Feature Article - May/June 2009

On The Spot

Immediate Rewards for a Job Well Done

By Rick Dandes


mployee incentive and recognition systems that include spot rewards and peer-to-peer recognition programs have become key elements in how many companies operate. That's not surprising, since competitive pressures to retain top employees and the pace of change have increased the demands on everyone at all levels of business, and maximizing performance has become notably more integral to the success of the company.

"At this very moment about three in 10 workers are thinking about walking out of their employer's door for greener pastures," said Louise Anderson, president and CEO of Anderson Performance Improvement, based in Hastings, Minn., one of many ground-breaking companies that design and implement behavior-based incentive and recognition programs that include analysis, measurement, communications, training, reinforcement and rewards.

"Despite these tough economic times, nearly half of your workforce expects to be working for a different company three years from now," she said. "Every new head you have to hunt costs somewhere between $2,000 and $100,000 to get them oriented, trained and engaged. This is no small investment. So how can these employees be so cavalier about leaving your company? It's simple: They do not feel they are recognized adequately for their work."

Dealing with people is complicated in any corporate environment, and that's true today more than ever before. For this reason, any kind of successful spot reward or peer-to-peer recognition system, Anderson contends, must begin with a basic understanding of the dynamics of the workforce and employee psychology.

In a typical hierarchical organization 20 to 30 years ago, manager-employee interaction was much simpler than it is today. Back then, a manager could just ignore the complications. The culture was, "I'm the boss, and you to have to do what I say … because I am the boss."

Times have changed and "organizations are flatter," observed Tom Miller, president of The Miller Company, of Dallas, Texas. "Look, every corporate culture is different, and all those differences show up in the workplace. Employees want to see value in the workplace, and, perhaps more important than that, employees want to be valued in the workplace. That's an important thing for companies to realize."

Anderson agreed, and said that in the new and future American marketplace, employees, "especially Generation Yers, want instant feedback, and they want to be recognized for a job well done."

Recognition programs and incentive rewards respond to this need by validating performance and motivating employees to improve. In whatever form recognition takes, whether manager-to-manager, manager-to-employee or employee-to-employee, it leads to positive-thinking, highly motivated and engaged employees, and that all adds positively to a company's bottom line. "Both in terms of employee retention and net revenue," Anderson said.

As companies begin to realize the importance of recognition, they are dedicating even greater resources to recognition strategies. But not just any recognition will do.

"To be truly effective," Anderson said, "recognition has to reward the right behaviors. And it must be immediate."

Strategies that visualize recognition as a management tool only ignore one of the key values of recognition. That is, its ability to act as a motivator and reinforcer of desirable behavior within the corporation. It can influence the way employees feel about themselves and their contribution to the organization's output.