Building a Successful Reward and Recognition Strategy
A formal reward and recognition strategy is vital for a productive and motivated workplace. But how do you design a reward and recognition strategy to successfully motivate your team?
Why is it important for organisations to have a reward and recognition strategy?
There are many reasons why people are motivated to come to work every day, and salary is not always the top motivator for people, even highly paid professionals
All people have basic desires that drive them – to feel good about themselves, know that what they do every day is meaningful and feel a sense of belonging to the organisation. A structured reward and recognition strategy needs to tap into those desires, and keep people focused on what the organisation needs them to do to create success for the organisation and also for themselves.
The absence of a coordinated reward and recognition strategy can create misalignment in how people are treated. Problems can also occur when some functions recognise and reward their teams, when others do not. This can cause resentment among those who are missing out on the reward.
How do organisations define and execute an effective reward and recognition strategy?
Reward and recognition is a broad term, encompassing everything from structured individual and team financial rewards, through to high achievement and culture-based awards. Some organisations limit their programmes to annual awards and individual performance bonuses, whereas others take a more team-based approach.
Organisations with large customer service or consumer-facing employees often run programmes which provide smaller rewards (such as movie tickets or restaurant vouchers) to reward someone who demonstrates the organisations values and behaviours. Some even have ‘point systems’ which allow the recipient to accumulate a number of points to save up for a bigger reward such as a travel voucher. All of these are valid forms of reward.
What about the recognition component?
If you accept the premise that people are motivated by factors other than just money, then consider what it takes for people to feel good about themselves.
Different types of people prefer recognition to be delivered in different ways. The simple fact is that recognition for achievement or behaviour is most effective when there is a combination of a reward that is valued by the person and recognition for how the person has made a difference to the organisation.
Reward and recognition programmes can be general in nature, acknowledging financial or other hard metric achievements right through to demonstrating the behaviours that align to organisation’s values and culture.
What are some of the key aspects of reward and recognition that should be considered in a formal programme?
1. Determine what you want to achieve from a reward and recognition programme. Once you know what outcomes you want to drive (whether a specific outcome, a more motivated and focused team or specific behaviours that align to your culture), you then need to determine the types of rewards that will drive those outcomes.
2. Once you have determined your rewards, then determine how to provide the recognition. You can’t make everybody happy, but you can pick a recognition style that fits with your culture. It will depend on the types of forums that exist in your business: if public recognition (rather than one-to-one manager to employee recognition) is most appropriate in your culture, do you have regular forums of groups of employees? Is it appropriate to provide the recognition at that forum?
3. Lastly, check all of your reward and recognition programmes for consistency and future focus. Do they align to promote consistent outcomes and behaviours? Could any of them appear contradictory or actually create unhealthy competition amongst your employees? Do they promote the outcomes you want in the future? The most successful reward and recognition programmes are future-focused, consistent and cohesive, and you can see how they fit together and drive the vision and mission of the organisation.
Is it possible to have a ‘one size fits all’ programme for your entire workforce, or should each individual in the team be treated differently?
The reality sits somewhere in the middle of this continuum. It would be logistically impossible and very inefficient to have differing programmes by individual (or even by small working team), but a ’one size fits all’ is not necessarily the most appropriate either.
A balanced programme will identify a series of outcomes and behaviours that are rewarded, at the local or team level, divisional level and cross-company level. Local rewards that are specific to the outcomes expected of the team would tend to focus more on individual or team achievements that reflect more tactical or short-term gains. While company-wide programmes would tend to span a longer-term time period, e.g. annual awards, and align more strongly to the key organisational outcomes (typically revenue and profit for most commercial organisations) and key behaviours that align to the company culture.
To summarise, a good reward and recognition strategy can positively increase the motivation and engagement level of the workforce, and positively impact the bottom line of the overall business. Take time now to look into your reward and recognition programmes to create a happier and more productive workplace.