3 Important Differences Between Reward and Recognition
You might be tempted to think money is the only thing that matters to your employees. As long as employees get their paycheck, they’re happy, right? Not quite. Employees need both rewards and recognition to feel fully satisfied with their job.
In a BambooHR study, nearly one-third of employees reported they would rather be recognized for their work accomplishments in a company-wide email from a company executive than receive a monetary bonus of $500 that isn’t openly publicized by a superior to their coworkers. But when is a reward appropriate and when is recognition the right route? And what is the difference between reward and recognition? Read on to learn the differences and get some tips for creating your own reward and recognition program.
What’s the Difference Between Reward and Recognition?
As you develop an employee reward and recognition program, you should thoughtfully consider the difference between these two incentives so you can assess when each of them is appropriate.
Rewards are transactional, while recognition is relational.
A reward is generally a tangible gift given to an employee from their manager or the executive team to celebrate something they accomplished with the context, if the employee does X they will be rewarded with Y.
Recognition is personal praise or gratitude for good work and can be given by anyone at the company at any time
Rewards are tied to goals and accomplishments.
Generally, organizations set up a system where employees accomplish x to earn y. For example, if someone in sales hits their goal, they might get tickets to a sporting event. Or if the company hits their yearly goals, every employee might get an end-of-year bonus.
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Rewards can be a great way to encourage employees to give your organization their A-game and can be an incentive for people to want to work for your company. However, you should be careful to not create a culture at your company where employees feel entitled to rewards. Rewards should be reserved for exceptional work and achievement.
Recognition can happen frequently and in the moment.
There are several major differences between reward and recognition. Recognition can be done frequently and in the moment, which means people don’t have to wait for praise on their job well done.
Plus, recognition is inexpensive. Managers don’t need to ask the executive team for budget to write an email celebrating the great work an employee is doing. And because recognition isn’t costly, it can be an employee-led initiative. At BambooHR, we use an employee recognition platform so coworkers can easily and publicly recognize the amazing work their peers are doing.
It can be hard for businesses to reward employees all the time, especially as a small or medium-sized business where budgets may be strict. But it’s really the recognition and not rewards that so many employees are craving. Research from OC Tanner found that 79 percent of employees who quit their jobs claim that a lack of appreciation was a major reason for leaving, and 65 percent of Americans claim they weren’t recognized even once in the last year. (Tell your employees “thank you” for their great work!) Recognition can be a great way to retain employees at your company.
Creating an Employee Reward and Recognition Program
As you consider a reward and recognition program, consider these points from the BambooHR ebook “13 Ways to Get Reward and Recognition Right”
#1 Identify What to Recognize
Map out the behaviors and actions you are looking for from employees and make sure everyone at your company has equal opportunity to be recognized.
#2 Make It Timely
To get the most out of your efforts, act immediately. Give recognition or a simple reward right when you notice behavior you’d love to see again.
#3 Do It Often
Like we’ve said before, people crave recognition. Look for small and unique ways to recognize employees regularly
#4 Make It Genuine
An automated email won’t cut it when it comes to employee reward and recognition, but a sincere “thank you” can mean a lot
#5 Personalize It
If you are going the recognition route, praise an employee in a way they are comfortable with. Some might feel embarrassed to be shouted out in a large company meeting. And if you are giving a reward, try to select something that will be truly meaningful to that employee.
#6 Make It Collaborative
Let everyone be a part of your reward and recognition program. Employees feel great being recognized, but also recognizing their peer’s work. Encourage employees to praise each other often and consider creating a program that allows people to nominate their coworkers for rewards.
#7 Make It a Habit
If leaders and managers set a standard of regular recognition, it will quickly become a part of the company culture and something everyone wants to be a part of
#8 Be Transparent
Recognition and rewards shows everyone the type of behavior you want other employees to exhibit. Plus if you feel the need to keep a reward a secret, maybe you should reconsider how fair it is in the first place.
#9 Be Fair
Look for the underdogs whose quality work might not be as obvious, and don’t create company rewards that can only be achieved by certain workers or departments.
#10 Don’t Forget Remote Workers
It’s easy for remote workers to be out of sight, out of mind. They can often feel disconnected from the office, so recognition from peers and management can help them stay engaged with the team
#11 Get Creative
Have fun with your reward and recognition ideas. Find ways to recognize and reward different groups, departments, and individuals in ways that are unique to their accomplishments, needs, and wants.
Figure out which employees deserve a little extra reward and recognition with BambooHR Performance Management software.
#12 Keep Recognition and Criticism Separate
Avoid the dreaded compliment sandwich. Recognition shouldn’t be used to soften the blow of criticism. Although feedback is important, try to keep these two separate.
#13 Reward the Right Things
Be sure you align your reward and recognition with your company’s mission, vision, and values.
Reward and Recognition Ideas
Need a few ideas to jumpstart your employee reward and recognition program? These were the top perks employees preferred to receive for work accomplishments and performance according to a BambooHR poll:
- Monetary bonus
- Gift card from a major credit card provider (Visa, AMEX, etc.)
- Extra vacation days
- Gift card to a specific retailer/establishment
- Brand-name consumer products (electronics, jewelry, clothing, etc.)
- Verbal recognition
- Gourmet treats/food
- Employee name on a plaque in a highly visible location in the office
- Premium reserved parking space
There are clearly some differences between reward and recognition, but both are important for helping your employees feel satisfied and engaged with their work. If you don’t have enough budget for fancy rewards, no worries! Your employees will be pleased with meaningful recognition, whether you get creative or simply give them a big “thank you.”