Recognition programs ‘effective’ in driving employee engagement

Maritz Motivation Solutions has released a new study on employee recognition programs and their impact on employee engagement. According to the CultureNext® Employee Engagement and Benchmark Study, 80% of companies believe their recognition programs are at least moderately effective in driving employee engagement, and 22% say their programs are very effective.
In other findings, over 78% of companies surveyed have a documented employee engagement strategy and nearly 50% measure success. 60% fund at least four to six different types of recognition programs. Budget ranked as the “greatest inhibitor of success,” with manager participation ranked as number two.
And surprisingly in today’s digital age, 13% of respondents do not use a technology platform to support their employee recognition programs. A full 25% of companies do not incorporate any form of social recognition as part of their employee approach.
“While most companies have employee recognition programs, our study shows they can be used much more effectively. Companies that rate their programs highly have a strategy, a documented plan and a way to measure success. They invest more, communicate with employees frequently, and train managers on the programs. These companies say that manager participation is the greatest inhibitor to success,” said Kimberly Lanier, vice president of employee engagement at Maritz Motivation Solutions.

“Another key finding is the relatively high number of companies with absolutely no technology platform or social component in their employee recognition programs. They are missing an enormous opportunity to connect with millennials and Gen Z, who will be the workforce majority in the next few years,” Lanier said.
The online survey was conducted with 117 companies that have more than 1,000 employees. 56% of the corporations surveyed have more than 10,000 employees; 64% generate more than $1 billion in annual sales; and 60% operate in more than one country. 20% have 80,000 or more employees. In terms of industries, 60% of companies are in the pharma, healthcare/medical and banking/financial services sectors, followed by hospitality, automotive, and consulting.
Other data points include:
•38.5% of companies indicate the investment in employee recognition programs represents between .01% and .5% of total payroll. 25% invest between.01% and .25% of total payroll. Those in the “very effective” category invest .76% or more of total payroll.
•The types of recognition programs used most frequently by study respondents are service anniversary, above-and-beyond performance, and employee referral. Gift cards are the most common awards used in recognition programs, followed by cash, certificates and company logoed products.
•More than half of the companies stream recognition into an activity or news feed. Notably, only 10% say their organization’s recognition platform can share to other sites such as Facebook or LinkedIn.
•60% of companies share recognition-related communications at least monthly. 5% never communicate. 39% of the “very effective” category communicates recognition across the company weekly or daily.
•More than half of the companies have formal training on how to use recognition programs effectively. Nearly 1 in 5 leave any training up to local managers. 77% of the “very effective” companies provide training.
“The study demonstrates clear best practices for companies to maximize their investment and realize better results with their employee recognition programs. In addition to strategy, measurement, and training, there are opportunities to link programs to business outcomes and to incorporate program data in predictive models and measures,” said Chris Winkelspecht, director of strategic services with CultureNext at Maritz Motivation Solutions.