August 3, 2019 0 Comment

6 Useful Tips for Setting up an Effective Employee Rewards Program

Most business organizations today are aware of the importance of rewarding their employees to enhance their sense of satisfaction and loyalty. So, it becomes essential for organizations to plan and implement their employee rewards programs appropriately. Here are a few useful tips for setting up an effective employee rewards program: 

How to set up an Effective Employee Rewards Program?

Though all organizations today are aware of the importance of rewarding their employees; but, 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

Temperaments and personalities of employees can differ significantly. This essentially means that what they value and derive motivation from can be quite distinct. The good news is that despite these differences, there are still some common motivation factors shared by the employees from the same team or division.

Learning about these general motivation factors can help in establishing a strong base for designing an effective employee rewards program. Otherwise, it is quite impossible for organizations to figure about what motivates individual employees separately.

Common motivation factors can be found out by asking employees to fill a quick survey form and doing a basic analysis of the data collected.

2. Set Meaningful Rewards Criteria

A successful rewards program is one that is based on meaningful criteria to avoid biases or random actions. Employee recognition should be considered as something special that can be received only through hard work and commitment.

It should not be perceived as an entitlement for employees who have good relationships with their managers or team leaders. Most importantly, each employee should have sufficient opportunity to receive recognition, irrespective of their level and role within the organization. This can be ensured only by clearly defining the criteria that employees would need to fulfil to be considered for the reward.

3. Form a Review Committee

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 size of the committee can be increased at a later stage if the organizations feels the need for the same.

The most important thing to ensure is that the members of the committee should 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 as a matter of privilege and pride.

This in itself can prove to be a reward for the employees who get the opportunity to take up the role.

4. Involve Team Leaders and Line Managers

When it comes to assessing the overall performance, contribution and achievement of employees, the feedback of their team leaders matter the most. Hence it is essential for the organization to ensure the involvement of the team leaders in any rewards program to make it truly effective and successful.

Most organizations commit the common mistake of seeking inputs only from the HR, and ignoring the opinion of team leaders and line managers. This diminishes the effectiveness of the rewards program as the line managers have first hard knowledge of the work, performance parameters and the needs of the employees. This combined with the strategic viewpont of the HR and management can add a lot of value to the program.

5. Know the Characteristics of a Good Rewards Program

Here are a few important points of a good recognition program:

– It should be timely; as any delay in rewarding and recognizing diminishes its value.

– It should follow a regular schedule integrated with the business operations.

– It should be specific, which means that it should aim to acknowledge some particular achievement or contribution of the employees

– It should have some tangible value so that the employee
continues to feel motivated even after receiving the reward.

– It should be value-based so that employees feel motivated to work towards common objectives.

6. Make the Program Multifaceted and Diverse

Creating variety in the rewards and recognition program keeps the concept fresh and exciting for long. Employees tend to feel a sense of curiosity about the program that enhances their enthusiasm about participation in the program.

However, care should be taken that the variety is not achieved at the cost of hurting the sensitivities of specific members of the workforce. 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.

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HiFives ( is an employee rewards, recognition and engagement SaaS platform that enables organizations to digitize, automate and transform their employee experience. The platform enables supervisors and co-workers to nominate, recognize and reward employees using a points-based system. Budget management, jury-based evaluation and multi-level approval workflows are built into the platform. HiFives has social features such as a wall of fame and gamification features such as leaderboards, e-certificates and digital badges. It also has a global redemption system with country-specific e-gift card options. HiFives integrates with all leading HRMS systems, Office 365, Google Workspace, MS Teams, Slack and other popular tools used at the workplace. HiFives is used by many large enterprises, small businesses and startups across 25+ countries in the world, in many industries including manufacturing, retail, technology, financial services and media.