How to make employee awards meaningful

Awards are meaningful if they are consistent with the organisation's purpose and values, and are sustainable.

The most meaningful employee awards are driven by purpose, values and strategy, and go beyond simply rewarding good performance.

At a glance

  • Acknowledgement of success and hard work is an important part of good work relationships and ongoing high performance.
  • A workplace awards system, while rewarding good performance, must also be driven by purpose, meaningful to the recipient and in line with the organisation’s values.
  • Without a strategy or purpose that is being served by the rewards, the rewards themselves could be counterproductive.

Before the COVID-19 crisis unfolded, the leadership team at Tonkin Consulting, an engineering firm, was not keen on the idea of employee awards, particularly cash bonuses.

The philosophy was that the work the company does is interesting enough to satisfy staff; and, for the most part, the team was right.

Instead of an awards system, Tonkin had an “appreciation society” – anyone in the business could be nominated for doing anything great, no matter how large or small. A nomination would result in a company-wide communication and a mention during the CEO’s weekly town hall-style meeting.

When the pandemic hit, a new strategic imperative was presented to the organisation, one that an employee award system helped the business achieve.

“It was really an engagement piece,” says Baseel Mohamed, Tonkin Consulting’s CFO. “Also, as a management team, we wanted to show our appreciation for the effort that people were putting in during uncertain and troubled times.”

When working from home became the norm, the business began to rely on Microsoft Teams, Yammer and other remote communication tools. Mohamed and his senior colleagues wanted to ensure all staff were comfortable with, and engaged in, that technology.

To help facilitate that engagement, a light-hearted, company-wide award system was introduced: if certain operational targets were met in the first month of the lockdown, the business would have a pizza delivered to the home of every staff member.

The target was met, the pizzas were sent – a major logistical project in itself, Mohamed says – and the company asked the staff to share images of themselves enjoying the pizza with family members on Microsoft Teams and Yammer. Suddenly, everybody was using and enjoying the technology that was essential to success in a distributed workplace environment.

Mohamed believes the company’s first ever awards experience has been a great success, because the awards were not simply offered for their own sake. Instead, they were a small part of a larger strategic plan.

Making awards great again

Soo Fern Lee CPA, partner, Malaysia talent leader and ASEAN diversity and inclusiveness leader with Ernst & Young Advisory Services Sdn Bhd, says employee awards must always serve a greater goal and be driven by strategy.

“It always starts with purpose, which drives everything that we do,” Lee says. “Strategy brings the purpose to life. Awards are just one of the ways in which our purpose is manifested.

“Awards are meaningful if they are consistent with the purpose and values, and are sustainable. Not all awards can be meaningful to all at any time or all the time.

“The important thing is for the organisation to be committed and consistent in its strategies. Which types of awards are effective are determined by timeframe – for example, are we looking at short-term or longer-term objectives? – and target audience, as well as constraints, for example budget, boundaries, whether the awards drive the desired behaviours.”

Awards that are not valued by recipients, that do not drive desired behaviours and cultural change, that do not support a capability lift and that are not meaningful, Lee says, are hollow.

In fact, research has shown that rewards, or at least encouraging work purely for the sake of earning a reward, can be counterproductive.

Human behaviour researcher, author and lecturer Alfie Kohn says rewards and punishments given as a direct result of behaviours or achievements typically have the opposite of the desired effect.

“At least two dozen studies have shown that people expecting to receive a reward for completing a task, or for doing it successfully, simply do not perform as well as those who expect nothing,” Kohn writes in an article titled The Risk of Rewards.

“This effect is robust for young children, older children and adults; for males and females; for rewards of all kinds; and for tasks ranging from memorising facts to designing collages to solving problems.

“There are numerous other benefits that come out of discussions, awards and gratitude for an organisation. There is learning that comes out of the conversation, for both parties. There is encouragement to continue with efforts.” James Keeler, Maximus

“In general, the more cognitive sophistication and open-ended thinking that is required for a task, the worse people tend to do when they have been led to perform that task for a reward.”

It logically follows that cultural change, or a reward that is simply one small part of a greater strategy, is the only way employee awards should be introduced into a workplace.

Without that strategy, and without a purpose that is being served by the rewards, the rewards themselves could actually be counterproductive. 

This, of course, also begs the question – if staff are accustomed to perform for an award, will their performance suffer should an award system be removed?

Staff engagement could be negatively affected, particularly in the short term, Lee says. “We need to examine why the awards have been withdrawn – is it due to budget constraints? Or maybe the awards no longer serve the bigger purpose and there is a need to reposition. If it’s the former, maybe nothing much can be done. Regardless, there will be a need for clear communications to help address any concerns or disengagement.”

Maria Sitaramayya, vice president of HR for Asia Pacific at technology multinational Unisys, says that an awards system that is well planned and part of a long-term strategy shouldn’t just end abruptly.

During the pandemic, not only have Unisys leaders at all levels been reminded that they should always be recognising performance in their teams, but they have also built a frequent-flyer points type of program that individualises and gamifies the awards system, while at the same time engaging staff in the process over the longer term.

As employees interact with multiple teams across the global company, anyone – not only a direct manager – can show their appreciation for a colleague by nominating them for an award.

“We do a lot of work with our leaders in developing a good understanding of what motivates and engages their team,” Sitaramayya says.

“To support this, we have a system whereby people are given points as awards. They can save those points for as long as they’d like to accrue as many as possible, or they can go straight into the ‘shop’ and spend their points on an award. I might choose one type of award, a colleague might choose something completely different.”

The idea is that you always get something that is meaningful to you, rather than something the company has chosen and that may be perceived as hollow.

CPA Library resource: The people manager's tool kit: a practical guide to getting the best from people. Read now.

Personalised rewards

A “rewards shop” that contains a broad selection of items is one option to make awards relevant to the recipients. Another option is for managers to think deeply about what each specific staff member would truly appreciate as a reward for outstanding work.

This process, says James Keeler, director of leadership development consultancy Maximus, helps managers to get to know their team members and can lead to greater feelings of closeness and appreciation.

“With my team, I think about where they live, what they’re interested in and what stage of life they’re at,” Keeler says. “I think about what might be useful, pleasant and nurturing at that point in time.

The award should also align with the individual’s passions and values, and should also be in line with the values of the organisation. Once the strategy is set and the purpose of the award is agreed, the most important parts of the process, Keeler believes, are thought, care and conversation.

“It’s powerful to sit down and take the time to tell people why they’re being recognised, and what exactly they did well,” he says.

“It feels good when somebody acknowledges your work and also shows that you can see their efforts and that you’re interested in what they’re doing.

“There are numerous other benefits that come out of discussions, awards and gratitude for an organisation. There is learning that comes out of the conversation, for both parties. There is encouragement to continue with efforts.

“There is motivation and permission to extend the idea and, ultimately, to innovate.”

When one human acknowledges another human, it makes them both feel very good, Keeler says.

Whether it is parents and children, romantic partners, siblings, friends or colleagues, acknowledgement and gratitude are an important part of what makes our relationships tick.

Importantly, this is true whether we are in extraordinary circumstances, such as the pandemic, or not, Keeler believes. We just have to be even more creative about showing gratitude when physical and movement restrictions get in the way.

Read next: The secret to employee retention

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