Employee recognition has long been thought of
as the lighter side of business management. The
notion conjures up images of office workers taking
a break from the day-to-day routine to honor a colleague
for many years of dedicated service with a gold watch
or special dinner – a nice gesture, certainly,
but nothing critical to the running of the business.
No longer. Companies large and small are realizing
potential of employee recognition as a key component
driving workplace morale, employee retention, and even
For firms on the leading edge of progressive incentive
and reward programs, the effort has little to do with
mere ceremony. The stakes, in fact, could not be higher.
“We are on the verge of an imminent global talent
crisis,” warns Christie Gibbons, executive director
of Recognition Professionals International (RPI), formerly
known as the National Association for Employee Recognition. “In
the next 10 years, we will see a glut of people retiring.
With this brain trust walking out the door, companies
need to know how to retain talent.”
To do that, employers must know how to make workers
feel appreciated on a level that resonates with them
as individuals, experts say. This requires a multifaceted
approach to employee recognition that demands more
than a seat-of-your pants strategy.
“Companies must teach management to encourage
effort and reward results,” says Chester Elton,
co-author of The Carrot Principle, an analysis of best
practices in employee recognition.
Elton cites a survey of 26,000 employees across 31
health care organizations. The study found that companies
whose employees claimed the highest level of agreement
with the statement, “My organization recognizes
excellence,” saw a significantly higher return
on equity, assets and operating margin. “Employers
need to understand that recognition is good business,” he
As new forms of employee recognition expand across
a growing spectrum of businesses, so do the opportunities
for creative use of awards, gifts and promotional items.
Far from becoming an anachronism, promotional products
as a component of recognition has benefited from a
burst of creativity as firms seek to recognize and
encourage employees in ways that promote corporate
values and goals.
Elton recognizes four primary blocks around which employee
recognition programs should be built: honors for top
achievers, day-to-day recognition, career recognition
and special events. The creative use of products can
play an important role in all of these strategies.
Rewarding the Top Dogs
Companies have long recognized the motivational power
of contests and rewards – for
salespeople of the year, for instance. These types
of recognition, in the form of prizes, bonuses, ceremonies
or membership in “million dollar clubs,” continue
to be important, even as companies discover new ways
to spread a sense of achievement and reward across
an entire workforce.
At Digineer, a Minneapolis-based technology consulting
company, director of humann resources and recruiting
Lucinda DuToit has received widespread praise for
her Digineer University program, which combines professional
development and employee rewards in a way designed
to reach, and inspire, every one of the company’s
“The biggest thing for us is the intelligence
and the knowledge building for our consultants,” she
says. To impart loyalty and core company values,
the program offers employees the chance to build
up points as credit for classes attended. Point levels
are posted online for comparison and friendly competition,
and individuals earn prizes and rewards, such as
company sweatshirts, T-shirts, camp desk chairs and
laptop bags. The top prize is a $1,000 technology
credit employees can use any way they want.
“They get a koozie just for showing up,” DuToit
reports. “It’s to get people engaged
in it right away, and to get them excited.”
“The nice thing is, because the program has
been so successful, we’re now looking at the
next level of gifts,” DuToit says. She is consulting
with employees about what sort of prizes they would
like to see.
“We’re not, as an organization, making
an assumption about what’s cool,” she
adds. “We’re asking what’s cool.
It’s about listening to employees.”
Also listening is Renate Witthoeft, people experience
partner on the HR team at 1800gotjunk.com, a Vancouver-based
junk removal services franchiser.
“You really need to engage with your employees
in terms of what motivates them,” she says. “We
get that feedback from the sales agents. We ask them,what
kind of prizes would you like? How do you want to
The company offers a variety of rewards, from digital
cameras and iPods to trips for two to Las Vegas and
Mexico, based on ever-changing criteria. Especially
popular is the Mini Cooper, wrapped in the company’s
logo, which top performers are given full use of
(along with a primo parking space) for two weeks.
