Imagine you helped your company reach the remarkable milestone of achieving $10 billion in sales for the year — something it had never before achieved. There’s rumor that there will be a show of appreciation for the effort. Take a moment and think about what that might be. What would make you feel valued for helping the company reach this record-shattering landmark?
How about a cookie?
Glancing across the web at employee recognition horror stories, this reported tale of tone-deaf audacity — a cookie as a reward for reaching a monumental financial goal — stood out. It’s as if the company said “good job” with a slap in the face. But more than that, it could set the company up for future failure.
Employee engagement in the U.S. in 2024 reached a decade low of 31 percent, according to Gallup’s annual update of U.S. employee engagement released in January. That’s millions of disengaged employees simply going through the motions in companies across the country. And while it doesn’t account for every reason an employee checks out, the lack of an employee recognition program — one that meaningfully celebrates individuals’ roles in organizational wins — is a significant contributor.
In addition to depressing engagement, not being recognized for successes generates turnover. Gallup found the primary reason most employees leave their job is lack of recognition. And given that the same pollster in two 2019 studies found that 1) the total cost of a disengaged employee is 34 percent of their annual salary and 2) the cost of replacing an individual employee can range from one-half to two times the employee’s annual salary, adding a meaningful recognition program can have a big bottom-line impact.
It’s important to emphasize the word “meaningful” here when talking about recognition programs. The data across studies that I found emphasize “quality of recognition.” Do you really value your employees’ contributions? Or did you give everyone on your sales team branded pens because someone in HR said a recognition program would boost productivity by 12 percent?
You want the best from your employees. You want them to innovate, to exceed their goals, to drive success for the entire organization. And employees want to do just that. But it’s insulting to receive as a reward for that hard work a stone that has the words “you rock” printed across it — another reported real-world example. Employees want to feel valued. And they want meaningful rewards that motivate them to drive towards the next goal.
Celebrate your company’s wins, and do so in a way that would make you feel appreciated if you received the recognition. Otherwise, those who helped you reach your goals may soon be helping your competitors reach theirs. ●
Fred Koury is President and CEO of Smart Business Network Inc.
