5 Reasons Why Businesses Don’t Recognise Employee Efforts (and 5 Reasons Why They Should)

reasons why businesses don’t recognise

Despite the years of study in the field of employee engagement highlighting the benefits a sustained recognition program can have on a business and its workforce, it’s still common to find a company that so far is yet to act on the research. In fact, research by ACCOR found just one in four business leaders actually have an engagement strategy in place for which recognition can play a major part. Here are 5 reasons why businesses don’t recognise employee efforts (and 5 reasons why they should):


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There can be many reasons for not recognising employee efforts, such as SMEs lacking the funding or in-house expertise to implement such a strategy, or indeed established firms for which doing things the old way has always worked - so why change?

But there are some really key reasons why business leaders who are aware of employee recognition and the benefits it can have on businesses don’t act and look to embed recognition strategies within their workplaces

Here are five of those reasons:

1. Businesses aren’t aware of the impact

Despite repeatedly hearing phrases such as ‘employee recognition’ and ‘staff engagement’ at conferences or across LinkedIn, some businesses simply aren’t aware of the tangible benefits that employing such a workplace strategy can have.

Yes, they might presume that staff could be happier and more engaged as a result, but the end-game benefits of this such as reduced employee turnover and enhanced productivity can sometimes be missed, as well as other real business enhancements that can be enjoyed as a result.

2. Leaders don’t fully understand what recognition is

For some businesses, recognition could be seen as semantics that really just means rewards - and naturally, that’s not entirely what employee recognition is about.

Really understanding what recognition is and how it can be actionably instilled within a way of working often requires HR expertise to understand and roll-out within a business.

Sure, sometimes rewards can play a part of that. But the core of recognising employees lies deeper than rewarding outcomes - it recognises and proves to employees that their everyday efforts are noted and appreciated - something which has far-reaching and longer-lasting benefits to only rewarding the top performers.

Recommended reading: Improve Productivity, Profitability and Customer Satisfaction by Implementing This One Strategy (And It Doesn’t Cost The Earth)

3. Firms think recognition is too difficult…

This leans somewhat on the last point too - a lack of understanding of what employee recognition really is at the basic level can leave many firms thinking recognition itself is too difficult and also too time-consuming for them to consider right now.

4. … and too expensive

But recognition can be simple, it can be easy and it doesn’t have to cost the Earth to carry out either.

Understanding the difference between reward and recognition is a starting place to understand that recognition won’t involve paying out for coffee vouchers or end-of-month bonuses. And whilst onboarding and training to ensure a recognition scheme will likely require some up-front investment if the in-house expertise doesn’t currently exist, even the short to medium-term financial benefits can far outweigh the initial outlay.  

5, They don’t know what they should be recognising

Understanding specifically what to recognise can be another stumbling block that stops business leaders going out of their way to research and implement their own recognition strategies. This is another area though where external advice and expertise or indeed an in-house HR function can work with the business to research and agree which behaviours and outcomes should be recognised and appreciated.

This can be as in-depth as employee actions that align with the company’s visions, aims and culture, or more on-the-surface positive behaviours such as meeting deadlines, exceeding expectations on a project, or showing a real desire to learn and achieve.

Recommended reading: 5 Ways For Making Training and Development for Employees Even Better

5 reasons why businesses should recognise

So although we know some of the reasons why businesses are reluctant to employ their own recognition strategies, what are the reasons why they should? The real, beneficial outcomes that justify the time and resource investment to get a program off the ground?

Here are just five of those reasons:

1. To align working practices with company goals

It’s amazing how many employees aren’t acutely aware of what their company’s goals and ambitions are. And for business leaders, this presents a real problem as an organisation will struggle to pull in the same direction or work to a shared set of values if not everyone knows what the business expects from them, ahead of doing your job and in return, getting paid.

This is something a recognition strategy can look to address, and those behaviours and outcomes for which it is agreed should be recognised and appreciation is shown for can be matched up to the company’s goals and values - further encouraging those behaviours in the future.

2. Encourage better performance

Staff recognition on a personal level is a brilliant tool to give employees a motivational boost and foster work engagement. Recognition that’s carried out publicly, such as in weekly team meetings or company-wide communications can also act as a powerful motivator to everyone in the business. It can help garner healthy competition within teams to strive to perform to their best and deliver the best work outcomes in the knowledge that they too can be recognised for the work they’re conducting.

Recognition serves as a far-reaching feel-good factor that encourages an entire workforce.

3. Boost work engagement

Employees that feel their efforts are recognised and appreciated are more likely to be highly engaged employees too. A clear link has been established between the engagement levels of employees and productivity too, boosting work output by up to 38% in some instances according to research from the Workplace Research Foundation.

4. Decrease stress and boost wellbeing

Stress-related illnesses cost UK employers billions each year with the estimates of how many working days are lost through stress, anxiety and other mental illness ranging from 70 million to 90 million depending on the report you read.

And recognition, as well as enhancing levels of employee engagement, has been shown to drastically cut these numbers for employers. And there’s a benefit for how productive employees are whilst they’re sat behind their desk or in the factory too. According to research by the O.C. Tanner Institute, employees who said their wellbeing was good scored their personal work output as 19% higher than those with poor wellbeing.

5. Cut recruitment costs

One of the key reasons why younger generations within the workforce in particular move jobs is negative relations with managers.

Recognition offers a chance to enhance manager/team relationships by building trust and affinity too. Recognition and appreciation are powerful motivators, and motivated workforces have a greater sense of purpose, are more engaged and will go out of their way to support their teams and crucially, are far less likely to be responding to LinkedIn job offers from recruiters.

Research from Gallup highlights this, showing that staff turnover in companies which give regular feedback to staff can see a 15% reduction in turnover rates compared to those businesses that offer little or no feedback.

What are some of the reasons you’ve heard or encountered as to why your company shouldn't recognise employee efforts and put in place an employee recognition strategy? Let me know in the comments below!

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Manchester, UK

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