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Rewards and Recognition
The document discusses the importance of rewards and recognition (R&R) in organizational change management, emphasizing their role in driving employee engagement and improving business performance. It outlines various strategies for integrating R&R into company culture, the effectiveness of different types of incentives, and the correlation between employee engagement and financial outcomes. Additionally, it presents best practices from companies like Cisco, Microsoft, and Google that have successfully implemented R&R programs to foster a positive work environment and enhance productivity.
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Rewards and Recognition
- 1. 2021 Presented By: GeorgeB. Lampere, Ph.D. Use of Rewards and Recognition in Organizational Change Management
- 2. 1 Understanding Rewards andRecognition Link with culture & engagement Drives high performance It's need in the 21st century Defining R & R
- 3. 2 Tangible and intangibleincentives, recognition and appreciation Should be grained into culture Recognizes performance and drives discretionary effort Defining Rewards & Recognition through different lenses
- 4. 3 The world ofwork is changing.. R & R key to engage employees in 21st century To cope with talent demand & supply gap, companies will reinvent strategy & focus more on 'employees' People Strategy & Planning Simplicity – in Complexity Agility & Innovation The Demanding Consumer Automation Analytics Access Diversity & Inclusion Individuali- zation & Entre- preneurship Purpose & Well Being New Demo- graphic Mix Skill Imbalances Geo-Eco- Political Dispersion Shifts in technology & digital productivity Shifts in ways of generating business value Shifts in resource distribution Shifts in workforce values & culture Twelve forces changing work... ... Why do we need R & R 1 2 3 4 5 6 7 Drive employee engagement Motivate employees Improve organizational culture Engage leadership and workforce Promote talent & high performance that will impact business An important business strategy to make an emotional appeal Brings employee closer to the objectives of the organization
- 5. 4 Effective R &R practices drive business performance through higher employee engagement 5 150 10 0 15 Profit growth 4% Revenue growth 2% Total assets 10% Gross profit 19% Earnings, EBIT 10% Operating margins 4% EPS 147% Research shows that companies with highly engaged work forces outperform financially Outperformance rates by companies with high engagement vs. low engagement More engaged teams deliver better results Productivity Profitability Customer Ratings Outperformance rates by teams with top-quartile engagement vs. bottom-quartile engagement scores +21% +22% +10% Companies with highly engaged staff enjoy "best employer" status Employee responses 85 75 67 44 0 20 40 60 80 100 (%) Other organizations Best in Class Our reputation as an employer helps us attract the best employees I would not hesitate to recommend this organization to a friend seeking employment
- 6. 5 Good relationships withsuperiors Appreciation for work (Rewards and Recognition) Good relationships with colleagues Research finds cultural elements highly important to employees worldwide Note: Respondents could choose from 26 job elements; this list includes only the top ten Source: 2014-2015 Google Creating People Advantage Survey
- 7. 6 Cultural elements of R& R that drive growth in an organization 1 2 3 Promote desired behavior: Helps organizations instill and promote it's 'value behaviors' that make people more committed to their responsibilities 4 Performance and talent management; Retention: Rewards people as per their performance and gives public recognition that adds to the complete package 5 People Strategy: It is an important business strategy to make an emotional appeal to build high performance Purpose and engagement: fosters a sense of pride in achieving goals & serves as a catalyst to increase employee engagement Organization mission, vision, goals: motivates employees and brings closer to the objectives of the organization
- 8. 7 Rewards are akey lever to implement strategy and connect employees with the larger goals Motivation Reflection Orientation Reward systems convey and reinforce strategic goals Motivate and recognize effort Facilitate progress tracking and support feedback
- 9. 8 R & Ris key to people strategy in driving engagement and affiliation R & R programs are designed to achieve the 'Organization Purpose'. It strategically connects people with the desired behaviors and motivates their performance towards certain goals which meets the set targets Attract & Recruit Review & assess Develop & Promote People Strategy & Planning Context, strategy, capabilities Purpose Employee Lifecycle Engage & Affiliate Including EVP, Total Rewards, onboarding & goal setting etc. Connect employees with the identified 'Purpose' / 'Goals' Including High-Perf. Culture, employee Dev't, etc. Through various Rewards & Recognition programs Performance assessment
- 10. 9 R & R application throughvarious dimensions Financial incentives Peer to peer & manager to associate recognition Celebrate desired behaviors Mementos Team rewards Reward medium term indicators
- 11. 10 1 Principles guiding ourview on the implementation of R & R Rewards and recognition is a part of the 'total offer' that corresponds with the 'Employer Value Proposition' Rewards and Recognition practices should be well integrated into the company culture R & R dimensions should be designed to foster maximum motivation Simplicity and transparency of rewards is critical Incentives help change the context in order to shape the desired behaviors Financial rewards are important, but just one piece of the overall reward system Recognition is valuable from all levels: peers, leaders, sr. executives 2 3 4 5 7 9 8 6 R & R is very close to building an emotional connect with the employees which can be a big driver for the overall growth It shapes the culture and behavior in an organization The R & R strategy should be a combination of top down and bottom up participant view
- 12. 11 Companies innovating in theways they approach R & R
