Employee recognition is vital for performance-oriented companies that look for mobilizing all employees and stakeholders, prominently dealers and distributors, in the direction of clear business objectives ascertained by sales, profits, customer satisfaction, and productivity. Such performance driven companies need to regularly communicate and strengthen their dynamic aims. Nevertheless, recognition for such organizations goes beyond the conventional character of service awards. In spite of the fact that recognition and incentive seem interchangeable, the two terms should not be confused with one another. While the recognition includes all the means that draw attention to employees who perform, the incentives usually employ discerning means to persuade people to accomplish a particular objective like increasing sales. Recognition can be impromptu, indeed to the level that there is no ceremonial announcement that the organization has a recognition program, while the incentives are well known so as to build enthusiasm through material reward. The true beauty of the recognition programs based on performance is their nature of surprise that is in contrast to service-award programs that make necessary ceremonies holding on a routine basis. In this way the employees would be much more interested in performing better rather than just concentrating on the reward.
Employee recognition domain has become to gain recognition among organizations as they begin to judge the impact of downsizing on long-term productivity, profits, and the quality of products and services. Previously, employee recognition meant service awards, wherein recognition of their service years in a company people got an intensifying series of awards accompanying a mention in the employee newsletter, while staying until retirement, they might get a gold watch. From time to time, companies expanded these programs to comprise recognition for diverse actions like superlative customer service; nevertheless often these were limited to rewarding nature.
In the present era, no one just simply depends on the incentives and reward system, rather in a downsized company; employees would ridicule a service award if there were one. Thus, with more understanding of the employees’ needs, companies are becoming more proactive when it comes to the employee recognition. While the effective recognition include activities like day-to-day, informal, and formal. For example, commendation is an illustration of day-to-day recognition that costs nothing and can be given by any person, to anyone anytime. While the form of informal recognition can take a diversity of forms, it has certain limitations and oftentimes contains a low-cost, material beckoning of appreciation or congratulations, the formal recognition includes awards for achievements, service, etc., and the celebration episodes at which all contributing employees take part and get recognition. However, a formal recognition customarily has inevitable policy and legal requirements.
In “1001 Ways to Reward Employees” and the “1001 Ways to Energize Employees”, Bob Nelson and suggests the significance of awards and recognition and the reason that they are essential tool of employee motivation, team building and productivity. According to Nelson, the American organizations did not always identify or accept this, as for a much longer time corporate America thought that high salaries, cash bonuses and good employee benefits were all that was needed to motivate their employees. While these factors do in an effective way provide a form of short-term motivation, however, much research finding points out that money is not an effective long-term motivational tool. Before 1954, what termed corporate motivation was the formula of Frederick W. Taylor that encapsulates that money was the primary motivator for all performance. Contrary to this scientific management formula, in the Hierarchy of Needs Abraham Maslow in 1950’s denied this scientific management and originated that individuals were not machines as they in truth have various levels of motivational contentment that need to be appeased to a certain degree. Form this theory it becomes apparent that contentment on top of that degree could be better consummated by using other less expensive and increasingly effectual forms of reward.
In the 1995 issue of “Employee Relations Today”, Professor Kenneth Kovach reported that his most recent research proved the two most referred to factors of motivation by employees were not salary and benefits, but more or less, an interesting job and recognition for doing that job well. Frederick Herzberg also identified this importance of recognition by the employer in his finding that employee accomplishment and recognition are two motivating factors inherent to the job environment. Furthermore, he asserted that the job satisfaction is contingent on these factors over and above anything. Thus a well planned recognition program can, lessen turnover, assist in retaining competent people and elevate pride and loyalty in the company, which not only improves performance but also brings about positive attitudes and raise a productive and perpetual work environment.