“It’s the thought that counts.” No it isn’t! A disappointing gift or reward can have a far more damaging impact than not being rewarded at all! In an article he wrote, John Sylvester, Executive Director, P&MM Motivation, said: “When rewards go wrong – the cost of giving the wrong incentive can be high”. The article refers to the Torbay Hospital in Torquay that recently thanked its employees for helping the trust become one of the best in the country by giving them a KitKat. The consequence of this was of disgruntled employees complaining that they felt “insulted”.

Although the above is a fairly clear-cut example of a less than generous award, Sylvester asks what would it take for an employer to disappoint a member of his/her staff: “How many employers would be able to answer? Few; far too few.”

Having said that, Sylvester explains that employers should aim at reviewing and benchmarking their reward and recognition policies at least every three years, while ensuring that they remain abreast of the current industry best practice. If there is an element of uncertainty about the cost, he maintains that one should always err on the side of generosity, applying the simple but indefatigable test by asking: “How would I react if given this.”

In addition to the above, in his article “Avoid a ‘Naked Wipeout’ when selecting Rewards”,’’ Sylvester explains that while it is crucially important to get employees on board by making incentive schemes exciting and interesting, the key objective must always be that of providing suitable incentives for the target audience. This is because award preferences are unique, and a reward that is acknowledging for one recipient can elicit a complete opposite, negative reaction from another.

A Maritz poll conducted across a diversity of full-time employees representing a wide variety of industries identified different and distinct recognition profiles (Garlick, 2007). The study illustrated the important differences that exist between employees with regard to receiving recognition. The conclusions drawn from this research were that it is not all about generations. Segmentation along demographic lines existed but did not occur with exclusivity.

Employees who received the type of recognition they wanted felt more valued, were significantly more satisfied with their jobs, more likely to remain with the company and more likely to recommend their workplace to others.

In many cases, providing the wrong type of recognition actually achieves the opposite of what is intended. Inappropriate incentive practices can engender resentment and serve to de-motivate employees.

Almost three out of four employees prefer to have a choice of rewards rather than a pre-selected item. While too much choice can be overwhelming to participants, offering the right mix of rewards (that is, a “purposeful choice”) is viewed very favourably.

The Maritz White Paper October 2010 entitled “The Human Science of Giving Recognition: Creating True Connections between Humans in the Workforce” explains that there is an art and a science when it comes to effective employee recognition. Indeed, truly effective recognition gets at the heart of what it means to be human. As Maya Angelou once said: “People will forget what you said, people will forget what you did, but people will never forget how you made them feel.”

Furthermore, the White Paper defines three core principles of effective recognition. These are:

Make recognition meaningful

Talk to employees on an individual basis to discover what motivates them, and design recognition experiences that connect to each employee’s wants and needs. Meet with employees periodically to assess how it’s working and to ascertain shifts in needs and preferences.

Connect emotionally:

Recognition is an interpersonal, authentic communication that can connect people to one another and to the organisation as a social institution. Recognition, when delivered with sincerity and empathy, generates an emotional response and activates engagement.

Connect employee efforts to specific corporate goals and achievements:

Tying expressions of recognition to already familiar company goals, values and achievements is a win-win for employees and the organisation. Because of the way the brain is wired, people immediately try to associate new information with what they already know. It helps to create those connections and build new meaning by tying recognition to company vision, values and achievements.

In a nutshell, employers must ensure that they spend enough time with their employees to determine how each employee is best acknowledged. One should ask whether the employee prefers public or private praise. Also, asking questions like “whom would like the employee to receive recognition from?” and “what type of recognition does the employee value?” will help the employer to move beyond a one-size-fits all programme and greatly increase the meaning and impact of recognition.

“Attempting to second guess your workforce’s choice will run the risk of getting it wrong; and there’s no point offering haute cuisine to someone who is happier with sausages and mash!” Sylvester maintains.

Finally, having a well-considered recognition strategy that understands the needs and wants of the employees can contribute to employees taking more pride in their work, bringing more attention and resourcefulness to their tasks, feeling more connected to corporate objectives, and finally, collaborating more effectively. What is more, a culture of recognition assists the organisation to align to corporate strategy and to be more responsive to market shifts as well as equipping the organisation to stand out from its competitors as the economy improves, paving the way for competitive advantage in the longer term.

The Moritz White Paper October 2010 concludes by explaining that in today’s knowledge economy, the wealth of most businesses is people-based wealth. As such, for organisations to achieve a sustainable competitive advantage, attracting, retaining and motivating people are critical success factors. In an otherwise vacuous toolbox, employee recognition is one of the few power tools available for leaders, HR professionals and front-line managers to accomplish these business imperatives.

Sylvester concludes by arguing that in a struggling economy it is crucially important that rewards are carefully administered. The impressive rewards offered in better days are unlikely to be feasible. Nevertheless, if an employer chooses to offer a token gesture of thanks it should make the employee feel valued. Rewards such as the Spree Card, a pre-paid MasterCard or a gift card are cost-effective, yet also have the power to give everyone the choice of what they want and to leave an employee with a happy memory and a smile. After all, Sylvester maintains, there is nothing worse, after the reward has been presented than an incensed employee saying: “No, you really shouldn’t have!” at the same time thinking “Is that all I am worth? Is that all they really think of me? I’ve worked hard for them for many years and all they gave me was a… Kit Kat.”

Ms Camilleri is a researcher at the Foundation for Human Resources Development (FHRD)