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How Employee Recognition Can Drive Innovation

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How Employee Recognition Can Drive Innovation In 2023

Today, in this highly competitive business environment, organizations not only need to hire top talent but also nurture them in a work environment that promotes and stimulates innovation. Employee recognition can drive innovation in the workplace by creating the right culture and motivating employees to innovate.

Also Read: Trends in Employee Recognition – What to Expect in 2024?

Why Is Organization Culture So Critical For Innovation?

Employee Recognition at a Startup

Innovation can be defined as any new idea, business process, work methodology, product, or service introduced in a work environment that creates a positive business impact.

Contrary to popular belief, innovation is not about making a massive breakthrough in a specific area of expertise.

Any small change that has a significant positive impact on the business can also be defined as an innovation.

Recognize Innovation Efforts and Remove Fear of Failure

A work culture that encourages innovation makes the process of innovation continuous and sustainable in the organization.

It encourages employees to think out of the box, experiment, and come up with innovative solutions to existing problems without the fear of failure.

It also encourages them to challenge the status quo and come up with new ideas.

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Also, having such a culture of innovation, makes it easier for organizations to attract top talent with similar innovative mindsets.

The infusion of such talent creates a virtuous cycle of innovation within the organization.

Why Points-Based System Works Best For Employee Rewards And Recognition

Hence, organizational culture is one of the key elements for promoting innovation in the organization.

The right HR policies and practices can drive a culture that encourages and generates innovation.

What Are The Challenges Towards Creating A Culture of Innovation?

Creating a culture of innovation is easier said than done, primarily due to the various challenges faced by the workforce in this context.

The most common of these challenges include the following:

1. Lack Of Top Management Support

Top Management

Most business leaders expect immediate outcomes from the various innovation efforts of the workforce.

This lack of patience from the top management proves to be the biggest hindrance in driving innovation in the workplace.

The top management needs to understand that even the smallest innovative ideas take time to provide the desired results.

Rejecting ideas within just a short time can prove quite damaging in the long run.

2. Fear Of Failure


Another major challenge faced by organizations in building a culture of innovation is the fear of experimentation and failure within the workforce.

Since being innovative means doing things differently, most employees tend to feel anxious about the changes resulting from implementing innovative solutions.

Hence, they tend to overlook the importance of continuous improvement (kaizen) and new ideas, building a strong internal resistance towards them.

3. Inadequate Managerial Support

Peer-to-Peer Recognition versus Manager Recognition

Supervisors and line managers are generally evaluated based on immediate outcomes and tend to disregard any efforts toward innovation.

Hence, when their team members come up with creative ideas, they fail to get adequate and timely managerial support for the same.

This prevents the employees from thinking out of the box and seeking innovative solutions to existing problems.

The lack of support from their supervisors results in lower motivation of the workforce towards innovation.

4. Unavailability Of Resources

Factory Worker

Innovative solutions often require organizations to provide employees with specific resources, such as time, space, materials, and even access to training programs.

The unwillingness of the organization to invest in such resources can diminish the spirit of innovation within the workforce.

Employees start thinking that innovation is not a priority for the organization and stop focusing their efforts away from innovation.

How Can Employee Recognition Drive Innovation By Creating The Right Culture?

Employee rewards and recognition can have a significantly positive impact on driving innovation in the workplace by developing an optimal culture.

A properly intentioned and structured employee recognition program can enable organizations to align their work culture toward promoting innovation.

Employee rewards and recognition can prove effective in keeping employees motivated and engaged.

Such employees are more likely to think about creative ways to work more effectively and efficiently and to enhance the growth and success of their organization.

Awards Event

More engaged employees are likely to feel inspired to find new and innovative ways to improve business processes, refine product offerings, and enhance customer interactions.

They are also more likely to come up with new and innovative ideas and suggest them to the management.

Knowing how important a conducive organizational culture is to driving innovation, let’s look at a few best practices for leveraging employee recognition to create such a culture of innovation in the organization.

Here’s how employee recognition can drive innovation:

best pactices of leverageing employee recognition to create such a culture of innovation

1. Recognize Innovation Efforts

Employee Rewards and Recognition for A Multi-cultural Workforce

Managers and supervisors should be empowered to recognize the innovation efforts of their team members.

Integrating the employee recognition program with the innovation efforts of employees would motivate them to continue with this behavior.

Employees would feel inspired to use their creativity towards new ideas and newer approaches to problem-solving.

They would feel that their organization is open to accepting new ideas and solutions even if they are small and seemingly insignificant.

2. Reward Innovation Impact

Integrate Reward and Recognition with Innovation Efforts

Organizations should look at employee recognition programs that offer rewards based on the outcomes of innovative solutions.

This would encourage employees to explore their creativity and experiment with different innovative ideas till they find the solution that provides the highest business impact.

3. Seek And Reward Best Ideas

Integrate Reward and Recognition with Innovation Efforts

Organizations should actively encourage employees to contribute new ideas and solutions and ensure that every innovation effort is recognized and appreciated, irrespective of how small it is.

Employees presenting such ideas should not only be recognized but also be appropriately rewarded.

This motivates the employees to make thinking out of the box an integral part of their work methodology.

Organizations need to create a process that enables employees to submit ideas regularly and get rewarded for the ones with the highest impact.

4. Organize Contests And Hackathons

Organize Challenges, Contests and Hackathons with Grand Prizes

Organizations can organize pitching contests and hackathons and reward and recognize the participants and the winners to promote the concept of innovation within the workforce.

Such events help create a spirit of healthy competition among the workforce and can contribute significantly towards developing a culture of innovation at the workplace.  

5. Enable Public Recognition For Innovation

Enable Social Recognition for Innovators 

Recognizing employees publicly at team meetings, town halls and other forums for their creative ideas and solutions is another way to drive innovation in the workplace.

Such public recognition encourages employees to continue their innovation efforts and inspires others to follow on their path of innovation

A good employee recognition software that offers integration with internal collaboration platforms such as MS Teams and Slack and social media such as Facebook and LinkedIn, can make public recognition much more effective.

6. Offer Skill Development As Reward

Communication for Successful Employee Rewards and Recognition

Another great way of promoting innovation in organizations is by providing upskilling and learning opportunities to employees, especially those who have demonstrated innovation as a form of reward or recognition.

This would not only motivate these employees to continue their innovation efforts but also increase the effectiveness of their efforts through additional skill development.

Final Thoughts   

Leveraging employee recognition to drive innovation in the workplace can prove beneficial for organizations in more than one way. In addition to enhancing the overall engagement, and productivity of the workforce, it can help businesses grow faster and stay competitive.

Sagar Chaudhuri

Lead author: Sagar Chaudhuri, the Co-Founder and CEO of HiFives. He is an HR Tech Evangelist with over 25 years of experience in the corporate world and entrepreneurship. In the past, Sagar has worked with companies such as Genpact, Infosys, and ICICI Bank, in leadership roles. He has an engineering degree from IIT Kharagpur and an MBA from IIM Lucknow. Connect on LinkedIn

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HiFives is a global employee rewards, recognition and engagement SaaS platform that enables organizations to digitize, automate and transform their employee experience. It is used by 100+ large enterprises, small businesses and startups in manufacturing, retail, technology, financial services and media, across 25+ countries.