Recession Impact on Recognition Efforts?

[Derek Irvine]

How are you seeing the recession impacting recognition efforts? Is funding decreasing or increasing? Are employees reaching out to each other more or less?

Our CEO, Eric Mosley, recently commented: “In a recession, the first thing that gets hit is productivity. As people worry about the economy and the stability of their jobs, recognition programs can help alleviate some of that worry. During these tough economic times when financial perks are being cut from budgets, some employers are turning to recognition as a way in which to keep employees happy. Recognition is a low-cost way of getting that return. You’re filling a gap and boosting their feelings toward the company. Over the past three years, we’ve seen recognition grow as an important tool in HR, and in the past months, we’ve seen the rate increase even more.”

That's largely what we're seeing in our view of the world. How about you?

[Roy Saunderson]

Derek:

What I have seen from both consulting clients and inquiries regarding how to deal with the economic downturn is leaders questioning their rewards and recognition programs.

Money is driving the decision making process right now. Usually someone like the CFO challenges the large budget line for rewards and recognition and says, “That should be easy to cut”.

What corporate leaders rarely have is a formal written recognition strategy to guide their decision making. According to the 2008 WorldatWork Trends in Employee Recognition Survey, only 48 percent of the member participants reported having a written recognition strategy. Interestingly, 96 percent of the companies with a recognition strategy had reward and recognition programs aligned with their business strategy. They knew the benefit of being strategic with recognition. It simply makes business sense.

Even today I had to tell company leader to go back to their “why” for giving recognition and rewards in the first place. I recommend people review their own philosophy and purpose behind giving recognition. Let purpose drive the decisions and plans for short-term actions versus money alone.

As my financial advisor reminded me last week, we will get through this recession. When we do employees who have been respected, valued and recognized will demonstrate greater loyalty and performance. Companies who cut rewards and recognition budgets now will lose out in the long run by having lower engaged employees if they still stick around at all.

Roy

[Joshua Gair]

I too have noticed that more clients have come to me for entertainment for their employee events as opposed to giving out cash bonuses and employees underdstand this and recognize it as necessary. I also think it is something more creative than money. Now is the time to show employees your recognize them as they do not feel secure at their jobs right now and any appreciation is great.

Josh