The Importance Of Employee Engagement

The Importance of Employee Engagement

Article written by Incentive Services University

Much of the literature today on building a strong corporate culture is centered around the importance of keeping employees positively engaged at work, creating a culture in which each employee feels connected, empowered, and ultimately contributing to the forward momentum of the organization.

One important way that we can impact employee engagement is through recognition – whether it be through verbal praise, monetary rewards, social networks, or service award programs. The impact of recognition on employee engagement can be a significant factor in training – and retaining – quality employees who feel engaged and empowered to make a difference every day. In fact, research by the Aberdeen Group found that “60% of Best-in-Class organizations stated that employee recognition is extremely valuable in driving individual performance” (Driving a Culture of Employee Recognition, 2013). In addition, “ . . . in organizations where recognition occurs, employee engagement, productivity and customer service are about 14 percent better than in those where recognition does not occur” (Bersin & Associates, 2012). Recognized employees are more likely to be engaged employees – interested in and contributing to a positive organizational culture and its growth.

But what are the risks of NOT recognizing employees? Is there any negative impact to the health and well-being of a company and its culture? Research suggests that “[w]ithout a way to engage employees, organizations risk losing top talent and jeopardize organizational growth” (Aberdeen Group, 2013). Disengaged employees are decidedly less productive, contribute less and may, in fact, drive the corporate culture in an apathetic, if not negative direction. Unfortunately, “[o]nly 14% of organizations provide managers with the necessary tools for rewards and recognition” (Aberdeen Group, 2013). Recognition, even in small ways, helps employees to develop a strong sense that they can positively impact the forward-momentum of the organization.

Recognition can take many different forms, both formal and informal. Informal recognition might include anything from off-the-cuff remarks, praise or even monetary incentives based on random criteria left solely to manager discretion. While these are noble efforts, they often have no tracking or accountability either from a performance or financial perspective. In fact, research from the Human Capital Institute suggests that “ . . . sporadic recognition may in some cases be worse than no recognition” (Human Capital Institute, 2009). Left without a structured program, recognition can be inconsistent and results entirely unknown.

Formal recognition programs, however, might be the “best way to implement a recognition program . . . as a rational, carefully formulated program that is based on sound theory and is well integrated with an organization’s business strategy (Human Capital Institute, 2009). Within a formally designed program consistent with company culture and values, these programs can provide thoughtful and meaningful recognition to employees, contributing to an overall culture of both engagement and positive recognition. Furthermore, a properly-managed program with the right software can also provide significant data on use, feedback, results, accounting, and reporting. Tracking this data can pin-point effective recognition strategies, align program goals among managers and comply with financial and accounting regulations. In addition, the use of social technologies linked to a formal program “ . . . allows employees an established way to provide recognition and easily receive specific feedback” (Bersin & Associates, 2012).

Let’s look at two best practice case studies in which a formal, agency-managed program helped to build a culture of recognition and employee engagement.

A leading healthcare services company with over 80 hospitals and 80,000 employees developed a two-phased approach:

  • In Phase 1 – the company wanted to standardize the Service Award Program through the organization creating a consistent look and feel to build a culture of recognition. The program included the use of e-cards and technology alerts to engage both managers and peers.
  • In Phase 2 – the company wanted to better understand all of the recognition methods being used within the organization. To do this, they created a formalized process which included:
  • Budgeting, Tracking, Electronic Recognition Process, Social Technologies, Award Redemption, Tracking of Taxes and Accounting.

This phased approach allowed the company to start creating a consistent culture of recognition, allowing the program to gain a foothold while the second phase was being implemented. Phase 2 brought additional structure and opportunity to the program and allowed the company to see just where recognition was making an impact – and where it could be used to create more significant employee engagement.

A large food service distributor with over 30 distribution centers and 8,000 employees created an employee ‘Loyalty’ Program in which employees can earn points for Safety, Wellness, Above & Beyond Performance and Years of Service. In addition, the individual distribution centers can run ‘contests’ and ‘games’ specific to their location to help drive awareness in particular initiatives. Program technology alerts help to engage managers and peers in the recognition process while data functions track taxes and accounting for financial reporting.

Works Cited

Aberdeen Group. 2013. Driving a Culture of Employee Recognition,

Bersin & Associates. 2012. Bersin & Associates Unlocks the Secrets of Effective Employee Recognition,

Human Capital Institute. 2009. The Value and ROI in Employee Recognition,

Site Links

5 Myths About Service Awards

5 Myths about Service Awards

Article written by Incentive Services University

The truth is the majority of Service Award programs out there are outdated and ineffective. Many programs were designed years ago and based on concepts from decades ago. It’s easy for these programs to get put on auto pilot but if you haven’t evaluated your program, now is the time. This is real money that could be better spent.

Here are 5 common myths about Service Awards and the reality…

Myth #1: Employees only care about the award

Reality: The presentation from the manager is more meaningful to the employee than the actual award. This is why it is extremely important to provide managers with the tools to make an effective presentation.

