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Ask the Experts
November 05, 2009
Q. We are committed to changing our culture. It’s been very “old school,” but the younger generations are expecting more feedback and appreciation. How do we kick-start that kind of behavior when many of us are not used to giving or getting recognition?
A. We can’t simply demand that people change their behavior without giving them the training and tools they need. Recognition training is one of the Seven Best Practice Standards established by Recognition Professionals International (RPI). When fully implemented together, the seven elements ensure a powerful and strategic recognition program for an organization. They are:
• Recognition Strategy
• Management Responsibility
• Recognition Program Measurement
• Communications Plan
• Recognition Training
• Recognition Events and Celebrations
• Program Change and Flexibility
RPI offers an International Association of Continuing Education and Training (IACET)-approved Certified Recognition Professional (CRP) series that gives foundational training. CRP graduates understand and apply effective recognition strategies and programs with real business results. They are trained to determine the ROI of a recognition strategy, align recognition goals with enterprise goals, and develop programs that meet them. This results in measurable bottom-line results for the organization. CRP grads are able to establish cost-effective processes for nominations and award procurement and fulfillment.
In addition, many of the service providers that are RPI members offer skills training and a variety of proven concepts and easy-to-use tools that can help transform your workplace. RPI also makes available best practice white papers that give detailed accounts of award-winning training strategies, such as those by ScotiaBank. To learn more about how to bring recognition training to your organization, visit www.recognition.org.
—Dee Hansford, CEO, Dee Hansford Consulting
Q. I am considering implementing gift cards that can be used for purchasing employee recognition awards. If this program is designed so that the cards are not redeemable for cash, then is this program a qualified program that will not result in the employees being taxed for the value of their award purchases?
A. According to George Delta, the executive director of the Incentive Federation and a leading authority on the taxation of awards in the premium and incentive fields, if the gift cards can only be redeemed for merchandise, and all of the other requirements imposed by code section 274(j) for a qualified length-of-service award are fulfilled, the awards would be non-taxable to the employees and tax-deductible for the employer.
However, Delta pointed out that the questioner came from the state of California. Effective 2008, that state requires gift card issuers to provide cash back to gift card holders for cards with a remaining value of $10 or less, so this could be problematic for the questioner’s program, inasmuch as the right to receive cash for the cards would make their receipts taxable. As a result, Delta strongly recommends that the questioner contact a California lawyer on the treatment of gift cards under state law.
It should be noted that taxes differ from one program to another. For instance, service awards are treated differently than performance awards. Likewise, different countries have different tax policies, so it is important to get proper legal guidance for each country that you operate in. Finally, as Delta pointed out, there can be differences from one state or province to another.
The bottom line: Consult a tax expert!
—Peter Hart, CEO, Rideau Recognition Solutions
Q. We are constantly trying to keep recognition current with the ever-changing work environment. Given that so many people work virtually, how can companies effectively engage employees through new vehicles?
A. As the way people work changes, it is important that recognition methods keep up with those changes. We have already seen great changes in ways to leverage technology to make recognition easier and more timely. Clearly, online solutions help managers “notify” staff but are not substitutes for talking to a person and recognizing someone personally. Companies are exploring how they can leverage technology to help connect with employees to make them feel more part of the organization. Many companies are leveraging internal Facebook-like systems so that remote workers can share with and learn about fellow employees. These systems can easily be used to acknowledge employees through informal and formal recognition; for example, companies often will put on top performers’ business cards when they have earned “president’s club” performance. These systems also can be leveraged to share best practices that ultimately help drive business results.
—Kevin Cronin, Vice President, Recognition and Rewards Solutions, Perks.com
Q. How should I allocate my recognition program investment?
A. There are two parts to this answer: 1) In which programs should you invest, and 2) How do you allocate funds within the program(s)? We explored the first part last month and will now address the second part.
There are lots of recognition programs from which to choose, and many factors that drive your employees’ performance (or lack thereof) can be positively impacted by a recognition initiative. The most important step is to determine exactly what you need to accomplish with your program.
Once your budget is established, the following guide will help you allocate the dollars within your program. However, despite the fact that most self-administered recognition programs do not track and measure program results, I strongly recommend that you break from that tradition if you run your program internally. Measurement is critical to evaluating program success, improving the program over time, and making informed business decisions about results based on facts rather than supposition.
Average percent of budget allocated to program components
Company Self-Administered
Awards
60%
Administration
25%
Communications
15%
Measurement
0%
Paper-Based Program
Awards
55-60%
Administration
20%
Communications
15%
Measurement
5-10%
Web-Based Program
Awards
65-70%
Administration
10-15%
Communications
15%
Measurement
5%
Take the time to determine what your workforce needs to feel valued, aligned, and engaged and make the investment in a recognition program that will deliver on that promise. As you reward your employees, they will reward the company in turn by positioning it for long-term success.
—Michelle Smith, Vice President, Business Development, O.C. Tanner
Do you have a question for the recognition experts? E-mail askrpiexpert@recognition.org with your question, and it may appear in a future column.
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.
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.
Michelle M. Smith, 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.
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