Employee Recognition: Why It Matters

Rewarding employees for a job well-done will do wonders for their performance--and your bottom line.

By Alex Hiam

I just returned from a fascinating conference put on by the National Association for Employee Recognition (NAER). (Yes, there really is such a thing.) I got a chance to give a talk myself, then spent two days meeting recognition specialists and learning from them. Some were from big companies like United Airlines, others from community colleges, city government and so forth. Not many entrepreneurs or small-business owners though. In fact, not a one.

Most entrepreneurs do not consider recognition a central part of their management practices. But let's get personal about this and talk about you. I bet you don't budget an extra 3 percent on top of your payroll costs for employee rewards, awards, celebrations and gifts, for example, yet that is the goal of many of the recognition specialists I met from large firms.

Is this a luxury for companies that can afford to waste money? I don't think so. In fact, I think there are many profitable returns from an emphasis on recognition. It probably costs us not to do it. Here are some ideas I brought back from my experience at NAER that I think can apply in every workplace, no matter the size or budget:

1. If you recognize and make a bit of a fuss about the good things employees do, then you will find yourself spending a lot less time worrying about the bad things they do. They will do less of the negative, and they will strive to do more of the positive things you are recognizing. It is far, far easier to lead people to improved performances by thanking them when they do it right than giving them "grief" (I was tempted by another word there actually) when they do it wrong.

2. There are important milestones and accomplishments in the life of your business. Mark them! Have a party. Take a moment to celebrate. Recharge your own and your employees' batteries. It is too easy to get so caught up in the daily struggle that you never stop to recognize the good work you do.

3. Praise and recognize your star performers. Some of your recognition budget (however large or small) should certainly go toward spotlighting role model performances and role model employees. This makes them feel good, encouraging them to stay on board and keep trying hard. And it gives everyone a bit of inspiration and a clearer idea of what you want employees to shoot for. 

4. Recognize good effort, not just results. When employees have had a tough week, throw a mini party for them. Bring in some pizza, a cheesecake or whatever inspires you, and share it with your crew. Or try writing a personal thank-you card to each employee--maybe picking out a different design for each and having some fun recognizing individuals in your selection. You help the marathon runner the most by offering encouragement and nourishment along the track, not just by waiting at the finish line with a trophy. Recognizing effort has a bigger impact than giving a prize at the end of the race. Same goes for employees, who are in a race every day.

Every day, millions of people throw their hearts into their work. They want to succeed. They want their work to be appreciated and their efforts to be recognized. When we remember to take care of these very human needs for recognition and appreciation and the occasional round of applause, we do a great deal to create the vital, energized workplace we need in order to succeed in today's challenging world of business.