Firms turn to recognition to reduce turnover
Employee loyalty contributes to better company performance, a stronger corporate culture and reduced expenses. As new personnel come in, they are able to learn from the experience of veteran staff members. Unfortunately, the average worker changes jobs every 4.4 years, according to the U.S. Department of Labor.
High turnover levels create additional costs related to training and onboarding. It also leads to additional stress for the staff members who need to ensure that projects continue on schedule and performance goals are met despite missing vital team members. These elements are encouraging businesses to develop strategies aimed at retaining top workers.
Employee reward programs are a straightforward way to recognize those who have contributed to the long-term success of an organization. A 2012 survey by Bersin & Associates found that the majority of firms that use rewards have a tenure-based program that acknowledges when team members have reached specific milestones with the organization. According to the survey, 87 percent of the $46 billion in funds dedicated to reward programs are spent on recognizing employees who have reached tenure, MarketWatch reported.
Support reward programs to improve results
However, simply having these types of initiatives is not enough to improve employee loyalty. For one thing, the study found that few workers are aware of the programs' existence at their organizations. While two-thirds of businesses surveyed stated they had recognition programs, only 58 percent of staff members said they knew about them. To be successful, these management tools need to be promoted internally to build excitement and increase awareness. Educating team members about how initiatives will work and how to receive recognition will encourage participation, which increases engagement and helps minimize turnover.
Once a large number of workers are excited to partake in a reward and recognition program, companies should take care to customize the initiative to their workforce. Employee Benefits reported that participants often feel that benefit programs don't fit their specific needs. The more diverse a group is, the more companies need to provide additional options, the source explained.
MarketWatch stated that variety is essential to the success of employee loyalty programs, and that firms are slowly beginning to offer a bigger range of rewards. While it once may have been standard for workers to receive a watch or other traditional reward after 10 years with a company, now participants can choose between hundreds of accessories, appliances and electronics. By giving staff members a choice, companies are able to deliver something that is personal and useful to recipients.