Let's say that an employee at a good-sized company has a great idea. Let's also say that idea will save the company thousands, if not hundreds of thousands, of dollars per year. More than that, the idea will make the company's products and services better, and may even make the company a better place to work.

And to show their appreciation of the employee for their idea, the company will offer them a choice of options from a catalog or from the company store of any item that cost them $75 or less when bought in bulk. Or maybe they'll go all out and offer them a trip to a local restaurant, or an exotic destination, or maybe even a theme park somewhere nearby.

Then again, they might really splurge and bring in donuts and coffee for everyone on Friday when they announce that they're going to implement the idea and acknowledge the employee's role in coming up with it. And maybe present an inexpensively framed certificate of appreciation on top of it all.

If you were that employee, would you feel more motivated now?

According to Recognition Professionals International, you might. Here's what they had to say on the topic at their home page (at least, as of Monday, July 9, 2007):

Employee recognition is the application of a scientifically confirmed behavioral psychology principle: employee performance and retention are strongly linked to consistent, appropriate positive reinforcement of behaviors that promote the organization's goals. A recent study conducted by Northwestern University found there is a direct link between employee satisfaction and customer satisfaction, and between customer satisfaction and improved financial performance.

... Research findings show that formal, informal and day-to-day recognition programs, when linked to the organizations values and goals, can create a culture of recognition that enhances employee engagement, performance and retention.

But wait, there's more! At least one designer of these employee appreciation programs says that companies might expect to get huge returns from their small investments:

One client invested $20,000 on our rewards and incentive programs and achieved $1.3 Million in savings in 9 months alone.

After considering those figures, would you say that employee is now better motivated after being "recognized?" Better engaged? More likely to stay at their current position? More inspired to go onto higher levels of performance?

Would it surprise you to find out that the answer is largely yes?

The reason why you might be surprised goes back to two assumptions that you're very likely making about the situation described in the first paragraph of this post. The first assumption is that the employer recognizes the full value of the idea the employee has communicated to them. The second assumption underlying the entire scenario is that the employer is exploiting their creative employee.

In reality, neither assumption could be further from the truth. Neither the employee nor the employer knows what actual benefits may be realized by the company from turning the employee's idea into reality. Neither one knows all the factors that might determine whether the employee's idea will really pay off big. There may be, after all, substantial costs and risks associated with implementing the employee's idea. Finally, neither one can predict what success, or for that matter, what failure, may occur.

And when you consider that very few ideas or accomplishments generated by employees are capable of providing the kind of outsized return to a company described above, trading the uncertain potential of what the company might realize for a small, but certain, reward in recognition of the employee and their efforts represents a fair exchange between employee and employer.

That underlying fairness makes the decision to implement an employee recognition program at a company a really good idea. After all, not too many things are capable of saving the company thousands, if not hundreds of thousands, of dollars per year. Or are capable making the company's products and services better. Or are even capable of making the company a better place to work.

Because, if nothing else, it means some higher up is actually listening!...

Labels: business

- posted by Ironman at 5:54 AM | Permalink | |