In this latest installment of Around the Bonfyre, we sat down with Steve Smith of The Starr Conspiracy to discuss the changing landscape of employee recognition programs, their connection to employee engagement, and the direction technology is taking the latest recognition trends.
The Starr Conspiracy is a strategic marketing and advertising agency serving the field of enterprise software and services. Along with the firm’s Intelligence Unit, Smith leads market research into the space of Human Capital Management (HCM) technology, and keeps his finger on the pulse of industry leaders’ ever-shifting needs.
This interview has been edited and condensed for clarity.
Scientific research discusses how intrinsic motivation produces better work performance than extrinsic motivation, and yet employee recognition programs focus predominantly on the latter. Why do you think that is?
It comes down to which side of the fence you fall on regarding employee motivation in the workplace. Do you believe most people come to work every day wanting to do a good job, or that they come to work needing motivation to do so? When you look at the history of the recognition industry, you can trace the roots back to the 19th century, the whole notion of the gold watch at retirement, and other signifiers of achievement that branched off into other tangible rewards. “Hey you killed that sales quota, here’s a nice pen with the company logo on it.”
Now, in addition to tangible rewards, you can earn gift cards and merchandise. Some people view that as motivating for the workforce, but especially in the last five years, the idea of peer-to-peer recognition and nonmonetary recognition have increased in market demand. Some employers will always believe recognition needs the “stuff” component—that I’m going to give you “stuff” in exchange for recognizing your work.
But part of the buyer population now believes the “stuff” isn’t necessary. They believe people naturally want to do good work. Just simple verbal recognition is more of a driver of that engagement for seeing good work in practice. To some buyers today, the “stuff” component doesn’t add anything because it’s not what people want. There’s a conclusive body of research that backs that up. That research also shows that in some cases adding the monetary component to recognition can negatively correlate with business performance.
Free resource: Learn How to Make Recognition More Rewarding
In your opinion, what’s the right mix of social recognition and recognition with the “stuff” component?
It depends on the individual business. People crave recognition. It doesn’t necessarily have to be tangible, although it can have that component. But people want to be recognized for doing work that matters, and doing great work. The value of recognition comes in here. It’s being able to say, “I made a difference for the company.” In my line of work, the first thing you see when you walk into a lobby at many companies is the trophies and awards they have won. It’s a symbol of progress, that you’re getting traction and moving forward. Why wouldn’t individuals want to point to that as well? I think they do, whether that’s a diploma, or a trophy, or just a compliment on the work itself. Most of the value comes in simple recognition–not in the amount of a cash bonus or gift card.
Would it be wrong to say that you see the value in the social and relationship-building elements?
It’s about the social and relationship aspects. The reason you recognize people is that you want to reinforce behaviors that are getting results for your business. High customer satisfaction scores, meeting sales quotas, whatever actions produce those results are what you want to reinforce. Other employees will see those behaviors and understand they need to emulate them. One of the most powerful pieces of recognition is simply standing up in front of a group and recognizing an individual for great work. From the research I’ve seen, just saying, “Great job” to someone in front of coworkers is one of the most powerful pieces of recognition in a North American workplace.
Why do you think that is?
It connects to basic human motivation. People want to see their work matters. When you look at the questions around employee engagement, it’s tied to your purpose. What is an individual’s purpose in life? You spend one third of your life at work. If you feel that your work doesn’t matter, how enthusiastic are you going to be about performing your job? That’s how people become disengaged and start looking for new work. One of the most salient issues for employers is communicating to employees that their work matters.
How important is mobile and social technology in delivering the employee recognition experience?
We’re at a point where everyone has mobile phones. Recognition has to occur in the moment, as it happens. It’s sort of like the old parenting adage—you have to catch your kids when they’re being good. I don’t think that parallels between the employer-employee experience and parenting always work, but in this particular instance it is accurate. You need to recognize employees in the moment to communicate that sense of purpose, and mobile is what facilitates that immediacy.
When you look at conversations around social recognition as a replacement for the traditional performance review, the potential advantage is that it’s more frequent than performance reviews. With performance reviews, there’s a bias toward remembering what happened in the four weeks before the review, and the other 11 months are forgotten. Recognition, driven by social and mobile technology, has the opportunity to fix that. It’s recording great instances of performance—big and small—as they occur. There’s value there that really adds to the power of recognition in ways that weren’t possible before social, mobile channels were widely available.
How do you see employee recognition programs changing in the next 3-5 years? What should companies be doing to prepare for those changes?
The “stuff” is becoming less important. Buyers believe there’s value in social recognition because they’re seeing its success in organizations. They’re buying technology that provides mobile-enablement of recognition. You’re going to see social recognition branch into areas of the workplace that hasn’t been using it traditionally. We just completed research on the learning technology buyer. When you look at user adoption within technology, there’s a very clear tie-in to recognition, and a very clear benefit it can bring to all types of people-focused technology, learning technology, employee communications technology, etc. There’s an untapped market with a great level of interest. There’s always been a “How” and a “Why” that’s been hard to communicate to employees about using enterprise technology. We’re in the early days of attaching recognition to these technologies, but it’s a potential answer to that problem.