HR Management

Employee recognition in the workplace: why it’s important?

Employee recognition forms an important part of modern HR practices in the workplace. Appreciation is a fundamental human need. Being recognized for hard work acts as a morale booster. It feels good when employees are recognized for their efforts, and their contribution leads to better business. Acknowledgment improves productivity, enhances collaboration and loyalty, reduces turnover, and generates higher profits.  

Organizations that do not see employee recognition as an important metric are often left behind by competitors. But companies often forget the fact that it is people who drive business and if they don’t feel appreciated chances are they will desert you for your competitors. Undervalued or unappreciated employees are often unhappy with their work and are just looking for better opportunities to make the switch. Companies are often confused as to what constitutes true recognition and fail to devise effective strategies. 

What constitutes Employee Recognition?

Employee recognition is the practice of acknowledging an individual or team for their hard work and achievements that align with the company’s goals. According to Social Psychology Professor Robert Cialdini, “We view a behavior as correct in a given situation to the degree that we see others performing it.” 

69% of workers agreed they will work harder if their efforts are better appreciated”.

(Source: Socialcast)

Ensure that your organization follows certain criteria or has strategies in place for successful employee recognition. The effects of employee recognition on businesses are manifold. While most companies identify recognition with bonuses and monetary benefits, it doesn’t always have to be that elaborate. Even a simple “thank you” or a word of appreciation can do wonders at times.

Importance of Employee Recognition

  • Improves Company Culture

Employees form the heart of the organization. No organization can succeed without the hard work of employees and companies that honor the same enjoy an improved company culture. If employees feel happy working for the organization, then success is assured.

  • Reduced Attrition Rates

Happy employees will stay longer with the organization if they feel appreciated and valued. Employee retention is a huge bonus for organizations as long-serving employees embody trust and are adept at their job roles. 

  • Employee Engagement

Recognition activities increase the engagement of employees and make them feel more connected to the organization.  

84% of HR Leaders say an employee recognition program helps employee engagement.

(Source- Workhuman)

  • Increased Productivity

Seeing efforts getting acknowledged promotes workers to work more hard thereby increasing organizational productivity levels. Employee recognition comes as a morale booster promoting employees to put in further efforts. 

  • Cultivate a culture of self-improvement

Employee recognition also ignites the passion within employees to constantly innovate and get better at their skills. It forces a healthy competition that gives rise to other budding stars in the organization. It further provides them with an opportunity to excel at what they do when they see good performance being appreciated or incentivized.

Effect of employee recognition on business

“Employees do not quit jobs, they quit managers.” Employees often feel that they are being undervalued by their seniors, even after making significant contributions to their job. Honoring the employee’s efforts and recognizing the difference they make to the bottom line gives rise to a healthy work environment. When people feel valued, they instinctively multiply their efforts, resulting in organizational success. 

85% of HR Leaders say an employee recognition program has a positive effect on organizational culture.

(Source: Workhuman)

A company culture that promotes even simple gestures of showing appreciation as staff recognition can have a big impact on staff morale and productivity. 

How can you enforce a similar culture to your workforce?

Many companies have employee recognition programs in place. However, this should not be the only opportunity to show appreciation to your employees. It is important to note here that every small gesture counts and can make a positive difference. Feedback should be timely, constructive and to the point to make a mark. It’s always better to praise your best employees in front of their co-workers because it can boost their self-esteem and also encourage others to perform well. 

Amplifying employee happiness by acknowledging their efforts is what recognition is about. Do have a workplace program in place but also do not undermine small gestures of acknowledgment that can go a long run in reinforcing good faith. 

About Paylite HRMS

Paylite® Human Resource Management Software is an end-to-end HRMS system to meet the ever-growing needs of modern-day workplaces. It has helped companies worldwide in increasing productivity by replacing age-old legacy systems. To adopt Paylite HR management software for your business, Book a Demo here: