A Guide for adopting Modern Employee Recognition Practices

The way in which businesses operate has undergone a drastic change over the past several decades. Attracting and retaining top talent has become a highly competitive activity, especially for organizations that still operate in a traditional manner. In this context, upgrading their traditional employee rewards and recognition programs with modern practices is an important step that business leaders need to take.

Understanding traditional employee recognition programs

The concept of recognizing and rewarding employees for doing a job well is quite old. However, traditionally, the rewards and recognition were generally limited to fixed monetary compensation or specific gifts that were handed out to the employees privately.

Until quite recently, most traditional organizations were of the opinion that employee rewards that are financial in nature are likely to be the best motivators for the members of the workforce. Moreover, the recognition was based solely on the end results provided by the employees for a task assigned to them.

It is only in the past couple of decades that this concept has evolved to focus more on the personal and emotional needs and expectations of the employees. Another major change that has occurred is that the focus of recognition has broadened to include various actions and behaviour that influence employee performance and workplace culture.

Reasons for the Failure of Traditional Rewards and Recognition Programs

Business organizations have come to realize the fact that traditional methods of employee recognition and rewarding are no longer proving successful.

These programs have failed to drive employee engagement and experience due to the following reasons:

1. These programs are typically based on award ceremonies that are held once a year and hence fail to provide timely recognition

2. Even though monetary rewards are still valued, they are not considered to be the best token of appreciation by employees today

3. Traditional reward programs often lack creativity and hence become repetitive and boring over a period of time

4. Since these recognition programs take into account only the end result of a task and not the effort or the method; hence they do not offer much scope for appreciating innovation

5. The programs are unable to meet the expectations of the employees, especially the younger ones who are a growing tribe within the organization

According to the results of a study conducted among employees of organizations still following traditional methods of recognition, 35% of the participants felt that their leadership just wanted to fill a recognition quota rather than actually appreciating their efforts.

The same study further revealed that 42% of those surveyed felt that the leaders were the only important employees within the organization while 39% felt that recognition was offered based on favoritism rather than performance.

Adopting Modern Employee Recognition Practices

The business world today is talent-driven and having an effective reward system in place is essential for organizations to attract, motivate, and retain top talent. Even the most traditional organizations need to adopt modern rewarding practices to create a holistic, well-rounded, and ongoing experience for their employees.

This is one of the biggest reasons that has made traditional rewarding approaches gradually obsolete. Implementing practices such as peer recognition and intrinsic rewards, etc. can help in creating a more satisfied, engaged and productive workforce, which in turn can drive better business results the organizations.

Which are key modern Employee Recognition Practices?

Modern rewarding practices are designed to be more personalized, comprehensive and social. These practices are based on greater flexibility and communication; they focus on ensuring enhanced happiness of the employees through their all-round growth.

A few modern reward practices that traditional organizations need to adopt are discussed in brief as follows:

1. Comprehensive recognition

As mentioned before, organizations need to move beyond the concept of handing out simple monetary rewards. Rather they need to combine monetary and non-monetary rewards to create a holistic experience.

A good example of the same is to present the employees with a combination of personalized gifts and certificates to appreciate their efforts and contribution. In this context, the practice of presenting movie tickets, family outing options and even gift vouchers to the employees are gaining much popularity.

2. Focusing on individual employee needs

The need to ensure greater employee satisfaction has led the modern reward practices to be more focused on their specific needs and expectations. That is why organizations need to consider the idea of letting them choose their own rewards based on their personal preferences.

This concept is proven to be more effective than the traditional approach of presenting mementoes and trophies.

3. Go social

Employees today love to show off- their achievements to their colleagues. Having a wall of fame in the workplace is an effective way of announcing employee achievements.

Organizations can also consider the option of creating leaderboards to list the top-performing employees for a given period of time. It helps in motivating employees to perform at a higher level to get featured on the leaderboard.


It is high time for traditional organizations to start implementing modern employee rewards and recognition practices for creating a highly motivated and engaged workforce if they want to attract, engage and retain top talent and drive a higher level of business growth.

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