Employees today are no longer satisfied only with good pay packages and benefits, even though these are still considered to be the two most important aspects of career growth. Employee rewards and recognition has emerged as one the 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.
What makes this approach inappropriate?
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 other professionals who have more experience and in most cases, have been associated with the organization for much longer would not value such programs.
However, the truth is that most mid and even senior-level employees also feel the need for consistent motivation and appreciation as much as entry-level employees. Thus, by opting to focusing only on the newest members of their workforce, for employee recognition, organizations can actually end up demotivating their tenured and high-performing employees.
Organizations that have recognition programs focused only at entry-level employees are likely to suffer from several negative consequences as compared to programs that cover all employees:
The most common consequences are as follows:
1. Development of Divisive Organization Culture
One of the biggest consequences that organizations face by opting to have a recognition system focused only at entry-level employees is the birth of divisive organization culture. This culture is rarely beneficial for the organization, as it will not only breed dissent among the employees and negatively affect the level of cooperation and support that new employees can receive from the older ones.
This can lead to adverse impact on the business due to poor communication, poor teamwork and .distrust among the workforce.
2. Reduction in Employee Engagement Levels
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 smooth business operations of the organization and eventually loss of credibility among customers.
3. Decline in the Employer Brand
Organizations that choose to ignore the efforts and contributions of their highest performing employees and reward and recognize only their entry-level employees can lose their credibility as a preferred employer. Potential employees especially experienced candidates may avoid joining such organizations as they feel that their hard work and contribution towards might not be appreciated or even acknowledged by the organization, after a point of time.
For many young professionals, being recognized and appreciated might hold higher value than any additional perks and benefits. The absence of a proper recognition program can make them less inclined to take up any job offers from such organizations. This will have a negative impact on the brand value of the organization as a recruiter, making it increasingly difficult for them to find quality candidates for various roles.
4. Lack of Innovation and Creativity from Demotivated Employees
When organizations fail to acknowledge their long-serving employees, it brings down the overall motivation levels of the entire workforce. Employees tend to carry out their tasks in a programmed way rather than feeling excited and motivated to take any initiative.
They tend to become less creative and innovative as they see no point in exploring new ideas and options to enhance business growth. They might even stop taking any initiatives and just wait for instructions from their superiors to perform tasks that they could have done voluntarily if they were recognized and rewarded appropriately.
This, in turn, can cause a negative impact on innovation, and continuous improvement and eventually lead to 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, as mentioned in this article, it is best to adopt a comprehensive employee reward and recognition system across all levels of the organization.
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