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How to create an employee recognition program

Employee recognition at work ensures the attraction and retention of a quality workforce, so motivating your team through recognising their work should be a no-brainer. Wondering where to start? Read on.
Published 9 Dec 2021
Updated 9 Dec 2022
10 min read
Employee Recognition: The What, Why and How

Everyone’s looking for that winning ticket to improve employee engagement and retention.

We all know that people are the heart and soul of every business. They’re the ones who keep the cogs turning, drive growth and work actively towards achieving your goals.

Let’s face it – without them, you wouldn’t be where you are today.

In today’s rocky job environment, it might seem like an uphill battle. With the impact of the Great Resignation creating a competitive recruitment market, it might make a change of scenery for employees all too enticing.

But there is one thing you can do to keep your employee retention rate high. And it starts with upping your employee recognition game.

What is an employee recognition program?

An employee recognition program is a system that acknowledges and rewards employees for their performance, achievements or behaviours that align with your company’s values.

The purpose of an employee recognition program is to show your employees that their hard work is not only noticed but also appreciated.

When done right, an employee recognition program can result in increased employee engagement, motivation and satisfaction, leading to improved employee retention.

Why is employee recognition important?

Employees who feel valued for the work they do will show higher levels of engagement within your business. They will contribute more, innovate and smash goals.

And it makes sense, when we feel valued and recognised we’re motivated to seek the warm fuzzies time and time again.

In turn, employee recognition at work ensures the attraction and retention of a quality workforce.

This is why recognising employees is very important for businesses that want to succeed. You want your employees to know that you appreciate all their efforts.

Are there different types of employee recognition?

Yes! There are different types of employee recognition, and the type you choose will depend on your company’s needs and goals.

Here are some examples of employee recognition:

  • Personal recognition or the acknowledgement of individual expertise, unique talents and qualities of your employees
  • Recognition of work practices, such as demonstrations of creativity, innovation and improvements
  • Recognition of dedication to work. If your employees showcase quality contributions to your business objectives, this should be rewarded
  • Recognition of progress made on meaningful or longer-term projects
  • Recognition of results on an end product and how the task has been completed
  • Recognising employees who embody company values

What are the benefits of employee recognition?

Recognising achievements, efforts and behaviours that align with your company values is a great business tool for a plethora of reasons:

  • An effective employee recognition program helps to support a culture of performance excellence and improves employee productivity.
  • Recognition reinforces the standards you want all of your employees to reach
  • Builds employee engagement and promotes job satisfaction
  • Fosters retention of quality employees lowering your staff turnover and ensuring you have a dedicated team behind you
  • Reduces stress and builds an environment of trust between employer and employee
  • Encourages greater creativity and innovation in the workplace
  • Fosters a culture of appreciation that values employee contribution and improves employee morale
  • Promotes ownership, involvement and interest in work

But, having an employee recognition program is not just what you bring to the table for your team. The benefits are echoed for employers, too.

Creating a culture of recognition can impact your bottom line by fostering a safe workplace with positive company culture, increasing employee happiness and in turn, improving employee productivity.

What’s even better is that many forms of recognition in the workplace are absolutely free and require little time to set up.good job thumbs up

Yes, show me the thumbs up 

Employee recognition and reward ideas

Now that you’ve decided that you want to introduce more employee recognition into your workplace culture, where do you start?

Is positive feedback alone enough? Or should you provide recognition by giving employees tangible rewards?

As a first step, you’ll need to find out what your people value and will engage with. This can be done with the use of employee surveys to find out what truly want when you decide to reward employees.

Below are some examples of high and low-budget employee recognition ideas you can implement in the workplace.Examples of employee reward and recognition

High budget employee recognition ideas:

  • Lunch clubs for high performers or people that reach their targets
  • Weekends away for successful teams over a quarter
  • Income bonuses for high performers
  • Tickets for events, attractions, concerts or activities of interest

Low budget employee recognition ideas:

  • Merch with your company name; water bottles, mugs, hats, t-shirts – anything that your MVPs (most valuable players) can wear around the office to show that they did something great
  • Let them be the office DJ for the day (A niche one! But if someone’s done something of merit it’s a fun little perk you could offer them)
  • Reward certificates or trophies for employees to showcase on their desk
  • Handwritten thank-you notes from the CEO or leadership team

How do you create a successful employee recognition program?

