The most meaningful employee rewards are driven by purpose, values and strategy and go beyond mere rewards for good performance.
At a glance
Proof of success and hard work is an important part of good working relationships and continued high performance.
The reward system in the workplace, while rewarding good performance, should also be guided by a goal that is meaningful to the recipient and consistent with the values of the organization.
Without a strategy or purpose that rewards serve, the rewards themselves can be counterproductive.
Before the COVID-19 crisis hit, the management of the engineering firm Tonkin Consulting had no interest in rewarding employees, especially cash bonuses.
The philosophy was that the work the company does is interesting enough to satisfy the staff; and for the most part, the team was right.
Instead of an awards system, Tonkin had an "appreciation society" - anyone in the business could be nominated for something outstanding, no matter how big or small. The nomination will lead to company-wide networking and a town hall-style mention at weekly CEO meetings.
When the pandemic hit, the organization was given a new strategic imperative, which was helped by the employee reward system.
“It was a real engagement,” says Basil Mohamed, chief financial officer of Tonkin Consulting. “In addition, as a management team, we wanted to show our appreciation for the effort people put in during uncertain and difficult times.”
As work from home became the norm, businesses began to rely on Microsoft Teams, Yammer, and other remote communication tools. Mohamed and his senior colleagues wanted to make sure that all staff were familiar with and involved in this technology.
To facilitate this interaction, a carefree company-wide rewards system was introduced: if certain operational goals were achieved in the first month of the lockdown, the company had to deliver a pizza to every employee's home.
The goal was reached, the pizza was shipped - a major logistical project in itself, Mohamed says - and the company asked employees to share images of themselves enjoying pizza with family members in Microsoft Teams and Yammer. All of a sudden, everyone was using and enjoying the technology that was essential to succeed in a distributed workplace environment.
Mohamed believes that the company's first awards ceremony was a great success because the awards were not offered just for their own sake. Instead, they were a small part of a larger strategic plan.
Making the rewards great again
Soo Fern Lee, Partner, Malaysia Talent Leader and ASEAN Diversity and Inclusion Leader at Ernst & Young Advisory Services Sdn Bhd, says employee rewards should always serve a larger purpose and be driven by strategy.
“Everything starts with a purpose that drives everything we do,” says Lee. “The strategy brings the goal to life. Rewards are just one of the ways in which we manifest our purpose.
“Rewards are meaningful if they are consistent with purpose and values and are sustainable. Not all awards can be meaningful to everyone at all times and all the time.
“It is important for an organization to be committed and consistent in its strategies. What types of rewards are effective are determined by time frames - for example, are we looking at short-term or long-term goals? - and the target audience, as well as constraints, e.g. budget, boundaries, whether rewards dictate desired behavior.”
According to Lee, rewards that are not appreciated by the recipients do not promote desired behavior and cultural change, do not increase ability, and are meaningless.
In fact, research has shown that rewarding, or at least encouraging, work solely for the sake of earning a reward can be counterproductive.
Human behavior researcher, author and educator Alfie Cohn says that rewards and punishments received as a result of direct behavior or achievement usually have the opposite desired effect.
“At least two dozen studies have shown that people who expect to be rewarded for completing a task, or for completing it successfully, simply don’t perform as well as those who don’t expect anything,” Kohn writes in an article titled “Reward Risk.” » .
“This effect is robust for young children, older children and adults; for men and women; for all types of awards; and for a variety of tasks, from remembering facts to making collages and solving problems.
“Discussions, awards and gratitude to the organization bring many other benefits. Both sides are learning from the conversation. There is encouragement to continue the effort.” James Keeler, Maximus
“In general, the more cognitive complexity and open-ended thinking required to complete a task, the worse people
dumb when they are forced to perform this task for a reward.
It logically follows that cultural change or rewards, which are only a small part of a larger strategy, is the only way to introduce rewards to employees in the workplace.
Without this strategy, and without the purpose that rewards serve, the rewards themselves can be counterproductive.
This of course also begs the question - if employees are used to competing for awards, will their performance suffer if the awards system is removed?
Employee engagement could suffer, especially in the short term, Li said. “We need to find out why the awards were withdrawn - due to budget restrictions? Or maybe the awards no longer serve a more important purpose and there is a need to change the situation. If the former, then perhaps nothing can be done. However, clear communication will be required to help resolve any issues or opt out.”
Maria Sitaramaya, vice president of human resources for Asia Pacific at technology multinational Unisys, says a well-planned reward system that is part of a long-term strategy should not come to an abrupt end.
During the pandemic, Unisys leaders at all levels have not only been reminded to always recognize the performance of their teams, but they have also developed a frequent flyer points program that personalizes and simplifies the reward system, while at the same time engaging staff in process in the long run.
Since employees interact with multiple teams in a global company, anyone, not just the line manager, can express appreciation for a colleague by nominating them for an award.
“We work a lot with our leaders to better understand what motivates and engages their team,” says Sitaramayya.
“To support that, we have a system where people are given points as rewards. They can keep these points for as long as they want to accumulate as much as possible, or they can go straight to the "shop" and spend their points on a reward. I can choose one type of reward, a colleague can choose something completely different.”
The idea is that you always get something that matters to you, not something the company has chosen that might be perceived as empty.
CPA Library Resource: HR Manager's Toolkit: A Practical Guide to Getting the Best Out of People. Read now.
Personalized Rewards
The "Rewards Store", which contains a wide variety of items, is one way to make rewards relevant to recipients. Another option for leaders is to think deeply about what each individual employee would truly appreciate as a reward for outstanding performance.
The process, says James Keeler, director of leadership development consultancy Maximus, helps managers get to know their team members better and can lead to greater feelings of intimacy and appreciation.
“With my team, I think about where they live, what they are interested in and where they are in life,” Keeler says. “I think about what can be helpful, pleasant and caring at the time.
The award should also be in line with the passions and values of the individual, as well as the values of the organization. Once the strategy is defined and the purpose of the award is agreed upon, the most important parts of the process, according to Keeler, will be reflection, caring and conversation.
"It's great to sit down and take the time to tell people why they get recognized and what exactly they did well," he says.
“It's nice when someone recognizes your work and also shows that you see their efforts and that you are interested in what they do.
“Discussions, awards and gratitude to the organization bring many other benefits. Both sides are learning from the conversation. There is encouragement to continue the effort.
“There is motivation and permission to develop an idea and, ultimately, to innovate.”
Keeler says that when one person acknowledges another person, it makes them both feel very good.
Whether it's parents and children, romantic partners, siblings, friends, or colleagues, recognition and gratitude are an important part of what makes our relationships enduring.
Keeler believes this is true whether we are in an emergency, like a pandemic, or not. We just need to be even more creative about expressing gratitude when physical and movement restrictions get in the way.
