What Are the Purposes of Rewards & Recognition?

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Motivation is one of the main purposes of employee recognition and reward.
Motivation is one of the main purposes of employee recognition and reward. (Image: Stockbyte/Stockbyte/Getty Images)

An employee-recognition program shows a business' appreciation for the departments, teams and individual employees that contribute to the organization. The benefits of employee-recognition programs are many -- they fulfill the intrinsic need to be appreciated, and they illustrate an employer's commitment to its employees.

Employee Engagement

Employee-recognition programs have many positive effects on the workplace; however, the most measurable one is improving the company's bottom line. Employee recognition in any form also increases employee engagement and raises morale. Managers should exercise creativity while designing ways to recognize employees. An employee recognition program that's fresh and relevant maintains employee enthusiasm, motivation and raises morale - qualities of a productive workforce and successful business.

Non-Monetary Recognition

Employee recognition goes beyond a ceremony and announcement. Rewarding workers with higher levels of responsibility or exciting job assignments effectively recognize, and thus, motivate employees. Well-known psychologist and best-selling author of books on management practices and theories, Frederick Herzberg, wrote extensively about the connection between recognition and motivation. "Mr. Herzberg challenged assumptions that workers are motivated primarily by money and other tangible benefits," writes "New York Times" contributor Barnaby Feder. Herzberg's theories on employee recognition concluded that achievement and autonomy motivate people in the workplace.

Business Reputation

Employers that demonstrate appreciation in a variety of creative ways are regarded as employers of choice - the companies that have the best working conditions, stability, benefits and consideration for their employees. The difficulty of getting a job at companies like these is a sign of their health; high employee satisfaction causes low turnover. Word of mouth about a good employee recognition program also helps enhance your public image. Employees network with industry colleagues and friends employed by other companies all the time, and inevitably, the topic of work comes up. When employees describe how your company creates formal and informal ways to recognize employees, these networks reinforce your status as an employer of choice.

Reduced Turnover

Low turnover rates and high employee retention rates are also benefits of employee recognition programs. Employees who consider working elsewhere usually do so not just because of compensation and benefits. Employees leave because they are unhappy with management or they feel their contributions and opinions are unappreciated. Employee recognition programs resolve these issues through regular and positive interaction with the workforce and recognition of ideas that often mean more to employees than a salary raise. Low turnover and employee retention greatly benefit the company's bottom line because it spends less hiring and training new workers.

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