Do Employee Recognition Programs Increase Overall Productivity?

December 19, 2018

According to Human Resources Today, upwards of 65 percent of employees do not feel recognized at work. In the business world, ensuring that your employees are motivated and intentional about their work is paramount for the daily operations of any business.

To encourage a sense of appreciation and to motivate staff, some businesses incorporate employee recognition programs into their human resources management. But is the result everything employers hope for? Do employee recognition programs increase overall productivity?

Here is everything you need to know when considering employee recognition programs.

The Benefits of Employee Recognition Programs

Employee recognition programs have a number of benefits that can result in an overall increase in productivity for your small business, depending on their purpose.

Some programs recognize employees for milestones such as length of service. If the recognition is valuable enough to your staff, this encourages employees to invest their time in your company. Wise employers know that it is almost always more efficient to maintain a current employee than hire a new employee. Recognizing the longevity of your employees could encourage them to stay on with your company long-term, resulting in an experienced and developed staff.

Some employee recognition programs that highlight accomplishments on the job might also yield an increase in employee productivity. If your staff feels as though their work is ignored regardless of its quality, they may lack the motivation to complete high caliber work. Conversely, employees who know that their work is monitored and that top-tier work is applauded may be inclined to conduct their work with more integrity, not only in the hope of being recognized, but also because they know they are being held accountable for what they accomplish.

Potential Difficulties

While employee recognition programs can be a great way to motivate your staff, they can also have some negative effects.

Primarily, employee recognition programs can backfire if they don’t offer enough incentive. When recognizing an employee, it’s important to ensure that the reward matches the effort of your employee. Staff members may be disappointed or even insulted if their five years of dedicated service are recognized with a company pen or monogrammed notebook.

Recognition programs that emphasize quality of work have the potential to encourage your employees to be more intentional about their daily accomplishments. When this is taken too far, it can result in unhealthy levels of competition within the workplace that lead to a tense work environment.

On a practical level, employee recognition programs can also be costly. If your human resources professionals use large amounts of company resources to fund employee recognition programs, it can inhibit the daily operations of your business. While it may be enticing to offer your top-performing employees raises and bonuses to reward their hard work, it may not be sustainable.

How to Do it Right

Employee recognition programs have costs and benefits, but when conducted wisely, the potential benefits can greatly outweigh any difficulties you may encounter.

To reap the most benefits from your employee recognition program, make sure that your human resources department focuses their efforts on employee recognition that is appropriate for your business and for your employees.

Your HR staff should seek to strike the perfect balance between recognition programs that are attractive enough to inspire high levels of productivity in your employees, but practical enough that your budget can sustain them.

Striking this balance may mean that employee recognition programs are made more valuable, but offered less frequently. You may also want to consider offering non-monetary incentives to recognize employee performance. Added time off or verbal praise can be just as motivating as a monetary bonus in some situations.

If your company is looking for different ways to boost morale or improve staff performance, employee recognition programs could be the key to increasing overall productivity. For more information on employee management programs or small business outsourcing, contact the HR and payroll experts at Commonwealth Payroll & HR. Call us today at (978) 599-1500.

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