Most business organizations today are aware of the importance of rewarding their employees to enhance their sense of satisfaction and loyalty. Here are a few useful tips for setting up an effective employee rewards program:
Although all organizations today are aware of the importance of rewarding their employees, when it comes to actually building an effective employee rewards program, most organizations are unaware of where to begin.
Discussed below are some useful tips for setting up an effective employee rewards program:
1. Learn What Motivates Employees
2. Set Meaningful Rewards Criteria
3. Form a Review Committee
4. Involve Team Leaders and Line Managers
5. Know the Characteristics of a Good Rewards Program
6. Make the Program Multifaceted and Diverse
The temperaments and personalities of employees can differ significantly. This essentially means that what they value and derive motivation from can be quite distinct.
Despite these differences, employees from the same business unit or team share common motivation factors.
Learning about these general motivation factors can help in establishing a strong base for designing an effective employee rewards program.
The organization could do a basic analysis of the data collected through an employee survey to understand the most common motivation factors.
Importantly, a successful rewards program is based on meaningful criteria to avoid biases or random actions.
Employees would only be considered for the reward if they fulfilled clearly defined criteria.
Employees who have good relationships with their managers or team leaders should not be favored for the rewards.
Most importantly, each employee should have sufficient opportunity to receive recognition, irrespective of their level and role within the organization.
Irrespective of the size of an organization, forming a committee to oversee the employee recognition program is highly advisable.
The committee may consist of just a few senior and mid-level managers, to begin with.
The members of the committee must be known for their honest and unbiased decision-making capabilities.
It is also essential for organizations to promote the concept that serving on the committee is a matter of privilege and pride.
When it comes to assessing the overall performance, contribution, and achievement of employees, the feedback of their team leaders matters the most.
Hence the organization needs to ensure the involvement of the team leaders in any rewards program to make it truly effective and successful.
However, most organizations commit the common mistake of seeking inputs only from HR and ignoring the opinion of team leaders and line managers.
However, combined with the strategic viewpoint of the HR and line management can add a lot of value to the program.
Here are a few important points of a good recognition program:
1. Should be timely; as any delay in rewarding and recognizing diminishes its value.
2, It should follow a regular schedule integrated with the business operations.
3. Should be specific, which means that it should aim to acknowledge some particular achievement or contribution of the employees.
4. It should have some tangible value so that the employee continues to feel motivated even after receiving the reward.
6. It should be value-based so that employees feel motivated to work towards common objectives.
Additionally, creating variety in the rewards and recognition program keeps the concept fresh and exciting for a long.
However, care should be taken that the variety is not achieved at the cost of hurting the sensitivities of specific workforce members.
This can render the whole program ineffective and even make the employees feel demotivated.
An effective employee rewards program can help organizations in engaging and motivating the employees, which in turn can give them a competitive edge.
Developing such programs is not as difficult as it may seem, especially if organizations were to follow the above-discussed tips to enhance the business impact of the program.
Lead author: Sagar Chaudhuri, the Co-Founder and CEO of HiFives. He is an HR Tech Evangelist with over 25 years of corporate and entrepreneurial experience. 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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