Myth #2: Employees are overwhelmed by a large selection of awards

Reality: There’s a reason a large percentage of your employees never select an award. Today’s employees want choice. Gone are the days of offering 25-50 “traditional” options. Employees want better brands and more options.

Myth #3: The website has to be boring and only for ordering purposes

Reality: The website should be an extension of your company and a dynamic experience for your employees. Technology allows you to highlight employees and get their peers involved.

Myth #4: You can’t appeal to every generation with the awards catalog

Reality: The truth is you can. The key is to build your awards selection based on your company’s demographics. You should have a blend of traditional awards for the baby boomers and lifestyle awards for the millennials.

Myth #5: Switching providers is difficult

Reality: It’s a lot easier than you think. An experienced provider will have the knowledge and detailed plan to make the transition quick and seamless.

Is it time you re-evaluate your Service Award program?

Site Links

Circles Of Influence

Circles of Influence and Social Recognition

Article written by Incentive Services University

World class athletes understand that no matter how hard they train, it’s impossible to maximize performance unless they compete. They can’t be at their best unless they measure themselves against the best. Competition, visibility and recognition fuel performance. – Incentive Services University

As organizational leaders, we know that employee recognition is crucial to maintaining motivation among quality employees. We all want to be recognized for our achievements, appreciated for our efforts and commended for our contributions. A hand-written thank you note, a tasty treat, or even an extra day of vacation can all be a grateful gesture for a job well-done.

More often, though, we are influenced by something greater than internal motivation or a private gesture of thanks. Our “circles of influence” and our levels of visibility extend to our colleagues, our leaders and even our social circles. We refer to this as social recognition. Social recognition isn’t a very complex concept. If you sum it up as the public acknowledgement of merit, you’ve pretty much hit the nail on the head. So when a manager praises an employee during a private discussion, that is not social recognition. But if that same manager honors the employee in a weekly team meeting, it is social recognition. – “4 Tips for Starting a Social Recognition Program”, TribeHR Staff, January 16, 2013

While social recognition may not fit in all situations, research shows that more and more employees want to connect with their workplace community – and with one another – through technology. Use of a corporate intranet for social recognition can help employees to feel appreciated, connected and can set a standard for employee culture and expectations.

For example, you might include a “Thank You” Wall where employees are recognized for their contributions or hard work. Perhaps employee anniversaries are acknowledged on an electronic Anniversary website. Or you might create a peer-to-peer site where employees are able to virtually “recognize” one another.

“Recognition that is timely, values-driven, and open to all employees builds a more connected and fully-engaged workforce” (“The Social Workplace”, Lupfer, 2011). By acknowledging employee value and accomplishments not only privately, but publicly, you create a larger circle of influence for each and every member of your organization.

When performance becomes visible in our circles of influence, we will do almost anything to succeed. – Incentive Services University.

Site Links

The 15-70-15 Rule

The 15-70-15 Rule

Article written by Incentive Services University
“Take aim at the heart of your workforce.”

In order to maximize performance, it’s important to understand the cross-section of a typical work force. It’s common for a normal group to have 15% of its employees in a top, elite group. On the other hand, 15% may be disengaged or problem employees. This leaves the bulk of your work force, 70%, in the middle.

The group at the top consists of self-motivated, talented employees. Most of these people are experienced and take it upon themselves to do their jobs in the best way possible. This elite group produces outstanding results whatever the motivational factors may be.

On the reverse side, the bottom 15% is generally unmotivated and disengaged. This bottom percentile does not have experience and most likely will never obtain it as they bounce from one job to the next. These people more than likely will not be with you in the future.

The group that makes up the major portion of your work force is the middle 70%. The results, records, and bottom line of your organization are dependent on whether this middle percentile can be motivated and trained to improve. The individuals within this middle group must feel they have an attainable goal and will be recognized for improving their personal performance. It is unrealistic in their minds to strive to be better than the elite employees.

When structuring a performance recognition strategy, it’s important to focus on this middle 70%. Programs that only highlight the top 15% spend money on people who will probably accomplish similar results independently. The focus should be on the portion of the work force that will bring the biggest return. Every employee in the middle 70% should feel they have the ability and opportunity to achieve pre-set goals.

In many situations, we have found that incentive dollars and manager time are directed incorrectly. Most of the time and resources are spent with the low achievers who will not be with the organization in the future, while most of the incentive budget is spent on the high achievers who would have accomplished similar results independently. Focus on motivating and engaging the middle 70% and watch your performance improve.

Site Links

Rethinking Engagement

Rethinking Employee Engagement

“The engaged stay for what they can give, the disengaged stay for what they can get.” Prepared by Incentive Services University.

Article written by Incentive Services University

Engaged or disengaged? Quit or Stay? As leaders in our organization, we all wonder which terms apply to our employees. How do we keep them “engaged” in their role, actively participating, and contributing to the company’s goals and strategic direction? A 2012 study indicated that 29% of employees “ . . . who are fully engaged do more in less time than their colleagues” and yet “ . . . 75% of organizations have no engagement plan or strategy” (Dale Carnegie Training).

