A Peek Into Employee Recognition Done Right!

Our recent post, “A Guide to Kick-Start Your Employee Recognition Program” covered how to plan an effective employee recognition program, and this one profiles two organizations who do it well. We hope these examples inspire you to take your employee engagement and recognition initiatives to the next level!

Employee Recognition Leads to Engagement

Research increasingly shows employee recognition is an important factor in achieving employee engagement, which boosts the bottom line, shown here in the research paper “The Evidence,” by Bruce Rayton of the UK’s University of Bath School of Management:

“Releasing the potential of an engaged workforce holds the prospect of reducing costs associated with sickness, absence, employee turnover, production errors, accidents and inefficient processes. It also holds the prospect of improving productivity, customer satisfaction, customer retention and innovation. Any one of these mechanisms is capable of delivering substantial benefits to the bottom line performance of organizations.”

Read on for insights into how CalPERS and Intuit transformed their workplace cultures and improved their bottom lines – just with well-designed employee recognition programs!

Building a Culture of Employee Recognition at Calpers

And this profile of a transformative employee recognition effort shows how one organization changed its culture and improved its bottom line. This workforce.com article, “One CEO’s Perspective on the Power of Recognition,” by James E. Burton, former CEO of CalPERS, the nation’s largest public pension fund, tells the story.

Burton says recognition and communication at CalPERS helped it achieve very aggressive business goals and objectives, and also helped change the organization in profound ways.

Before implementing its recognition program, CalPERS’ employee surveys and focus groups revealed:

• Supervisors were viewed as secretive and competitive with one another.
• Employees working in different divisions in the same building had conflicting understandings about their priorities.

“We learned that we needed to be much more adept at listening, so we strove to make sure that staff felt valued for the work it did on a daily basis and that not only high-profile projects deserved leadership praise and recognition,” Burton observes.

CalPERS allocated funds for managers and supervisors to purchase recognition items and host recognition-based events, which Burton calls:

“ … a strategic business decision designed to help us retain our top performers, maintain our institutional knowledge and help us meet and exceed our ever-escalating customer demands.”

He says CalPERS developed a reputation as “the destination employer in state service,” saving thousands and thousands of dollars and labor hours through easier recruiting and improved employee retention.

The organization developed accountability measures to promote quality communications and recognition practices. Subsequently, says Burton, supervisors became increasingly more accessible to their employees. Workers said they learned a lot about effective communication, about breaking down silos, about doing research, and about successfully completing a project.

“We leaders learned a lot, too. We learned that when we communicate, we build bridges to understanding. These bridges span branches, divisions and even personal differences. And finally, we learned that recognition is a key component to changing an organization.

By creating a strategic plan for recognition that supported our overall goals and objectives, we grew to value each other not only as internal customers and as part of a team, but as part of a work family.”

Employee Recognition at Intuit

A case study developed at the Stanford Graduate School of Business in conjunction with recognition firm Globoforce, outlined in “Intuit’s Successful Employee Recognition Strategy,” shows how a strategic employee recognition program can go beyond rewards, help companies create a performance-driven culture, and motivate employees around the world.

The case study evaluated the successful strategic employee recognition program at Intuit, Inc., called the Spotlight program.

As the article says, the study demonstrated the effectiveness of Intuit’s strategic Spotlight program, which produced:

• More rewards: Awards given at Intuit jumped by 400% within the first three months.
• More recipients: 85-90% of all eligible Intuit employees received an award within two years.
• Immediate recognition: Companywide rewards immediately recognized a job well done.
• Rewards linked to business outcomes: This united employees behind a common goal.
• More choices: Spotlight provided a variety of gift card and gift certificate options, which employees preferred over cash. This enabled them to choose from thousands of desirable, locally relevant gifts.
• Widespread acceptance: After two years, the program was ingrained into Intuit’s culture.

The article quotes Eric Mosley, CEO, of Globoforce:

“Employee recognition may seem easy to implement, but most companies wrestle with the how. This study illustrates the power of employee recognition done right. Intuit’s program united employees around core values, empowered its workforce to publicly recognize others, and rewarded employees with desirable gift cards. Moreover, it was championed by management and reinforced through ongoing communications. These are the keys to widespread adoption and shaping a performance-driven culture.”

Can Employee Recognition Help Cut Costs?

Yes! says Forbes journalist Roger Aitken in his article, “Employee Appreciation: Where’s It Gone…But Can Good Company Practice Boost Stock Performance?”

As example, Aitken quotes Rob Catalano, vice president of global expansion and engagement at recognition firm Achievers:

“There are countless examples of the positive impact that recognition programs have had on businesses. We’ve seen retail clients increase customer satisfaction rates by 112% in retail stores that implemented recognition programs versus stores that did not, and sales percentages at companies getting a boost from recognition.”

Catalano cites costs per hire falling in some instances from around $1,800 to $500, staff retention increasing by 10% or more one year after the launch of a recognition program, and saved work days.

Is it time to evaluate your employee recognition program? We hope these examples highlight the positive impact on your business of doing recognition right.

For more great tips and insights into building a vibrant culture of engagement and recognition, be sure to download our free e-book, “The Top 20 Employee Engagement Blogs You Should be Reading”.

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