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Glenn Elliott

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Get reward and recognition right; or don’t do it at all

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Many companies have a reward and recognition scheme in place, but a programme is only as good as the communication and execution of it. Glenn Elliot considers how you can boost the value in your R&R.

If not personally, most of us probably have a friend or family member who would identify with this employee’s recent experience of his workplace recognition scheme, in this case for long service. Having clocked up 15 years of continuous service with his employer, Jim was allowed to choose a long service award. He chose a watch. A nice gift to recognise his time with the company? Well, he did appreciate that his employer valued his loyalty and hard work over such a long period, some of it during really hard times for the company, but further discussion revealed that much of the good feeling generated by the recognition was subsequently undone by poor execution on the part of the company. 

Firstly, his manager didn’t seem to know exactly how Jim set about getting his long service award and took quite a few days to find that out and then let Jim know. Jim was then directed to an online catalogue listing a selection of around 20 seemingly random gifts ranging from vases to picture frames, cordless phones to watches. It looked a bit outdated, full of things manufacturers might want to shift because no-one would buy them. In the end, he chose a watch he didn’t need or particularly want but then he didn’t want a vase, picture frame or cordless phone either. When the gift did arrive some weeks later, he had been sent a vase instead!

This, like so many other Reward & Recognition (R&R) schemes across industry, demonstrates a lack of strategy, indifferent communication and poor implementation. Rather than supporting the business, the chances are that this R&R scheme was actually working against the employer. A poorly implemented scheme results in high administrative costs, which are often hidden, and undermines the employee’s perception of the employer brand. The rewards themselves can become the source of workplace jokes which discredit the organisation rather than promoting it. At their worst, R&R schemes achieve the exact opposite of their intention.

In the CIPD’s 9th Annual Survey Report looking at reward management, it was found that around 40% of businesses polled use employee recognition, around 50% of private sector firms make long-term service awards and a further 30% plan to introduce a reward and recognition strategy. If you are one of those companies about to embark on the R&R journey, or perhaps already have a scheme in place, take some time out to assess what you need to do to get it right.

As with any business investment it is important when implementing an R&R scheme to define your strategy and understand what you hope to achieve. Be clear that your R&R scheme is different to performance incentives, such as bonuses or commission, and understand that a scheme should be inclusive, enabling recognition of the contribution of different departments across the business. Never lose sight of the fact that while reward benchmarks may be different for different departments, they should all be pulling towards the same overall company objective.

Don’t get hung up on the expense of the awards – much of the value comes from a well-timed, well-executed, sincerely meant ‘thank you’ or other recognition and the award value may be small in monetary terms but significant in employee value. 

For an R&R scheme to be successful, it needs to engender support from staff and managers, nominees and recipients and have credibility. It is therefore essential that your R&R scheme is sustainable with realistic rewards and a consistent approach based on your available budget. Transparency is important, with clear information about what recognition is designed to reward – more than just the day job – and how the process is implemented.  Consider some of the knotty questions: should only line managers have the opportunity to nominate or should peer and cross department nomination be facilitated too? And how will your nomination and approval process work to make it easy for all?

R&R can work really well. The marketing and communications manager of a utility company said of their new R&R scheme that: "the business strategy clearly defined the personal attributes we had to demonstrate to differentiate our service from our competitors. The management team made it clear that it wasn’t just the responsibility of the customer-facing departments but fed through both middle and back-office functions. They implemented a reward scheme that enabled online peer and manager nomination for actions and service that demonstrated the core attributes the business was keen to promote. The website gave clear information about expectations and the rewards were exciting. The process was fun and captured the imagination of staff across the business helped in part by a communication campaign celebrating the successful nominees each month."

Having defined your strategy and devised a business plan, make sure that when implemented, the actual scheme doesn’t let you down. One of the common pitfalls of internal as well as third-party provided reward schemes is timeliness. Often the lead times between the positive behaviour (whether that’s long service or outstanding service delivery) and reward giving are too great because the nomination process is complicated or because the resultant administration is cumbersome. Another common failing is the reward itself caused by a lack of choice, unattractive reward options or complicated points systems that make appreciating ‘worth’ difficult. 

Developments in the R&R market have provided some exciting solutions including some really fantastic technology enabling products that allows employers to speed up the whole process and introduce some exciting reward options. This, in turn, has led to a real uplift in the benefits and results to be gleaned from R&R programmes. For instance, compared to the traditional points and catalogue schemes which have become discredited over the years, the ability to have an evoucher – or with some retailers, an SMS text – sent in real time is a massive improvement. The right programmes can offer employees an almost unlimited choice of vouchers, including local retailers. So if a recipient wants a manicure from the nail bar in the high street or an employer wants to have a ‘coffee and doughnut at Cafe Nearby’ for a small, instant reward, it can be done.

The ability to make small awards is highly attractive to employers, opening up an easy, cost-effective way to recognise the right employee behaviours – and sitting well with CSR and initiatives to support local business.

Technology has enabled an employee to be nominated for an award, have approval given and the award despatched all in less than an hour. So there really is no excuse now for a failing R&R scheme. Employer value from a well-planned and executed R&R scheme is significant. Get it wrong and the result may be a very costly wooden spoon – or a vase you don’t want.


Glenn Elliott, managing director and founder, Asperity Employee Benefits

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