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The Benefits of Employee Recognition: Boost Morale, Productivity, and Retention

Published on
June 25, 2024
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TL;DR

Employee recognition is one of the most powerful drivers of productivity, engagement, and retention when it is genuine, frequent, and tied to company values. Effective recognition programs go beyond occasional top-down praise to include peer-to-peer, social, private, behavior-based, and achievement-based recognition—ensuring every employee feels seen and valued. Organizations that prioritize recognition experience higher morale, stronger relationships, reduced voluntary turnover, improved performance, and greater resilience during challenges. Motivosity leads the way in modern employee recognition by enabling connection-first, peer-driven appreciation that scales across teams, reinforces culture, and measurably improves business outcomes through increased engagement and productivity.

It is no surprise that happy employees do better work and make the workplace more positive. Everyone loves to be recognized for their hard work and accomplishments. When a company’s culture is centered around genuine recognition, success is sure to follow. Here is everything you need to know about the power of employee recognition.

Understanding Employee Recognition

A great employee recognition program is your opportunity to make employees feel valued in the workplace. To have an effective employee recognition program it is important to understand how recognition works and the benefits it can have for employee productivity, employee retention, and overall workplace culture.

Recognizing employees for their hard work allows managers to highlight qualities and performance that directly contribute to the success of company goals. A great recognition program is a win-win situation because employees feel valued while employers establish expectations, increase communication, and highlight behavior that they want to be replicated.

Types of Employee Recognition

Many companies provide the bare minimum when it comes to recognition for their employees. Traditional recognition initiatives may award an employee for years of service or after a certain quota has been achieved. Great recognition programs offer many types of recognition that can help create an ideal company culture while supporting positive mental health in their employees. Every employee is different, which is why utilizing the different types of recognition can help ensure that everyone feels valued.

Peer-to-Peer Recognition

Peer recognition is when coworkers recognize each other for their hard work and achievements. This type of recognition can improve communication in teams and help employees build lasting relationships in the workplace.

Peer-to-peer employee recognition programs allow coworkers to provide recognition to each other. This can come in the form of public recognition, shoutouts, and rewards. Peer-to-peer recognition can help increase communication between employees while boosting morale. These programs help employees build genuine relationships and feel valued by the team.

Peer-to-peer employee programs take much of the responsibility off the manager's plate. Once a system is put into place, employees are free to show their appreciation to each other whenever they feel like it.

Peer-to-peer recognition - Types of Employee Recognition

Top-Down Recognition

Top-down recognition comes from HR leaders, executives and managers. It may also be known as "Superior Recognition". This type of recognition can be used to highlight employee achievement while acknowledging employees for their contributions to the company's mission.

Top-Down or Superior Recognition - Types of Employee Recognition

It may be difficult for a manager to see the benefits of employee recognition because of the amount of work needed to implement a program that works. Superior-led recognition tends to be seen as less genuine by employees when it comes to day-to-day messages of appreciation. Superior recognition is best done in conjunction with other forms of recognition.

Attributed Recognition

Attributed recognition is when the source of the recognition is attributed to another person. This type of recognition can help build a relationship between two employees by sharing a direct message of gratitude or achievement.

Anonymous Recognition

Anonymous Recognition is when the source of the recognition is unknown. This type of recognition can be valuable because it builds an appreciation culture in the workplace. Since the recipient doesn’t know the source of the message, they will feel a general sense of appreciation from their coworkers and may be more likely to reciprocate the recognition to as many people as possible.

Social Recognition

Social recognition is any recognition that is received in front of other people. This could include an office birthday party, an annual awards ceremony, or even a positive shout-out shared with the entire team. Social recognition is beneficial because you recognize employees for their hard work while also improving the overall appreciation culture which can add to the company's success.

Private Recognition

Private recognition is recognition that is only between two employees. This is an ideal method for HR leaders looking to motivate employees or address employee well being. This is a great way to make employees feel appreciated because management is taking valuable time to show appreciation directly to them and not the entire team.

Behavior-Based Recognition

Behavior-based recognition is the recognition given to an employee based on how they act and treat other employees in the workplace. This type of recognition gives everyone a great opportunity to reward employees for living the company values like positivity, communication, accuracy, and so on.

