The Bersin & Associates Employee Recognition Framework

© BERSIN & ASSOCIATES RESEARCH REPORT | V.1.0

Stacia Sherman Garr,

Senior Analyst

April 2012

A Guide to Designing Strategic Recognition Programs

The Bersin & Associates Employee Recognition

Framework

The Bersin & Associates Employee Recognition Framework 2

Bersin & Associates © April 2012 • Not for Distribution • Licensed Material

The Bersin & Associates Membership ProgramThis document is part of the Bersin & Associates Research Library. Our research

is provided exclusively to organizational members of the Bersin & Associates

Research Program. Member organizations have access to the largest library

of learning and talent management related research available. In addition,

members also receive a variety of products and services to enable talent-related

transformation within their organizations, including:

• Research – Access to an extensive selection of research reports, such as

methodologies, process models and frameworks, and comprehensive

industry studies and case studies;

• Benchmarking – These services cover a wide spectrum of HR and L&D

metrics, customized by industry and company size;

• Tools – Comprehensive tools for HR and L&D professionals, including tools

for benchmarking, vendor and system selection, program design, program

implementation, change management and measurement;

• Analyst Support – Via telephone or email, our advisory services are

supported by expert industry analysts who conduct our research;

• Strategic Advisory Services – Expert support for custom-tailored projects;

• Member Roundtables® – A place where you can connect with other peers

and industry leaders to discuss and learn about the latest industry trends and

best practices;

• IMPACT® Conference: The Business Of Talent – Attendance at special

sessions of our annual, best-practices IMPACT® conference; and,

• Workshops – Bersin & Associates analysts and advisors conduct onsite

workshops on a wide range of topics to educate, inform and inspire HR and

L&D professionals and leaders.

For more information about our membership program, please visit us

at www.bersin.com/membership.

http://www.bersin.com/membership



TABLE OF CONTENTS

Introduction 4

What Is Recognition and Why Does It Matter Today? 7

Recognition Defined 7

Why Does Recognition Matter Today? 9

An Introduction to Employee Motivations 11

The Bersin & Associates Employee Recognition 17 Framework

Introduction to the Employee Recognition Framework 17

Part 1: Recognition Strategy and Audience 19

Part 2: Program Design 39

Part 3: Program Launch, Management and Measurement 68

Part 4: Applying the Employee Recognition Framework 87

Final Thoughts 91

Appendix I: Additional Images 93

Appendix II: Glossary of Terms 95

Appendix III: Table of Figures 98

About Us 100

About This Research 100



IntroductionGift cards. Thank-you notes. Coffee mugs. Certificates. Each of these is a form of employee recognition in organizations today. But what do organizations get for the collective $46 billion1 that they spend on recognition and rewards each year? Most of them do not know.

Two factors make recognition programs hard to quantify. First, recognition historically was a grassroots effort, with individual departments or business units making decisions about when, why and how to recognize employees. When you multiply all of these “little” initiatives across a large organization, the investment in recognition becomes much more substantial; yet, due to its highly dispersed nature, it remains difficult to measure. Second, this highly fragmented recognition approach resulted in the perception that recognition is a “nice-to-have” local initiative. Even in those organizations which centralize tenure or other annual recognition programs, many still believe that these programs make little impact and, as such, take few efforts to measure them.

In many organizations, this perception – that recognition makes little impact – is right. One reason for this is that the most common recognition program, an award for service or tenure anniversaries (programs that exist in about 87 percent of organizations), is frequently viewed by employees as an entitlement, not recognition. In fact, our research shows that tenure awards have little or no impact on the outcomes which organizations care about most, such as employee engagement, productivity and turnover.2 Further, many recognition programs are designed to recognize employees for demonstrating company values; yet what gets recognized most often is achieving company goals.3 This disconnect means that the organization sends an inconsistent message to employees about what they should do to receive recognition. The end result of this is that recognition does not appear to make much of an impact in many organizations.

1 Source: Incentive Marketing Association, http://www.incentivemarketing.org/.2 This information is based on our current research on the topic of employee

recognition, the report for which is due to be published 2H’2012.3 Ibid.

http://www.incentivemarketing.org/



It does not have to be this way. We have found that recognition can make a difference to employee outcomes. Specifically, our research uncovered that, in those organizations in which employees are recognized, the company’s average score for employee results (an index of employee engagement, employee productivity and customer satisfaction) was approximately 14 percent higher than in organizations in which recognition does not occur.4 Other research shows that a 15 percent improvement in employee engagement can result in a two percent uptick in operating margins.5

This study is about creating a recognition strategy and supporting programs that drive those better results.

Our research reveals that progressive organizations look at recognition differently. Most importantly, they have a strategy for recognition that ensures alignment with business goals, organizational culture and other talent management processes. These organizations design their programs to consistently reinforce key behaviors and outcomes necessary to drive business success. Further, they measure the impact of those programs.

The Bersin & Associates Employee Recognition Framework® is a roadmap to creating a comprehensive recognition initiative and the individual programs that support that initiative, with the goal of helping organizations to capture as many of the potential benefits of recognition as possible. The Framework is neither a list of best practices nor a process-based overview of recognition. Instead, it is an at-a-glance image of all the decision points that need to be considered when designing a recognition initiative and its supporting programs. It covers recognition strategy, audiences, design elements, launch, ongoing management and measurement. In short, it is your guide to designing a high-impact recognition approach.

In creating this research, we relied on hundreds of years of our collective experience and that of our customers with talent management challenges and solutions. We focused on questions such as the following.

4 For more information, High-Impact Performance Management: Maximizing

Performance Coaching, Bersin & Associates / Stacia Sherman Garr, November 2011.

Available to research members at www.bersin.com/library or for purchase at

www.bersin.com/hipm.5 Source: http://www.forbes.com/2009/11/19/incentives-recognition-engagement-

leadership-ceonetwork-employees_print.html.

http://www.bersin.com/library

http://www.bersin.com/hipm

http://www.forbes.com/2009/11/19/incentives-recognition-engagement-leadership-ceonetwork-employees_print.html

http://www.forbes.com/2009/11/19/incentives-recognition-engagement-leadership-ceonetwork-employees_print.html



• Whatarethestrategicdecisionsthatmustbemadepriortodesigningor launching a recognition program?

• Howdoalloftheelementsofrecognitionfittogether?

• Whatareallofthecriticalactivitiesofrecognition?Howcantheybedone in a way that has a positive impact on employee performance and business outcomes?

• WhatisthemosteffectivewaytoorganizeHRtosupportmanagersin their recognition management activities?

• Howshouldrecognitionintegratewithothertalentmanagementfunctions? What resources are necessary to support that integration?

• Whatarethebenefitstotheorganizationfromdoing recognition well?

As always, we welcome you to continue the dialogue with us. If you have comments or see areas that you would like to further explore for your organization, please contact us at [email protected] or at 510-251-4400.

Stacia Sherman Garr

Senior Analyst

mailto:[email protected]



What Is Recognition and Why Does It Matter Today?Over the past year few years, the volatile economy forced many organizations to do more with less. As a result, businesses sought new ways to innovate and grow without increasing costs. To better motivate and retain employees during these trying times, many organizations focused on increasing employee recognition. But what does this really mean? Our research found that recognition means different things to different people.

Recognition Defined

We define recognition as the expressed appreciation by one person to another for that person’s behaviors, activities or impact. Recognition may or may not be accompanied by a physical or financial reward, as shown in Figure 1. Recognition programs generally are designed to touch a large number of employees across the enterprise (e.g., more than just top performers). In many ways, recognition is part of the total rewards6 an employee receives in that they can provide additional financial recompense for performance. Importantly, recognition should align with an organization’s comprehensive talent management approach, and reinforce critical employee behaviors and expectations.

6 Total rewards can include items, such as regular and incentive compensation plans,

benefits, skills development, and career opportunities.

We define recognition

as the expressed

appreciation by one

person to another for

that person’s behaviors,

activities or impact.

Recognition may or may

not be accompanied by

a physical or financial

reward.

K E Y P O I N T



7 “Emblematic rewards” are a type of recognition that includes praise and

appreciation, special projects, certificates, and trophies and plaques.8 “Token rewards” are a type of recognition that includes rewards of smaller values,

typically around $100. These rewards can include gift cards, candy, flowers, lunches /

dinners and merchandise, or points that can be converted to other items.9 “Monetary rewards” are a type of recognition activity that includes rewards of

values above $100. These rewards can include special trips (e.g., team outings), awards

conferences, learning conferences, cash / vouchers and extra paid time-off.

Figure 1: How Recognition Fits within Total Rewards

Source: Bersin & Associates, 2012.

Copyright © 2011 Bersin & Associates. All rights reserved. Page 1

Tota

l Rew

ards

Recognition

Praise and Emblematic Rewards7

Token Rewards8

Monetary Rewards9 Skills Development and Career Opportunities

Benefits

Compensation and Incentive Plans



Why Does Recognition Matter Today?10

Organizations turn to recognition today because it can have a positive impact on employee performance and engagement. For example, recent Bersin & Associates research on high-impact performance management11 found that, in companies in which recognition occurs, the organization’s average score for employee results (an index comprised of employee engagement, performance and productivity) was approximately 14 percent higher than in organizations in which recognition does not occur. Other research shows that a 15 percent improvement in employee engagement can result in a two percent uptick in operating margins.12

Across the past few years, five market factors resulted in organizations to focus more on recognition, including:

1. A volatile economy;

2. The need for greater agility;

3. The flattening of organizational structures;

4. Technology; and,

5. The rise of the millennial generation in the workforce.

In the following, we discuss each of these factors in detail.

1. Volatile Economy – As many Western organizations dealt with the economic recession, they found themselves unable to increase compensation, and had to decrease or eliminate bonuses. Further, many of those same organizations reduced portions of their workforces. The upshot was increased pressure on the workers who remained, but with fewer rewards for their harder work – resulting

10 Bersin & Associates defines emblematic rewards as recognition that represents

an acknowledgement of contribution, but typically cannot be converted to something

with monetary value. We include certificates, plaques and trophies in this category.

Although they cost some money to produce, they are not seen by the recognizee as

having monetary value. Token rewards include items that cost money, but are viewed by

the recognizee as rewards of token value, usually less than $100. The monetary category

includes things that are not of token value.11 For more information, High-Impact Performance Management: Maximizing

Performance Coaching, Bersin & Associates / Stacia Sherman Garr, November 2011.12 Source: http://www.forbes.com/2009/11/19/incentives-recognition-

engagementleadership-ceonetwork-employees_print.html.

http://www.forbes.com/2009/11/19/incentives-recognition-engagementleadership-ceonetwork-employees_print.html

http://www.forbes.com/2009/11/19/incentives-recognition-engagementleadership-ceonetwork-employees_print.html



in lower employee engagement.13 Coaching and development became a popular (and relatively cheap) alternative to show that the organization still valued the employees remaining on the job. Organizations have similarly turned to recognition, particularly the types requiring low cost per employee.

2. The Need for Greater Agility – As we all know, business is moving faster than ever. Organizations need to be able to reconfigure their workforces to respond to new business demands. Some of this reconfiguration will come from new hires and some of it will come from the current workforce. Further, the workforce continues to become more globalized, with increasing competition for top talent stretching across multiple regions. One study found that to sustain economic growth, by 2030 the United States will need to add more than 25 million workers and Western Europe will need to add more than 45 million employees.14 The result is a dramatic need for practices that attract new employees and keep existing employees highly motivated and engaged. To do this, progressive organizations are creating recognition programs that align with business demands and the needs of the broader workforce.

3. The Flattening of Organizational Hierarchies – The old days of a top-down hierarchy, in which the manager is the “king,” rarely exist anymore. Every day, more organizations are adopting collaborative work environments and reducing the levels of management within their ranks. The result is a decline in the number of promotion opportunities available to employees. To continue to show employees that they are valued, organizations are turning to a myriad of recognition approaches that do not include promotions.

4. Technology – As we all know, social technology has grabbed hold of the public’s attention and time in a big way across the last five years. At the same time, transparency, collaboration and knowledge-sharing have become more the norm within organizations. Many organizations are attempting to leverage both trends by using social technology to increase the transparency, collaboration and knowledge-sharing within the organization. A key element of many social platforms (e.g., LinkedIn and Facebook) is the ability

13 Source: “Employee Engagement Index, Gallup Management Journal, 2010,

http://trustmattersgroup.com/spiritoftrust/?p=441.14 Source: “Global Talent Risk – Seven Responses,” World Economic Forum, 2011.



for individuals to give positive feedback directly to others within the network. It is, therefore, a natural extension that employee recognition has become more common in organizations following this approach. In fact, a whole host of technology providers are now offering services that enable this type of online social recognition.

5. The Rise of the Millennial Generation in the Workforce – Younger employees typically require more feedback (both positive and constructive) and development than older generations. Given that many organizations are in a situation in which baby boomers will soon start to retire in droves, employers are searching for ways to keep these younger workers engaged, productive and retained. Employee recognition can be a critical tool in doing all of these things.

As organizations prepare to hire, grow and manage their workforces of tomorrow, it is critical that HR leaders and their teams take the actions necessary to ensure their talent programs remain competitive. The subsequent sections of this report are intended to help organizations to understand how recognition can support these efforts and also contribute to the bottom line. We will begin by discussing the different types of employee motivations and why they matter in the context of recognition. We will then turn to the fundamental elements of recognition and how your organization can use them to uncover pockets of productivity today and over time.

An Introduction to Employee Motivations

As shown in Figure 2, there are two main types of motivation – intrinsic and extrinsic. “Intrinsic motivation” occurs when people are internally motivated to do something because it either brings them pleasure, they think it is important or they feel that what they are learning is significant.15 Essentially, the motivation comes from inside an individual, rather than from any external or outside influence (e.g., rewards). For example, students who are intrinsically motivated are more likely to engage in tasks willingly, as well as work to improve their skills,

15 Source: “A New Self-Report Scale of Intrinsic versus Extrinsic Orientation in

the Classroom: Motivational and Informational Components,” Developmental

Psychology / Susan Harter, May, 1981, http://psycnet.apa.org/index.cfm?fa=buy.

optionToBuy&id=1981-24428-001.

“Intrinsic motivation”

occurs when people are

internally motivated to

do something because

it either brings them

pleasure, they think

it is important or they

feel that what they are

learning is significant.

K E Y P O I N T



which will increase their capabilities.16 On the other hand, “extrinsic motivation” comes from outside the individual. This motivation needs to be tapped differently. For example, a student may feel compelled to act a certain way because of external factors, such as money or good grades.

In the context of the workplace, people who are intrinsically motivated in their work will put forth strong effort in a project simply because it is enjoyable and not because there is a reward. However, having intrinsic motivation does not mean employees will not also seek extrinsic rewards available to them.

16 Source: “Children’s motivation for reading: Domain specificity and instructional

influences,” The Journal of Educational Research / A. Wigfield, J.T. Guthrie, S. Tonks and

K.C. Perencevich, 2004.

Figure 2: Types of Motivation

Source: Bersin & Associates, 2012.Copyright © 2011 Bersin & Associates. All rights reserved. Page 1

Intrinsic Motivation

Comes from within an individual

Motivation tapped through actions and activities relating to things individuals

already take pleasure in

Extrinsic Motivation

Comes from outside the individual

Motivation tapped through rewards, grades,

money or threats



However, some social psychological research indicates that extrinsic rewards can lead to over-justification and a subsequent reduction in intrinsic motivation.17 In one study demonstrating this effect, children who expected to be (and were) rewarded with a ribbon and a gold star for drawing pictures spent less time playing with the drawing materials in subsequent observations than children who were assigned to an unexpected reward condition.18 Furthermore, when rewards are taken away from employees who are extrinsically motivated, their motivation and effort have the potential to decline.19

It is important to note that these findings do not necessarily mean that organizations should not leverage the extrinsic motivation of employees; there are definitely times when it can be used to effectively improve performance. Yet, it does mean that organizations should understand both intrinsic and extrinsic motivation, and deploy strategies to drive extrinsic motivation in appropriate situations. For example, it may be appropriate to leverage extrinsic motivation when encouraging employees to change their behaviors (which, perhaps, they did not want to change) or to put forth that extra burst of discretionary effort which they would not have otherwise done.

