mind your business: Job Well Done
Rewarding and recognizing employees is tricky business. It can motivate people to perform their jobs more effectively or it can utterly discourage their efforts.
Here are a few tips and traps:
Establish a clear link between what people are rewarded for and the organization's priorities. Does everyone see and understand the relationship between their improvements and financial rewards? Too many profit-sharing plans, for example, are disconnected from daily work. The effect of cost control or customer satisfaction efforts on the bottom line is so fuzzy that it's meaningless.
Be careful when offering money or recognition for employee suggestions because it can lead to conflict. Individuals and groups often end up protecting their ideas or arguing about the source of ideas. Suggestion systems also separate idea generation from implementation. Effectiveness is a function of how strongly ideas or strategies are accepted and then implemented by the people who can make them work.
Suggestion systems work best in traditional "command and control" or paternalistic organizations. Workers come up with ideas and managers decide which ones get implemented. In a highly involved organization, teams generate and test ideas as part of a bigger focus on improving their own key processes.
Involve team members, individuals or managers in developing their own incentive and reward systems. A study of group incentive plans in 144 U.S. companies by consultant Towers Perrin concluded those plans with the highest levels of effectiveness also had the highest levels of employee involvement in design.
Involvement can be achieved through opinion surveys, focus groups, teams that study and recommend or teams that design and implement the rewards. The best organizations combine both approaches.
Reward systems and recognition practices speak volumes about an organization's values. Are they designed and delivered to employees—or with them? Do they reflect a management view of "we know what's best for you?" Are they partial and piecemeal or part of a larger system and philosophy?