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The Power of Rewards - Developing an Effective Employee Reward Program

July 29, 2016 by Stacey Papp

Employee Rewards
You value your employees. In fact, they might be your most precious asset. And you want to create a program that rewards them for what they bring to the company. But what does that program look like? Where do you start? Here are some things to consider and do as you set up your employee reward program.


The first thing to consider is the why. What are your reasons for creating an employee rewards program? While such a program could very well have beneficial effects like increased productivity and efficiency, it’s important that you don’t approach it with that goal in mind. Employees will spot a program that is designed simply with company profit in mind, possibly causing the opposite effect. Ultimately, the goal should be to enrich the experience of working at your company for your employees, and the side effects of happy, fulfilled employees will provide benefits all around.


With that in mind, you can begin to flesh out some ideas for what the rewards program should be. Allow your employees to be your guide here as they are most able to tell you what will appeal to them.

  • Talk to them. One-on-one conversations with your employees can give you valuable information on what’s important to them and how they feel about the company. This will give you guidance on what kind of rewards will most resonate with them.
  • If you don’t have time or proximity to talk to employees face-to-face, or if they’re holding their cards close to the vest, maybe try an anonymous survey about what employees would like to see in a rewards program. Anonymity is a good tool to reassure people that their opinions won’t be used against them, so you might be likely to get more complete answers if the one-on-one approach isn’t working.

In addition to developing ideas for how to reward employees, you should commit to the program. Make sure that there is a budget available to pay for the program if necessary, but keep in mind that this type of program can often be put together with little or no cost. Verbal or written accolades given in front of an employee’s peers can be as or more effective as a gift.


Someone will have to manage the process, and like most things a group to divide the work is better than putting it all on one individual.

  • Create a committee – no matter how small – that develops the awards, the criteria for recognition, and handles doling out the accolades. This will help ensure consistency and constancy and protect against the practice falling to the wayside or changing so much it loses value.
  • Make sure that managers get involved in the process of rewarding employees. While an award that comes from the HR department has value, it has much deeper meaning for employees when senior management gets involved in giving out recognition. People prefer to be recognized by the people they work with and for, not just by an arbitrary department to which they are only distantly connected.


Now the rubber meets the road. What should the awards be? Here’s some ideas you can use – or prompt you to develop you own ideas:

  • Peer-to-peer: Here’s a good way to get the workers engaged in the process. Create an award that they can nominate each other for. This way, employees will feel valued by both their peers and their managers, who might decide on the final recipient.
  • Not every award needs to be explicitly linked to performance measures. Recognize employee anniversaries and life events to help build and maintain a sense of community. Most offices have a ringleader who would love to track and plan these events – let them run with it. And for larger anniversaries (10 years, 20 years, etc.), you can plan something bigger, maybe with a gift attached.
  • You can get a lot of mileage out of awards that have no cost at all. A note of recognition and thanks from a manager is a valued reward for any employee. If you want to go beyond an e-mail or written note, Microsoft Word has award certificate templates that can be customized to use as awards for employees – something to post in a cubicle as recognition of good work. It reinforces the value that the employee brings to the company and reminds them of how important they are. The lack of such recognition leads employees to feel isolated and unwanted – causing unhappiness and underperformance and often driving them away.
  • If you have the budget for it, small to medium tokens of appreciation can really show employees that they are appreciated, whether they be for individuals or for the group. Make sure to check any tax implications with your accounting department, though.
    • Gift cards are always appreciated and useful gifts.
    • Extra time off is a reward that any employee would appreciate.
    • Plaques or trophies for “Employee of the Month, Quarter, Year, etc.” is something a worker can display with pride.
    • Ice cream days or lunch brought in for employees lets them know they are valued.
    • Employee outings like picnics or activities such as bowling are great rewards and foster community among workers.

There are lots of ideas out there for employee recognition programs. Do your homework and be creative, and you’ll be on your way to showing your staff just how vital they are to your operations.

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