Another element of motivation to note is the relative importance of money – and the research findings that money and its equivalents (e.g., gift cards) are not necessarily the ultimate in employee recognition. One study found that 69 percent of employees prefer praise and recognition from their managers more than financial rewards, and 82 percent of employees say such recognition inspires them to improve their performance.20

17 Source: http://en.wikipedia.org/wiki/Motivation#Intrinsic_and_extrinsic_motivation.18 Source: “Undermining Children’s Intrinsic Interest with Extrinsic Reward; A Test of

‘Overjustification’ Hypothesis, ” Journal of Personality and Social Psychology / Mark R.

Lepper, David Greene and Richard Nisbet, 1973, and Wikipedia, http://en.wikipedia.org/

wiki/Motivation#Intrinsic_and_extrinsic_motivation.19 Source: “What Motivates Your Employees? Intrinsic vs. Extrinsic Rewards,”

Performance Management / Rosanne D’Ausilio, Ph.D., September 10, 2008,

http://www.tmcnet.com/channels/performance-management/articles/39417-what-

motivatesemployees-intrinsic-vs-extrinsic-rewards.htm.20 Source: Gallup Research, http://www.ehow.com/way_5984783_intrinsic-

extrinsicemployee-motivation-techniques.html.

“Extrinsic motivation”

comes from outside the

individual and employee

motivation needs to be

tapped differently.

K E Y P O I N T



This information suggests that organizations which primarily recognize employees through financial means are not getting the most possible for their money. Further, a number of other studies21 show that financial incentives can actually hinder creativity and performance. These findings point to the need for organizations to reexamine their incentive structures and to consider how they can better tap into employee motivations. Some organizations may find that, by effectively leveraging a recognition strategy, they could reduce the amount spent on bonuses, while at the same time improving outcomes.

Understanding Employees’ Needs and Motivations

To help explain the drivers of intrinsic and extrinsic motivation in the context of the workplace, this next section discusses well-known psychologist Abraham Maslow’s hierarchy of needs. As shown in Figure 3, the hierarchy suggests that people are “motivated” to fulfill basic needs before they realize other, higher-level needs.22 The highest need is called self-actualization, which is a process of developing to reach one’s individual potential.

21 Source: “The Influence of Strength of Drive on Functional Fixedness and Perceptual

Recognition,” Journal of Experimental Psychology / Sam Glucksberg, 1962. 22 Source: http://en.wikipedia.org/wiki/Maslow’s_hierarchy_of_needs.

The data suggests that

an effective recognition

strategy does not require

large investments of

budget dollars, though

it does require an

investment of time on the

part of all employees.

K E Y P O I N T



Thinking about this in the context of the workplace, Maslow’s Framework could imply that managers can help address those lower-level needs, so that employees can focus better on their work.24 So what do employees need from their managers and their organizations?

Let us start at the bottom of the hierarchy in Figure 3 with physiological needs. These needs include the air employees breathe, as well as food and the roof over their heads. Organizations have little impact on these needs.

23 Source: “A Theory of Human Motivation,” Psychological Review / A.H. Maslow, 1943;

for graphic update http://en.wikipedia.org/wiki/Maslow%27s_hierarchy_of_needs.24 Source: “Motivation-related values across cultures,” African Journal of

Business Management / Osarumwense Iguisi, April, 2009, available at http://www.

academicjournals.org/AJBM.

According to Maslow,

the highest need is called

self-actualization, which

is a process of developing

to reach one’s individual

potential.

K E Y P O I N T

Figure 3: Psychologist Abraham Maslow’s Hierarchy of Needs23

Source: Abraham Maslow’s Hierarchy of Needs, 1943.

Esteem (Importance,

recognition, respect)

Love / Belonging (Social, love, family, team)

Safety (Economic and physical security)

Survival (Food, water, sleep)

Compensation and Benefits

Modern Recognition

Career, Development Opportunities

Self-Actualization (Challenge, opportunity,

learning, creativity)

http://en.wikipedia.org/wiki/Maslow%27s_hierarchy_of_needs

http://www.academicjournals.org/AJBM

http://www.academicjournals.org/AJBM



Organizations do, however, have an impact on employees’ second need, “safety,” which can be defined as the security of things such as body, employment, resources and property.25 Compensation and other benefits help employees secure their “safety.”

Moving up the hierarchy, some employees will want to fulfill their need for “love and belonging” by connecting more effectively with the broader organization. Recognition from managers, colleagues and peers can help to satisfy this need. However, it is important to note that other employees may have different ways they need to fulfill the need of “love and belonging,” such as the desire for work-life balance, which allows them to spend more time with family and friends.

As we continue to move up the hierarchy, employees’ needs become more complex. Recognition programs can be used once again to build esteem, confidence and acknowledge achievement. These programs could include praise and appreciation, rewards (on top of incentive plans), or even promotions. If these needs are fulfilled, employees can move to the top of the pyramid, self-actualization. At this level, employees can truly reach their full potential – it is, perhaps, a state of workplace nirvana. Employees at this level are highly motivated in their roles and successful – and are also most likely to engage in development and best prepared to move to even higher levels within the organization.

The above example is not an exact science but, instead, shows how recognition can tap into a variety of employee needs. It is also intended to highlight how needs and the motivation to contribute to the workplace can come together.

In summary, the prior two sections of this report have reviewed many of the elements that drive employees to perform, as well as key market factors influencing recognition. The next section of this report highlights the key recognition elements an organization should consider when creating a holistic recognition program.

25 Source: “A Theory of Human Motivation,” Psychological Review / A.H. Maslow, 1943;

for graphic update http://en.wikipedia.org/wiki/Maslow%27s_hierarchy_of_needs.

http://en.wikipedia.org/wiki/Maslow%27s_hierarchy_of_needs



The Bersin & Associates Employee Recognition Framework

Introduction to the Employee Recognition Framework

While every organization has a different reason for considering or implementing a recognition program, ultimately, most organizations desire the same basic outcomes. These include the following.

• A Focus on Driving Business Results – The entire organization is committed to doing what it takes to improve business outcomes. Today, the market demands that organizations run with leaner staffs, operate more efficiently and leverage strategies that enable maximum growth.

• An Empowered and Engaged Workforce – Organizations understand that meaningful links can exist between engagement, performance and retention. As the economy slowly and steadily rebounds, many leaders are increasingly concerned that they could lose top talent and are looking for new ways to retain their best and brightest; and,

• An Attractive Culture – Organizations embrace a core set of values, beliefs and behaviors that affect how internal employees interact with each other and other constituents such as customers and shareholders. Organizations that do this well differentiate themselves in the marketplace, gain competitive advantage and are better prepared to achieve desired business outcomes.

The question is, how can an organization achieve these results? This is where the Bersin & Associates Employee Recognition Framework (see Figure 4) comes into play. The Framework is designed to help organizations attain these results by explaining how the different elements of recognition fit together and outlines the points of integration with other areas of talent management. After reading this report, you should be able to determine which recognition elements to design, adjust or eliminate to support your organization in delivering high performance.

Our Employee

Recognition Framework

is a tool to help you

examine the practices

of recognition at your

organization, identify

areas for improvement,

and ultimately drive

increased employee

productivity, engagement

and retention.

K E Y P O I N T



This report will walk you through each of the elements of the Employee Recognition Framework, using the following broad sections:

• Part 1: Recognition Strategy and Audience;

• Part 2: Program Design; and,

• Part 3: Launch, Management and Measurement.

For each Employee Recognition Framework, section, we include the following:

• AnoverviewoftheindividualFrameworkelements;

• DefinitionsoffundamentalrecognitionconceptswithintheFramework; and,

• Examplesofhoworganizationshaveappliedtheseelements.

Figure 4: Bersin & Associates Employee Recognition Framework®



Multi-level Structure Key Messages

Audience Executives | Managers | Professionals | Hourly | Organized Labor | Contingent | Critical Talent Segments

Recognition Activity

Design

Employee Support | Vendor Strategy | Talent Management Integration

Gov

erna

nce

and

Man

agem

ent

Exe

cutiv

e S

pons

orsh

ip |

Adm

inis

tratio

n | C

ompl

ianc

e | E

quity

| O

ngoi

ng O

ptim

izat

ion

Recognition Strategy Purpose of Recognition | Business Goals | Alignment with Culture | Talent Management Integration | Vision | Transparency | Accountability | Globalization

Metrics and Evaluation

Business O

utcomes | P

erformance | B

ehaviors | Em

ployee Satisfaction |

Engagem

ent | Retention | A

ctivity andw P

articipation Level

Launch Branding Plan | Employee Training | Marketing | Communications

Rewards Non-Monetary | Token | Monetary | Company- or Employee-Selected

Budget Amount, Allocation, Control

Criteria Performance, Behaviors, Tenure

Recognizers Leaders, Managers, Teams, Individuals, Clients, External

Direction Top-Down, Peer to Peer, Bottom-up

Approval Rigorous, Informal, None

Visibility Public, Group, Private

Frequency Annually, Quarterly, Monthly, Weekly, Daily

Delivery Face to Face, Letter / Email, Event, Online Platforms

Customization Employee Type, Business Unit / Functions, Geography

Measurement Approach, Methodology, Reporting



We will conclude with a discussion of how to apply the Employee Recognition Framework in your organization.

This Framework is the result of innumerable interviews with senior talent management experts, from a variety of industries, geographies and organization sizes. It is a tool to help you examine the practices of recognition at your organization, identify areas for improvement, and ultimately drive increased employee productivity, engagement and retention. When effectively implemented, the end result is improved outcomes for the business.

Part 1: Recognition Strategy and Audience

Figure 5: Bersin & Associates Employee Recognition Framework® – Recognition Strategy and Audience






Design


Gov

erna

nce

and

Man

agem

ent

Exe

cutiv

e S

pons

orsh

ip |

Adm

inis

tratio

n | C

ompl

ianc

e | E

quity

| O

ngoi

ng O

ptim

izat

ion



Business O

utcomes | P

erformance | B

ehaviors | Em


Engagem

ent | Retention | A

ctivity andw P

articipation Level















Recognition Strategy

Overview

Almost all business functions and the divisions supporting them have a strategy to help drive the business forward. That strategy is typically supported by programs with clear objectives and a process for measuring outcomes.

However, our research shows that this fails to hold true for recognition. In fact, a recent study shows that 87 percent of respondents said their organization makes no effort to track the return on investment (ROI) of their recognition program.26

This is remarkable, given that the same study found 80 percent of organizations have some sort of program in place. Moreover, organizations spend more than $46 billion per year on employee rewards and recognition programs.27

Part of the reason organizations do not effectively measure recognition is because traditionally recognition programs have been dispersed across the organization. As a result, those programs lack consistency of goals and measurement.

Progressive organizations are centralizing their recognition initiatives and creating a comprehensive strategy to move forward their business. Similar to all HR programs, executive buy-in and sponsorship are critical to the success of this effort. High-impact organizations effectively develop a holistic recognition strategy that considers eight primary elements, including:

26 Source: http://www.shrm.org/Publications/HRNews/Pages/GloboforcePoll.aspx.27 Source: Incentive Marketing Association, http://www.incentivemarketing.org.

Progressive organizations

are centralizing their

recognition initiatives and

creating a comprehensive

strategy to move their

business forward.

K E Y P O I N T



1. The purpose of recognition;

2. Business goals;

3. Alignment with the culture;

4. Talent management integration;

5. Vision;

6. Transparency;

7. Accountability; and,

8. Globalization.

In this section, we discuss each element in detail, as well as the strategic decision points underpinning them. Without clarity on these fundamental decision points, recognition is prone to being a series of loosely related and unmeasurable events that provide little lasting impact for the organization.

Fundamental Elements

Purpose of Recognition

In a world of bottom lines and cost reductions, why should your organization focus on employee recognition? There are two primary reasons.

First, people typically will alter their behaviors toward desired behaviors in order to be recognized. These desired behaviors should be aligned with the organization’s goals. With more people across the organization performing these behaviors, the organization should achieve its goals more rapidly.

Second, recognition is intended to demonstrate to employees that they are appreciated and their work is valued. Ultimately, this can improve employee engagement, which can increase employee performance, satisfaction and retention.

Recognition programs are

intended to incent the

workforce in a completely

different way.

K E Y P O I N T



It is important to point out that the purpose of recognition is not the same as compensation or bonus plans. Both of those programs are often viewed by employees as entitlements, given they are usually predefined and occur regularly. Recognition programs are intended to work in a completely different way. For example, they can be designed to create excitement, build cultural alignment and foster behaviors such as teamwork. These programs also aim to provide extrinsic motivation to staff, so that they will put forth greater discretionary effort – essentially getting them to “go the extra mile.”

In summary, this section on the purpose of recognition is to underscore the importance of defining what your organization wants to accomplish through recognition, and how that relates to employees’ and the business’s needs. Recognition is something that must be planned strategically and measured objectively. The ultimate intention is to create programs that recognizes people for doing the right things at the right times in a way that will encourage them to do those things again. Once you have had a dialogue with your team about the purpose of recognition, you are ready to move on to the next section of this Framework, in which we discuss the link between recognition and business goal.

Business Goals

Strategic organizations use employee recognition to accelerate their business goals. For example, some organizations establish programs to recognize employees for improving customer service or increasing revenue per customer – both of which can be linked to bottom-line results. As your organization works through this piece of the strategy, identify specific business goals and determine how recognition can encourage employees to engage in the activities that will accelerate the achievement of those goals. Focus specifically on how recognition will improve employee engagement, encourage employees to engage in certain behaviors more frequently or help employees understand how to change their behaviors. Both improved engagement (leading to greater discretionary effort) and engaging in more effective behaviors can drive business results.

An example of this in action was when an organization in the automotive industry recognized its factory workers for practicing specific safety measures. The organization had fewer accidents, resulting in savings

As organizations think

through this piece of the

strategy, it is critical to

define what business goals

will be targeted and how

recognition can encourage

employees to engage in

the activities that will

accelerate the achievement

of those goals.

K E Y P O I N T



for the benefits programs. This ultimately improved the bottom line. Another example was when a hospital organization motivated its employees to increase their level of teamwork, more patients received better care and they received it faster. As a result, patient satisfaction scores increased. This gave the hospital more referrals and that translated to increased revenue.

Our research has found that today only about 60 percent of organizations tie their recognition programs to business goals.28 The following is an example of a large technology company that is missing the mark with it recognition program.

Case in Point: Technology Organization’s Loosely Defined Goals Show No Hard Results

With 20,000 employees in nearly 50 counties across the globe, a large technology firm decided to create a recognition program to help the organization become more “employee friendly.” The only problem was that the program was very resource-intensive.

This program was a performance-based program and the responsibility of the business, although there was some coordination by HR and marketing. As part of the program, employees nominated each other’s projects for the best annual work. To kick off the program, the organization’s corporate communications team designed marketing materials to engage employees to nominate themselves, peers or others across the organization. All nominations were posted on the organization’s intranet. The corporate communications team also helped to facilitate this by writing key excerpts, so postings were easy to understand.

All of the nominations were then placed in a “tournament” for judging by HR and operations employees and some senior business

28 This information is based on our current research on the topic of employee

recognition, the report for which is due to be published 2H’2012.

Our research has

found that today many

organizations do not

tie their recognition

programs to business

goals.

K E Y P O I N T



leaders. Seven project winners were announced at the regional level, another seven at the functional level and another seven at the business-unit level. Ultimately, there is one winner, selected by the CEO, who is then recognized by the CEO and board of directors. In addition, each regional, functional and business-unit winner gets a plaque.

This process is a lengthy one that requires a lot of time from HR, the business, marketing and employees. When asked how much time this took, the organization responded that it had no idea how much time was required nor did it track the program’s costs. Furthermore, the company has not defined how the program will change key goals, performance or behaviors in meaningful ways. As a result, it is next to impossible to determine the ROI or achieve business results. The main issues with this structure are that the HR department has no understanding of the costs and benefits of the program, and the program is not aligned with business goals. e

Before moving on from this section of the Framework, ask yourself and your colleagues the following questions.

• Whatareourorganization’stopthreebusinessgoals?

• Whichbehaviorsdoweneedpeopletoengageintohelpusreachthose goals?

• Howcanweensurethattherecognitionprogramisencouragingemployees to engage in those behaviors?

Alignment with Culture

Bersin & Associates defines “culture” as the collective set of organizational values, conventions, processes and practices that influence and encourage both individuals and the collective organization to continuously increase knowledge, competence and performance. This includes the attitudes, experiences, knowledge and beliefs within the enterprise. This collective structure influences the way employees relate to each other and also controls how they behave with external stakeholders.

Bersin & Associates

defines “culture” as

the collective set of

organizational values,

conventions, processes

and practices that

influence and encourage

both individuals and the

collective organization

to continuously increase

knowledge, competence

and performance.

