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Recognition and Engagement in Today’s Workforce

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As the late American poet laureate, Maya Angelou once said, “People will forget what you said, people will forget what you did, but people will never forget how you made them feel.”

Engaged employees feel satisfied and appreciated in their job. They want to come to work daily and feel emotionally connected to their employer.

This article will review the impact of employee recognition and engagement programs, how they are evolving to meet the changing needs of today’s workforce and marketplace, and the need to ensure that your employees do not get left behind as your business grows.

The Impact of Employee Recognition and Engagement

Companies design employee recognition programs to reinforce critical behaviors and outcomes, as well as foster positive attitudes among their workforce. 

The Gallup Organization has found that 54% of the American workforce is not engaged at work – nearly a third of those (17.2%) are classified as actively disengaged. 

The impact of engagement on employee performance cannot be denied. Again, quoting Gallup  findings:

  • Employees who feel highly engaged are 87% less likely to leave their employer voluntarily.
  • 69% of employees say they would work harder if they felt more appreciated.
  • 37% of employees say recognition is the most critical factor in job satisfaction.

Equally as compelling is the impact of employee engagement on company performance. Once again, from Gallup:

  • Companies with high employee engagement are 21% more profitable and 22% more productive than their peers. 
  • Disengaged employees cost companies $3,400, on average, for every $10,000 per year that the employees earn.

And let’s not forget the impact of employee engagement on customer service, as assessed by Demand Metric:

  • 80% of customers are retained by organizations with employee engagement rates of 50% or higher
  • Customers who know that a company’s employees enjoy what they do feel more positive about their experience and are likelier to develop a sense of loyalty to the company.

Companies are asking a lot from their recognition and engagement programs, aren’t they? All the more reason yours need to be reviewed on a regular basis to ensure they are keeping up.

Workforce Demographics and the Pandemic’s Impact

Performance incentives have long been used to attract and retain quality workers.Today, there are five generations in the workforce for the first time in history. These include, in order of size:

  • Millennials (1981 to 2000) – currently 37%* of the U.S. workforce
  • Generation X (1965 to 1980) – 28%
  • Baby Boomers (1946 to 1964) – 27%
  • Generation Z (2001 to 2020) – 6% 
  • Traditionalists (1925 to 1945) – 2%

*estimated to increase to 75% by 2030.

How these individual generations approach work and its role in their lives have an impact on the engagement activities and recognition programs that resonate with them.

The challenges and uncertainties of the pandemic have led to employees re-evaluating their work-life balance. There is now a greater focus on personal well-being, including mental health.

Workers expect more from their jobs and are not afraid to change jobs or even careers to find a position in which they feel satisfied, motivated, and fulfilled. 

About 23% of workers are looking for a new position with a different employer in 2022. When considering only remote-based workers, that number increases to 24%.

Considering that Millennials are now the largest generation in the workforce, having surpassed Baby Boomers, there’s no wonder it’s become hard to fill open positions and keep the employees you do have.

Recognition is Increasing in Relevance

Deloitte cites five market factors that make recognition programs even more relevant today than before:

Market Factor Context
Unstable EconomyMany companies have to do more with less. Recognition is one way of tackling engagement.
Need for Greater AgilityCompanies today need to be able to reconfigure their workforce in response to faster business demands. Recognition can help attract new employees and retain existing ones. It keeps employees engaged and motivated enough to respond to global markets while allowing the company to compete for top talent.
Flattening Organizational StructuresMany company structures are becoming less hierarchical and collaborative, creating fewer promotion opportunities. More innovative methods are required to recognize strong performance.
TechnologyTransparency, collaboration, and knowledge sharing have become the norm. Social media is often used as part of recognition programs, for example, peer-to-peer recognition via social media platforms.
Millennial Generation
Millennial generation employees tend to require more feedback than others. Companies are focused on finding ways to keep this workforce engaged and productive.

The Need to Grow with Your Business

Companies change as they grow, and these changes may involve the overall company vision and business model, the types of customers and employees, or simply how many customers and employees you’re now managing.

In any event, successful recognition programs aren’t one-size-fits-all. Just as employee engagement and recognition efforts need to adapt to changes in the workforce and market factors, they need to evolve as your business grows.

The more integral the role that recognition, incentives, and rewards play in your company culture, the more obvious it will be if the program doesn’t adapt to changes in company dynamics.

Reward programs need to be kept fresh and innovative – the same as other employee benefits – to achieve optimal success in helping to attract and retain high-performing employees. 

Responding to industry trends, market conditions, budgetary factors, and more may require changes and upgrades to program parameters, implementation procedures, and the nature of the rewards themselves.

The Right Partner

Having the right partner can make all the difference in the world to the success of your engagement and recognition program.

Xceleration’s powerful software platform is backed by experienced professionals who help businesses like yours create customized recognition programs that engage, motivate, and reward. Contact us today to learn how we can equip your business with the tools you need for a cost-effective employee recognition program with impact.

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