The level of our employees’ engagement may be more than just black and white, engaged or disengaged. According to a recent Employee Engagement update, there are actually five levels of employee engagement ranging from those who are fully engaged to those who are fully disengaged by ranking employees based upon their levels of both contribution and satisfaction. (BlessingWhite Research Update, 2013).

Five Levels of Employee Engagement

The Engaged: High contribution and high satisfaction. Those employees who have the greatest personal and organizational interests.

Almost Engaged: Medium to high contribution and satisfaction. Among the high performers and “reasonably satisfied with their job”, these employees deserve our investment as they have the “shortest distance” to travel to become fully engaged.

Honeymooners & Hamsters: High satisfaction but low contribution. Honeymooners are new to the organization or role and “happy to be there.” Hamsters are working hard, but are “spinning their wheels” and contributing little to the organization.

Crash & Burners: High contribution but low satisfaction. Top producers who are “disillusioned and potentially exhausted.”

The Disengaged: Low contribution and low satisfaction. Disconnected, skeptical and negative, they often feel underutilized at work.

By focusing our attention on those employees who have the potential to make a contribution to the organization, we can help more individuals to achieve full engagement. This includes not only the Engaged, but those who are Almost Engaged and the Honeymooners & Hamsters.

Creating Engagement

So how can we reach employees who are just below the apex of contribution and satisfaction? And, perhaps just as importantly, how do we measure their intention to stay and to contribute? Surveys are a great start, but “ . . . engagement surveys do no good if they only result in a list of actions that managers are ill-prepared to undertake.” Three key elements are critical to a fully-developed employee engagement strategy:

1. How an employee relates to his or her job and employer

2. How managers work with individual employees to address individual engagement drivers and faster positive team dynamics

3. How executives create an inspiring vision for the future and foster a purposeful culture that makes engagement a core driver of business results.

Engaging employees must be a shared responsibility in every organization – shared by employees, managers and organizational leaders. Managers and leaders need to take the time to identify where each and every employee lies on the axis of satisfaction and contribution. Are their roles and their goals aligned with the direction of the organization? Are they engaged or almost engaged? Can you reinforce and realign the honeymooners and hamsters? Or have they crashed and burned? Almost “ . . . 61% of employees who say they are satisfied with the amount of input they have in decisions affecting their work are engaged” (Dale Carnegie Training, 2012).

Recognition and Reward

Finally, how are you effectively recognizing the contributions of your employees? Reinforce the need to challenge, stretch and coach employees to their full potential and to “ . . . recognize attitude, effort and results” (BlessingWhite). There are so many ways to recognize employees for successful contributions to the organization, including:

  • Everyday behaviors
  • Innovation
  • Sales results
  • Living company values
  • Wellness & Community
  • Personal wins
  • Cost saving
  • Teamwork
  • Recruiting
  • Going above and beyond
  • Hitting goals
  • Safety Achievement

Think beyond the general strategies of yearly bonuses and occasional promotions. Rewards should be “meaningful . . . Benefits and incentives can be customized to appeal to different segments of the workforce” (Dale Carnegie Training, 2012). Recognition of employee accomplishments can – and should – be a significant motivator towards employee engagement.


Challenge, stretch and recognize your employees to maintain their full engagement – every day. Employee engagement needs to be a shared responsibility and a “top-down” commitment. Building a fully engaged workforce must be part and parcel of your daily culture and built from the top-down – to give your organization that competitive advantage.

Site Links

Four Tips

Four Tips For Structuring Incentive Programs

Article written by Ann McKeough

Company success rests on the performance of employees. As organizations look at ways to reward and motivate their workers, recognition methods have come a long way from a pat on the back and upgraded parking spot. Structured incentive programs—which reward employees for meeting performance-based milestones—are helping employees set, meet and exceed goals, and helping companies attract and retain valuable talent. Employee incentives also help build brand loyalty.

In fact, employees who participate in company-driven incentive programs say they feel more valued (85%), are more loyal to their companies (65%) and get better results (60%). And at companies without incentive programs, one-third of office workers say they’d put in an extra workweek each year, if their company would implement one.

Here are four tips to help companies structure effective incentive programs:

1. Align the program with company objectives: By keeping your incentive program in line with company business goals, you’ll ensure that employees are trying to achieve milestones that matter. That is, they’ll be focusing on your organization’s priorities while striving to improve the business as a whole.

2. Communicate effectively: When structuring an incentive program, it’s essential that the goals and details of the program be communicated to participants. Have a clear plan that outlines communication frequency, along with vehicles—such as conversations with managers, an internal website, a company newsletter, etc.—for communication. Increased understanding within the business can ultimately lead to better results.

3. Engage all levels of business: It’s critical to align the entire company around the goals of the incentive programs. Providing incentives for just one level of business can ultimately have a negative impact on performance goals. If salespeople are part of the incentive program, make sure the sales managers are as well so that everyone feels engaged and motivated.

4. Choose effective rewards: An incentive program is only as good as its rewards. When selecting rewards. Remember to provide products that motivate employees and drive performance. Many incentive programs are points-based, allowing workers to earn points that can be redeemed for a reward of their choosing—which in turn, can make it more meaningful.

Site Links