K E Y P O I N T

Case in Point: Technology Organization (cont’d)



Aligning the recognition strategy with the organization’s culture is a critical ingredient to the success of a recognition initiative. However, this is often easier said than done, especially when an organization’s leadership team has the perspective that “an employee’s paycheck is thank you enough.” Furthermore, some highly competitive organizations that value “cut-throat” behaviors will have a more difficult time transitioning to a culture that values recognition. While not impossible, it will take longer for competitive organizations to move to a recognition culture, as compared with organizations that already value a balance of behaviors. We are not implying that competition is bad – simply that, where recognition is concerned, balance among competitive, collaborative and other behaviors is important.

When considering culture, organizations should also identify when internal or external business circumstances could negatively impact employee satisfaction. While dissatisfaction can be tied to a number of factors, Grace Haven Assisted Living’s analysis led it to focus on improving its culture by using recognition. The following case in point illustrates how issues such as declining morale were positively impacted.

Case in Point: How Grace Haven Transforms Its Culture with Recognition29

Grace Haven Assisted Living, located in St. John’s, Michigan was going through a time of rapid change in early 2010. The organization experienced a nearly 200 percent increase in residents over just a few months. This major growth in the business clearly put additional pressure on all employees. Unfortunately, Grace Haven’s culture had developed into one in which employee dissatisfaction was common. The combination of these factors resulted in soaring turnover and plummeting morale within a relatively short period.

To make proactive changes that would reverse feelings of dissatisfaction, Grace Haven worked to fully diagnose the

29 Source: http://www.corpmagazine.com/management/human-resources/itemid/5872/

transform-your-culture-with-strategic-employee-rec.

http://www.corpmagazine.com/management/human-resources/itemid/5872/transform-your-culture-with-strategic-employee-rec

http://www.corpmagazine.com/management/human-resources/itemid/5872/transform-your-culture-with-strategic-employee-rec



problems and decided to implement an employee recognition program. As a first step to creating that program, supervisors and employees took part in an evaluation process that included interviews, focus groups and an employee engagement survey. The engagement survey identified the key issues that needed to be addressed to reverse the steady decline in morale. After establishing the most critical issues impacting culture, a comprehensive, customized employee recognition plan was developed, which set priorities to address each issue. Implementation included coaching sessions with management and informational meetings with all employees to help acquaint them with the new program.

Within one week of the program’s implementation, anecdotes revealed that optimism had increased noticeably. After 60 days, 78 percent of employees had given recognition and 68 percent had received it. Another employee engagement survey revealed steady improvement in all of the areas that program addressed and the positivity continued to grow. Benchmarks were also established, so that the organization could monitor its culture over time. e

Talent Management Integration

Careful consideration should be given to how recognition impacts the other elements of talent management and who will be responsible for overseeing the integration of recognition as a component within it. As part of recognition strategy, organizations should discuss three things. First, they need to determine how recognition can complement the other parts of the talent management function. This includes compensation, benefits, performance management, engagement, succession, learning and even recruiting. For example, how can recognition be incorporated into the performance appraisal process? How can it be used to attract top talent for open positions?

Second, determine any conflicts the recognition program could have with existing talent management strategies, policies and programs. For example, ask yourself questions such as, “Do we want to change our rigid vacation policy to accommodate recognition?” Finally, leaders need to determine how they can optimize costs. For example, can existing

Careful consideration

should be given to how

recognition impacts all of

talent management and

who will be responsible

for overseeing the

integration of recognition

as a component within it.

K E Y P O I N T

Case in Point: How Grace Haven Transforms Its Culture with Recognition (cont’d)



manager and employee training programs be used for the recognition effort? Does the organization need to hire new people to run the recognition program or should the team leverage internal resources?

Figure 6 explains how recognition intersects or can complement the existing talent management function.

Figure 6: Strategic Integration Considerations between Recognition and Other Talent Management Activities

Talent Management Domain Action Steps for Recognition

Compensation / Bonus and Stock Option Plans

• Considerwhatincentivesbeyondcompensationwillmotivatestafftocontributetotheorganization’sbottomline.

• Ensurecompensationiscompetitiveinthemarketplacebeforeimplementingarecognitionprogram.

Benefits / Work-Life Balance

• Considerhowpolicies,suchasvacationorflexibleworkschedules,shouldbeadjustedtorecognizepeople.

• Determineifrecognitioncanorshouldextendtoeffortsthatpromotehealthatworkorout-of-the-officeactionstoreducethenumberofemployeeabsences.

Talent Capability / Competency Management

• Determinehowrecognitionshouldalignwithjobandbehavioralcompetencies.

• Implementprotocolssothat,whenthebusinesschanges,competenciesandrecognitionprogramsarecontinuallyinalignment.

Leadership Development

• Createtrainingprogramsthatteachmanagershowtomotivateandrecognizeemployees.

• Workwithmanagerssothattheyunderstandhowtorecognizetheiremployeesinwaysthataretiedtothegoalsandbehaviorsvaluedmostbytheorganization.

• Providemanagerswithassistanceonarticulatingrecognitionmessagesanddeliveringrewardsinathoughtfulmanner.

Performance Management

• Deployrecognitionsothatallemployeescangiveandgetfeedbackandreinforcementwhenwarranted.

• Encouragemanagerstoleveragerecognitionforcoachingconversations.

• Determinethecriticalityofcapturingrecognitioninyourorganization’sperformanceappraisalsystem.




Vision

Once an organization establishes a purpose, considers its culture, determines its goals and integrates those items with existing talent management programs, it can more easily build out its direction or “vision” for the future.

The first step is developing a clear understanding of the current state of recognition. To do this, either review existing employee feedback (which usually includes the results of employee surveys, one-on-one meetings or focus groups) or collect new feedback from managers and employees to understand what they value most. A common mistake is failing to review employees’ feedback on their managers. Doing this helps to highlight any areas of disconnect.

Also, plan to review employee performance appraisals and to compare them to business performance. Analyze this information by business unit, function, region and geography, as appropriate. While some regions will have similar challenges, others will have distinct performance issues. This analysis will enable you to determine differences in performance and behaviors, and then segment strategies for the future.

After analyzing this information, integrate it with your findings from the sections that we previously discussed – purpose, business goals, and alignment with culture and talent management integration. With this material, you can build a “roadmap” that depicts where your

It is essential to gather

feedback from managers

and employees to

understand what they

value most.

K E Y P O I N T

Figure 6: Strategic Integration Considerations between Recognition and Other Talent Management Activities (cont’d)

Talent Management Domain Action Steps for Recognition

Career Management

• Leveragerecognitiontohelpemployeesunderstandtheirstrengthsanddrivetheircareerdirections.

• Considerhowrecognitioncanbemosteffectivelyusedtokeepemployeesengaged,whileincreasingtheirlikelihoodofstayingwiththeorganizationlonger.

Recruiting / Onboarding

• Craftyourrecognitionprogramsothatitalignswiththeorganization’semploymentbrand.

• Encourageemployeestotellfriendsaboutthebenefitsofarecognitionprogram.

• Introducenewhirestotherecognitionprogramimmediatelytohelpthemadapttoyourorganization’sculturemorequickly.




organization wants to go and how it will get there. Key questions to answer as part of this process include the following.

• Howdowewanttouserecognitiontoimprovetheengagementandperformance of our workforce?

• Howshouldwerecognizestaffinthefuturetomeetour business goals?

• Doweneedtoadjustourculture,valuesandemployeebehaviors in any way?

• Howlongwillittakeustogetwherewewanttogointhefuture?

• Whatresourcesdoweneedtohelpgetusthere?

Building a comprehensive roadmap requires organizations to identify the activities and decisions that need to occur before they can execute on its vision. Having a clear direction and documenting where an organization wants to go, how it will get there, and how long it will take, is an important piece of the strategy.

KPMG in Canada is an example of an organization that created a strategy with a clear vision and plan for getting there.

Case in Point: KPMG in Canada Reinforces Critical Business Behaviors with Its SHINE Program

KPMG LLP (Canada) is the Canadian member firm of KPMG International, and is a leader in providing audit, tax and advisory services. The firm has more than 660 partners and more than 5,000 employees operating in 32 locations across Canada. More than a decade ago, KPMG in Canada began its journey from an organization in which “a paycheck was considered thanks enough” to one that regularly recognizes employees’ achievements. In 2011, the total rewards and recognition team realized that it was time to take the next step in that journey by updating the nearly 10-yearold program to a social online recognition program. The goal was to provide a clearer line of sight between desired employee behaviors and business needs.

The value of building a

comprehensive roadmap

is that it requires an

organization to conduct

a gap analysis to clearly

show the things that

need to occur before an

organization can execute

upon its vision.

K E Y P O I N T



KPMG in Canada’s business strategy requires that employees build strong relationships with clients. To do this, they need to leverage four critical behaviors (see Figure 7). KPMG designed its new online recognition program, SHINE, so that employees could recognize each other for engaging in those behaviors. This nurtures a culture of appreciation and helps employees to see how they can have a direct impact on the business.

The introduction of peer-to-peer recognition with non-monetary and lower dollar value awards that can be distributed with no approval process represented another innovation in KPMG in Canada’s recognition approach. This shift was significant, as previous recognition programs primarily focused on recognizing top performers on an as-needed basis, not as a regular practice. KPMG in Canada understood that its business strategy required that it adapt to the needs of its workforce. Since that workforce includes a large population of younger employees, who typically require more feedback, a peer-to-peer recognition program made sense. Further, the additional transparency of the recognition program helped to constantly reinforce the four behaviors.

Figure 7: Four Behaviors Reinforced by KPMG in Canada’s Recognition Program

Growth

Delivery

KPMGforLife

CommunityLeader


Case in Point: KPMG in Canada Reinforces Critical Business Behaviors (cont’d)



From the beginning of its redesign efforts, KPMG in Canada focused on achieving two goals – improving the employee workplace experience and reinforcing the critical behaviors that drive business results. Early results indicate that these goals are being met. Employees are enthusiastically using the program, with more than 15,000 recognition activities taking place within the first nine months. Each of these recognition actions serves to further encourage employees to do the very things that make KPMG in Canada successful. e

Transparency

One of the most important elements to think about prior to creating a program is establishing a level of trust between your organization and its employees – this is done through program transparency. In some cases, recognition can be viewed as a popularity contest or a matter of quid pro quo (e.g., if an employee does this, he gets that). To ensure employees have faith in the program, organizations must clearly define criteria and communicate program details, including guidelines for winning, the evaluation process and the rewards. In addition, in high-profile competitions for recognition, it is important that all employees who participated in the program know who won and that the person received the prize promised. This helps to give the program greater credibility.

Employees also need to know that the various recognition programs offered across different employee populations and business units are fair and equitable. For example, if an organization only offers programs designed to recognize its highly valued engineers and HiPos30, other groups may feel slighted and think that their contributions are not valued equally. Organizations should consider how employees will perceive the recognition programs offered.

The Calgary Marriott is an example of an organization that designed its recognition program to incorporate an equitable and transparent structure.

30 A “high-potential employee” is an employee who has been identified as having the

potential, ability and aspiration for successive leadership positions within the company.

Often, these employees are provided with focused development as part of a succession

plan and are referred to as “HiPos.”

One of the most

important elements

to think about prior

to creating a program

is establishing a level

of trust between an

organization and its

employees – this is

done through program

transparency.

K E Y P O I N T

Case in Point: KPMG in Canada Reinforces Critical Business Behaviors (cont’d)



Case in Point: Calgary Marriott Downtown Evolves Its Recognition Program to Drive Bottom-Line Results

The Calgary Marriott Downtown, part of one of the world’s largest hotel chains, employs more than 300 employees. In 2008, the organization found it needed a tool that would better support its recognition strategy, business goals and employee retention efforts. Although the organization had a number of initiatives in place, they were scattered across various departments. As a result, the programs lacked consistency and there was no way to track whether or not employees were using them. Furthermore, the cost of maintaining the program was high, and it was not effective at driving positive behaviors that it defined for its associates.

To improve its recognition programs and make them more transparent, the Calgary Marriott Downtown redesigned its recognition program to better align with its strategy. As part of this process, the organization adopted new web-based technology. The technology platform offered a points-based system for rewarding Marriott’s employees. The organization branded its program S.P.I.R.I.T. – Rewards (meaning special recognition, participation in the community, introducing new business, recruitment, innovation and team recognition). This acronym stands for the performance and behaviors most valued by the organization. It also represents measurable criteria that are easy for employees to understand. The system was customized to be interactive and engaging – employees and associates were able to earn points at any time for living any of the S.P.I.R.I.T values.31

After implementing this new recognition program, employee engagement increased dramatically. The overall engagement

31 “Points” are a reward mechanism for employees who meet certain recognition

criteria. Points can be redeemed for a wide range of brand-name merchandise, travel, gift

cards and experiences using an extensive online catalogue.

Employees need to

know that the various

recognition programs

offered across different

employee populations

and business units are fair

and equitable.

K E Y P O I N T



score increased 16 percent, and the hotel had the highest improved employee satisfaction rates throughout Marriott Hotels’ Northwest region. Furthermore, importantly, the renewed program has impacted the bottom line by motivating employees to focus on suite upselling – tripling the number of suite upsells over a two-year period. In addition, the organization saw a 15 percent increase in the satisfaction score on the metric that asked about the quality of the rewards offered to employees, despite the fact that many wages had been frozen or seen minimal increases over a two-year period. e

Program Accountability

Recognition strategies are complicated by the number of people involved, as well as the fact that, typically, no one person or group owns all recognition initiatives. An essential part of the strategy is figuring out who will own what and then holding those people accountable. Key questions which organizations must think about when establishing accountability include the following.

• WhatwillbecentralizedandcontrolledbyHR?

• Whatwillbecontrolledordecentralizedtothebusinessunits?

• WhichresponsibilitieswillbesharedbyHRandmanagers?

• Forwhatshouldindividualcontributorsberesponsible?

Another important part of accountability is determining, “How can our team ensure we deliver on what we say we are going to do?” As part of this process, organizations should analyze how much time the recognition program will take away from managers’ other critical tasks and if there is any way to simplify the process. If the time required of managers or leaders is too excessive, the program will fail.

An additional element of accountability is determining how the organization will ensure recognition is taking place. For example, will you use employee engagement scores, performance reviews or some other metric? Some organizations may use recognition to support radical change. For example, an organization evolving away from an overly competitive culture may temporarily require its managers to recognize 10

Case in Point: Calgary Marriott Downtown Evolves Its Recognition Program (cont’d)

An essential part of the

recognition strategy is

figuring out who will own

what and then holding

those people accountable.

K E Y P O I N T



people a quarter for teamwork performances. This approach would allow a company to tie recognition outcomes to managers’ goals. However, we would note that this type of accountability should be used with extreme caution as recognition is only impactful when it is genuine. If employees think recognition has to be done, it loses its meaning and ability to empower.

By clarifying ownership, prioritizing initiatives and setting measurable goals, organizations are more likely to ensure accountability and are less likely to break promises to employees regarding recognition efforts.

Globalization

The final element of the recognition strategy is globalization. Having a global audience should change your scope. Do you expect recognition to play out uniquely in different parts of the world? How can you use recognition to attract global candidates? As we discussed earlier, the workforce continues to become more globalized and it is essential to customize some elements of recognition to attract and retain top talent. For organizations operating in five or more countries, this will be no easy undertaking. The addition of local champions and experts to the project team is essential and important consideration for making the globalization effort a success.

Strategy Action Plan

To successfully create a recognition strategy, it is important that your leaders are able to answer the series of questions shown in Figure 8.

The addition of local

champions and experts

to the project team is

essential and important

consideration for making

the globalization effort

a success.

K E Y P O I N T



After you are able to answer this series of questions, it is time to think about how recognition should affect different audiences across your organization. This next section of the Framework will discuss those key elements in detail.

Figure 8: Questions Your Organization Must Answer before It Makes Other Decisions in This Framework

• Whatisouroverallpurposeofrecognition?

• Howdoesrecognitionhelpusachieveourbusinessgoals?

• Whatbehaviorsdoweneedtoimprovetoaccelerateourachievementofbusinessgoals?

• Howcanrecognitionbeusedtostrengthenourorganization’sculture?

• Howshouldrecognitionintegratewithothertalentmanagementprograms,includingcompensation,performancemanagement,learning,engagement,onboardingandmore?

• Inanidealworld,whatwouldrecognitionlooklikewithinourorganization?Howdoesthiscomparetoourcurrentstateofrecognition?

