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We all know that strong employee retention is good for a company's bottom line, but a recent Gallup poll put an exact number (or average figure) on exactly what the financial impact of employee disengagement looks like for companies. The study found that companies lose approximately $20 million for every 10,000 employees who flee for greener pastures, or roughly $2,000 per employee.
For small and mid-sized businesses that rely on workers with knowledge of their company's particular processes, the impact per employee lost can be even greater. One of the first reasons companies lose great employees is a poor work environment and lack of recognition and appreciation.
Has your company considered implementing employee appreciation strategies to improve the culture and keep employees happy (and in place)? Here's why employee appreciation matters and what you can do now to start effectively boosting recognition practices at work.
In 2023's tight labor market, companies are looking to be creative in finding ways to increase employee retention. Increasing salary or bonuses isn't always the answer--not only is it often infeasible for the employer, but it's not necessarily what every employee is looking for.
In fact, according to a study by Acheivers.com, 55% of employees planning to leave their current company left due to "lack of recognition," not lackluster pay. But just how much more important is culture than pay?
Ten times more important, according to MIT's Sloan Management Review, whose data shows that employees are 1,000% more likely to depart because of a toxic workplace than poor compensation. In that spirit, here are some of the top ways to boost your culture by recognizing a team member for their good work.
Related: How an Employee Relations Strategy Supports Your Company's Culture
A run-of-the-mill "good job" just isn't cutting it anymore. Sharing specific praise, on the other hand, is a surefire way to make employees feel like their hard work is truly seen, understood, and appreciated. In the realm of behavioral psychology, specific praise (or positive reinforcement) is shown to significantly increase the type of behavior being praised.
In other words, if you want to incentivize employees to turn in their assignments on time, offer specific praise to employees when they consistently meet deadlines. Has a particular employee or functional group been hitting their numbers or winning return business? Let them know that you notice that they're succeeding, and communicate what types of behaviors you're seeing that you believe might be leading them there.
This type of praise communicates to the employee that you recognize that relevant business results are a direct product of their hard work, innovation, or ingenuity.
RELATED: Five Proven Tips for Building Strong Employer-Employee Relationships >>
Some tasks are high effort, low reward; some tasks are low effort, high reward; and some tasks are a good balance of each. Most roles within your company are likely to have a mix of projects that vary in their placements on the effort-reward scale. However, some employees will inevitably be positioned in roles in which their effort isn't as obvious or as often rewarded as others'.
Salespeople, for example, might do everything right during the prospecting phase, and expend a lot of effort recruiting a client just for the client to go with a competitor at the last minute, and for reasons outside of the salesperson's control.
If you appreciate the hard work the sales employee has put into the prospecting process, let him or her know. While their hard work won't be rewarded with commission, it can (and should) still be recognized.
Let's start with the obvious: everyone appreciates praise, but not everyone wants their praise to be public. Whether an employee wants public or private praise (or a healthy mix of both) is something that may not be known if a manager doesn't make it a point to ask.
Performance reviews are a great time for managers to ask their team members how they prefer to receive praise. Do your employees only want to be rewarded tangibly, i.e., with extra paid time off or via a bonus structure, or do they also want to see that their efforts are translating to career growth--i.e., with more responsibility or a title change?
For the small, everyday jobs well done, verbal communication or small tokens of gratitude (like a free lunch out) may suffice. There are endless ways to be creative here, and the best source of ideas will likely be your employees themselves.
RELATED: Employee Appreciation - Creative Work Anniversary Gifts >>
If you're reading this post, it's because you care about incentivizing your employees for a job well done. That alone communicates a lot about your company's positive culture. Even with the fantastic jumping-off point for employee relations that a positive culture provides, small and mid-sized businesses don't always have the resources they need to support a full human resources department.
That's where Axcet HR Solutions comes in. We can take on a full suite of HR duties for you, so you can focus on growing and scaling your core business. Training, development and employee relations are just the beginning. Schedule a free consultation today to see what Axcet HR Solutions can take care of for you.
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