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The Business of Recognition

by | Mar 9, 2021

The Business of Recognition

by | Mar 9, 2021

Most professionals are aware of the power of promoting and branding your organisation. Yet, struggle to see the same level of importance in recognising their employees.

Employee recognition and the positive effect upon organisations who establish programs is well documented.

Most professionals are aware of the power of promoting and branding your organisation. Especially the positive effect it has upon the companies bottom line. Thus, many emphasise the importance of promoting their brand to gain consumer recognition. Yet, struggle to see the same level of importance in recognising their employees.

I thought it would be a good exercise to compare three points from each form of recognition side by side. Highlighting the parallels between each.

 


The Business of Recognition by Lasercraft.com.au (Blog - Recognise - Employee - Rewards - Appreciation) - Pic-02

Marketing is an effective way of engaging customers. Engaging with your customers, ensures they receive all relevant information about your products. Marketing key role is to give customers a sense of belonging when purchasing a specific product.

Gallup has been tracking employee engagement for 15 years. They believe engagement is the key factor influencing employees and organisational performance. It the 2017 State of the American Workforce report they summarised:

“Simply put, engaged employees produce better business outcomes than other employees – across the industry, company size and nationality, and in good economic times and bad.”
Gallup defines engaged employees as those involved in, enthusiastic about and committed to their work. Aon defines employee engagement as “the level of an employee’s psychological investment in their organisation”.

Engagement is one of the most important business concepts as it creates a beneficial workplace environment. Greater organisational engagement leads to improved productivity and profits at the business level. Within marketing, engagement is crucial in developing lasting customer loyalty.

 


The Business of Recognition by Lasercraft.com.au (Blog - Recognise - Employee - Rewards - Appreciation) - Pic-03

Marketing helps generate revenue for the company. When a company promotes its brand to consumers it entices them to choose the products and services that it manufactures thereby increasing revenue.

Gallup’s 2017 State of the American Workforce report states that companies with an engaged workforce will achieve:

  • 41% lower absenteeism
  • 24% lower turnover of employees in high-turnover organizations
  • 59% lower turnover of employees in low-turnover organizations
  • 28% less shrinkage (employee theft)
  • 70% fewer employee safety incidents
  • 40% few quality incidents (defects)
  • 17% higher productivity
  • 20% higher sales
  • 21% higher profitability.

All these benefits contribute to a company’s cost reduction, revenue generation and profitability.

The Aon Hewitt Trends in Employee Engagement survey of 2011, also found that: “Organizations with engagement levels of 65% or greater outperformed the total stock market index and posted total shareholder returns that were 22% higher than average; companies with engagement levels of 45% or less had a total shareholder return that was 28% lower than the average return in 2010.”

 


The Business of Recognition by Lasercraft.com.au (Blog - Recognise - Employee - Rewards - Appreciation) - Pic-04

Marketing is an important strategy to ensure the growth of your business. In essence, marketing secures your business’s future through new and old customer engagement.

Recognising employees will allow them to express ideas and suggestions freely. In many organisations, leadership is further removed from the operations of the company and may not see the best options for productivity improvement. In short, your engaged employees will guard your business’ future.

There is no doubt that marketing is essential for business health and growth. So too is employee recognition. Like many other ‘soft’ areas like communication and HR, employee recognition too-often doesn’t happen or is done badly. However, not giving recognition comes at a cost – reduced workplace performance.

A 2018 BetterUp study, reported in the Harvard Business Review online, found that more than 90% of the 2,285 US professionals surveyed were willing to trade a percentage of their lifetime earnings for greater meaning at work. More meaningful work involves creating a sense of achievement in work activities, and more acknowledgement by peers and managers of work well done. Suitable employee recognition is essential to a sense of meaningful work.

So, when you next look at your annual expense budget,  remember to add a line for a recognition program. You’ll be surprised at the results that you will reap.

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