• Howimportantistransparencytoourorganization?Areourprogramsequitable?Howcanweensureprogramssupportourtransparencygoals?

• Whatwillbetherecognitionresponsibilitiesofourorganization’sstakeholders(e.g.,seniorleaders,managers,employeesandHR)?Howwilleachofthosestakeholdersbeheldresponsibleforfulfillingtheirresponsibilities?

• Towhatextentshouldthisprogrambeglobalized?




Audience

(Figure 5 is repeated in this section.)

Overview

Employee recognition has the potential to touch nearly every employee within the organization; however, just because every employee can be recognized does not mean it will happen for everyone. The reason for this is three-fold. First, many employees do not know what they have to do to be recognized – either they do not understand or were never told. Second, some employees just do not meet the requirements to be recognized. Third, employees who should be recognized are not because an employee’s manager does not want to spend the time or

Figure 5: Bersin & Associates Employee Recognition Framework® – Recognition Strategy and Audience






Design


Gov

erna

nce

and

Man

agem

ent

Exe

cutiv

e S

pons

orsh

ip |

Adm

inis

tratio

n | C

ompl

ianc

e | E

quity

| O

ngoi

ng O

ptim

izat

ion



Business O

utcomes | P

erformance | B

ehaviors | Em


Engagem

ent | Retention | A

ctivity andw P

articipation Level















does not believe in recognizing. To combat these challenges and others, organizations should clarify the roles and activities for every audience that is employed. In this section, we will discuss the different audiences within the employee population and detail the recognition activities that are unique to each segment.


The workforce is comprised of subsets of employees who vary greatly in terms of their needs, expectations, preferences and stakes in the company. We have identified seven subsets of employees (see Figure 9) that should be thought of independently for the purpose of recognition. It is important to note that these subsets may vary by region, industry or even company. These definitions can also vary by hours worked, provision of tools, job autonomy, benefits and compensation. Figure 9 lists the subsets that we have identified in our research and provides definitions for each of them.

Employee recognition has

the potential to touch

nearly every employee

within the organization;

however, just because

every employee can be

recognized does not

mean it will happen for

everyone.

K E Y P O I N T

Figure 9: Recognition Audiences

Audience Definition

Executives / LeadershipSeniorleaderswithintheorganization,includingchief-levelpositionsandthosereportingdirectlyintothosepositions.Alsoincludesseniormanagerialpositions.

Managers Leaderswithintheorganization,typicallyatthemiddle-managerlevelorbelow.

Professionals / Salary / Exempt

Professional-levelemployeeswho,becauseoftheirpositionaldutiesandresponsibilities,andlevelofdecision-makingauthority,areexemptfromtheovertimeprovisionsoftheFairLaborStandardsActsorotherregionallaws.Thehourswhichtheseemployeesworkareexpectedtobeanequivalenttoregionalfull-timestatus,butarenottracked.

Hourly / NonexemptAnemployeewhoselevelofworkentitleshim/herundertheFairLaborStandardsActorotherregionallawstoovertimepaybyanorganization.Thehoursworkedbytheseemployeesaretrackedonanhourlyrateandfallwithinfull-orpart-timeregionalstatus.

Organized Labor / Union Employeeswhoarerepresentedbyalaborunion.

Contingent / ContractAnindividualengagedbyacompanytoprovideaspecificsetofservicesonatemporarybasis.Arolethatisnotseenasafull-timeemployeeforanorganization.

Critical Talent SegmentsIndividualswhoarelikelywithinoneoftheaboveaudiences,butwhohavebeenplacedinasubgroup,aswell,forthepurposesofprovidingadditionalattentionorfocus.Thisgroupcanincludespecificfunctions,regions,joblevelsorstatus(e.g.,HiPos).




Although executives, managers and employees need to meet similar recognition criteria, senior leaders have more responsibility for motivating employees and ensuring recognition practices are adopted by others in the organization. In Figure 10, we describe the activities and roles for each subset of an employee population.

Figure 10: Recognition Activities Unique to Each Audience Segment

Audience Recognition Activities Unique to Segment

Executives / Leadership

• Create,exemplify,guideandreinforcetheattributesthatmeetthecriteriaforrecognition.• Communicateexamplesofwhatisdeemedworthyofrecognitiontoallcompanyemployees.• Distributerewards,asappropriate.• Userecognitionmetricstofurtherassesstheengagement,performanceandretentionof

talentacrosstheorganization.

Managers

• Modelcriticalbehaviorsandactivities.• Motivateindividualemployeestoengageinthosecriticalbehaviorsandactivities.• Recognizeemployeesforachievingperformances,andmodelingvaluedbehaviorsandactions.• Trackdepartment,teamandindividualefforts,sothatmetricsandeffortscanbebest

improvedonanongoingbasis.• Communicateandtrainallcontingentandpart-timelaboronthecompany’scultureand

values,whenappropriate.

Professionals / Salary / Exempt

• Participateinrecognitionprogramsthatsupportthecompany,theirteamsandwhichalsohelpemployeestogrowasindividuals.

• Communicateupwardtomanagerswhentheydonotunderstandwhattheyneedtodotoberecognized.

• Sharefeedbackaboutwhentheydo/donotfeelacknowledged.

Hourly / Nonexempt

• Participateinrecognitionprogramsthatsupportthecompany,theirteamsandwhichalsohelpthemtogrowasindividuals.

• Communicatetomanagerswhentheydonotunderstandwhattheyneedtodotoberecognized.

• Sharefeedbackaboutwhentheydo/donotfeelacknowledged.

Organized Labor / Union

• Participateinsomerecognitionactivitiesandcommunicatefeedbackasdefinedinunioncontracts.

Contingent / Contract

• Embracebehaviorsandperformancealignedwiththecompany’sculture.Whetherornottheseworkersparticipateinformalandinformalrecognitionprogramsisoftendependentontheindustry,lengthofproject,andotherrequirementsspecifictotheorganizationandcontract.

Critical Talent Segments

• Participateinrecognitionprogramsdesignedtosupportcriticalsegments(i.e.,leadershiporhigh-performancetrainingprograms,orspecialprojects).ThisisusuallyledbyHR.Thetalentsegmentsshouldparticipateinawaythatsupportsthecompany,theirteamsandwhichalsohelpthemtogrowasindividuals.




Once you have considered the recognition roles and responsibilities for key audiences within your organization, it is important to think about what programs you should create to meet the needs of those audiences. This next section of the report, “Part 2: Program Design,” will discuss the key elements to consider in designing a recognition program.

Part 2: Program Design

Figure 11: Bersin & Associates Employee Recognition Framework® – Design and Rewards






Design


Gov

erna

nce

and

Man

agem

ent

Exe

cutiv

e S

pons

orsh

ip |

Adm

inis

tratio

n | C

ompl

ianc

e | E

quity

| O

ngoi

ng O

ptim

izat

ion



Business O

utcomes | P

erformance | B

ehaviors | Em


Engagem

ent | Retention | A

ctivity andw P

articipation Level















Program Design Overview

Program design is critical to the overall success of the recognition initiative. To do it well, organizations need to design the program with the end in mind. Specifically, HR needs to be clear on how the recognition program will align with business goals and the anticipated impact of the investment in the program. For example, if the organization invests $20,000 in a recognition program, how would employee engagement, customer satisfaction or some other critical metric change? The business case for the investment needs to be clear before program design begins.

Once the business case is in place, organizations should identify who will join the program design team. This team should be comprised of employees from HR, finance, legal and relevant business units and geographies. Once the team is in place, it should establish tactical goals and objectives that support the strategy such as, “Create a recognition program that focuses on two core values,” or “Implement a recognition-based technology platform to increase both employee motivation and transparency in our rewards program.”

The program design section of the Employee Recognition Framework is intended to help organizations understand all of the critical design questions that must be answered in the quest toward an exceptional recognition program. Through our research, we have identified 10 fundamental elements an organization should consider when creating a program. These elements include budget, criteria, recognizers, direction, approval, visibility, frequency, delivery, customization and measurement. We discuss each of them in detail in the following sections.


Budget

The first fundamental program design element is budget. A well-designed and documented budget ensures all stakeholders are on the same page in terms of how the program money will be spent. There are three fundamental considerations pertaining to the budget – amount, allocation and control. This section will discuss each of them in detail.

HR needs to be clear

on how the recognition

program will align with

business goals and the

anticipated impact of

the investment in the

program. The business

case for the investment

needs to be clear before

program design begins.

K E Y P O I N T



Amount – First, leaders should determine the amount that will be spent on a recognition program and from where it will come. The recognition budget generally comes from centralized HR funding (e.g., compensation or other program), business units or functions, or a combination of sources. According to 2011 data, recognition budgets typically average 2.0 percent of the payroll budget, though the median amount budgeted is one percent.32 Intuit, for example, established a budget of one percent of payroll for its awards program.33 Departments can budget more or give higher-level awards by reducing spending in other budget areas. The average 2011 recognition budget is down slightly in 2011 compared with 2008 (2.0 percent of payroll spend versus 2.7 percent, respectively).34 We think the decline partially reflects the recent challenges and volatility in the economy.

Allocations – The second element that organizations need to think about is budget allocation. As shown in Figure 12, there are three major areas requiring consensus. First, organizations need to consider how much of the budget will be used to pay for staff (internal or external) to administer the program. Second, organizations need to think about what portion of the central budget will be distributed to each department (e.g., for discretionary rewards or other programs). As part of this process, conversely, stakeholders should determine if individual departments need to contribute any funding. Lastly, organizations should decide how they will allocate the funding toward centralized program initiatives (e.g., rewards allocations for tenure programs or technology allocations).

32 Source: http://www.worldatwork.org/waw/adimLink?id=51194.33 Source: http://talentmgt.com/articles/view/intuit_spotlights_strategic_importance_of_

global_employee_recognition/3.34 Source: http://www.worldatwork.org/waw/adimLink?id=51194.

There are three

fundamental

considerations pertaining

to the budget – amount,

allocation and control.

K E Y P O I N T

http://www.worldatwork.org/waw/adimLink?id=51194

http://talentmgt.com/articles/view/intuit_spotlights_strategic_importance_of_global_employee_recognition/3



http://www.worldatwork.org/waw/adimLink?id=51194



Control – The final budget decision is control. There are two major components to control – control over individual recognition rewards and control for all other program spending. As we mentioned earlier, some organizations decentralize the control of certain rewards, such as Top 100 in revenue or customer service, to business units or functions. In these instances, organizations need to determine who has input into how dollars are spent, as well as who has the final say on spending. For example, when will a committee take a vote and when will budget dollars be up to a manager’s discretion? As part of this process, it is essential to design budget approval processes, and clarify what needs sign-off and what does not (This will be discussed in more detail in the approvals section of the program design part of the Framework).

The final element of control is determining how the budget will be monitored for spending not related specifically to individual recognition rewards. This could be spending on recognition events, time spent by employees reviewing recognition nominations or any other similar

Figure 12: Budget Allocation Considerations

Source: Bersin & Associates, 2012.1

Total Budget

Staff / Administration

Decentralized Program Funding

Centralized Program Funding

As part of this process,

it is essential to design

budget approval

processes, and clarify

what needs sign-off and

what does not.

K E Y P O I N T



spending related to the program. Typically, organizations will identify a person to monitor the budget who is responsible for reporting on it to the budget owner and other stakeholders. This person ensures that the budget spent aligns with the amount necessary to achieve the desired program return on investment.

Criteria

One of the most important elements of program design is establishing and articulating recognition criteria. This element is critical to establishing both equity and transparency. There are three primary types of criteria that organizations choose to establish – performance, behavior and tenure. This section will discuss each component in detail.

Figure 13: Three Primary Criteria of Recognition


Performance • Tied to business goals

and outcomes

• Criteria should help evaluate individual and enterprise performance

Behaviors • Tied to culture or core values

• Tied to other behaviors that

are not part of core values

• Criteria should ensure behaviors recognized lead to performance improvements or improvements to an organization's internal or external environment

Tenure • Tied to anniversaries or

length of service

• Criteria should align with specific employment dates (e.g., five years with company X)



Performance – Performance criteria should be tied to business goals and outcomes. Some organizations’ recognition programs have loosely defined performance goals, objectives and criteria. When this happens, it is more difficult to reward across the organization in an equal and transparent way because stakeholders and other employees are unclear about what they should be working toward. It is important to note that the purpose of performance criteria in the context of recognition is different from the assessments and feedback discussed as part of a structured performance review. However, organizations need to consider how recognition will be accounted for in the formal performance review process.

As you consider key performance criteria, we suggest you think through the following questions.

• Whatperformancelevelsdoweneedtohelpourorganizationachieve its goals over the short and long term? What does the performance look like?

• Whendowewanttorecognizeemployeesforcorejobresponsibilities?

• Whendowewanttorecognizeemployeesforgoingaboveandbeyond core job responsibilities?

• Whattypesofrecognitionrequiremultiplepeopletoassessperformance?

• Whenshouldanindividualhavediscretionaboutwhattypeofperformance to recognize?

There are generally two types of performance use for recognition programs. We describe each of them in detail in Figure 14.



• Individual Performance Criteria – As shown in Figure 14, to keep employees motivated, many organizations recognize individuals when they meet a goal or milestone in their core roles or exceed expectations. Immediate feedback, gratitude or praise lets employees know they are on the right track. Flexibility is a critical part of designing individual performance criteria. Organizations need to consider how much discretion they want to give managers in terms of deciding what performance and efforts should be recognized (e.g., a project milestone or performance above and beyond a core role) and what rewards should correspond to the performance.

• Enterprise Performance Criteria – As shown above in Figure 14, enterprise recognition programs often identify key criteria that have the potential to significantly impact an organization’s bottom line. These programs include performance competitions across different divisions, functions and geographies based on either individual

Figure 14: Key Performance Criteria Categories


Individual

Enterprise

• Recognizeindividualswhomeetgoalsormilestonesintheircoreroles.

o Immediate feedback lets employees know that they are on the right track.

• Recognizeindividualswhoexceedwhatisexpectedofthemintheircoreroles.

o Feedback shows appreciation for discretionary efforts.

• Recognizeindividualsorteamsbasedoncriteriamostlikelytohaveadirectimpactonenterpriseperformance(e.g.,costreductionoffivepercentormore)whenitoccurs.

o Feedback reinforces criteria having optimal chances to implact business results in a meaningful way.

• Recognizeindividualsorteamsthroughcompetitions(e.g.,bydepartmentsorgeography).

o Feedback encourages outstanding individual and team performance.



performance or a collaborative team effort. For example, at the divisional level, an individual category could include the most new revenue or upsells or the highest qualitative score in customer service. At the team level, the competition could be for the team that creates the most innovative new product.

Some of the programs just mentioned only touch the top performers. Sometimes adding “runners-up” or “Top 100” category helps to recognize more people. That said, these people are still usually at the top of their region or division, so these additional categories may not sufficiently diversify the types of recognition. Another way organizations try to include more people is by incorporating programs that have the potential to indirectly lead to improved performance. One example is a perfect attendance program.

In summary, performance criteria need to tie to existing performance goals or other criteria that drive the enterprise forward in a meaningful way. The programs for defining performance and rewarding must also be flexible, so that employees will be engaged and excited to participate.

Behaviors – Behavioral criteria are typically based on an organization’s culture. This includes the attitudes, experiences, knowledge and beliefs within the enterprise. As part of setting behavioral criteria, many organizations define core values and other desired behaviors to employees. For example, safety may not be a core organizational value but safety is a critical behavior required in an organization’s manufacturing plant. Creating programs and criteria that improve behaviors can also lead to improvements to enterprise performance. Take, for example, a program such as “most likely to help a colleague out of a tight spot.” In a way, this program fosters teamwork; however, the program may also motivate employees to get more work completed – which, in turn, helps contribute to the bottom line.

When designing behavior criteria, organizations should do two things. First, they should consider the behaviors necessary to achieve individual performance and overall business goals. Second, they should identify which behaviors represent their culture. Consider the following questions organizations when determining which behaviors your organization will define, promote and recognize.

Behavioral criteria are

typically based on an

organization’s culture,

and include the attitudes,

experiences, knowledge

and beliefs within the

enterprise.

K E Y P O I N T



• Whatbehaviorswillhelpusincreaseorganizationalperformanceoverthe short and long term?

• Willcertainbehaviorshelpusintheshort-termbutthenhurtusinthe long term?

• Willcertainbehaviorshelpustochangeourcultureforthebetter?

• Arecertainbusinesscircumstancesnegativelyimpactinghowemployees feel about our values and causing them to behave in a way that does not support our culture?

