When surveyed, employees consistently will ask for cash, but research shows that it is the least effective form of recognition. How come? For example, let’s say Steve is a loyal employee who enjoys his work. He is productive and reliable — a model employee. Yet he was surprised when his 10-year service award package offered him cash as an option. It wasn’t like he couldn’t use a few extra bucks, but the fact that his employer was able to put a price tag on 10 years of his life left him feeling a little cold and confused.
Why is it that when companies offer the very thing that employees seem to want, it falls short of carrying the important message declaring that “we care about you and are glad you’re on our team”?
Maybe it has something to do with the question. Asking employees what they want tends to imply that you don’t know and really don’t care all that much. The moment employees think that you are using recognition more out of obligation than desire, they will emotionally disengage, feel a bit insulted, and give you the answer they think you want to hear: “Aw, what the heck, just give me a gift card!”
It actually has to do a lot more with perception than logic. Employees want so much to be genuinely appreciated that the minute you give them the smallest hint that you’re attempting to manipulate them with carrots and sticks, you lose.
It’s really just about doing a few very basic things right and in the correct order. This requires training supervisors to understand some straightforward principles, realize that it’s to their personal benefit to make recognition a powerful management tool (appeal to employees’ natural self interests — in a good way) and communicate more effectively so their staff believes they mean it.
Once honest emotional engagement is achieved, you’ll be amazed at how quickly financial incentives can take you and your company to another level of measurable, bankable ROI that will have everybody wanting more. It’s an educational challenge that too many companies ignore, but are paying for over and over again.
First, no one disagrees that cash is important. The reality is, however, you owe it to yourself, and potentially your stockholders, to do what’s best with the company’s money. The data overwhelmingly supports the fact that well-designed incentives will out perform cash by more than two to one and carry far lower tax consequences.
Supervisors will embrace these tools once they understand their value, see what is in it for them, and have a clean, well-defined path to run on. For example, you can give a gift valued at 1 percent of an employee’s salary, and if done enthusiastically, the staffer will feel the love. But, if you give employees a 1 percent bonus or raise, they will be looking at the classifieds. Same dollars but totally different results. It is all about perception!
Most companies use a variety of disjointed programs to recognize and reward their people. Even if the programs are working, it’s impossible to determine the level of participation and financial return. Imagine if you orchestrated all of the tools used to communicate with employees so that they could be properly measured, kept relevant to company goals and you could easily teach your supervisors the proper way to implement them.
This is called an Umbrella Recognition Strategy and the benefits are numerous. However, there can be potential challenges involved when moving your organization toward this type of approach. Here are three steps you should take when considering the implementation of an umbrella strategy:
1. You need to have upper management support. Only then will you be able to get all of the program owners to open up and provide the information needed to analyze the current situation and begin to see opportunities for improvement.
2. Your team has to be open to new ideas and be willing to brainstorm all viable options. One of the few positives to this current economic downturn is that things are on the table today that would probably not be open to discussion during more robust financial times.
3. The goal of your team needs to focus on developing the greatest ROI on your recognition investments, not protectionism or departmental isolationism. A macro view of the situation, where everyone is considering program initiatives from a broad perspective based on company culture, mission and long-term objectives is the secret to getting the best overall program and the ROI you deserve.
As you begin to evaluate your current recognition programs, you’ll be surprised at both the amount of money leaking out of the organization in various ways and why there may be inherent confusion from the employees’ perspective. We recommend a Four Cornerstones approach:
1. Communications – People need to see where they fit in the overall scheme of things. Every employee wants to know the direction of the organization and the plan to get there. Communication addresses the “what to do” and provides a professional, well-organized theme.
2. Training – Managers need to know how to give recognition rather than just present awards. Training focuses on the “how to do” and is an important element to performance improvement. Effective training avoids your best intentions being seen as nothing more than “throwing them a bone.”
3. Reinforcement – Recognition is not an event, it’s a process. Employees need to “want to,” but how do we achieve this emotional engagement? It’s done through validation. Employees must feel important and appreciated when they go the extra mile.
4. Measurements – Things that are measured tend to improve. Measurements address “how we are doing.” With the vision and strategy in place, the objectives and responsibilities of each employee to support the strategy must be determined. This is the most overlooked part of performance improvement programs because it requires responsibility and can often be uncomfortable. Outstanding employees want to be measured and ineffective employees want to remain invisible.
There’s a lot more to recognition than just handing out awards and gifts, but therein lies the opportunity to turn accepted expenses into significant profits. Companies that take on the challenge of embracing this new view of employee engagement are seeing impressive improvements in productivity, profitability, morale and teamwork, along with significant reductions in turnover, recruiting and safety-related costs.
John Schaefer is a consultant with more than 20 years experience helping companies realize and react to the employer/employee disconnect. He is the author of “The Vocational Shrink – An Analysis of the Ten Levels of Workplace Disillusionment,” as well as “The Vocational Shrink – The Game.” He also has a manager-training program called “Why Should Supervisors Care (or what they’re really thinking) ... What’s in it for Me?” For more information, call 888.646.6670 or visit www.schaeferrecognitiongroup.com.
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