More employers using recognition to drive performance by Claudine Kapel

Recognition programs abound in organizations today — but some interesting shifts are happening with respect to what organizations recognize.

Although service awards still top the list in terms of prevalence, organizations are focusing more attention on performance-based recognition.

The latest WorldatWork study on trends in employee recognition found that recognition programs are highly prevalent – with 89 per cent of respondents having programs in place. And many organizations have multiple programs.

Some 67 per cent of respondents offer between three and six different recognition programs, with 4.6 being the average number of programs offered. The average number of programs is back to the 2011 level, after dipping to 3.9 in 2013.

The findings reflect responses from 457 organizations.

The top five types of recognition programs offered were:

  • Length of service (87 per cent)
  • Above-and-beyond performance (76 per cent)
  • Programs to motivate specific behaviour (51 per cent)
  • Peer to peer (48 per cent)
  • Retirement (34 per cent).

The WorldatWork reports some shifts are happening with respect to how organizations leverage recognition, with “a growing number of organizations relying on recognition programs that drive organizational results.”

It notes, for example, that there has been a 10 percentage-point increase in the use of programs to motivate specific behaviours versus 2013.

Further, 25 per cent of all organizations surveyed offer two types of results-driven programs as part of their recognition programming.

The research found the organizations with more results-driven programs also had a stronger commitment from the organization and a higher level of perceived success.

The WorldatWork, however, notes it isn’t clear whether these findings are simply the result of “having better clarity around the intent of the program,” making the program easier to explain and measure, or because recognition programs designed to drive specific results truly have greater relative success compared to other programs such as service awards.

The top five organizational objectives for recognition programs remained unchanged since 2013:

  • Recognize years of service
  • Create / maintain a positive work environment
  • Create / maintain a culture of recognition
  • Motivate high performance
  • Reinforce desired behaviours.

Although not making the top five, the goal of increasing retention / decreasing turnover rose to 51 per cent, representing a 10 percentage-point growth over 2013. Most respondents (77 per cent) agreed that their recognition programs are meeting their established objectives.

The top five types of items presented as recognition has not changed since 2013, and include:

  • Certificates and/or plaques
  • Cash
  • Gift certificates for product purchases
  • Company logo merchandise
  • Food.

Although recognition programs are highly prevalent, the survey findings indicate there is ample room for organizations to approach these programs more strategically.

Only 53 per cent of respondents indicated they have a written strategy that underpins what they offer. Further, some 53 per cent indicated “no one position” is responsible for the recognition program – instead it is “a shared responsibility among department personnel.”

Human Resources was the most commonly referenced department responsible for managing recognition programs, followed by Compensation, and each department being responsible for its own program administration.

Perhaps the most notable area of concern, the perceived level of support for recognition programs from senior management declined to 34 per cent, down 7 percentage points from 2013.

Granted, recognition programs don’t typically have big budgets. The WorldatWork study found 80 per cent of respondents have a budget for their recognition programs, with 42 per cent allocating between 0.1 per cent and 0.3 per cent of its payroll budget. Some 20 per cent allot between 1.0 and 1.9 per cent of payroll.

But as with any aspect of total rewards, taking a more strategic approach will typically yield more meaningful results and a better return on investment. In fact, the survey found the prevalence of a written strategy was dramatically higher among respondents with the highest number of result-driven recognition programs.

A strategic intent, along with a clear plan for managing recognition programs and measuring their impact, can make the difference between programs that are nice to have and programs that deliver real value.

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