• Howdowewantexternalaudiencestoviewourorganizationin the marketplace?

Tenure – The final criterion is tenure, which is recognition of an employee’s length of service. This is a nice way to appreciate employees who have been at the organization for a long time. However, because tenure can also be viewed by many as an entitlement, similar to compensation, these programs should be supplemented with other recognition programs.

Methodology for Assessing Recognition Worthiness

Once the criteria for performance, behaviors and tenure are established, it is important that organizations think about when a robust “scoring methodology” will be needed and when a simple reference “Criteria List” will do. Criteria and the process for determining reward winners should be clearly articulated to ensure program equity and transparency. For example, some recognition programs will have nomination processes, requiring the assessment of multiple criteria and different levels of calibration. Consider the following questions when making decisions.

• Howwillweknowifemployeeshavemetthekeycriteria?

• Willourassessmentmethodologybequalitative,quantitative or both?

• Howwillweconveycriteriatoemployees?

The last thing to consider is if one program is sufficient to drive the performance or behaviors your organization needs, or if more than one program is necessary. Intuit, for example, consolidated its recognition program under the name of “Spotlight,” and uses this program to



“spotlight performance, innovation and service dedication.”35 Innovation awards are for patent disclosures, patent filings and issued patents. Service awards are for milestone anniversaries in multiples of five years.

Recognizers

“Recognizers” are the people within or outside of an organization who provide employee recognition. Progressive organizations build out their recognition programs, so that anyone worthy of recognition can be recognized by anyone else. This ensures that the values and actions deemed appropriate get rewarded and reinforced regularly. It is important to think about who the recognizers should be. Consider the following questions.

• Whichrecognizerswillengageemployeesthemost?

• Whatrecognitionapproachwillencouragethebehaviorsandperformance that will drive our business forward?

We can group the recognizers into two categories – internal employee recognizers and external audience recognizers. The details of each category are shown in Figure 15.

35 Source: http://talentmgt.com/articles/view/ intuit_spotlights_strategic_importance_

of_global_employee_recognition/3.

Recognizers are defined

as the people within an

organization or outside of

it who give recognition to

an employee or group of

employees.

K E Y P O I N T






Internal Employee Recognizers

Internal employee recognizers include senior leaders, managers, teams and individuals. Leaders should consider who is doing the recognizing in their organizations today and how (or if) that should change. In the past at most organizations, senior leaders and managers were primarily responsible for recognizing employees. This approach is evolving, though, due to the rise of more collaborative work environments and the flattening of organizational structures. Increasingly, we see organizations encouraging all employees to recognize each other.

Figure 15: Types of Recognizers


Internal Employee Recognizers

Senior Leaders

Managers

Teams

Individuals

External Audiences Recognizers

Customers

Partners

Third-Party Award Constituents

Certifications

1



External Audience Recognizers

External audience recognizers include four main groups, including:

• Customers;

• Partners;

• Third-partyawardgivers;and,

• Third-partycertificationorganizations.

Many organizations view external audience recognition as very important. For example, customers and business partners may recognize employees through emails, anecdotes and even share token rewards. Some organizations choose to share this recognition internally; others let the initial recognition suffice. Your organization should have a point of view on whether these external recognitions are shared. Other types of external audience recognitions can include awards to the enterprise, team or individual. Examples include “best place to work awards,” “best product awards” and “the top 40 project managers under 40,” respectively. Furthermore, many organizations recognize employees for achieving professional certification and designations that are specific to roles, such as IT (program manager certification), finance (certified financial planner) and accounting (CPA). Again, leaders need to think about if they want to recognize employees when these acknowledgments occur or let the recognition from the third party be sufficient. Also, leaders need to consider if staff members are allowed to accept gifts from customers and, if so, what are the parameters? This decision should be made in conjunction with your organization’s legal or compliance department.

Direction

Another fundamental program design element is the direction in which recognition flows. As shown in Figure 16, there are three general directions in which recognition occurs – top-down (e.g., manager to employee), peer to peer (employee to employee) and bottom-up (employee to manager). The impact of recognition can be maximized when recognition flows in all of these directions throughout the organization. An increasing number of programs are designed, so that employees across the organization have the potential to be a recognizer, as well as the “recognizee” – the one receiving the recognition.



The direction of recognition has evolved in recent years from a mostly top-down approach to a combination of top-down and peer-to-peer. More recently organizations have added programs that also include bottom-up recognition. Lilly Canada is an example of an organization that has implemented a structure that encourages all three of these directions.

Figure 16: Directions of Recognition

Type Definition Why the Direction Is Important

Top down

Occurswhenpeoplerecognizesomeonewhoisbelowthemwithintheorganizationalhierarchy

• Manymanagerslookuptotheirsupervisorsforrecognitionandapprovaloftheiractions.Similarly,manyindividual/non-manageremployeesturntotheirmanagersinthesamemanner.

• Someemployeesfeeldistinctlyvaluedwhentheircontributionsarenoticedbymorepeoplethantheirdirectmanagers.Forexample,subordinateemployeesandmanagersoftenvaluefeedbackfromleaderswhoaretwoormorelevelsabovetheminrank–rangingfrom“theirboss’sboss”toa“C-levelexecutive”intheorganization.

Peer to Peer

Typicallyoccurswhenpeopleofequalstatusrecognizeeachother.Dependingonthecriteria,projectorsituation,apeercouldbeapersonwhoishigherintitle/rankorlowerintitle/rank.

• Organizationalhierarchiesareflatteningandpeopleareworkingtogethermoreonmultipleteams.Tobetterengageindividualswhoareonteams,organizationsarecreatingprogramsthatallowforthedirectionofrecognitiontoflowbetweenpeersandcolleagues.

• Thisstructurealsohelpstoencouragetherepetitionofkeybehaviorsandthebehaviorsbyothersintheorganizationasidefromanemployee’sdirectmanager.

Bottom up

Occurswhenpeoplerecognizesomeonewhoishigherthantheywithintheorganizationalhierarchy.Bottom-uprecognitionincludesnominationprogramsforwhichemployeesnominateleaderswhohaveexceledinaparticulararea.

• Managersaremeasuredincreasinglyonattributesthatdeterminehowwelltheyaretraining,motivatingandengagingtheirteamstoachieveresults.Withthat,theyalsoneedfeedbackandrecognitionfromthosebelowthem.

• Thisstructurealsoworkstobettersupportcollaborativeworkenvironmentsand,whennecessary,tobreakdownheavytop-downhierarchycultures(asdiscussedintheprevioussectionofthisreport).




Case in Point: Lilly Canada Drives Recognition across All Levels within the Enterprise36

Lilly Canada, one of Canada’s top pharmaceutical companies, is the Canadian affiliate of major American pharmaceutical company, Eli Lilly & Company. When data from “Voice of the Employee” surveys (done internally at Lilly Canada) showed room for improvement in rewards and recognition between supervisors and employees, Lilly Canada wanted to move to a solution that would recognize and reward sideways, up and down – as well as peer to peer, and also supervisor to subordinate and subordinate to supervisor. In 2010, Lilly Canada selected a third-party vendor to help them do this.

The HR team took the budget that it had for all of the other rewards programs and reallocated that dollar amount into a point value for use with the new system. This meant that Lilly Canada’s awards nomination process, along with all the dinners and gift cards, were replaced with a performance-based points system. Based on the number of people managed by each supervisor, points budgets for supervisors were developed. The solution was implemented to mimic the same performance leadership behaviors that show up in Lilly’s performance management system and code of conduct, in which performance management, leadership assessment and rewards are tightly integrated together.

Training and transparent exposure were key to a successful implementation. The transparency of the rewards program online made it easy to see who was and was not being rewarded, as well as for what supervisors were giving out points. The transparency of the system also helped managers learn best practices from each other. The HR team used both training and learn-as-wego processes to bring the new rewards program to managers, knowing that some managers would be concerned with over-recognition.

36 For more information, Recognizing Employees: Lilly Canada Increases Employee

Engagement with a Dynamic Rewards Program, Bersin & Associates / Katherine Jones, July

2011. Available to research members at www.bersin.com.

Lilly Canada wanted to

move to a solution that

would recognize and

reward sideways, up and

down – as well as peer to

peer, and also supervisor

to subordinate and

subordinate to supervisor.

K E Y P O I N T

http://www.bersin.com



Some of Lilly’s Canadian-based employees are managed by global managers around the world. These managers also have an opportunity to use the Canadian-based tool to recognize their Canadian staff members. This helps to ensure that physical separation or country location does not prevent the Canadian-based employees from benefiting by this offering.

Implementation of the rewards program has also given Lilly Canada a way to track employee satisfaction and engagement. The team used its 2010 I Love Rewards data to evaluate implementation usage, as well as employees’ response to Lilly’s Voice of the Employee survey. In fact, Lilly Canada has seen its overall employee engagement scores go from an unremarkable low-to-midrange score to a dramatic high. The company is now the number one affiliate worldwide when ranked against peer affiliates in employee engagement. e

Approval

In the context of this Employee Recognition Framework, approval is defined as the level of complexity and approvers needed for recognition to take place. As shown in Figure 17, there are three levels of approvals to consider, including rigorous, informal and none.

Case in Point: Lilly Canada (cont’d)

Figure 17: Types of Approval Approaches

Rigorous Informal None

Approval Process

• Recognitionapprovalrequiresinputfromavarietyofconstituentstoensuretherightbehaviorsarerecognizedandtherewardisappropriate.

• Rewardsprogramstendtohaveahighmonetarycomponentoragreatdealofsymbolismattachedtothem.

• Recognitionapprovalrequiresatleastoneotherpersoninadditiontothepersonwhoinitiallywantstorecognizetheemployee.

• Rewardstendtobesymbolicortoken.

• Recognitionapprovalrequiresnoinputinadditiontothatofthepersonwhodesirestorecognizeanother.

• Rewardstendtobepraiseortokenawards.

Approvers

• Requiresmanyoflevelsofsignoffand/oroneveryseniordepartmentleader.

• Requiressomeapproval;usuallysimplyverbalpermissionand/oranemailgivingpermission.

• Nolevelofsignoffrequired.




Our research found that organizations have to strike a balance with approval. Too many layers may deter people from participating in the recognition process; too few will result in leaders failing to sponsor the recognition program because they are uncomfortable with it.

Organizations should define an approval process that conveys when recognizers need approval and when they do not. Consider the following questions.

• Howrigorousshouldourprocessbe?

• Whatcircumstancesanddollaramountsseparateinformal from rigorous?

Visibility

For the purposes of recognition, we define visibility as the state in which the recognition can be seen or heard by others. There are three main settings in which employees are recognized, including public, group and private. Each of these is explained in greater detail in Figure 18.

Figure 18: Details on Recognition Visibility Levels

Type Definition Considerations

Public

Opentoallemployeesand/orotheraudiences,suchascustomers,mediaorpartners

• Manyrecognitionprogramsincorporateapublicelementtoincreasetransparencyandperceivedprestige.Forexample,arewardsprogramthatallowsmanypeople,perhapseventheentirecompany,orexternalclientsandpartnerstoparticipate,ishighlytransparentandconfersahighdegreeofprestige.Toensuretransparency,anorganizationmayrequirethatallnomineeswhowinberecognizedinapublicsetting.

• Therearevaryingdegreesofemployeecomfortwithrespecttopublicrecognition.Forexample,someemployeesmaybecomfortablebeingona“public”letteroremaillist,buthaveabsolutelynointerestingoingonstagetoberecognized(orbeingaskedtogiveaspeechbeforeagroup).

• Toallowemployeeswhodonotwanttobeannouncedpubliclyforsomething,rewardsprogramownersand/ormanagersshouldbesuretodisclosethelevelofvisibilityinadvance,sothatemployeescanopt-outifthatistheirpreference.




Technology is an additional important visibility consideration. Many organizations are creating programs that use online social platforms to facilitate recognition. These platforms allow everyone registered to view and contribute to Facebook-like “news feeds.” This is a very public way of displaying who receives recognition, why they get it and what rewards are given. This format increases the transparency of the program and potentially the engagement of some employees. That said, the platforms can be used for group or private recognition as well. For example, some organizations will establish internal limitations on who can see what, so perhaps only a department can see the recognitions taking place. In addition, people giving recognition can choose to send it only to the person being recognized – making the recognition private. Employees should still keep in mind that the recognizee’s preferences regarding recognition when using these systems and adjust their recognition approach accordingly.

Figure 18: Details on Recognition Visibility Levels (cont’d)

Type Definition Considerations

Group

Giveninamoreintimateenvironment,suchasinfrontofateamordepartment

• Similartopublicvisibility,manyrecognitionprogramsneedtobedeliveredinagroupsettingtoincreasetransparency(e.g.,monthlydepartmentorsmallteamcontests).

• Sincemanagershaveagreaterdegreeofcontroloverwhathappensintheirdepartments,theycanmoreeasilycustomizetheprogramtoalignwithemployeepreferences.Forexample,ifthereareemployeeswhodespisewalkinginfrontofasmallgroupandgivingaspeech,themanagercansayafewwordsonbehalfofhis/heremployeeandhandthatpersonthereward.

Private

One-on-onerecognition • Somerecognitiondoesnotrequireahighdegreeoftransparency.Assuch,thisrecognitioncanbecompletelycustomizedbasedontheemployee’spreferenceforprivaterecognition.

• Sometimesmanagersneedtoacknowledgeonepersonprivatelybecauseaconfidentialelementwasrecognized(e.g.,amilestonetoIPOplanningorotherliquidityeventscannotbedisclosedduetoindustryregulations).


When thinking about

visibility, organizations

need to consider the

right balance between

what the employee

prefers and the program

requirements.

K E Y P O I N T



Overall, when thinking about visibility, organizations need to consider the right balance between what employees prefer and what the program requires.

Frequency

In the context of recognition, frequency refers to the rate at which the recognition occurs or is repeated over a particular period of time. Recognition can be given annually, quarterly, monthly, weekly, daily or a combination of these timeframes.

The primary factor determining recognition program frequency is the program purpose and criteria, which we have already discussed at length. Many programs are event-driven and frequency is determined based on key dates. For example, highest annual revenue or MVP criteria requirements can take a year to complete. As a result the event would occur once a year; however, reminders about the performance levels necessary to attend the event could be sent out on a quarterly basis. Conversely, some performance and behaviors occur spontaneously. In these instances, recognition frequency could be daily or whenever the behavior occurs.

It is important to take into account employee needs when determining frequency. At the beginning of this report, we discussed the importance of employee motivations. When determining appropriate frequency, consider how recognition will motivate employees. For example, managers and peers comprise an employee’s close network at work – regular recognition from this group will enhance the employee’s sense of belonging, in addition to communicating the value of the employee’s specific activities. On the other end of the spectrum, senior leaders tend to be representative of the entire organization and recognition from them will likely have a greater impact on an employee’s sense of esteem and accomplishment. Since this type of recognition contributes differently to the employee’s motivation, less frequent recognition may be appropriate. There is no universal “right” answer when determining recognition frequency, as this is something that will vary based on the goals of the program, the organization’s culture and the people involved.



Generally speaking, though, more genuine, targeted, thoughtful recognition is better than less, as it reinforces the right behaviors immediately. An example of organization that has incorporated frequent recognition is Trinity Health, which is the 12th largest healthcare system in the U.S. Trinity Health encourages teams to begin meetings with a Reflection, perhaps a thoughtful reading, a humorous story, or simply a moment of silence, to bring participants fully into the meeting. At the end of the meeting, teams are encouraged to express some form of appreciation. Depending on what the focus is, the appreciation could go to the entire team or an individual. It could also be recognition of something significant or a small contribution. Regardless, the point is that taking the time to be intentional with appreciation or recognition can be easily integrated into daily or weekly activities; it does not have to take a lot of time or cost a lot of money, and it has the potential to be extremely memorable. Furthermore, it makes appreciation part of the everyday culture.

Delivery

Delivery refers to the methods used, so that recognition can touch an individual or group of individuals. There are four main ways in which recognition is delivered, including face to face, letter / email, event and online platforms, as shown in Figure 19. Organizations should consider each one, and how it relates to the organization’s and employees’ needs.

Generally speaking,

more genuine, targeted,

thoughtful recognition

is better than less, as

it reinforces the right

behaviors immediately.

K E Y P O I N T



Once your organization has had a dialogue about the delivery platforms, it is time to move to the next section of the Framework in which customization will be discussed in detail.

