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Ask the Experts
May 21, 2009
Each month, Michelle Smith, vice president of business development for O.C. Tanner; Peter Hart, CEO of Rideau Recognition Solutions; Dee Hansford, CEO of Dee Hansford Consulting; and Kevin Cronin, vice president of recognition and rewards solution for Perks.com answer your questions about the incentive industry, in “Ask the Experts.”
Q. In today’s economy, with so much scrutiny, aren’t motivation programs considered a frivolous expenditure?
A. Research and case study data prove unequivocally that incentive and recognition programs improve the corporate bottom line, and employees are far more productive and loyal when they are recognized. Keeping workers engaged is your best opportunity to survive this downturn and be prepared for the recovery as soon as it begins.
Any company can benefit from the advantages of an engaged workforce; it only requires a small investment of time and resources. A study by the Corporate Leadership Council and research profiled in the book Practice What You Preach provide a small sample of compelling data on the benefits of engaging employees:
• Increased employee commitment can lead to a 57 percent improvement in their discretionary effort
• Greater effort produces a 20 percent performance improve¬ment
• A 20 percent raise in employee satisfaction produces a 42 percent raise in financial performance
There have also been several studies comparing same-industry companies that utilized incentive and recognition programs against those that didn’t over a decade of time or more. The companies that utilized incentive and recognition programs significantly outperformed their competitors every single year.
Most investments in recognition or incentive programs pay for themselves from the increased revenues and/or cost savings they generate. The facts are clear and quite compelling. Recognition and incentives are important, proven business tools we should be utilizing, and the benefits of more engaged workers continue long after the program ends. Can you afford not to have that advantage in today’s market?
—Michelle M. Smith, Vice President, Business Development, O. C. Tanner
Q. Can employee recognition programs actually be measured in terms of ROI?
A. The old business management adage “you can't manage what you don't measure” applies perfectly well to recognition programs. In fact, given today’s economy, recognition programs that aren’t being measured stand a good chance of ending up as recognition roadkill!
Recognition Professionals International believes measurement is so important that it made ROI its third Best Practice Standard. Every year RPI presents an award to the company that does the best job of measuring the effectiveness of its recognition programs.
But it doesn’t start with measurement, it begins with a clearly defined recognition strategy that ties into your senior leadership’s mission, vision, and corporate strategy. If you have alignment between recognition and strategy, the task of measuring recognition becomes easier and more meaningful.
Measurement should be examined on two levels. The first should tie into the same things your senior leaders are interested in at a high level: turnover, engagement, and employee satisfaction. What are the objectives of your recognition program? If it’s retention, what are your current turnover rates? If it’s employee engagement or satisfaction, what are these scores? Establish these as your baselines and measure them on a regular basis.
The second level is much more program-specific. For instance, what is the program usage rate? What are your response rates? Conduct program surveys and don’t just ask questions about the awards but also ask recipients what they experienced and felt when they were formally appreciated.
—Peter Hart, CEO, Rideau Recognition Solutions
Q. Our company is facing lots of cutbacks and we put a freeze on external training and travel, a ban on company-provided birthday cakes, and an end to gift cards. With four very distinct age groups and no budget, what can I do to show meaningful recognition?
A. There are some very powerful no-cost, low-cost recognition resources at your disposal. First, the more knowledge you gain about the various generational perspectives and motivational needs, the more effective you’ll be. There are numerous Websites, articles, and books that offer insights into the various generational “cohorts.” By understanding how Traditionalists, Boomers, Gen Xers, and Millennials differ, plus their expectations of recognition, you can tailor your messages to reinforce their behaviors and actions. Here are some tips and tricks to help you get started:
Traditionalists (ages 63-88) make up 25 percent of the workforce and prefer part-time, flexible, or temporary work schedules and team recognition. Baby Boomers (ages 46-63) are our largest “cohort” at 52 percent; they live for new experiences and appreciate more free time. More than one-quarter of the workforce are Gen Xers between the ages of 28 and 45; they like the opportunity to interact with managers and are motivated by a free-spirited workplace. Millennials (aka Gen Y or Echo Boomers) are between 14 and 28 and are motivated by opportunities to learn, grown, and make a difference. They want feedback, gratitude, trust, and respect. But then again, don’t we all?
—Dee Hansford, CEO, Dee Hansford Consulting
Q. Our company wants to go company-wide with our recognition and reward programs to cover all 20,000 international employees. What advice can you give us?
A. How wonderful to formally say to your global workforce, “Thank you,” “Gracias,” “Merci,” and “Tarima kasi Tulu”! Employee appreciation is the key to engaging your workforce no matter the language!
Knowing that one size does not fit all, I encourage you to form a work team of employees that represent all the countries. The key to successful international implementation will be to ensure that you are culturally sensitive to the norms of each country. I also would recommend that you have human resources from each of those countries be involved in the signoff to ensure all the program materials, awards, and examples are culturally relevant to their country. Don’t forget to review how any awards/points needs to be treated from a tax standpoint, and as well the cost of shipping. The other item you will also want to review is the pay parity by country. You want to ensure the award is meaningful to the local salary level.
The culture of your company needs to be the driver of how these programs look and feel. As always, your recognition and reward strategy needs to be imbedded into your company’s brand, mission, and values. Oftentimes companies have failed to do this for their non-U.S. offices; this is a great opportunity to include that messaging and to help drive engagement of all your employees worldwide.
—Kevin J. Cronin, Vice President, Recognition and Rewards Solutions, Perks.com
About the Experts
Kevin J. Cronin is vice president of recognition and reward solutions at Perks.com. He is an expert on employee engagement and serves on the board of directors and marketing committee of Recognition Professionals International.
Dee Hansford, CRP, is CEO of Dee Hansford Consulting. She is a respected authority in leadership development and organizational change resulting in measurable ROI. Her clients have received national recognition for award-winning programs supporting a higher performance work culture.
Michelle M. Smith, CPIM, CRP, is vice president of business development at O.C. Tanner. She works in every facet of recognition and incentives and serves on the board of directors of Recognition Professionals International.
Peter W. Hart, CRP, is president and CEO of Rideau Recognition Solutions, a global provider of corporate rewards programs. He serves as treasurer on the board of directors of Recognition Professionals International.
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