Written by Christine Whelan on the 16th March, 2017.
Organisations that spend more than 1 per cent of their payroll on recognition efforts experience positive effects on employee engagement levels. That is what the Society for Human Resource Management discovered in its employee recognition survey. And while this can consume hundreds of thousands of dollars for large organisations, rewarding your workforce can yield better financial results, lower turnover rates and more dedicated staff.
These findings make sense considering that people who feel valued and recognised for their work are likely to put in more effort. However, as workforce demographics change, businesses need to alter their recognition strategies to ensure long-term success.
New workforce, different recognition
Millennials are starting to take over the workplace. As the demographics shift, employee engagement is still heavily influenced through acknowledging achievement and milestones. Yet the way in which leaders express this recognition needs to align with millennial culture.
PwC suggests 54 per cent of millennial workers predict they will have up to five different employers throughout their professional careers, with a quarter of study participants expecting more than six. These findings indicate that organisations could face a serious retention dilemma with severe consequences for standard service modelling, where employees simply don't stick around long enough to be rewarded.
Rethinking timing of rewards
Where traditional programmes recognised staff for major milestones like 5, 10 or even 20 year anniversaries, modern approaches need to reflect the shorter-term mentality of the millennial worker. This means that successful rewards and recognition programmes need to be planned in smaller increments. Instead of waiting five years, companies might want to celebrate one year anniversaries, retaining the full rewards until employees hit the three year mark.
Another thing to consider is that millennials tend to value a much more social process of recognition. Nowadays, employees like to be acknowledged in person by their superiors. It takes on an increased meaning when superiors express their appreciation in front of other staff, taking time out on an anniversary day to do so. After all, you wouldn't celebrate a birthday or wedding on just any other day.
Insights you can leverage
At Strategic Pay we recognise that every organisation faces its own set of challenges when it comes to rewards and remuneration for its workforce. That is why we not only provide expert advice, but offer a wide range of industry sector market surveys, designed to help you make good decisions.
For more information about how we can help with your remuneration and recognition programs, reach out to our team today.