Customization

We define customization as the way an organization may alter its recognition program to meet the needs of employee types, business units and geographies. Figure 20 shows some of the different populations requiring customization.

Figure 19: Types of Delivery Methods


Face to Face • To capture spontaneous, in-the-moment

recognition as it occurs • To personalize or express thoughtfulness • To engage a team at meetings • To show transparency within program (e.g.,

awards competitions)

Letter / Email • To recognize a lot of people who are remote or

in different areas of the business (e.g., newsletters)

• To demonstrate special acknowledgments (e.g., tenure or other)

• To personalize (e.g., thank-you note signed by one person or a group)

Events • To acknowledge select audiences in a

personalized structure (e.g., formal awards ceremonies for top 100, customers service representatives MVP or innovator)

• To instill common behaviors among groups (e.g., team-building athletic events that offer prizes for demonstrating valued behaviors)

• To recognize teams or individuals on an ad-hoc basis (e.g., team appreciation lunches and dinners)

Online Platforms • To convey program information or distribute

awards; examples of platform types include: • Intranet and / or external website • Points-based platforms • Social platforms • Mobile devices



Organizations need to think through the different ways recognition should be customized in terms of the overall approach and the reward components (Rewards will be discussed in greater detail in the next section). In addition, when creating the segmentation, leaders must ensure that what is created is perceived as fair and equitable.

Measurement

As we have alluded to throughout this report, measurement is an important aspect of developing a comprehensive recognition strategy. Specifically, you should consider how to design your organization’s measurement approach, methodology and reporting (as shown in Figure 21). Once you have thought through these elements, create an action plan to move your organization forward.

Figure 20: Customization Considerations

Customization Type Considerations Key Questions

Employee Type

• SalariedversusHourly

• HiPoversusSolidPerformer

• Howdoyouwanttoengagedifferentaudiencestoparticipate(e.g.,professional,hourlyandcriticalsegments)?

• Whatrecognitionprogramscouldyoutargetthatwouldbebothfunandarebasedonyourbusinessobjectivesandcriteria?

Business Unit / Function

• ProductGroupAversusProductGroupB

• ITversusFinance

• Whenisbehavioruniformityacrosstheenterprisethegoalandwhenshouldtheapproachbesegmented?

• Aretheredifferentbehaviorsyouwanttoencouragethatvaryfromonedepartmenttothenext(i.e.,pharmaceuticalsdivisionversusafoodproductdivision)?

Geography

• MajorCityversussmalltown

• State/ProvinceAversusState/ProvinceB

• CountyAversusCountryB

• Dointerpretationsforacorebehaviorvaryfromcitytocityorcountrytocountry(i.e.,howdoyoushowrespectindifferentcultures)?

• Howshouldyousegmentyourmaterials(e.g.,colorsused,languagetranslations,timezoneconsiderations,etc.)?




Approach

A measurement approach details how the organization will measure the program and identifies who will be responsible for this task. For example, large and global organizations may engage a group of local champions on the project team who can more easily gather and assess information in different countries and regions. When approaching measurement, organizations should also consider defining what results they will measure immediately and what will be measured over the long term. For instance, if your organization has not valued recognition in the past,

Figure 21: Components That Lead to a Measurement Action Plan


Approach

Methodology

Reporting

Measurement Action Plan

1



it could take from several months to years for some cultural changes to appear. Other changes may be noticeable almost immediately.

Methodology

We view methodology as the underlying rules and protocols for measuring recognition. For example, what will you measure to show the impact of recognition? Will you use employee engagement scores, performance reviews, sales results, retention data or something else? After you know what you would like to use across multiple departments and geographies, it is important to think about how you will get this data. It is critical to partner with the owners of this data, so that you can get what you need quickly.

Reporting

Determine early on what types of information you will share, with whom the reports will be shared and how frequently reports will be distributed. Many companies create dashboards for the leadership team that show everything from rewards redeemed and time spent on an online recognition website, to the list of behaviors changed and the business goals achieved. Sometimes report creation and distribution require levels of customization. For example, will you share different reports with leaders in the U.S., as compared with those in Australia?

Measurement Action Plan

The answers to the questions introduced in the previous section will enable you to create a measurement action plan. We have summarized these questions as follows.

• Whatresourcesdoweneedtomeasureourprograms?Whodoweneed to engage and how should we engage them?

• Whatmethodologieswillbeusedtoshowtheimpactofrecognition?

• Whattoolswillweusetomeasurekeyperformances,behaviors and actions?

• Fromwhatregionsanddepartmentswillwecollectdata?

• Whenwilldatabecompiledbytherecognitionteamandwhenwillitneed to come from someone else?



• Whatreportswillbecreatedandtowhomwillthereports be distributed?

• Howoftenwillreportsbecreated?

Overall, establishing a clear approach, methodology, reporting structure and action plan will help to ensure that programs are structured in ways that it can be further optimized in the future.

Rewards

Overview

With most of the core elements of the recognition program determined, the next step is to think about what, if any, types of rewards should be part of the recognition program. As discussed earlier in the report, both appreciation (without any financial elements) and rewards make noteworthy contributions to employee motivation.

That said, we do have some indication that recognition programs which also have rewards may correlate with organizations with better financial performance. In our High-Impact Performance Management research37, we found that 58 percent of organizations provide individual or team recognition, but only 36 percent have a formal rewards program. This research also found that organizations with “recognition-only” programs or recognition and rewards programs both had better employee38 and talent39 results than organizations that lacked those programs. Interestingly, though, we only found a relationship between organizations with both recognition and rewards programs and financial performance – we did not find that organizations with “recognition-only” programs had better financial performance. Specifically, we found that 57 percent of organizations with both a recognition and reward

37 For more information, please see our High-Impact Performance Management

industry studies, available to research members at www.bersin.com/library or for

purchase at www.bersin.com/hipm.38 “Employee results” is an index comprised of employee productivity, employee

engagement and customer satisfaction.39 “Talent results” is an index comprised of hiring the best people, developing great

leaders, developing employees, retaining top performers, planning for future talent

needs, having the right people in the right jobs.

Our research found

that 57 percent of

organizations with a

recognition and reward

program had strong

financial performance.

K E Y P O I N T


http://www.bersin.com/hipm



program had strong financial performance; however, only 38 percent of organizations with only a recognition program had strong results – about the same percentage as those organizations that lacked both a recognition and rewards program.

This research clearly indicates that organizations need to at least consider if it is appropriate for them to include rewards in addition to their recognition program. Within this section, we will discuss each reward category in more detail.

Reward Types

Organizations use several types of rewards to motivate employees. As shown in Figure 22, these can be divided into three categories – emblematic, token and monetary. We define emblematic rewards as recognition that represents an acknowledgement of contribution, but typically cannot be converted to something with monetary value. We include certificates, plaques and trophies in this category. Although they cost some money to produce, they are not seen by the recognizee as having monetary value. Token rewards include items that cost money but are viewed by recognizee as rewards of token value, usually less than $100. The monetary category includes rewardsthat are not of token value. This category generally includes rewards that cost more than $100.

Figure 22: Reward Types*

Emblematic Token Monetary

• Praiseandappreciation• Specialprojects(e.g.,newskills)• Certificates• Trophies• Plaques

• Giftcards• Candy/flowers• Lunches/dinners• Merchandise• Pointsthatconverttoother

tokenitems

• Specialtrips(e.g.,teamoutings)• Awardsconferences• Learningconferences• Cash/vouchers• Extrapaidtime-off

Source: Bersin & Associates, 2012.*Note: The items listed in this figure are suggestive of the types of rewards within each category, but are not exhaustive of all types of rewards.



To determine which reward is most relevant, organizations should think back to the recognition criteria, as well as the overall purpose of recognition described in the strategy section of this paper (This section also includes the discussion on employee motivations).

As part of thinking through each of the “individual” rewards for every “reward type,” the program team needs to determine who should select the reward type for the employee – either employees themselves or the company.

Many organizations are flexible in that they allow employees to give different rewards to different people. This allows for a greater degree of thoughtfulness and reward customization. For example, one leader from a large services organization shared some commentary from one of his high-performing employees at a monthly checkpoint meeting. The employee stated, “I never get recognized.” He responded, “What do you mean? You got a few days of extra paid time off, cash and several gift cards over the past two years.” The employee replied, “Yes, but I have never received a plaque in front of the group.” So, for her, the appreciation was the plaque that would be placed prominently on the wall in the hallway while for others it may be the cash or extra paid time-off. Overall, when rewards and the appreciation itself are thoughtful and closely align with the employee needs, employees are more likely to be motivated down the road.

Companies should consider distributing rewards that are “company-selected” when using them will either give them greater control over costs or when they want to deliver unique messages that can only be communicated by using a particular category of rewards.

The last thing organizations need to consider as part of rewards is the mix of reward types given. Consider the following questions.

• Whatistherightmixofnon-monetaryversusmonetaryrewards?

• Whenwillacertificateorasimplethankyousuffice?

• Iscashreallynecessary?

As we discussed in earlier sections of this report, praise is valuable, sometimes more valuable than rewards with cash equivalents. Research experiments suggest that a small reward or a small rewards can have a productive effect. Heyman and Ariely (2004) suggest that, when offered a small amount of money, people are less likely to put forth effort

Progressive organizations

are flexible in that they

allow staff members

to give different

rewards to different

people. This allows

for a greater degree

of thoughtfulness and

reward customization.

K E Y P O I N T



into a given task than if they were not offered any sort of financial compensation. On the other hand, if they are given a friendly gift, such as a candy bar, they will tend to exert more effort. Interestingly enough, once a monetary value is attached to a gift, the transaction is likely to be seen as though it exists in a monetary market, and effort tends to be less than if the dollar value had not been made apparent.40

Three additional items should be considered as part of program design – employee support, vendor strategy and talent management integration. We discuss each of these in detail in the following sections.

Employee Support

Employee support should not be forgotten when designing your recognition program. One of the first things to do is to establish a “go-to person” or group of people the employee can contact with questions about the recognition program. This person may be within the business unit, HR, or perhaps with the vendor who helps administer the person. The employee support person’s responsibilities should be to answer questions about the overall program, the rewards program and its requirements.

Vendor Strategy

Vendors play an important role in the design and implementation of a recognition program. They can generally be divided into the following (not mutually exclusive) categories (see Figure 23):

1. Survey vendors;

2. Tangible rewards vendors;

3. Consultants; and,

4. Technology vendors.

40 Source: “Effort for Payment: A Tale of Two Markets,” Psychological Science / James

Heyman and Dan Ariely, University of California, Berkeley and Massachusetts Institute of

Technology, March 2004.



We explain these vendor categories as follows.

1. Survey – Some HR organizations use external survey vendors to help them to answer key questions and conduct detailed analyses. In other cases, organizations create and analyze their own surveys. Organizations need to decide who will conduct the surveys necessary to obtain key data about topics, such as employee engagement and satisfaction.

2. Tangible Rewards – Numerous vendors provide tangible rewards, such as merchandise, gift cards and trophies.

3. Consultants – Consultants provide services to train managers or prepare marketing materials, among other services.

4. Technology – As part of this effort, there are several types of platforms to consider, such as those used for administering surveys, rewards (e.g., point redemption systems, social recognition technology) and training (e.g., online learning modules).

Figure 23: Vendors Categories to Consider


Surveys

Tangible Rewards

Consultants

Technology Recognition

Vendor Options

Organizations need to

evaluate vendor costs

across the organization

to identify talent

management process

improvements and other

operational synergies.

K E Y P O I N T



Another consideration is the number of vendors or suppliers your organization already uses today, both locally and globally. With this understanding, companies can decide where to consolidate, add or remove suppliers to meet their needs. Moreover, organizations need to evaluate vendor costs across the organization to identify talent management process improvements and other operational synergies.

Talent Management Integration

The last portion of the design section of the Framework is talent management integration. A well-designed recognition program will integrate with and add value to other talent management programs such as compensation, benefits, performance management, engagement, learning and even recruiting. It will also work to ensure there is no duplication of effort.

Earlier in the recognition strategy section of the Framework, we identified how recognition can intersect with other talent management disciplines. As part of that section, we asked you to consider which strategic talent management integration “actions” should be incorporated into your organization’s recognition program. Now, you should identify how those key strategic “actions” will be integrated on a tactical level. For example, consider the following questions.

• Howmanydaysshouldweallowforextrapaidtime-offaspartoftherecognition program?

• Whataretheparametersforflexibleworkschedulesaspartoftherecognition program?

Another important component to consider is performance management. For example, “To what extent should recognition feedback be captured in the performance management system and who will be responsible for ensuring this takes place?”

A well-designed

recognition program

will integrate with and

add value to other talent

management programs

such as compensation,

benefits, performance

management,

engagement, learning

and even recruiting.

K E Y P O I N T



Part 3: Program Launch, Management and Measurement

Overview

Once a program is designed, it has to be launched, managed and measured regularly. Considerable thought should be given to deciding the optimal implementation and supporting governance model for recognition. These efforts allow you to keep critical lines of communication flowing from the business to supporting HR functions. The evaluation of your recognition program requires the tracking and use of key metrics to drive continuous improvement, and to ultimately improve the performance, retention and engagement of your workforce. This next section will discuss the three areas shown in Figure 24:

Figure 24: Bersin & Associates Employee Recognition Framework® – Governance & Management, Metrics & Evaluation, and Launch






Design


Gov

erna

nce

and

Man

agem

ent

Exe

cutiv

e S

pons

orsh

ip |

Adm

inis

tratio

n | C

ompl

ianc

e | E

quity

| O

ngoi

ng O

ptim

izat

ion



Business O

utcomes | P

erformance | B

ehaviors | Em


Engagem

ent | Retention | A

ctivity andw P

articipation Level















1. Launch;

2. Management and governance; and,

3. Metrics and evaluation.

Launch

Launch is the time when the stakeholders need to create and execute a plan that communicates the recognition program’s purpose and its benefits to employees. The four key elements include a branding plan, employee training, marketing and communications. This next section will discuss each of these elements in detail.

Branding Plan

A branding plan helps to convey to employees the details of the recognition program. As part of the program strategy and design section of the Framework, organizations should have collected feedback from employees to understand how they perceive recognition and what they would like from the program. In addition, key program criteria should have been defined. This information should be included in the branding plan. Other factors that will inform the branding plan are the organization’s overall brand, the variations on that theme for existing complementary programs and appropriate message segmentation for different employee populations. For example, what will you say for programs targeting HiPos, midlevel managers in China or another population? What messages will be the same and what will be different?

The overall recognition program and individual rewards program messages should be simple, meaningful and consistent. For example, the Calgary Marriott uses the name S.P.I.R.I.T. and it includes the things the organization values – special recognition, participation in the community, introducing new business, recruitment, innovation and team recognition. The performance and behaviors valued are clearly articulated in the program’s name.



Employee Training

Training is one of the most important elements of the launch section. Employees, and especially managers, are very busy, so time away from their regular work needs to be a valuable use of their time. Therefore, the training program must be simple, relevant and concise. Employee training initiatives should focus on two fundamental areas.

First, managers should be trained on how to motivate and recognize their employees. This includes what performance and behaviors should be recognized (as identified through the program criteria), as well as how to give the recognition. Specifically, managers should be equipped with knowledge about how to recognize employees in a thoughtful and meaningful way. For example, what types of words should they use and in what manner should those words be conveyed? To do this, many organizations have created programs to guide managers on best practices in recognition and employee motivation.

The following case in point is an example of an organization that has integrated recognition into its management training programs.

Case in Point: Financial Services Organization Trains Managers to Be Program Ambassadors

With roughly 10,000 employees, a large financial services organization has incorporated several manager training programs to explain the importance of recognition and how it should be used to motivate employees. The organization’s recognition programs encourage managers to give praise and feedback that tie with business goals, while also motivating staff with rewards based on their preferences (e.g., cash, certificates, and verbal praise, and other).

To do this, the organization offers supervisor training to all managers in the form of two courses. The first course, which is offered to all new supervisors, focuses on the fundamentals of management. It includes an introduction about recognition,

Training is one of the

most important elements

of the launch section.

K E Y P O I N T



motivation and rewards –intended to define key concepts and how they should be used across the organization. The second program takes a more in-depth look at management essentials. This program lasts eight weeks, and includes a “deep-dive” on motivation and rewards. In this session, the organization’s managers are taught how to critically think about “what” drives their employees professionally and personally. In addition, the program educates managers about “how” they should motivate staff and configure recognition messages that are meaningful. Then, the program connects the motivations with rewards that are appropriate based on the organization’s business goals and culture. Finally, the training programs reinforce the branding messages, criteria and benefits of its enterprise-wide recognition program.