“A different component is recognized for each
time,” Witthoeft says. “It could be for
great customer service, most improved sales, or achievement
of a personal best.”
Jenny Craig, the weight management services provider,
offers employees a wide range of motivational rewards
through its MOVE (Master Our Values Everyday) program.
Employees earn points based on quality of customer
service and clients’ success, which are tallied
on a Web site. Points can be redeemed for jewelry,
electronics, trips, clothing and other items, according
to vice president of human resources and organizational
development Chris Hilker.
The company is also proud of its peer-to-peer recognition
program, whereby one employee can honor another for
exceptional achievement by downloading a special
certificate. The certificates can be presented directly
to the worker or through their immediate supervisor,
At Avis Budget Group, the need to integrate new employees
and re-enforce company values in the wake of Avis’ incorporation
of Budget Rent-A-Car led to a comprehensive employee
rewards program that has led 97% of employees to
report they feel “part of the company,”
according to a study cited by Elton.
Having promotional items on hand for managers to
recognize employees in a timely way is “critical” to
the program’s success, Elton says, noting the
company has 10 promotional items with the company
logo available to managers – “practical
things they can use in the workplace” like
pens and calendars. Managers report success in their
recognition efforts by contributing to an online
program where information is shared across the company.
Good manager training is a key component of the best
recognition programs, Gibbons says. Understanding
this, RPI has begun a certified recognition professional
program whose first class of 42 graduates was presented
at the association’s annual conference in Savannah,
GA, in April.
Candidates attended four intensive, all-day courses
to learn theories and methods in implementing recognition
systems. To be certified, participants must pass
a test for each course.
Gibbons lists off a number of creative ways to recognize
employee achievement, culled from a survey of the
association’s membership. These include peer
recognition programs, achievement bonuses, community
spirit awards for volunteer work and awards for team
building, innovative practices, promoting employee
health or diversity and outstanding customer service.
Her key point: there’s no limit in the ways
to honor people for the work they do – and
no good reason not to.
This most obvious strategy for effective employee
retention and moral boosting is, ironically, the
one most-often overlooked. “I find companies
are really good at recognizing top achievers. Where
they really miss the boat is the day-to-day recognition,” Elton
says. “Would you rather see a 10% performance
increase in the top 2%, or a 3% performance raise
in the bottom 98%? Most companies would choose
the latter. The top achievers are maxed out anyway,
so encourage and recognize effort anywhere you
Gibbons recommends having new hires fill out surveys,
which can be updated periodically, so management
knows how to recognize someone in a personal way.
Someone with small children might appreciate flex
time more than tickets to a concert, for instance.
DuToit agrees. “Understand who your employees
are and what’s important to them,” she
DuToit has seen first-hand the power of personalized
recognition. When an employee’s overtime was
putting a strain on family life and forcing her husband
to pick up many more home duties, the company gave
the spouse two Digineer golf shirts, hired a babysitter
and sent him and his buddy out golfing for a day.
In another case, to say “thank you” for
working through a particularly challenging situation,
the company paid for an employee’s wife and
kids to sit for a special portrait, given to him
as a surprise.
Of the latter gesture, DuToit said the employee’s
response “gave me goosebumps. It’s simple
things like that that really do a world of wonder.”
Along with such rewards, managers should also be
taught to encourage employees, Elton says. This can
be something as simple as thanking an employee for
staying late when bad weather kept others in the
office at home.
“Managers can get upside down because of the
loss of a good employee, wondering how they can afford
to increase pay or benefits,” says Jim Blasingame,
host of The Small Business Advocate show and Web
site. “Maybe all you had to do was let them
know you valued their time and not take them for
granted,” Blasingame says. “Every time
you look at an employee you don’t want to lose,
imagine there’s someone out there courting
them right now. Make sure you catch people doing
Companies are increasingly recognizing the power
of special events as ways to promote team spirit,
corporate values and a sense of pride and belonging.
