Employee rewards and recognition have emerged as key factors for employee motivation and retention. However, organizations often end up having rewards and recognition for entry-level employees only, excluding more tenured employees. Is this the right approach? Let’s take a look.
Organizations often feel that rewarding and recognizing entry-level employees is of utmost importance.
They also feel that these programs do not hold much significance for employees at higher levels in the organization.
They believe that experienced employees do not value such programs.
However, this is not true. Most mid and even senior-level employees also feel the need for consistent motivation and appreciation as entry-level employees.
Thus, by focusing only on the newer employees for employee recognition, organizations might demotivate their tenured and high-performing employees.
Organizations with recognition programs only for entry-level employees are likely to see negative impacts.
The most common consequences are as follows:
1. Divisive Organization Culture
2. Reduction in Employee Engagement
3. Decline in the Employer Brand
4. Lack of Innovation and Creativity
One big drawback of having a recognition system focused only on entry-level employees is the birth of a divisive organizational culture.
Such culture is detrimental to the organization. It can breed dissent among employees and reduce cooperation and support from older employees.
It can lead to adverse impacts on the business due to poor communication, poor teamwork, and distrust among the workforce.
The absence of a fair rewards and recognition system increases the chances of disengagement even among the most dedicated employees.
As a result, they can tend to become indifferent towards the happenings in the organization and become less productive.
The decline in engagement levels can also result in a significant rise in employee turnover.
This can hamper the smooth business operations of the organization and eventually loss of credibility among customers.
Organizations that do not recognize tenured employees and recognize only entry-level employees can lose their credibility as preferred employers.
For many young professionals, being recognized and appreciated might hold a higher value than any additional perks and benefits.
The absence of a proper recognition program can make them less inclined to take up job offers from such organizations.
Hence, it can hurt the brand value of the organization as a recruiter.
Hence, the organization might find it increasingly difficult for them to hire quality candidates for various roles.
When organizations fail to acknowledge their long-serving employees, it brings down the overall motivation levels of the entire workforce.
Employees may tend to do their work mechanically rather than feeling excited and motivated to take initiative.
So, they might become less creative or innovative and might not look at exploring new ideas and options for business growth.
Hence, it can hurt innovation, improvement, and eventually loss of competitive advantage and lower business growth.
There is often a debate among HR practitioners that employee rewards and recognition programs should be targeted only at entry-level employees. However, it is best to adopt a comprehensive employee reward and recognition system across all levels of the organization.
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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