Let’s face it: a strategic reward system focusing on four key elements: recognition, appreciation, remuneration and benefits is a basic need in every company. The main issue with reward and recognition programs in many organisations nowadays lies in the lack of one or more of these elements. Additionally, the aspects that are addressed are seldom perfectly in line with the company’s other corporate strategies. A successful reward system should acknowledge and reward two sorts of employee activity: performance and attitude. The former is obviously the easiest to address because of the unambiguous link between the goals you set for your employees and the final outcomes that result. For instance, you could implement an incentive plan or recognise your top salespeople for achieving periodic goals. That can be easily done.
Instead, honouring specific behaviours that truly make a difference to your business is definitely more challenging than rewarding performance. One way to overcome that obstacle is by posing two questions: “What am I rewarding my staff for?” and “What is the attitude I want to reward?” For instance: are you rewarding employees for working long hours or for being creative coming up with new processes on how to carry out their work in a more effective and efficient fashion? In other words, are you rewarding someone for the amount of time they’re sitting at their desk or for their will to innovate and create new business opportunities? The difference between the two is clearly enormous.
The first step is to determine the core values that truly matter to your company. Those activities might include building up customer relationships, inflecting critical processes or helping employees invest on their managerial skills.
The idea owners and stakeholders often have of reward systems usually sees compensation as the main (and sometimes only) recognisable element. True: this is not entirely incorrect, since not many people are willing or able to work for free. However, the best strategy should also include an incentive compensation plan that’s precisely connected to the goals of your company, even within a specific period of time. You might also want to take into account some sort of longer-term rewards for key employees in your business. Traditionally, this often comprises of some form of equity ownership.
Another type of reward in a strategic reward system is – without a doubt – benefits, and make no mistake: your employees are unequivocally going to take notice of the types of benefits you have to offer. Businesses that do not match or exceed the benefit levels of the competition will have difficulty appealing and maintaining top performers.
Nonetheless, you cannot underestimate the significance of recognition and appreciation as essential elements of a victorious strategic reward system. These two ingredients seldom receive the attention they deserve from the senior management, which is astonishing because they are the low-cost/high-return elements. Staff love to know how good, bad or average they are, so it’s crucial that you let them know.
Acknowledging an employee or a team before their peers for specific projects, for being successful even in the short-term, for actions taken or behaviours exemplified through their attitude, is what recognition is all about. Appreciation, at the same time, focuses on expressing gratitude to someone for their actions. Demonstrating appreciation to your staff by explicitly recognising superior performance and the type of behaviour you want to strengthen is best done through simple expressions and statements. For example, you might send a personal note or make a positive remark on a shared platform to convey your appreciation as a means to thank them in front of the employee’s colleagues or team, indicating specific cases of what they have accomplished that has positively impacted the company.
This is exactly why being able to present an ample array of rewards in the form of digital gift cards, e-vouchers or discounts is complimentary to any fully developed social recognition programme. The uncommon benefit of presenting gift cards is that each employee can choose their uniquely meaningful prize, thus obtaining something they truly want or need.
If your objective is to make sure your staff is happy, why not give them something that works: a unique platform that allows them to actively engage with each other, recognise the top achievers and motivate your workforce.
If you’d like to find out how to build an effective recognition strategy, download our free e-book.