Achievement-Based Recognition

Achievement-Based Recognition - Types of Employee Recognition

Achievement-based recognition is recognition that is given to an employee based on the specific employee accomplishments they have completed. This type of recognition is valuable because it rewards work that directly leads to strong business outcomes. Achievements may also focus on non-business metrics. For example, you may want to encourage employees to focus on financial or physical wellness and can recognize those who complete company sponsored challenges.

How recognition affects employee engagement

Employee recognition helps improve employee happiness tenfold. When employees are recognized regularly, employers notice a huge boost in the mood of their employees. Here are some things you can expect to happen when you improve your employee recognition program.

  • Drastic Decreases in Voluntary Turnover
  • Improved Relationships between team members that lead to strong business outcomes.
  • Improved communication around the office both between coworkers and managers and their employees.
  • Fewer days out of the office.
  • Improved outlook on company goals.
  • Increased productivity.
  • Higher resilience to difficult situations in the workplace.
  • A more cohesive office environment.
Employee Recognition Software from Motivosity

Benefits of Employee Recognition

Recognizing employees is a great way to add value and spread positivity in the workplace. Here are some of the amazing benefits that come from a successful employee recognition program.

With only 20% of employees reporting that they are passionate about their jobs, it's more important than ever to find creative, out-of-the-box ways to increase job satisfaction.

Since we know there's a direct correlation between employee turnover and employee recognition, the solution is clear: the key is to make your staff feel valued and appreciated. What better way to do that than by celebrating their birthdays? Not only does it show you care, but it makes them feel appreciated, which boosts motivation and morale.

A study performed in 2019 found that one of the best ways to drive workplace engagement is by implementing a reward and recognition system. Having a system in place that focuses on rewards and recognition contributes to higher productivity and lower turnover.

Boosting Employee Morale

There is no better way to boost employee satisfaction than by celebrating employees at every opportunity possible. Everyday recognition can spread a positive attitude across the office. When you reward employees for their hard work they will approach work with a more positive attitude.

When you make employees feel appreciated in the workplace, they are more likely to feel valued. When employees feel valued in the workplace, they are far more likely to be loyal employees when difficult moments arise.

We all have seen the effects of a negative coworker in the office. Now think of a workplace where everyone wants to be there, and everyone is willing to go the extra mile because they are confident that they will receive strong feedback and potential financial benefits when their hard work contributes to organizational success.

A positive employee experience has been shown to lead to increased productivity and an overall positive impact on employee performance.

Increasing Productivity and Performance

A study from the Harvard Business Review found that recognition is one of the greatest indicators of workplace satisfaction, with 40% of employees saying they'd work harder if they were recognized at work. Imagine the difference it would make in every aspect of the company if almost half of the employees felt more motivated to perform to the best of their ability!

When employees receive recognition for a job well done, they are more likely to increase productivity in search of more recognition in the future. The same can be said for when one employee sees another employee recognized for adding to the organization’s success.

Recognition programs make people feel like they are valued in the workplace. This can help employees enjoy coming to work. When employees enjoy their jobs, they are less likely to struggle with mental health, take days off, or seek employment elsewhere.

Employees understand the importance of employee recognition and are willing to leave their careers if they do not feel welcomed. Employee recognition programs are an investment in your employees. If you want to create a more engaged workforce, you have to give them a reason to be engaged employees.

Reducing Employee Voluntary Turnover

It is no secret that employee turnover rates are at an all-time high. With such a competitive job market, employees are no longer willing to suffer in a workplace where they do not feel appreciated.

Data on costs of employee turnover

In an extremely competitive marketplace, employee turnover rates are higher than ever. High turnover rates can be both time-consuming and incredibly expensive for companies looking to build the best teams. According to the latest SMHR data, it costs businesses six to nine months' salary on average for each employee who exists in their first year. For a manager making $40,000 a year, that's $20,000 to $30,000 in recruiting and training expenses per employee.

Job dissatisfaction is one of the top culprits of low employee retention, and a large part of that is workplace recognition. In fact, according to a study by Achievers, 63% of employees feel that they don't receive enough recognition at work, while 39% say they don't feel as if they're appreciated. Now that's a problem!

Employee appreciation programs can help create a culture where everyone feels like they belong. Frequent recognition can help reduce employee turnover by building a company culture that values loyalty.

Increased peer communication can build real relationships in the workplace that stand the test of time. When teams enjoy working together, they will be far more likely to overcome challenges in the workplace. Strong relationships between peers can drastically increase employee retention rates.

