss your recognition programs, company culture, board, business strategy, trends, goals, or anything else related to your business, book a confidential, free 30-minute call with me here.
I’d be delighted to talk with you.
And if you’d like to learn more, these related posts might be of interest:
- Top 10 Things Your Business Culture Needs to Focus On for Success
- 10 Principles for a Sustainably Excellent Culture – Beginning With “We”
- 1 Thing That Great Leaders Do
- Leaders Who Coach Get Great Results
- “Leading isn’t a position; it’s an action.” – Adam Contos
- The Power of Accountable Leadership
- “Excellence is Not a Skill. It is an Attitude.” – Ralph Marston
- “Company culture matters. How management chooses to treat its people impacts everything for better or for worse.” – Simon Sinek
- “Happy employees lead to happy customers, which leads to more profits.” — Vaughn Aust
- 3 Things You Must Do to Keep Your Top Performers and Your Company in Great Shape for the New World of Work
- Just 15% of Employees Work at Their Full Potential – Are Yours?
- Are Staff Leaving Because of Bad Management?
- Team Development for Sustainable Competitive Advantage
- Going from Good to Great – How Companies Achieve Greatness
You might also find these articles from Fortune and Forbes to be of interest:
- Almost half of employees don’t believe their boss’s praise is genuine. Here’s what leaders can do to fix that
- There’s a fairly inexpensive way companies can save millions in employee turnover costs
- Why Employee Recognition Is More Crucial Than Ever
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