The ‘Employee of the Month’ is a recognition for an outstanding performer in a team, department, function or the entire organization. In fact, it may be in a form of a gift, voucher, certificate or even cash. Additionally, organizations may have a wall of fame and the picture and name of the ‘Employee of the Month’ is put up there.

Many organizations initiate with this form of recognition, but often scrap it within a few months, whereas several of them continue to believe that it is the best form of employee recognition and motivation. Different organizations have had different levels of success while implementing an ‘Employee of the Month’ award as part of their rewards and recognition program.

1. Drives Healthy Competition

Award for the best performance should motivate the employees to strive harder to attain their set goals, creating additional business impact for the organization. In sales, an employee with the highest sales figures, and most satisfied customers will have a good chance of getting the award. Similarly, in customer service, an employee who has the best customer ratings is likely to get a shot at the ‘Employee of the Month‘ award.


2. Helps in Employee Retention

‘Employee of the Month’ awards can help to retain employees, as it is a significant accomplishment and can help in boosting the employee’s motivation and commitment. The ‘Employee of the Month‘ and other forms of employee recognition can help in employee retention. When hard work is appreciated, employees feel happy and satisfied; hence, they are less likely to leave the organization.


3. Boosts Employee Engagement

The ‘Employee of the Month‘ Program increases employee engagement as the employee feels more motivated working towards a reward and recognition for their efforts. So, this enhances the sense of belonging to the organizations. In fact, an engaged employee sees the organization’s goals and visions as his or her own and makes greater effort to increase the organization’s reputation and interests. He or she is fully absorbed and enthusiastic about his work.


4. Leads to Higher Productivity

A perfectly set up reward and recognition system with an ‘Employee of the Month’ Program is one of the best ways to appreciate and acknowledge employees who are doing well. So, employees feel motivated to put in their best efforts and attain or overachieve their monthly goals. Hence, this leads to higher productivity and great business impact for the organization.

Though an ‘Employee of the Month’ Program can have significant benefits, there is a flipside to it, if not executed well. Here are a few of the possible pitfalls that organizations must avoid:


1. Can lead to Unhealthy Competition and Discord

While a program such as ‘Employee of the Month’ might push employees to work harder to achieve their goals, it might also lead to all-out competition between team members. Given the focus on individual performance, teamwork and collaboration might take a backseat. This can impact productivity and business results of the organization in the long run.

Solutions to the above challenges could include having a more balanced framework for the evaluation of the ‘Employee of the Month’ that includes teamwork and peer feedback as additional parameters. Also, including team awards as a part of the overall employee rewards and recognition framework could help in balancing between individual and team performance.


2. Too much Focus on ‘Results’

The ‘Employee of the Month’ program can help drive employees to perform better on their key business goals. However, it can degenerate into just a race for numbers. Employee might focus too much on achieving the results, ignoring the ‘means to the end’. They might resort to shortcuts or even questionable methods that help them get closer to the award. Such behavior can lead to loss of business reputation for the organization in the long run.

Given the pressure of achieving short-term results, employees might move their focus away from long-term projects and even innovation. These can be detrimental to the business in the longer term.

The solution to the above problem once is to bring in a more balanced approach to the evaluation of the ‘Employee of the Month’ award that includes additional parameters such as innovation, creativity and integrity apart from the performance on the KRAs. Instituting other categories of awards focusing on innovation and integrity in the overall employee rewards and recognition program might also be a good idea.


3. Allegations of Favoritism

Lack of transparency in the evaluation process can lead to allegations of favoritism and create distrust among the workforce. This can lead to negative sentiment and poor work environment in the organization. Instead of motivating and inspiring employees, it might just lead to disengagement and loss of motivation.

A balanced and transparent system of evaluation for the award is the best way to avoid such trust issues. Using a balanced scorecard approach to decide on the award winner might be a good solution. Bringing an evaluation panel or jury might also help in making the system more fair and unbiased.

1. Define Program Objectives

‘Employee of the Month’ awards can help in employee retention, employee engagement, and increasing productivity. The organization should keep one or more of these objectives in mind while designing the ‘Employee of the Month’ program and other awards. The program should be aligned to the business goals as well.


