4 Ways Employee Recognition Leads to Operational Excellence

Looking to increase productivity and boost your bottom line? The best place to start is with your frontline team. Too often employee recognition is overlooked as a strategy to make employees feel valued for their contributions and, consequently, inspired to contribute more at work. Through regular, authentic recognition you can encourage your employees to do more to drive operational excellence. Consider the following four strategies.

1. Employee recognition increases productivity.

It turns out that acknowledging the hard work employees do makes them want to work harder. Researchers at the Wharton School at the University of Pennsylvania conducted an experiment on the effects of gratitude on two groups of university fundraisers. One group followed the standard format for soliciting alumni donations, while the second group first received a speech from the program director, thanking them for their hard work. The latter group made 50 percent more calls than the group working without thanks.

2. Employee recognition retains top performers.

Turnover is expensive, particularly if your star talent keeps leaving for new opportunities. Research from Bersin by Deloitte found that organizations leading in “recognition-rich culture” had 31 percent lower voluntary turnover than other companies. Recognizing your in-house knowledge base may prove key in keeping skilled employees contributing to your company’s goals.

3. Employee recognition encourages ongoing improvement.

Making employees feel valued for their contributions inspire them to contribute more. Leadership consultant Gordon Tregold has seen proof that recognition of small improvements can push teams to improve more. He recalls working for a manufacturing company that was working to implement a measurement system for customer service provided against committed service levels. While the initial level of service was low and reporting poor, the teams were recognized for making an effort in adopting this new process. That recognition encouraged small improvements, that were in turn recognized. Over time the company raised raised the bar for recognition until it achieved a culture of recognition and a reputation for service excellence. “If we had decided to wait until the team had achieved 95 percent before providing reward and recognition, I believe it would never have happened,” Tregold writes.

4. Employee recognition grows your bottom line.

TalentCulture CEO Meghan Biro has found that organizations with highly engaged employees see two times the annual net income of companies whose employees lag on engagement. And Gallup finds that’s 2.5 times the revenue for companies with engaged employees compared to companies with low engagement levels.

Keep it simple

Recognition doesn’t have to be complicated. In fact, Gallup has conducted research that indicates that low-cost endeavors are among the most effective tools. The secret is to keep the recognition authentic, meaningful to the employee and reflective of the company culture. For example, a manager might write a personal note recognizing a specific action. A company CEO could present a commendation for driving forward a central company objective. Personal recognition hits home in a more powerful way than a general plaque that celebrates sticking around for ten years.

Take time during your next gemba walk to watch how hard the members of your frontline team work. Recognize the small achievements that are happening every day and over time you’ll see them steadily grow.