Insights from New Gallup Research on Recognition Programs

August 14, 2023

Insights from New Gallup Research on Recognition Programs

Employee appreciation and recognition have long been recognized as important drivers of business success. However, quantifying the return on investment in concrete terms can often be challenging for HR leaders. Fortunately, Workhuman and Gallup have joined forces to address this very challenge through groundbreaking research. Gallup, a renowned global analytics and advice firm, brings unparalleled expertise to employee engagement.

In this comprehensive study, Gallup surveyed over 7,000 full-time and part-time workers in the United States, along with more than 5,000 workers in Western Europe, to explore their experiences with recognition in the workplace. For the purposes of the study, recognition was defined as "the act of praising, acknowledging, or expressing gratitude to employees for who they are and what they do. It involves taking time to thank employees, give them credit for good ideas, and acknowledge their accomplishments."

To delve deeper into the findings, you can access the full report on driving business impact through recognition, conducted by Gallup. Here's a summary of the key insights:

  1. Recognition Experience Gap: 

The research reveals that a majority of companies fail to provide a remarkable recognition experience for their employees. Only 23% of employees strongly agree that their organization has a system in place to recognize professional milestones like promotions and work anniversaries. Furthermore, a mere 15% strongly agree that their organization recognizes people for personal life events such as birthdays and weddings.

Considering the significant influence a well-designed recognition program can have on employee engagement, retention, belonging, and well-being, these statistics highlight the need for companies to adopt a more strategic approach to recognition. Surprisingly, 81% of managers and leaders admit that recognition is not a major strategic priority within their organizations.

  1. Financial Impact: 

This research offers compelling insights for finance professionals and anyone seeking to demonstrate the return on investment in recognition. The study found that an organization with 10,000 employees can save over $16 million annually in employee turnover costs by making recognition a pivotal part of its culture. This financial benefit is in addition to the savings achieved through increased employee engagement and productivity.

A positive recognition experience makes employees less likely to leave the organization and fosters greater loyalty. Seventy-seven percent of employees who feel they receive the right amount of recognition at work strongly agree that they feel loyal to their organization, which is three times more than those who don't receive adequate recognition. Moreover, when recognition is provided a few times a week or more, over 40% of employees perceive it as the right amount, leading to noticeable benefits.

Well-being and Recognition: 

The research also establishes a connection between recognition and employee well-being. A quarter of employees report being frequently burned out at work, resulting in a significant decline in energy, motivation, and productivity. Organizations can combat this trend by catering to the holistic well-being of their employees. By intentionally celebrating employees' life events, organizations can triple employees' perception that their organization cares. Furthermore, more than 70% of employees who have positive recognition experiences rate their overall lives more positively and are more likely to thrive in their day-to-day lives compared to those who are not fully recognized.

Based on this research, how can organizations design recognition programs that benefit both employees and the business? Here are the five pillars of effective recognition:

  1. Fulfilling: 

Employees should be recognized at least a few times a month, with a focus on fulfilling their recognition needs. When employees feel fulfilled by the recognition they receive, they are four times more likely to be engaged.

  1. Embedded in Culture:

Recognition can be a standalone practice or an integral part of an organization's culture. Incorporating formal recognition programs and tying monetary incentives to recognition helps reinforce the desired culture.

  1. Authentic:

Recognition loses its impact when it feels insincere or hollow. Only about one-third of employees strongly agree that the recognition they receive at work is authentic, indicating significant room for improvement in making recognition more meaningful.

  1. Equitable: 

Inclusivity plays a vital role in recognition. Unfortunately, the research reveals that only a small percentage of Black and Hispanic employees strongly agree that they receive comparable recognition to their counterparts with similar performance levels. Recognition should exemplify inclusivity within organizations.

  1. Personalized: 

Only 20% of employees strongly agree that someone in their current workplace has asked them how they prefer to be recognized. Personalizing recognition experiences enhances their effectiveness and impact. 

The full report contains a wealth of data and insights that can help build a compelling business case for recognition or evaluate the effectiveness of existing programs. Are there opportunities for your organization to enhance the recognition experience for employees?