Attract Top Talent

Talented employees in every field are looking for employers with a great company culture where they feel appreciated for their talent and hard work. New employees understand the importance of employee recognition and are far more likely to go to a company whose core values and business success revolve around frequent recognition.

Job seekers are attracted to companies with great cultures. In a job market where salary stays standard, the company culture you create is what will set you apart from the competition. Think how inviting it would be for top talent to know that every bit of work they do will receive recognition.

Employee recognition efforts help attract the best talent to a workplace

A great peer recognition initiative serves as an additional incentive for top talent. Gaining early recognition from their peers will make new hires feel welcome right away. Peer recognition programs can help build trust with new talent without additional resources from admin.

Implementing Employee Recognition Programs

Implementing a new initiative can consume a lot of resources for HR professionals and managers. Not only is it difficult to start a recognition initiative, but it takes a lot of work to get engaged employees to actually use it. If you have not had employee appreciation as one of the core values of your company, it may take some time for people to believe that your company is looking out for employee well being.

If you are looking to make employee recognition important in your company, here are the crucial steps you should follow when working to implement a successful recognition program.

Key elements of successful recognition programs

Here are the key elements that all sophisticated recognition programs have in common.

1. Recognition is Personalized and Specific

Employee recognition is meant to improve employee engagement. This cannot happen if the recognition isn't tailored directly to the employee receiving it. Recognition should reference specific actions or behaviors that improved workplace culture or helped achieve the company’s mission.

2. Recognition Happens Early and Often

Whether an employee has been with the company for 1 week, 1 year, or 100 years, they deserve to know that they are appreciated. Recognition should happen as often as possible to ensure that the workplace culture stays positive and employee morale is always high.

3. Recognition is Tied to Company Values

Connect employee recognition efforts with company values

Public employee recognition is an opportunity to express appreciation, provide positive feedback, and improve employee engagement. Recognition allows you to highlight the positive actions and behavior that directly match your company values in an attempt to get others to replicate those actions.

4. Recognition is for Everyone

Everyone in the company deserves a little bit of employee appreciation. The more recognition you give out, the more business success you bring in. When it comes to motivating employees through recognition, you can't afford to leave anyone out.

5. Recognition Lifts People Up

Employee recognition is all about spreading positivity. Recognized employees should feel great about getting the spotlight. All recognition is about rewarding employees for a job well done, not pointing out their flaws in front of their peers.

Key Elements for a Successful Employee Recognition Program

Measuring the Impact of Recognition Programs

While it is easy to see that recognition programs are extremely valuable, one of the more difficult tasks is figuring out how to measure just how valuable. Businesses that implement a program should measure the following points before and after implementation to see just how valuable it can be.

  • Voluntary Turnover
  • Participation Rates
  • PTO Used
  • Percentage of Employees using their Full Budget

A monthly satisfaction survey can also be a great way to measure if your program is effective. Programs like Motivosity have a built-in data center so you can easily see how effective your program really is.

Measure the impact of an employee recognition program

How to Get Started with an Employee Recognition Program with Motivosity

Getting started with an Employee Recognition Program is simple. The first step is to recognize that your employees deserve a better way to feel valued for their hard work. Here are some steps you can take to start improving your company culture by communicating appreciation with an employee recognition program through Motivosity.

  • Schedule a personalized demo is a great way to see how Motivosity can transform your company culture through genuine recognition.
  • Check out our ROI Calculator to see just how valuable an employee Recognition program could be for your company.
  • Explore our simple pricing options to see that an employee recognition program is a no-brainer for your business.
  • See first-hand how a Peer-to-Peer Recognition program can affect your company culture through our vast collection of videos and blogs in our Resource Center.
  • Schedule a meeting with one of our knowledge sales experts to how Motivosity can increase employee engagement and make employee recognition and rewards a breeze.

With an employee recognition program from Motivosity, you can increase employee engagement through exciting and effective employee appreciation. Visit Motivosity.com to get started.

Easily manage your employee recognition program with Motivosity

Article written by
Raechel Duplain
VP of Marketing
Raechel Duplain is the VP of Marketing at Motivosity, bringing deep expertise in product, solutions, and customer marketing from previous roles at Podium and Workfront. Outside of work, she loves time with her family, reading, building Legos with her son, and wholeheartedly committing to her weightlifting-and-creatine era.
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