Recognition programs aren't just a nice thing to do, they can be crucial to your bottom line.

When it comes to business success, it's the little things your employees do every day that make the difference. But if they aren't engaged, they'll be less willing to make that extra effort for your organization. You can increase engagement through recognition programs to give your employees the incentive they need.

A recent ADP Research Institute® Global Study of Engagement highlights the importance of employee recognition when it comes to engagement and retention. The report measured conditions that lead to greater engagement at the team level, focused on four key factors: mission, expectations, job-fit, recognition and growth.

As the report suggests, regardless of gender, generation or geography, employees value recognition and want to be appreciated for a job well done.

"One of the main reasons employees leave their jobs is lack of appreciation or recognition," according to the report, suggesting that, "Team leaders can directly affect change for employees by providing timely recognition, which will have a positive impact on engagement."

Employee recognition and reward programs can be a key element for creating a positive workplace culture. People thrive off of positive reinforcement, and these programs put an additional spotlight on the effort people put into their jobs.

Additional data from a recent study by Lighthouse Research found that high-performing firms (those with higher revenue, employee retention, and engagement scores) were 14 percent more likely to focus on employee strengths and 37 percent more likely to use recognition as a tool to encourage and reward great performance.

Recognition programs aren't just a nice thing to do, they can be crucial for your bottom line.

Determine Your Desired Outcome

You should have a clear goal for how your recognition program will help your organization. Are you trying to improve employee morale? Are you trying to increase sales? Do you want to reduce turnover? Often businesses just set up a program with no plan on how to increase engagement through recognition programs. This means they have no way to tell whether their program was a success. By aiming for a clear outcome, you can measure your progress compared to where you are today.

Consider Different Awards for Different Generations

Different generations respond better to different types of workplace rewards. When it comes to verbal recognition, baby boomers prefer a more formal setting in front of their peers, like receiving a plaque at a ceremony. Millennials do not need the same fanfare, but they expect more immediate and frequent praise. This is a key point for retaining Millennials and next-generation employees, who according to a 2019 Deloitte survey, are more likely to leave a job they found dissatisfying—with 49 percent saying they would quit their current jobs in the next two years if they had a choice.

For rewards, baby boomers appreciate cash the most, especially as they approach retirement. Millennials lean more towards experiences than cash, like the chance to go to a special industry conference or tickets to an NFL game. Gen Xers rated more time off as their preferred reward over cash, plaques, and merchandise. Fine-tuning your program to generational preferences, both in terms of rewards and timing of recognition, could make it more effective.

Use Data to Assess Your Program

Consider combining all recognition programs into one web-based system. This can help your business stay organized and on track. You should regularly check in on the results of your recognition program by using data analysis. Also, compare current performance to your original benchmarks.

This can be a critical component to achieving effective employee engagement, as experienced by Heritage Bank Vice President, HR Operations and Insights Manager Shannon Carson, an ADP customer.

"ADP helps Heritage win the war for talent," she said, "[our] employees are our number one asset, and we have this particularly competitive industry in the Pacific Northwest and in banking in particular."

A single, integrated platform, with the ability to produce accurate data reporting for long-range strategic planning, helps Heritage to attract and retain employees in a competitive industry.

For example, did productivity increase in the six months since you launched your recognition program? If not, this could be a sign that people aren't responding to the rewards. You can gauge employee morale and engagement through data and surveys. Pay attention to how frequently you give out rewards as well — if the number of employees being recognized starts falling, that's an early indicator of problems with morale.

Motivate Your Employees

One reason recognition programs fail to work is because organizations don't properly explain the program and its goals to their employees. Your employees need to be well aware of the possible rewards, what they need to do to achieve the rewards and how the program ties into your workplace culture. Beyond that, you should ask HR to schedule regular reminders about your recognition program so employees don't forget.

One way to achieve this, particularly for Millennials and next-generation employees, is through easy-to-access mobile applications.

Overall, your goal should be to foster a culture of recognition, where employees know their hard work will get noticed. This can lead to more engaged, more loyal and more productive employees as a result.

To find out more about how factors that impact employee engagement, download the ADP Research Institute's Global Study of Engagement.

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