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Better Recognition Experiences Pay Dividends

By March 3, 2016 May 6th, 2020 No Comments

There is overwhelming evidence that a better recognition experience leads to better business outcomes, especially when the following key conditions are met:

  • Recognition practices are fair, transparent and consistent
  • Supervisors and Managers provide recognition effectively and in a timely manner
  • Employees value the recognition they receive

When this happens, the following business benefits are most likely to be seen:

  • Higher levels of job satisfaction leading to increased staff retention
  • Increased performance, attendance and quality of work
  • Staff become team players striving for the greater good of the organisation
  • Employees feel comfortable presenting new ideas and initiatives
  • There is an uplift in customer experience

All of that points to elevated performance and productivity, with a direct impact on the bottom line.

A key bottom-line impact comes from increased retention. As you will know, replacing employees can cost up to 150% of a person’s salary (Mercer Consulting), which can run into millions of dollars. In terms of retention, our research showed:

Employees were most likely to plan to leave their employer in the next year when they felt less valued, appreciated, respected and had lower perceptions of fairness regarding the organisation’s recognition practices, and experienced lower overall job satisfaction.

Employees who reported high levels of manager effectiveness in providing employee recognition and valuing the recognition they receive were more likely to stay with their current employer 3 years or longer. This could have a major impact on your bottom line.

Fair pay matters most, but don’t rely on that too much.

Unsurprisingly, pay matters most. As we’ve said before, base compensation (and deserved pay increases) must be fairly given for the work done. Our research also bore this out:

More than a quarter of working adults (28 percent) said that written or verbal appreciation from their direct supervisor or manager is important, but when it comes to the types of recognition that employees say are important to them, money tops the list. Six out of 10 employees (62 percent) cited merit-based salary increases as important, followed by fair monetary compensation (47 percent), performance-based bonuses (43 percent), and promotions or advancement (38 percent).

Our concern with this type of result lies in “who defines fair?” Regular readers of this blog know very well about the good and the bad information availability through sites like, and the movement for pay transparency. And merit-based pay may be well on its last legs (the differentiation just isn’t there anymore).

Additionally, cash as the primary form of recognition becomes an entitlement or an expectation. We can’t keep giving out the same raises or bonuses every year. The budget just won’t allow for it. And cash bonuses in particular have been proven not to work even though employers still insist in throwing money away with bonuses that do not relate to or impact future positive behaviour.

Recognition in other forms must fill the breach but many organisations rely too much on manager recognition.

In our survey, all the conclusions drawn about the importance of the frequency or amount of recognition focused on that given by managers.

But the survey shows only 30% of employees say their organisations offer recognition in the form of verbal or written appreciation from supervisors.

Even fewer (16%), allow for peer-to-peer recognition. This is a tremendous missed opportunity. Even the best managers can’t see all the good happening around them. And let’s be honest – what percentage of managers in your organisation would you classify as “best?”

Take the burden off managers alone. Empower all employees to notice, appreciate and recognise excellence in their colleagues every day.

One last thought for you to consider – why would we be conducting this research? It’s a bit of an obvious and “common sense” answer – because whether or not we’re recognised for what we do all day impacts our overall well-being.

And that’s also a bottom-line impact – the health and wellbeing of your employees ties directly to your corporate performance

What do recognition practices look like in your organisation?

Which approaches are most successful in terms of business outcomes (productivity, performance, retention, engagement)?

If you would like to learn how Brownie Points can positively affect the health of your corporate performance call us today on 03 9909 7411 or email the team at

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