Brian Drum, CEO of New York-based, executive search
firm Drum Associates, cites a client’s exclusive “fiscal
fitness” outing, at which participants received
gym bags with the company logo.
“People wind up carrying them around as a point
of recognition. It shows they were invited to this
Another client gave out T-shirts to recognize a company-sponsored
MBA executive program at New York University. For
special events, such as sponsored marathons or charitable
activities, firms have provided promotional windbreakers,
mugs, messenger bags, computer pouches and backpacks.
“It gives a sense of belonging and ownership,
and becomes a point of pride,” Drum says. “Doing
something on a large scale helps everyone understand
who they’re working for. All of these events
need these logo-driven paraphernalia to tighten them
up and help to create the right culture.”
Business events such as sales conferences offer similar
opportunities. Among other items, Drum has seen the
distribution of glass paperweights, hot mug holders
and jars for paper clips.
“Whether it’s your company’s 30th
anniversary, hitting a corporate revenue goal, a
team achievement, or a holiday party, celebrations
give you lots of opportunities to thank everyone
and communicate ‘we’re in this together,’” Elton
and Adrian Gostick write in The Carrot Principle.
The authors praise a Salt Lake City firm, Intermountain
Health Care, for its care in choosing a gift for
the company’s anniversary. Organizers chose
a custom watch displaying the corporate logo and
anniversary theme, which executives believe was critical
to the event’s success.
“The gift was not given as an everyone-gets-one-so-here’s-yours
type of presentation,” Elton and Gostick point
out. “The importance of organizational mission,
values, history and quality was reinforced through
the promotion of the celebration and at the actual
Of course, smaller celebrations also
matter as a way to show individuals and teams that
you appreciate them. Bakemeawish.com runs a corporate
loyalty program that makes it easy for companies
to fete employees with personalized, gourmet cakes
for birthdays and other events, shipping them overnight
in a customized box.
The cake program “reinforces and improves brand
image, employee morale and customer relationships,” company
spokesperson Jenny Corsey says.
Birthdays and holidays take on special significance
for the families of those in the military, and companies
have stepped up lately in giving gifts to families
of employee-reservists or employees with a spouse
serving overseas, according to the RPI survey cited
Career recognition programs, which honor employees
for a period of service or upon retirement, are
all about loyalty. Even in today’s environment
of increased turnover, with most workers staying
at one company for no more than three to five years,
these ceremonies still matter as a way to foster
retention. In fact, some companies are finding
ways to recognize employees after only a few months,
or even right off the bat.
Elton and Gostick report that “welcome awards” are
becoming more common, presented in tandem with interviews
of recent hires that glean how the individual feels
about their job. Pins with the company’s logo,
an inexpensive watch, company jackets and luggage
are just a few of the items used as part of these
public recognition ceremonies.
“The important thing is that you can’t
wait five years to show appreciation for loyalty
in employees you wish to retain,” they say. “You
start at 90 days.”
Longer-term recognition programs have helped companies
buck the turnover trend. Jenny Craig honors employees
at, 10, 15 and 20-plus years of service with points
toward prizes, a recognition page on the company’s
nationwide Intranet site and a special symbol worn
on employee nametags: based on seniority, consultants
will sport an amethyst, ruby, sapphire or diamond.
Name tags are an important part of company culture,
Hilker explains, as they symbolize the one-on-one
relationship employees build with clients. For many
companies, symbols are an important part of reinforcing
core values and making employees fell they are a
key component of a firm’s success.
“Recognition engenders trust,” says Elton.
Good programs make employees feel that their efforts
will not only be noticed, but that they will be given
due credit for them through meaningful channels,
be it public recognition, a gift or symbol laden
with significance, monetary rewards or a thoughtful
comment from the right person.
“If your employees are happy, engaged, and
know that you feel they are doing a great job, they’re
going to stay,” Gibbons says. “That’s
what you want.”
James Sturdivant is a freelance writer based in Pennsylvania.