Thoughtful, spontaneous ways of recognizing and rewarding employees are great culture builders, but your company may also want to create something more official. Formal recognition programs require more structure, communication, criteria, consistency, and fairness than informal methods of employee recognition.
Examples of Formal Employee Recognition Programs
When an organization wants to improve specific activities or behaviors, it can create formal recognition programs to recognize and reward the desired improvement.
Here are examples of formal programs to offer:
- Monetary award for the employee who exhibits best practice customer service for the week
- Spot award for an employee seen facilitating the forward progress of a team
- Sales commission increase on each sale that exceeds the previous year’s same-day sales by x%
- Monetary reward for increases in quality and production
- Monetary award for excellent attendance
How Informal Recognition Programs Differ
Successful informal programs are ongoing and provide:
- Many rewards and recognition so employees don’t regard them as scarce resources gained only at the expense of co-workers
- Frequent recognition so employees are motivated by their work environment, in general, and can look forward to their turn
- Unpredictable recognition so it does not become an entitlement
Keys to a Successful Employee Recognition Program
In a formal recognition program, criteria are important so employees know exactly what change or improvement you seek. Some additional factors make a formal program achieve its purpose. These components should be present to achieve goals and avoid demotivating employees:
- Establish criteria for what constitutes an award-worthy performance. If the actions and behaviors requested are not measurable, verbally describe the desired outcomes in word pictures so vivid that employees can explain them to you.
- Make all employees who do the same job, or who work for the company (depending on the reward) eligible for the recognition. For example, if a manager is ineligible, all managers must be ineligible. It's not in the best interests of your overall company goals and culture if one or two departments offer a formal recognition program that leaves others out who do similar work. But if the goal is to increase customer service of a call center, only call center employees should participate.
- Inform employees exactly what they did to merit the recognition. Your goal is to encourage more of that behavior from your staff, so sharing the recognition publicly is good practice.
- Be fair and equitable. Anyone who performs at the level stated in the criteria should receive the reward. If you want to limit recognition to one employee, select a fair method to decide which qualifying employee is rewarded. (For example, if 20 employees meet the criteria, place all qualified names in a drawing.) This may be less of a motivation, so consider asking your employees how they want you to implement the award process. They may surprise you. Or, consider cutting back on the amount of the award or the type of award to stay within your budget. Don't let managers pick and don't change the program midway because too many people qualify. It's important to follow through as promised.
- Be prompt with recognition. Since the goal is to reinforce the behavior you want to encourage, give the reward immediately after the program's end. With a monthly or annual formal recognition frequency, success is too dim a memory and you fail to reinforce the behavior you wanted to encourage more of from the employee.
- Acknowledge the formal recognition with an official letter or handwritten note. It should remind the employee in detail why they received the award. Employees cherish these notes forever. After the money is spent and the food treats consumed, employees have something substantive to remind them they were recognized and rewarded.
The Bottom Line
A formal recognition program has special challenges that informal methods don’t. But each has a place in a company that wants to provide a work environment where employees feel recognized, rewarded, and thanked for their efforts and contributions.