Overall, the results of the manager training program have been instrumental in keeping employees motivated, engaged and retained – and, importantly, are driving the business forward. Furthermore, the fact that the programs are structured helps to ensure all managers implement the programs in an efficient and engaging manner. This structure facilitates continuity with the organization’s overall recognition effort. e

A second fundamental element is training on the program itself. Many organizations offer multiple sessions which include hands-on training, as well as online tutorials. Organizations should also consider when training is necessary. For example, do employees just need written instructions about how to complete nomination forms or do they need training on how to communicate strengths on the nomination form?

Across the past few years, there has been a growing trend in online recognition platforms. Training may be needed on these platforms; however, the goal of most of these platforms is to make the programs intuitive enough that no major training is required. These platforms include features such as distributing thank you notes and allocating points that can be traded for merchandise. As discussed earlier, some vendors also provide systems that also include a social networking component to them – the ability to have a “news feed” like what is provided on LinkedIn or Facebook. As a result, there is a need for on-line

Case in Point: Financial Services Organization Trains Managers (cont’d)

Managers should be

equipped with the

knowledge about how

to recognize employees

in a thoughtful and

meaningful way.

K E Y P O I N T



and sometimes in-person training that provides guidance on the “dos and don’ts” of using a real-time system.

Marketing

As part of the launch, corporate marketing materials must be created. They should be educational, succinct and truly describe the main messages of the recognition program, so that it resonates with staff. In addition, if your organization partners with a third-party vendor, it may want to incorporate some of that provider’s materials, particularly with respect to the functionality or items that will engage an employee to participate. Core marketing materials generally include, but are not limited to:

• Brochures;

• Intranetportalsandnewsletters;

• Flyers;and,

• Written/videotestimonials.

All materials should support the criteria of the program and the organization’s culture and values overall.

When thinking about the marketing plan, some organizations prefer to keep the details on the company’s internal website or intranet. Others may choose to communicate the program or elements of it externally on the web, so that it is visible to the public. For example, one organization may simply decide to write a small paragraph about the program on the recruiting section of its external website to help attract candidates. Other organizations may decide to post the details of their entire recognition programs prominently on their external websites. For example Kern County Superintendent of Schools displays the program on its home page as shown Figure 25.41

41 Source: http://kern.org/.

Corporate marketing

materials should be

educational, succinct

and truly describe the

main messages of the

recognition program,

so that it resonates

with staff.

K E Y P O I N T

http://kern.org/



Kern County also shows the complete details of its program on this external website, as shown in Figure 26. A summary of the recognition program is shown at the top of the page. (In addition, Kern County posts a brochure about recognition on its website (see section, “Appendix I: Additional Figures” for more details.)

Figure 25: Kern County Superintendent of Schools’ Home Page

Source: Kern County Superintendent of Schools, 2012.



Communication

With the branding plan, training programs and marketing materials created, it is time to communicate the recognition program(s) to employees. At this juncture, it is important to determine who within the organization will communicate the initial launch of the program. You should also establish who will continually communicate about the program, so as to maintain the greatest levels of engagement. Within both of these communications, it is important to communicate to employees what they get out of the recognition program – why they should recognize peers and what they will gain from supporting each other and the organization as a whole.

Executive sponsorship of the program is perhaps most strongly demonstrated by the company’s CEO. For example, KPMG in Canada had its CEO launch the initial recognition program; he continues to support the program by talking about it frequently when he has conference calls

Figure 26: Kern County Superintendent Schools’ Recognition – External Website Page

Source: Kern County Superintendent of Schools, 2012.

Summary

Program Components



or meetings with employees. As another example, the CEO and president at Meridian celebrates the success of the program on an ongoing basis by sharing recognition success stories with the entire organization during Meridian’s “Early Word” conference calls, which occur approximately every quarter.

As part of the communications, organizations also need to think about what tools will be used to communicate the program. Communications can be delivered through venues such as online mediums, lunchrooms, town halls, and conference calls. Written marketing materials should be prepared and disseminated as appropriate. Organizations should also think about who will create new materials when programs change. Employees often need reminders about programs because they have so much on their plates that it is easy to forget about them.

For example, a large company in the services industry has a very enticing recognition program but company-wide participation in it is very low. The performance-based recognition program evaluates a number of manger-nominated employees and then selects 10 winners quarterly who receive a $1,000 gift card. Those winners are then entered into a grand prize for that quarter – an attractive one week of paid time-off and a $5,000 travel voucher to go wherever the employee wanted to go. However, the organization is struggling to get nominations because information about the program was inadequately communicated to managers. To address this, the company plans to hold one-on-one conversations with managers to increase levels of engagement in the program. Furthermore, the program team plans to promote the programs in the company newsletter and in onboarding programs.

Communicating the recognition program to new employees is important. New employees join the company on a regular basis. It is important to determine what programs will be communicated though onboarding programs, what programs should be communicated by managers and what programs should be communicated by other materials sources or venues.

Finally, you should also determine how best to communicate the program to managers, particularly when elements of the program’s objectives are temporary tied to key performance indicators or the manager needs to allocate some of their work hours to recognition training. Be sure to clearly articulate to managers what they will gain from engaging in recognition activities.



Management and Governance

For the recognition program to be effective over the long-term, HR executives, business leaders and other employees must make an ongoing commitment to it. The management and governance portion of the Framework is designed to help organizations think about how to sustain the program over time. In this section, we will focus on five components that are critical to the overall operation of the program, including – executive sponsorship, administration, compliance, equity and ongoing optimization.

Executive Sponsorship

As with any major business initiative, and particularly holistic recognition programs, executive sponsorship is vital. While HR is often the main executive sponsor, for recognition to be successful, the CEO must buy into the strategy. It is difficult to create a unified culture of recognition without this support. It is also important for other C-level executives to support the initiative. These leaders have the greatest influence over other managers in different business units, geographies and functions. Strong leaders “lead by example,” – this management style is essential to promote recognition broadly, particularly when praise and simple “thank yous” are not part of the culture. It is also important to note that leadership tends to change over time, so be sure you have multiple executives, managers and others onboard with the initiative.

Administration

Program administration is an important element in optimizing returns from the recognition program. Today, many recognition programs operate in silos – with business units and departments doing different things that are not transparent to others in the organization. This can result in behavioral inconsistencies, employees misunderstanding what is worthy of that recognition and employees viewing the programs as unfair. Furthermore, it is next to impossible to measure recognition programs in a meaningful way when you do not know what is happening across different business departments.

Progressive companies centralize program administration and generally have one person spearhead those efforts – usually a program manager, project manager, analyst or other. When there is a lot of decentralization in the business and /or decentralization needed for certain recognition

The management and

governance portion of the

Framework is designed to

help organizations think

about how to sustain the

program over time.

K E Y P O I N T



programs, this person’s role would be to coordinate all activities in a way that makes the program easier to measure. This person would also oversee the creation and monitoring of key metrics and other dashboards. This is no simple undertaking. Many organizations also use task forces to provide support. The task force is comprised of individuals from multiple regions with different domain expertise.

Compliance

Over time, policies, procedures and goals may change. In addition, it is possible that people stray from the program’s goals and policies. To help combat this, organizations should think about how they will regularly communicate policies and any changes to them. However, misalignment issues are not always easy to see. To help manage compliance more proactively, many organizations conduct audits of the program in a non-obtrusive way.

Some organizations involve their finance and legal departments in the program management process, particularly since those divisions have domain expertise about how the enterprise needs to adhere to country, state and local regulations. For example, consider compliance as it relates to rewards, and particularly cash and trips. Rewards must be in compliance with all applicable tax laws. Rewards can also have tax implications for employees; it is important to figure out how you want to address them. Intuit, for example, offers a awards program, in which the company grosses up the recipient’s income to cover award taxes for employees.42

Equity

A key portion of the recognition strategy and program design elements of the Framework is putting forth a structure that ensures the program is equitable over time. Program criteria may change, new programs are often added and some are discontinued. When these situations occur, it is important for someone to evaluate how the changes affect the recognition program as a whole, as well as the diverse business departments. The following are key questions to ask.

42 Source: http://talentmgt.com/articles/view/intuit_spotlights_strategic_importance_

of_global_employee_recognition/3.





• Arethenewcriteriatransparentforemployees?

• Whodoweneedtonotifywhenprogramsarediscontinued?

For the program to have the best chances of being viewed as credible by employees, it is critical that changes to criteria, scoring methodologies, and material changes to rewards are conveyed in a timely fashion.

Also, when thinking about equity, organizations should consider how often programs are being used. The likelihood of inequity increases when a subset of people in the organization use the program and others do not. Typically, when managers and employees are engaged with the program, they use it appropriately. When they are not, they are not likely to make it part of their routines.

For example, many organizations provide managers centralized funding to provide “on the spot” recognition. Some managers may use all of this budget while others only use 10 percent. It is unreasonable to expect that managers use every penny to reward staff – some people’s performance will not be worthy. However, it is essential to look at extremes to see if there is an equity issue. With that said, tracking this activity is no easy undertaking. Some companies have protocols in place to track this either manually or as part of a financial budgeting program. It is also important to point out that technology configured specifically for recognition is evolving to better track “who” is recognizing and “why” the recognition is occurring.

Ongoing Optimization

Ongoing optimization is essential to ensure a successful management and governance program. The number one factor influencing its success is how effective an organization is at ensuring that the program’s vision evolves over time to align with business goals and employee needs. However, our conversations with leaders reveal that there is some significant work to be done in this area.

As mentioned earlier, the majority of companies with programs today lack a holistic strategy and fail to embrace the right measurement practices. To increase the effectiveness of their optimization efforts, HR leaders should focus on doing the following three things.

The likelihood of

inequity increases when

a subset of people in

the organization use

the program and others

do not.

K E Y P O I N T



1. Assess Metrics Relative to Benchmarks – Today some organizations are just not measuring the right things while others, unfortunately, are not measuring at all. When the right metrics are in place and realistic goals are set, it is easier to make proactive changes to the program and work with those accountable to make progress.

2. Collect Continuous Feedback on Programs – There must be a structure in place, so that program owners can continuously collect feedback from staff. As we mentioned earlier, some of this feedback is collected through employee support initiatives. In addition, some companies use focus groups, surveys and one-on-one conversations to obtain insightful and up-to-date information about the program’s effectiveness.

3. Meet Regularly to Discuss Progress and Set New Goals – The program team should meet to discuss progress and set new goals when appropriate. Progressive organizations schedule regular meetings with the program manager, project team, executive sponsor and other leaders, when necessary. How often the team meets with each group depends on the complexity of the program, as well as the size of the organization.


The final portion of the Employee Recognition Framework is metrics and evaluation. Incorporating the right metrics and evaluation processes are key to ensuring the overall success of the recognition program and its role in meeting business goals. In this next section, we will discuss seven fundamental elements, including – business outcomes, performance, behaviors, employee satisfaction, employee engagement, employee retention and activities and participation level. At this stage of program implementation, organizations should establish key benchmarks for each of the elements that they want to track, and also decide who will review the metrics (e.g., which business leaders and HR leaders) and how often they will be reviewed.

Business Outcomes

Business outcomes include a wide range of potential metrics in addition to financial measures, such as increased customer satisfaction, greater employee commitment, enhanced leadership effectiveness, more



productive sales approaches, improved work quality and so forth.43 While these are not direct financial measures, business leaders understand that they are key contributors to financial performance and are often leading indicators of future business success.

When thinking through business outcomes, organizations need to ensure that the goals which will be regularly assessed are clear. This was discussed at length in the vision element of the strategy section of the this report. Generally speaking, the exact business outcomes vary from one organization to another, but all should be items that are measurable and drive the business forward. For example, most organizations view improving customer service as something that will influence revenue and business outcomes, but what else pertains to your business? Manufacturing organizations may set Six Sigma44 goals. Organizations with significant turnover may focus on employee commitment or engagement. Keep in mind, such challenges can vary across among business units.

The following questions are intended to help you to think through program evaluation.

• Haveweachievedourbusinessgoals?Ifwehavenot,whatdidwe do wrong?

• Doourgoalsneedtoberedefined?

• Ifwereachedourgoals,havewecelebratedoursuccessinameaningful way?

• Howdowewanttocommunicateoursuccessandareastoimproveupon to program stakeholders and other employees?

Performance

Measuring performance is critical to the success of the overall recognition effort. This includes the measuring of the performance of individual employees and evaluating the recognition programs as they relate to

43 Source: The Six Disciplines of Breakthrough Learning, Calhoun Wick, Roy Pollock,

Andrew Jefferson, Richard Flannigan / John Wiley, 2006, http://media.wiley.com/product_

data/excerpt/21/04705265/0470526521.pdf.44 “Six Sigma” is a rigorous, focused, high-impact process that uses proven quality

principles and techniques to reduce process variance. For more information on Six Sigma,

please visit http://www.isixsigma.com, which offers articles and easy-to-read examples of

how to apply Six Sigma to any business process.

Generally speaking,

the exact business

outcomes vary from one

organization to another,

but all should be items

that are measurable

and drive the business

forward.

K E Y P O I N T

http://media.wiley.com/product_data/excerpt/21/04705265/0470526521.pdf

http://media.wiley.com/product_data/excerpt/21/04705265/0470526521.pdf

http://www.isixsigma.com



key criteria and business outcomes. For example, consider the following questions, “Did the rewards program in Division A contribute to a rise in revenue by X percent compared with the previous year?”, and “Based on our criteria, what performance improved the most?” With answers to these types of questions, organizations can best determine how well its recognition efforts are performing and which changes to the programs are warranted. Furthermore, organizations can more accurately adjust performance metrics and benchmarks as necessary.

It is also important to once again point out that recognition is a supplement to traditional performance management (e.g., reviews, 360s and promotions). With that, as part of the evaluation process, organizations need to identify what elements of the recognition program should be measured and documented as part of the performance management process.

Behaviors

Measuring the valued behaviors is critical to the program’s success. Similar to what was discussed in performance, organizations should review their criteria, and determine if the behaviors recognized actually contributed to the individual performance of employees and business outcomes. Furthermore, organizations need to determine if the behaviors highlighted as most valuable supported their objectives pertaining to culture. Questions to consider include the following.

• Didwerecognizetherightbehaviors?

• Wereemployeesawareofwhattheorganizationvaluesthemost?

After reviewing the metrics and assessing what contributed to them, organizations are best prepared to make any necessary changes to their programs and adjust metrics as necessary.

Employee Satisfaction

As part of the strategy and program sections in this report, organizations were asked to consider getting feedback from employees about rewards, including how they would like to be recognized, what training they needed, and more. Based on these findings and the resulting design decisions, it is critical to go back and get a “pulse” on how employees view your programs. To do this, many organizations once again conduct surveys or use other methods (e.g. informal on-one-ones or focus groups)

Measuring performance

is critical to the success of

the overall recognition

effort.

K E Y P O I N T



to collect employee feedback. Based on that feedback, it is important to incorporate relevant changes to the program and adjust metrics as necessary.

Engagement45

Many organizations conduct an annual survey to measure employee engagement, satisfaction and retention. It is important to point out that satisfaction is not the same as engagement.46 Employees can like or dislike an attribute with respect to their jobs – emphasizing satisfaction or dissatisfaction. Engagement, however, is more about determining if the motivation is there for them to do their jobs. For example, “Is an employee emotionally connected to his / her job?”, and “How much discretionary effort will employees put forward?” Once the recognition program is implemented for a while, it is essential that organizations assess how the recognition program impacted engagement and then make changes as necessary.

Retention

As the economy begins to improve, many organizations are concerned about employee retention. As a result, progressive organizations are incorporating measurable recognition programs to help them improve retention. Retention is generally evaluated using data from the following sources:

• Turnoverdataeithercollectedmanuallyorreportedinanorganization’s human resource management system (HRMS); and,

• Surveydatathatassesslevelsofemployeeengagementandtheirimplications for retention.

Once these items are evaluated in conjunction with the other elements of measurement, organizations are most prepared to make changes to their programs and update their key benchmarks.

45 For more information, The Employee Engagement Primer, Bersin & Associates / Brenda

Kowske, Ph.D., January 2012. Available to research members at www.bersin.com/library.46 “Employee engagement” refers to an employee’s job satisfaction, loyalty and

inclination to expend discretionary effort toward organizational goals.




