Employee recognition programs offer numerous benefits, some of which are obvious while others are more discreet. Unfortunately, many employers overlook these programs, assuming it’s nothing more than a drain on their finances. But in reality an employee recognition program is almost certain to yield a positive return on the employer’s investment. To learn more about these programs and why their important, keep reading.
#1) Reduces Turnover Rates
According to a study conducted by Forbes, companies that embraced a “recognition-rich” working environment experienced a 31% lower turnover rate. A high turnover rate can quickly burn through a company’s finances in the form of conducting interviews, analyzing job applications, training, insurance, and more. This can be avoided, however, by implementing an employee recognition program.
#2) Improves Engagement
Lack of engagement is growing problem in today’s workplace. When workers are disengaged, they are more likely to make mistakes, burn professional relationships with clients, and create a negative brand image of the company. However, a 2010 Psychometrics poll found that 58% of workers said recognition is the most effective way to improvement engagement. When workers are recognized for their hard work and dedication, they are more willing to push themselves on the job.
#3) Recognition Over Cash
Employers often assume that the best incentive to drive workers for excellence is cash or a pay raise. But several studies have shown that workers prefer recognition over monetary compensation. Something as simple as a verbal “thanks for the hard work” can make a world of difference in the workplace.
#4) Recognition Is Widely Embraced
A Bersin study revealed that approximately 75% of organizations have an active recognition program. Now for the bad news: only 58% of employees believe their organization has a recognition program. This signals a disconnect between management and employees, which is why it’s important for employers to spread the word about their program. Whether it’s an employee-of-the-month program, a quarterly recognition program, etc., it will only prove effective if workers know about it.
#5) Peer-To-Peer Recognition
Rather than focusing strictly on management-to-employee recognition, you should consider using peer-to-peer recognition as well. A study conducted by Globoforce found peer-to-peer recognition to be 37.5% more likely to yield a positive financial return.
Of course, there are just a few statistics attesting to the power of employee recognition. So if you’re still on the fence about implementing an employee recognition program, you’ll probably want to reconsider after reading this.
