Difference Between Incentive Awards & Recognition Awards
Effective award programs increase performance and create happier employees. Two types of awards are meant to honor and motivate employees.
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Award Choices
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When employers want to reward employees they have two choices: incentive rewards and recognition awards.
Incentive Rewards
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Incentive rewards target employee achievement of business goals and deliver specific rewards to those employees who help accomplish them. An example would be a cash bonus.
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Recognition Awards
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Recognition awards are meant to reinforce behaviors on the job. They provide after-the-fact acknowledgment for certain types of performance or achievements, and indicate what the business values. An example would be an opportunity for further training or cross-training on another team that interests the employee.
What Companies Do
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Many companies choose to reward past performance and achievements (with recognition awards) rather than encourage new or improved performance (with incentive awards for future performance achievements that will benefit the company).
What Should Be Done
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To achieve desired goals, reward systems should be closely affiliated with organizational strategies and success.
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