Activity and Participation Level

Ask yourself, “Did our organization achieve the tactical program goals we set out to achieve?” Some of the items to consider as part of evaluating the program activity level include:

• Recognitionbudgetversusspend;

• Numberofpeoplewhoparticipatedinaparticularprogram;

• Numberofpeoplewhoregisteredtouseonlinesocialnetworks;

• Numberofawardsgiven;

• Typeofrewardgiven;

• Numberofpointsredeemed;

• Howmuchtimeemployeesspendonthecompany’srecognitionwebsite; and,

• Documentationofrecognitionbyrecognizertype(e.g.,manager,customer, peer).

Many of these metrics should be part of the reporting dashboard that was created as part of the program design section of the Framework (measurement element). Organizations should regularly review what is driving strategic and tactical metrics at various levels. Once that is done, it is easier to make changes to the program and create new benchmarks. This will ensure that the programs have the best chances of success over the short and long terms – and also that the business views recognition as a valuable contributor to business goals, as opposed to “a nice to have” but unmeasurable perk.

Meridian is an example of an organization that created a measurable metrics and evaluation program.



Case in Point: How Meridian’s Metrics and Evaluation Efforts Fire on All Cylinders Meridian, one of Canada’s largest credit unions, has a talent management strategy based on the premise that engaged employees lead to engaged credit union members (e.g., customers), which ultimately drives profit and sustainable growth. Furthermore, the company believes that, when employees are recognized for desired behaviors, they are more likely to repeat these behaviors, which results in and sustains high organizational performance.

To improve its recognition efforts, the organization created a new program, “iApplaudu@Meridian.” Prior to creating the program, Meridian did two things. First, it involved the organization’s top leaders in the recognition strategy. Executive sponsorship of the program is perhaps most strongly demonstrated by the company’s president and CEO, who supports and endorses the program regularly. Second, the organization established clearly defined goals and objectives that would be evaluated and measured after the program was implemented.

Today, “iApplaudu@Meridian” includes a platform that allows for all employees to be “recognizees” or “recognizors.” The program criteria include behaviors aligned to the organization’s values and brand (e.g., providing superior, personalized service to colleagues or customers), performance (sales incentives), employee referrals and tenure anniversaries. Now that the program is well underway, the organization’s leaders can analyze recognition program metrics – and they do so continuously. Quarterly insight meetings are held to review program usage, strengths and opportunities. Meridian’s third-party technology provider includes a flexible reporting platform that allows the program team to run a variety of useful analytical reports (e.g., how often the management team is using the system to recognize and reward employees).

To date, Meridian has achieved the results it had set out to achieve prior to the program’s implementation, including – business outcomes, employee engagement, performance, behaviors, employee retention and activities and participation level. Some of the key results are included in Figure 27.



In addition, Meridian’s team wanted to measure the financial impact of its recognition program, and particularly the financial impact of the program on business performance. Meridian’s financial results indicate there may be a connection between engaged employees and business results. For example, the following numbers compare top and bottom quartile employee engagement scores.

Figure 27: Meridian’s Key Performance Metrics and Results

Category Measurement and Evaluation Result

Employee Engagement

• Whenemployeeswereaskedtoratewhetherornottheyarerecognizedfordoinggoodwork,thepercentofemployeeswhowouldratethis“5”outof5increasedfrom44percentto51percent.

• Theengagementscorerelativetorecognitionhasmovedfrom3.96to4.13onafive-pointscale(withfiveasthehighest).

• Thisisasignificantresult,asmovementof.10isconsideredamaterialchange.

Employee Retention• Turnoverrateforengagedemployeesislowerthan

itisfordisengagedemployees(seeFigure28formoredetail).

Tactical Goals: Activities and Participation Level

• Cost-savingswereevidentintherewardsbudgetduetoreductionsinadministrationandmanagementcosts.

• Fifty-fourpercentofrecognitiongiventhroughtheonlinerecognitionprogramwasnotlinkedtoamonetaryreward.

• Ninety-sixpercentofemployeesmaintainactiveaccountsintheonlinerecognitionprogram.

Source: Meridian, 2012.

Case in Point: Meridian’s Metrics (cont’d)



• Averagegrowth(Canadiandollars,inmillions)perfull-timeemployee (FTE):

o Most engaged employees (top quartile) – Canadian $2.11 million per FTE

o Least engaged employees (bottom quartile) – Canadian $1.29 million per FTE

• Membership(client)growthpercentageattributabletoeachFTE:

o Most engaged employees (top quartile) – 4.7 percent

o Least engaged employees (bottom quartile) – 1.1 percent

• RevenuegrowthpercentageincreaseperFTE:


o Least engaged employees (bottom quartile) – 2.3 percent

• Financialmargingrowthpercentage:


o Least engaged employees (bottom quartile) – (-)1.2 percent

These figures show that more engaged employees produced greater financial results. In addition, Meridian’s turnover rate for engaged employees is lower than it is for disengaged employees (see Figure 28).




Meridian continues to evolve its program by setting new benchmarks and continually evaluating its key metrics. As a result, employees enjoy a wide variety of individualized and meaningful rewards, while the leadership team is better able to align employee recognition for performance against strategic goals and the demonstration of desired behaviors. e

Part 4: Applying the Employee Recognition Framework

Recognition beyond regular compensation, incentive pay and rewards programs is an evolving discipline. Although most organizations have some of the elements in place (e.g. awards programs), the majority of those organizations are not:

Figure 28: Meridian’s Engaged Employee Turnover Rate

Source: Meridian, 2012.

Your Company

Logo Goes Here

Reinforcing our Culture of Engagement through Recognition

Spotlight: Measuring the Impact of Recognition on Engagement and Performance

Turnover Rate




• Settingmeasurableobjectivesfortheirprograms;or,

• Buildingaholisticstrategythatisdesignedtoaccelerate business goals.

This Employee Recognition Framework is designed to help your organization consider all of the elements necessary to build a recognition program from scratch or redesign how your programs currently operate. The goal should be to build a suite of programs that reinforce each other in a more meaningful and measurable way. To use recognition most effectively, we suggest beginning with the top of the Framework, the Recognition Strategy bar. This section is intended to help the HR team and senior business leaders engage in a dialogue about the best way to incorporate recognition. Below are some of the key questions that you will need to answer.

• Whatisthepurposeofrecognitionatourorganization?

• Howcanweuserecognitiontoaccelerateourbusinessgoalsandbuild the culture we want in the future?

• Howshouldrecognitionalignwith,reinforceandcontributetoourorganization’s talent management strategy?

• Whatmeasuresdoweneedtotaketoensureourprogramisequitable and transparent for employees across different functions, regions and geographies?

• Whoshouldbeaccountableforreachingourgoals?

• Howwillwemeasurewhatwesetouttoachieve?

We then suggest that you clarify how each audience member is affected by recognition today. Programs may vary based on each talent segment, but they should be transparent and equitable. From here, we suggest you have conversations with the people that need to implement the program, or are currently managing your existing program – you should have a dialogue with them for all elements within the program design portion of the Employee Recognition Framework. The following are some of the key questions you will need to answer.

This Employee


is designed to help your

organization consider all

of the elements necessary

to build a recognition

program from scratch

or redesign how your

programs currently

operate.

K E Y P O I N T



• Arewespendingourbudgetinawaythatrewardsandrecognizesemployees based on qualified criteria?

• Doweneedtoreconsiderwhoshoulddelivertherecognition?

• Aretheapprovalprocesseswehaveinplaceworkingtoenablethebest program possible?

• Havewesegmentedourprogramtomeetthepreferencesandneedsof employees across multiple regions and geographies?

• Howoftenshouldwerecognizeemployees?

• Howcanwemeasureourprograminamorequantitativefashion?

From here, you will want to think about rewards. Consider the following questions.

• Howmuchdoesyourorganizationpraiseorexpressappreciation?

• Howimportantisittoincluderewardsinadditiontorecognition?

Overall, in this section, you need to identify the “ideal mix” of rewards is for your organization, based on its business goals, the behaviors you want to recognize and employees’ needs.

After that, consider how your employees will be supported, your vendor strategy and what portions of the program will be integrated with your existing talent management programs. Questions that are relevant to this section include the following.

• Dowehavetherightplatformsandtoolstoengagemanagersandemployees in our program?

• Whatvendorswillhelpusaddvalueandisourexistingvendorstrategy working?

• Whatportionsoftheprogramneedtobeintegratedwithourexisting talent management programs?

Next, dive into the last three section of the Framework – program launch, management and measurement activities. Launch includes the elements that bring forth the formal commencement of the newly created or revised recognition program. The program management and governance, and the measurement and evaluation sections, which represent the two pillars on each side of the Framework, are important to helping your organization to effectively manage and support

You need to consider

what the “ideal mix”

of rewards is for your

organization, based on

its business goals, the

behaviors you want to

recognize and employees’

needs.

K E Y P O I N T



recognition on an ongoing basis. When working through this section, consider the following questions.

• Doesyourbrandingplanandsupportingmarketingmaterialsreflectthe messaging necessary to communicate the performances and behaviors your organization perceives as valuable?

• Haveemployeesreceivedenoughtrainingandsupportonthethingsthat matter most?

• Doyouneedtogetmoreleadersengaged,sothatyoucanimprovethe results of your program?

• Doesyourcomplianceandgovernancestructuresupportwhatyouare trying to accomplish for the business?

• Howcanyoubetteroptimizeyourrecognitionprogramstoshowmeasurable results for the talent management function and the other parts of the business?

In summary, the Employee Recognition Framework is intended to help your organization better engage employees and drive business performance over the short and long term. The Framework has been constructed to enable your team to create a holistic strategy that is supported by the right programs and measurement tools. It is our hope that when the Framework is applied that your team will achieve the greatest returns on its recognition investments.

The Employee


is intended to help your

organization better

engage employees

and drive business

performance over the

short and long term.

K E Y P O I N T



Final Thoughts Recognition and rewards programs are not really “new” to the business. However, the way in which these programs are incorporated into the business is changing.

Progressive organizations have developed a holistic and equitable recognition strategy designed to drive improved employee engagement and targeted employee behaviors. Over the next few years, we think organizations will increasingly embrace recognition as an important approach to driving change and improved performance. As such, recognition has the potential to become an increasingly core and strategic tool of the HR function.

This Framework is intended to help your organization understand how all of the elements of recognition fit together and the key decision points necessary for creating a strategic recognition program. The end goal is for you to understand how to develop a program that effectively integrates recognition into your organization’s business and talent management strategies – and ultimately contributes to improved business outcomes.



Appendix IAdditional Images



Appendix I: Additional Images

1

Figure 29: Kern County Employee Recognition Program

Source: http://www.employeerecognition.kern.org, 2012.

http://www.employeerecognition.kern.org



Appendix IIGlossary of Terms



Culture

“Culture” is the collective set of organizational values, conventions, processes and practices that influence and encourage both individuals and the collective organization to continuously increase knowledge, competence and performance. This includes the attitudes, experiences, knowledge and beliefs within the enterprise. This collective structure influences the way staff relate to each other and also controls how they behave with external stakeholders.

Emblematic Rewards

“Emblematic rewards” are a type of recognition that includes praise and appreciation, special projects, certificates, and trophies and plaques.

Employee Engagement

“Employee engagement” refers to an employee’s job satisfaction, loyalty and inclination to expend discretionary effort toward organizational goals.

Employee Results

“Employee results” is an index comprised of employee productivity, employee engagement and customer satisfaction.

Extrinsic Motivation

“Extrinsic motivation” comes from outside the individual, such as rewards, trophies, money, etc. In most cases, competition is considered an extrinsic motivation since it encourages the individual to beat others to win, thereby not participating for the pure enjoyment of the activity.

High-Potential Employee

A “high-potential employee” is an employee who has been identified as having the potential, ability and aspiration for successive leadership positions within the company. Often, these employees are provided with focused development as part of a succession plan and are referred to as “HiPos.”

Intrinsic Motivation

“Intrinsic motivation” is when people engage in an activity for its own sake, without some obvious external incentive present. Intrinsic

Appendix II: Glossary of Terms



motivation occurs when people are internally motivated to do something because it either brings them pleasure, they think it is important or they feel that what they are learning is significant. Essentially, the motivation comes from inside an individual, rather than from any external or outside influence (e.g., rewards).

Monetary Rewards

“Monetary rewards” are a type of recognition activity that includes rewards of values above $100. These rewards can include special trips (e.g., team outings), awards conferences, learning conferences, cash / vouchers and extra paid time-off.

Points

“Points” are a reward mechanism for employees who meet certain recognition criteria. Points can be redeemed for a wide range of brand-name merchandise, travel, gift cards and experiences using an extensive online catalogue.

Recognizers

“Recognizers” are the people within an organization or outside of it who give recognition to an employee or group of employees.

Six Sigma

“Six Sigma” is a rigorous, focused, high-impact process that uses proven quality principles and techniques to reduce process variance. For more information on Six Sigma, please visit http://www.isixsigma.com, which offers articles and easy-to-read examples of how to apply Six Sigma to any business process.

Talent Results

“Talent results” is an index comprised of hiring the best people, developing great leaders, developing employees, retaining top performers, planning for future talent needs, having the right people in the right jobs.

Token Rewards

“Token rewards” are a type of recognition that includes rewards of smaller values, typically around $100. These rewards can include gift cards, candy, flowers, lunches / dinners and merchandise, or points that can be converted to other items.

http://www.isixsigma.com



Appendix IIITable of Figures



Appendix III: Table of Figures

Figure 1: How Recognition Fits within Total Rewards 8

Figure 2: Types of Motivation 12

Figure 3: Psychologist Abraham Maslow’s Hierarchy of Needs 15

Figure 4: Bersin & Associates Employee Recognition Framework® 18

Figure 5: Bersin & Associates Employee Recognition Framework® – Recognition Strategy 19, 36 and Audience

Figure 6: Strategic Integration Considerations between Recognition and Other Talent 27, 28 Management Activities

Figure 7: Four Behaviors Reinforced by KPMG in Canada’s Recognition 30 Program

Figure 8: Questions Your Organization Must Answer before It Makes Other Decisions 35 in This Framework

Figure 9: Recognition Audiences 37

Figure 10: Recognition Activities Unique to Each Audience Segment 38

Figure 11: Bersin & Associates Employee Recognition Framework® – Design and Rewards 39

Figure 12: Budget Allocation Considerations 42

Figure 13: Three Primary Criteria of Recognition 43

Figure 14: Key Performance Criteria Categories 45

Figure 15: Types of Recognizers 49

Figure 16: Directions of Recognition 51

Figure 17: Types of Approval Approaches 53

Figure 18: Details on Recognition Visibility Levels 54, 55

Figure 19: Types of Delivery Methods 58

Figure 20: Customization Considerations 59

Figure 21: Components That Lead to a Measurement Action Plan 60



Figure 22: Reward Types 63

Figure 23: Vendors Categories to Consider 66

Figure 24: Bersin & Associates Employee Recognition Framework® – Governance & Management, 68 Metrics & Evaluation, and Launch

Figure 25: Kern County Superintendent of Schools’ Home Page 73

Figure 26: Kern County Superintendent Schools’ Recognition – External Website Page 74

Figure 27: Meridian’s Key Performance Metrics and Results 85

Figure 28: Meridian’s Engaged Employee Turnover Rate 87

Figure 29: Kern County Employee Recognition Program 93



About UsBersin & Associates is the only research and advisory consulting firm focused solely on WhatWorks® research in enterprise learning and talent management. With more than 25 years of experience in enterprise learning, technology and HR business processes, Bersin & Associates provides actionable, research-based services to help learning and HR managers and executives improve operational effectiveness and business impact.

Bersin & Associates research members gain access to a comprehensive library of best practices, case studies, benchmarks and in-depth market analyses designed to help executives and practitioners make fast, effective decisions. Member benefits include in-depth advisory services, access to proprietary webcasts and industry user groups, strategic workshops, and strategic consulting to improve operational effectiveness and business alignment. More than 3,500 organizations in a wide range of industries benefit from Bersin & Associates research and services. Bersin & Associates can be reached at http://www.bersin.com or at (510) 251-4400.

About This ResearchCopyright © 2012 Bersin & Associates. All rights reserved. WhatWorks® and related names such as Rapid e-Learning: WhatWorks® and The High-Impact Learning Organization® are registered trademarks of Bersin & Associates. No materials from this study can be duplicated, copied, republished or reused without written permission from Bersin & Associates. The information and forecasts contained in this report reflect the research and studied opinions of Bersin & Associates analysts.

http://www.bersin.com

The Bersin & Associates Employee Recognition Framework

Documents

Transcript of The Bersin & Associates Employee Recognition Framework