ROI on Recognition Programs

[alkar]

When we were looking at an employee rewards system, we got lucky with a provider who took the time to design a solution for the company's core business challenges around employees with lots of flexibility in reward and programs options.

Four insights came out of it:

1) Maximize the program:
-- there is a difference between handing out cash versus a prepaid card with your company name on it (you'll know when the employee thanks their manager again the day they spend the money at the store)

2) The lesser of two investments (rewards versus hiring)
-- if your top employees are constantly being offered other positions, then ask yourself why they're still around if all things are equal
-- the answer is -- all things are not equal!
-- even if the pay is higher -- change is always a risk (will I be treated as well? will I fit in? what if it doesn't work out? I know I'm doing well enough here, so why move?)
-- a rewards program can increase that non-cash risk perception in your favour. (an new question becomes: what if they don't recognize my efforts?)

3) non cash vs cash rewards
-- its true that surveys tend to say that employees prefer cash
-- but preference doesn't mean they won't also be happy with other options
-- the combination of good will and bulk buying advantage means that a fantastic trip or merchandise rewards can also deliver fantastic results

4) spend time designing the communications program around the reward
-- that's where your company gets most of its ROI with employees
-- communicating before, during and after the reward is given

there are great tools that allow you to do both (deliver rewards and leverage them through communications to employees on a regular basis)

We'd gone through this whole exercise so I thought I'd share some of the insights.