November 25, 2020 0 Comment

Why do Employee Rewards and Recognition Programs fail?

Employee rewards and recognition programs in organizations are generally launched with a great deal of fanfare with top-level executive involvement. However, not all employee rewards and recognition programs are able to sustain the same momentum after launch and over a period of time the tempo fizzles out. There are many reasons as to why employee rewards and recognition programs fail; in this article, we take a look at a few possible reasons:

What are the Key Reasons for the failure of Employee Recognition Programs?

Why do Employee Rewards and Recognition Programs fail?
1. Lack of executive sponsorship

Leadership involvement reduces over time and employee rewards and recognition end up as one of the many HR initiatives. Leaders tend to shift focus on to other strategic and tactical imperatives and lose interest in the program as it becomes largely operational.

Organizations that have strong operations and people focus tend to fare better than others as employee rewards and recognition related key metrics remain an integral part of all internal reviews.

2. Lack of line manager involvement

Line managers hold the key to a successful implementation of employee rewards and recognition programs. However, if they are not involved during the design and planning of the program, they are likely to perceive this as yet another management initiative. This cynicism percolates to their team members and eventually to the entire organization.

The objective of employee rewards and recognition program is to create a culture of appreciation and recognition, and managers are the key components of this. Hence, managers should be involved in the program at the planning and rollout stage and the success of the program should be incorporated in their KRAs.

3. Lack of ground-level interest

Employees might lose interest in the program over time due to the lack of interest from the leadership and diminishing importance or visibility of the program. Or it could be due to disconnect with the program objectives or the messed-up implementation from the very inception.

If the program was conceived as a management or HR initiative without taking proper inputs to form the employees or the line managers, then it is likely that the entire program might fall flat on its face like many other such initiatives once the initial enthusiasm wears off. Hence, employee rewards and recognition programs should be planned only after a dipstick with the employees.

4. The process is too cumbersome

Implementation challenges might also derail the success of employee rewards and recognition programs. For example, making the process very cumbersome with too many criteria and variables might make it difficult for managers to reward and recognize the employees.

An operations heavy process will deter them from going ahead and participating in the program. This holds true for employees as well. If the process of getting rewarded and recognized is too cumbersome, employees might not want to be a part of it. Hence, it is critical that the process is kept simple and intuitive; digitizing and automating it might be the icing on the cake.

5. Program is frozen in time

Employee rewards and recognition programs designed once upon a time might lose its relevance over time unless the program evolves with the changing requirements of the organization and the workforce.

Organization priorities might change over time as it grows and as the business environment changes.
For example, achievements related to revenue generation might hold maximum importance when the organization is in the growth phase.

Over time as the growth slows down and organization matures, there might be an increased focus on cost-saving initiatives. Also, the changing profile of the workforce might impact the expectations of the employee rewards and recognition program.

Younger and more tech-savvy employees or an increasing percentage of women employees entering the workforce would definitely place different demands from the program. Increasingly, peer recognition and self-nomination are becoming mainstream in most employee rewards and recognition programs.

It is no longer the exclusivity of managers to recognize employees but be a part of a broader organization culture of appreciation. The leadership and HR should act as catalysts for the program giving it the required importance and visibility in all possible forums.

They should invest in tools that digitize, automate and streamline employee rewards and recognition programs and ensure that there are no operational hurdles in the smooth running of the program.


These are just a few of the top reasons why employee rewards and recognition programs fail. Leaders and HR must avoid these pitfalls to keep the programs alive and kicking, to keep employees motivate and productive at the workplace. And honestly, this is hardly rocket science.

What employee rewards and recognition program really needs is continuous support from the leadership and effort from the HR to keep the program alive and in tune with the needs of the employees at every level.

The phrase “Change is the only constant” applies to employee rewards and recognition programs as well as they need to evolve and adapt to the changing organizational priorities, work practices, and employee preferences.

by HiFives

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.