by Matt Alderton | July 11, 2017
Employee recognition programs are effective -- but missing out on opportunities to be even more advantageous than they already are, according to a new study on employee recognition programs and their impact on employee engagement, published last week by Maritz Motivation Solutions.

Based on an online survey of 117 companies with more than 1,000 employees, the "CultureNext Employee Engagement and Benchmarking Study" found a majority of companies (80 percent) believe their employee recognition programs are at least "moderately effective" in driving employee engagement, and nearly a quarter (22 percent) believe their programs are "very effective."

Helping programs succeed, Maritz suggested, are the following facts:

• Seventy-eight percent of companies have a documented employee engagement strategy;

• Sixty percent of companies fund at least four to six different types of recognition programs, the most common types being service anniversary, above-and-beyond performance, and employee referral programs;

• More than half of companies offer formal training on how to use recognition programs effectively; and

• Sixty percent share recognition-related communications at least monthly.

Companies in the "very effective" category communicate about recognition even more often (daily or weekly), are even more likely to offer training (77 percent of "very effective" companies offer recognition-program training), and also spend more: They devote 0.76 percent or more of total payroll to recognition programs, compared to 38.5 percent of companies that spend between 0.01 percent and 0.5 percent and 25 percent of companies that spend 0.01 percent to 0.25 percent. 

Speaking of budget, companies overall said it's the "greatest inhibitor to success," while those in the "very effective" category cited manager participation, instead.

"While most companies have employee recognition programs, our study shows they can be used much more effectively," said Kimberly Lanier, vice president of employee engagement at Maritz Motivation Solutions. "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."

Along with spending, strategy, training, and communication, a major opportunity for companies is technology, according to Maritz; 13 percent of companies don't use a technology platform to support their employee recognition programs, it found, and 25 percent do not offer employees any type of social recognition. Furthermore, only 10 percent of organizations that use a recognition platform said it can share to external sites like Facebook and LinkedIn.

Concluded Lanier, "The relatively high number of companies with absolutely no technology platform or social component in their employee recognition programs … are missing an enormous opportunity to connect with millennials and Gen Z, who will be the workforce majority in the next few years."