What Companies Get Wrong About Employee Recognition

Simple misconceptions can keep an organization from effectively and fairly recognizing all employees. To start, money isn’t always the right approach.

Written by Aaron Rubens
Published on Mar. 04, 2024
What Companies Get Wrong About Employee Recognition
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Many managers and companies have some misconceptions about effective employee appreciation. They take a top-down approach to employee appreciation, relying solely on leadership, HR and administrative assistants to spread gratitude in the workplace, hoping to boost employee engagement

5 Ways to Recognize Employees

  1. Build a recognition wall.
  2. Hold an annual Employee Recognition Day.
  3. Provide a way for employees to celebrate each other.
  4. Celebrate milestones such as birthdays and new babies.
  5. Offer achievement bonuses.

Instead, organizations should tackle employee recognition more laterally, empowering individual contributors to be included in recognizing their workplace peers. Doing so makes it possible to create a grassroots culture of appreciation that can affect the whole organization. 

Leadership teams shouldn’t underestimate the importance of getting employee appreciation right, as it can have a material impact on their organization. In a 2024 Kudoboard report on employee happiness trends, 98 percent of respondents indicated they would work harder and feel happier if they felt more appreciated at work. Nearly as many, 97 percent, believe that those who show appreciation to employees underestimated the impact of the act.

With this in mind, let’s consider some ways companies get it wrong regarding employee recognition and explore as more effective ways for organizations to show employee appreciation and increase employee engagement.

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What Not to Do When Recognizing Employees

Here are some actions to avoid in order to improve your approach to recognizing and rewarding individual staff members and teams.

Delay recognition 

In many organizations, when employee recognition happens too slowly or is delayed for too long, the result can be just as detrimental as if workers had received no recognition at all. When managers or administrators fail to notice and respond to employees’ efforts or only acknowledge them once every six months or year, people can quickly disengage with dampened enthusiasm and motivation. 

To encourage more consistent performance and harness the power of employee engagement, employees should receive timely recognition for their achievements. Implementing a weekly recognition program, rather than delaying employee appreciation by relegating it to less frequent intervals, can help boost morale and encourage sustained effort and productivity in the workplace.

Rely solely on cash incentives and bonuses

Money isn’t everything to every employee. That’s why, when it comes to figuring out the best approach to showing gratitude to staff members, it’s misguided for organizations to rely only on incentives like raises and bonuses. 

If you create an environment with no external motivators besides monetary rewards, you’ll increase the likelihood that employees will leave for higher-paying opportunities. Instead, consider other types of motivators, including those that peers can offer each other, such as personalized appreciation gifts, food, event-related recognition or company swag.

Fail to sustain programs

Some organizations decide to initiate an employee recognition program and succeed in getting it off the ground, but that’s just the start. Keeping it moving forward to prevent its collapse demands continuous management dedication and oversight. 

Leaders can supplement traditional half-yearly or yearly programs with ongoing weekly and monthly recognition efforts that encourage and facilitate peer recognition. This approach reinforces the appreciation’s impact and value to both employees and management. The more often that employees receive recognition and appreciation, the more likely they will stay engaged in the workplace, which can boost productivity.

IGNORE employee perspectives 

Employee recognition and rewards aren’t going to be meaningful, impactful or effective if they aren’t something that the recipients value. Avoid failing in this arena by seeking team input early on, including during program development, and then continuing to regularly check the pulse of your workforce. 

Conduct surveys to understand employee preferences regarding appreciation and tailor the recognition program accordingly. Managers can foster a feeling of inclusion and respect among employees by consulting them about their preferences in advance rather than choosing rewards without knowing that they’re wanted.

thank you thank youMake Every Day Employee Appreciation Day

What to Do When Recognizing Employees

Instead of these problematic approaches, try these more effective ways to show employee appreciation.

Build a recognition wall

Companies can establish a physical and/or virtual platform where peers and managers alike can publicly acknowledge and celebrate employee achievements. This recognition wall can help create a culture of appreciation among peers and inject some fun into the workplace. This approach also has the potential to empower everyone on a team to appreciate their coworkers.

Institute Employee of the Month awards

As an alternative to financial incentives, companies can recognize exceptional performance by selecting and honoring one outstanding employee each month. The options for incentives and rewards are endless with this method and might include certificates, reserved parking spots or personalized desk accessories to showcase appreciation. 

If you go this route, ensure inclusivity by recognizing a diverse range of employees. To incorporate staff participation, encourage employees to nominate peers who they think deserve the honor.

Hold annual recognition ceremonies

While companies should avoid relying only on yearly recognition efforts, annual awards ceremonies can still play an important role in an organization’s appreciation arsenal. Consider honoring employees across different categories and departments, instilling a sense of prestige and anticipation within the organization while celebrating collective achievements.

As with Employee of the Month awards, companies can generate more excitement and engagement by letting peers nominate each other for annual recognition awards.

Offer goal achievement bonuses

Nothing makes someone feel unappreciated more than ignoring the fact that they’ve reached an important goal. To avoid this, managers and companies can offer bonuses for employees who consistently meet or exceed performance goals. These goal-achievement bonuses need not be monetary. Non-monetary bonuses, like extra flex time or appreciation gifts, can also help employees celebrate goal achievement and feel seen.

Recognize employee milestones

Organizations can additionally facilitate appreciation by finding reasons to call out individuals at key milestones. Recognizing personal and professional events like work anniversaries, promotions, birthdays, new babies and other significant moments with a shout-out can help to create a vibrant culture of belonging. By giving peers an opportunity to participate in this milestone recognition, companies can help everyone feel involved and included.

Knowing what to avoid with employee appreciation is a vital and necessary start in improving recognition programs. But when you understand what can really make people feel valued and rewarded, you’ll be in a much better position to generate a level of happiness and engagement in the workplace that improves productivity and retention.

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