While the typical in-office perks once were a major way of a recognition strategy (hello, ping-pong tables, casual Fridays and beer on tap), it’s now an expectation that employers offer more if they want to hold onto their star players.

The reality is, when employee recognition isn’t championed in the workplace, it could be costing you big time.

Everyone wants to feel rewarded and recognised for the good work they do. But, how can you ensure this and give everyone that standout employee experience?

You need to have a strong employee recognition strategy for how you make your employees feel valued and recognised for the work they’re doing.

1. Get personal while giving private recognition

To provide meaningful recognition, it’s important to be specific, personal and accurate when providing private employee recognition. Use positive words, and demonstrate to the employee that you actually understand their accomplishments.

Outline employee achievements and exactly what they did well, how it impacted a particular project or scenario and highlight exactly how that happened because of their individual successes or participation.

The more personal recognition, the better as it shows your employee that you really were paying attention to them and their work.

By offering a non-monetary reward as a form of recognition, you are making employees feel valued and cared for. Who doesn’t love a genuine and thoughtful gesture?

2. Use recognition software to encourage public recognition

While verbal communication is clearly the most effective way to recognise employees, the best strategy is to back it up by publicising employee accomplishments across multiple forums such as company newsletters, dashboards and in team meetings.

Technology-based employee recognition software is a great way to do this. They should be mobile-friendly, allowing public recognition to happen anytime, anywhere.

If you don’t have the budget to invest in recognition platforms, you could initiate something as simple as a Slack channel dedicated to recognising hard work.

3. Create reward programs

Personalised rewards are a great way to celebrate employees when they go above and beyond at work. A good way to find out what meaningful rewards looks like to your employees is to ask them directly by conducting surveys.

This way you can use the findings to create recognition programs based on what they really care about. This could be a team lunch, day off, volunteer days, movie tickets or an experience.

At Employment Hero, we reward our team through our employee recognition platform using Hero Dollars. Hero Dollars can be used in Discounts, Employment Hero’s online marketplace with access to savings on thousands of everyday items.

4. Monthly and yearly employee recognition awards

Although it might seem like a novelty, organising monthly and yearly service awards are a fun way to show thanks to top players in your company.

Whether it’s going above and beyond in their role, innovating at every chance possible or contributing to different projects, it’s one way to show gratitude.employee of the month award gif

To get started, decide on the categories you want to award. This could be employee of the year, employee of the month, top innovator, star team player, leadership, growth or meeting targets – the list is endless.

Have some trophies made up, a prize waiting (this could be gift certificates, an extra day off, or even an all-expenses-paid company trip) and host a gathering to announce the winners.

5. Motivate with financial incentives

While monetary rewards to employees are the go-to for many companies, studies have found that offering financial incentives is less effective compared to providing benefits to employees.

According to a survey by Glassdoor:

  • 79% of employees would prefer new or additional benefits over a pay increase.
  • Specifically, the survey found more women (82%) than men (76%) prefer benefits or reward perks over a pay raise.
  • Younger employees aged 18-34 (89%) and 35-44 (84%) prefer benefits or reward perks to pay raises when compared to those aged 45-54 (70%) and 55-64 (66%).

This is because they can be remembered long after the payment hits their bank account.

This brings us back to checking in with employees and asking them what they want from an employee recognition program.

Although financial incentives aren’t always the best motivators, they can certainly demonstrate appreciation for work well-performed. If you have the option to offer monetary bonuses, this is one way to keep your team actively please gif

Our suggestion when it comes to offering bonuses? The best financial incentives are more open-ended and unpredictable because they motivate people to work their best at all times.

6. Introduce an employee share scheme (ESS)

Nothing says reward and recognition like having an employee share scheme (ESS).

An employee share scheme (ESS) – also known as an employment equity plan – is a program that offers your team members shares or options for your company. This means that they’ll become part-owners of the company they’re working for.