- 13. 12 Six themes emergefrom R & R best practices Case examples Honor right people Transparent talent systems Engage leadership & workforce Drive performance & impact Build a culture of recognition Measure results and adapt to them • Identify and encourage desired behaviors that lead to strategic objectives • Recognize both hard/soft skills and individual/team achievements • Involve people managers and employees in program design • Ensure active participation by employees at all levels • Have heart-felt support from CEO and senior leaders • Tailor rewards to what matters for each employee segment • Align resources and incentive to reward high performers, critical employee and competence in critical skills • Reward employees in appropriate, meaningful and memorable ways • Build programs to complement and reinforce existing performance management systems • Communicate criteria publicly and transparently • Develop capabilities to enable recognition culture via training/development • Utilize 360º recognition from managers, peers, and customers • Recognize winners through timely and highly visible celebrations • Create a culture of informal recognition to reinforce desired behaviors • Measure programs for effectiveness based on specifics KPIs • Flex programs in response to data and employee feedback Best Practices Themes
- 14. 13 Cisco designed theirprogram to recognize and reward employees for their contributions and achievements, both individually and as part of teams, and to encourage them to take ownership of their work and drive performance. • Improve employee engagement, motivation, retention, and business results • Reinforce company values • Comprehensive rewards and recognition program • Elements include peer recognition, spot awards, long-term incentives • Connected Recognition platform for recognition and rewards • Long-term incentive plan with equity-based rewards • Increased employee engagement, motivation, and retention • Improved business results: productivity, customer satisfaction, revenue growth • Reinforced company values Objective Approach Impact
- 15. 14 Microsoft developed theirRecognition and Reward program to improve employee engagement, productivity, and satisfaction, encourage innovation and collaboration, and increase retention and attraction of new talent. • Improve employee engagement, productivity, and satisfaction • Encourage innovation and collaboration • Increase retention and attract new talent • Comprehensive rewards and recognition program • Elements include peer recognition, manager recognition, spot awards, and long-term incentives • Company-wide recognition events, such as "Founder's Awards" and "Hackathons" • "Manager Excellence" program to train managers on recognition best practices • Improved employee engagement, productivity, and satisfaction • Increased retention and attraction of new talent • Higher levels of innovation and collaboration • Improved business performance and financial results Objective Approach Impact
- 16. 15 Google's multi-program 360◦recognition portfolio drives unique employee – centric culture • Reinforce culture through enterprise-wide programs • Encourage recognition through top-down and bottom-up programs • Retain critical employees via specialized recognition • Google's multi-program 360◦ recognition portfolio includes a variety of recognition programs designed to meet the needs and preferences of all employees. • These programs range from peer-to-peer recognition to manager-led programs and include rewards such as cash bonuses, stock options, and more. • The programs are designed to be inclusive, transparent, and accessible to all employees. • The recognition programs have helped to create a strong sense of community and camaraderie among employees. • The programs have also helped to increase employee engagement and retention, as employees feel valued and appreciated for their contributions. • The programs have been shown to positively impact employee productivity and overall job satisfaction. Objective Approach Impact
- 17. 16 Designing an R& R program
- 18. 17 Design a reward program: Goals+ Feedback Strategy Participant view • Derive task specific goals from strategy • Translate goals into measurable metrics • Decide on reward type • Integrate rewards into Performance assessment • Assess participants views on goals • Scrutinize behavioral reactions to performance metrics • Understand feedback and learning processes
- 19. 18 How to designan R & R program Launch reward system Design reward system Review status quo and set target Change Journey 3 2 1 Implications on Organization
- 20. 19 Review status quo andset target Design reward system Launch reward system Assess status-quo • Map current reward system • Align on issues • Conduct cost-benefit analysis Understand participant group • Perception of current rewards and performance assessment • Preferences, personal goals, and subjective peer groups • Goal-setting and motivation Derive strategic target profile • Align on strategy/challenges • Identify task-specific goals • Derive desired behaviors Benchmark rewards with competitors' offer Translate goals into metrics • Derive metrics to measure behavior and goal attainment • Model opportunistic behavior, side effects, and blind spots Decide on reward type based on • group preferences • firm requirements • legal and accounting setup Define payout function • Analyze cost vs. motivation • Model opportunistic behavior, side effects, and blind spots Explore motivation potential and miss- specification in audits Refine reward system Prepare legal and accounting • Support contract design • Prepare accounting treatment Integrate with performance assessment • Design opportunities for personal progress tracking • Outline supervisor talk integration Prepare communication and teaching toolkit Provide feedback channels • Create forum to file complaints • Prepare reward-fit survey Communicate and teach Start system Design incentives with client in three step process
- 21. 20 R & RTools
- 22. 21 Diagnostic tools to evaluatehow R & R is delivered Engagement for Results The Employee Engagement Assessment measures employee engagement across key disciplines and motivators Employee responses to EEA survey • 35-question survey mapped against response database of over 340 companies • Existing client Pulse survey data may also be mapped to EEA questions Analysis benchmarks company results against response database by quartile • Results indicate strengths / weaknesses on each section and individual question • Analysis done at enterprise or BU level, and by employee level or function Assessment Toolkit Assessment evaluates R & R programs in support of large-scale change adoption Assessment question responses • Diagnostic question sets indicate performance level on 1-5 scale • Dashboard tracks program metrics and KPIs to measure impact and effectiveness Results identify areas for improvement based on each section scores • Assessment questions look across organization for best-in-class metrics and coordination • Program questions derived from best practices Regular, objective evaluation critical to maintaining sustained excellence
- 23. Thank you Presented By GeorgeB. Lampere, Ph.D.