2. Design the Evaluation Process

One of the most important design parameters of the program is the evaluation criteria for the award. The criteria could be based on target achievement, innovation, integrity, teamwork and overall corporate values demonstrated. Different weightages could be defined for each parameters based on their relative importance.

A small group of senior managers could be made responsible for the evaluation process based on the parameters defined. They would be able to rate each nominated candidate on the various parameters. Whoever gets the highest aggregate ratings should be declared the winner of the award.


3. Implement the System

A digital employee recognition platform can help organizations implement a well-designed ‘Employee of the Month’ program to perfection. The platform can accept nominations from various managers, run the evaluation process and release the awards to the winners. The awards can consist of e-certificates and reward points, redeemable for gift cards or merchandize.


4. Drive Participation

The organization should create a buzz around the program to create interest and drive participation among the employees. Ideally, the ‘Employee of the Month’ awards should be presented in large gathering of employees such as a team meeting or townhall, either physically or virtually.

Integration of the employee rewards and recognition platform with other internal platforms such as MS Teams, Slack or Intranet or even social media platforms such as Facebook and LinkedIn can create the necessary social visibility of the program.


5. Get Feedback and Fine-Tune

Once the program is rolled out, the organization should seek feedback on its effectiveness and suggestions for improvement from employees and managers. In fact, such feedback can be solicited through short surveys or focus group discussions. Hence, it can help the organization to make the necessary changes in the program and make it more effective.

1. Verbal Appreciation

Thanking the award winner in person goes a long way. Thank the employee in front of the whole team; introduce him or her as a high performer to clients or to the senior leaders of the organization. Take efforts to highlight the excellent work done by the employee during important presentations and meetings.


2. Certificates or Thank You Cards

Give certificates or thank you cards to the award winners. In fact, these could be digital certificates or cards or physical ones signed by the manager or a senior leader in the organization.


3. Physical or Digital Gift Cards

Gift cards of online or retail stores work very well as rewards. So, such gift cards give the employees the freedom to select a product or service of their choice. In fact, spa, salon or dining vouchers are good ideas.


4. Experiences as Rewards

A free movie ticket or a free pass for a musical or sports event can work as good ways to reward the award winners. An activity like this also promotes good work-life balance, as he or she can get to spend quality time with family sponsored by the organization.


5. Time–off or Paid Leave

Give a half-day off or even a full-day off to the award winners, which they could spend with families or indulge in leisure activities. In fact, this can be combined with other forms of rewards like gift cards or experiences. Hence, it can help high performing employees achieve a better work-life balance.


6. Special Projects or Assignments

Employees who win the award can be considered for a short-term cross-functional project or special project reporting directly to a senior leader. In fact, being part of such project can greatly enhance their outlook and increase their exposure to different aspects of the organization. Such projects can also give them the opportunity to connect with other teams and senior leaders in the organization. This can enhance their skills and opportunities for career growth significantly.


7. Training Programs

Nominating employee for a relevant training program, either in-house or external that the employee might not have been otherwise be eligible for is also a good way of rewarding employees who have won the award. Such programs can help these employee to learn new skills that could help in enhancing their performance at work and boost their careers. Hence, high performing employees are likely to value such opportunities.


8. Wall of Fame

Also, organizations can display the profile pictures of best performers on a physical bulletin boards or a digital wall in their employee recognition platform or intranet, along with their accomplishments. On a digital wall of fame, other employees can congratulate the winners. This social acknowledgement can give a further boost to their motivation.


9. Social Sharing

Additional social visibility can be created by announcing the awards on internal social platforms such as Slack, Teams or Yammer, or public social media such as Facebook and LinkedIn. Such announcements can be through an integration with the online employee recognition platforms. In fact, these public announcements can greatly multiply the impact of the award on employee motivation.


10. Award Ceremony

A good practice for the ‘Employee of the Month’ program would be to announce it in a team meeting, all-hands-on-deck meeting or an employee townhall. Such events can be organized either virtually or physically. The presence of a senior member of the leadership team during the event can greatly enhance the happiness of those receiving the awards.