Even though an ESS is commonly synonymous with startups, this type of scheme is open to businesses of all sizes.

One of the main benefits of an ESS is that it encourages employees to think bigger picture and with a growth mindset because their contributions can directly impact the growth of the company.

The result? A win/win situation for all involved.

7. Encourage peer-to-peer recognition

As well as you or your leadership team setting up reward and recognition incentives for your employees, you should also encourage peer-to-peer recognition.

Peer-to-peer recognition has a huge impact on the performance and overall job satisfaction of everyone in your business. It can:

  • Help build a trusting company culture by creating transparency amongst different departments and authorities. It also eliminates old-school problems of managers taking credit for their direct report’s work or ignoring the value of a piece of work
  • It will help boost employee engagement and retention as employees are motivated to work harder to impress colleagues and therefore stay at their jobs longer where they receive acknowledgement and praise for work
  • Empowers teamwork across the business for team-based projects as individuals feel more appreciated by their peers.

What does peer to peer recognition look like - Employment Hero

Try to encourage giving recognition that is meaningful and make sure your team are recognising achievements or behaviours that are truly worthy of being recognised.

For example, employees who go above and beyond their everyday job roles to get something done or fix an urgent problem.

8. Review your incentives regularly

We suggest reviewing your employee reward and recognition program at the end of every financial year, as a minimum. The main thing to review is if your company can afford to keep running all the incentive programs.

For instance, are there some that cost the company a lot more money than you intended? Go over the programs and re-assess. You also want to make sure your employees are actually happy with the new rewards they’re given.

Create an annual engagement survey to get regular feedback and check in with what your employees really think. A simple tool like Google Forms can do just the trick.

Companies with employee recognition programs

When it comes to successful recognition programs, there are some big companies out there who are already pathing the way for the rest of us.

Here are some great examples of employee recognition in action to give you some inspiration.

1. Disney

The Walt Disney Company logo

Firstly, we have the childhood giant Disney, which has over 180 employee recognition programs set up to date! One of these programs is a really good example of how sometimes it is a good idea to think outside of the box and find something unique to your business.

This can be seen at Disney, where they have an employee recognition program set up that’s named after Fred, a longtime employee who during his time at the company exemplified the qualities the company values, such as dependability and friendliness.

Every year, plaques are made for winners of the Spirit of Fred Award for any employees that have shown some Fred-like qualities. There are even bronze statuettes of the company’s most iconic character, Mickey Mouse, for the winners of the Lifetime Fred Award.

2. Google

google logo

Google learned through experience that non-monetary rewards motivate people better than cold hard cash. The internet mastermind is stepping away from the idea of generously rewarding their people with the big bucks.

They discovered that these types of employee recognition programs were fostering jealousy and resentment within their business — which wasn’t the positive response they had in mind.

So Google phased out the cash rewards program and rolled out a new employee rewards program that offered experiences — everything from dinners out to new tech gadgets to trips to Hawaii.

Employees said they found the new program more fun, memorable, and thoughtful than the cash awards.

3. Nike

The sports retail giant, Nike, recognises and appreciates their employees by providing them with opportunities to stay fit and support the wellness of their families.

From paid sabbaticals to product discounts and tuition assistance, Nike works to help employees stay engaged and motivated at work.

They have also set up NikeU, which helps with leadership development by growing leaders to better hire, manage, and recognise their teams.

The Wrap Up

Employee recognition and positive feedback are powerful tools for getting the best out of each employee. The tips outlined above are good starting points, but depending on your business and industry, you can custom-design other employee recognition programs that reflect your organisation’s particular needs.

We’ve built employee rewards and recognition into our employee recognition software to make recognition easier for employers. Encourage a culture of recognition with HeroThanks; a peer-to-peer shout out feature designed to sit within the Employment Hero’s personnel management software.

If you don’t already have reward and recognition incentives established in your business – why not?

They’re a great way to get the whole team aligned and engaged with the overarching business goals and will help to increase employee satisfaction and decrease employee turnover.

What more could you ask for?

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Engaging Employees: A Competitive Differentiator

Julia Merrick
Head of Brand and Content - Employment Hero
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