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| Karla Thorpe
Director
Leadership and Human Resources Research |
A recent study by the Conference Board found that organizations spend $175 per employee on recognition annual ($123 in the public sector and $208 in the private sector). And more than half of this spending (54 per cent) is on milestone awards including long-service and retirement recognition. Performance-based recognition programs such as manager to employee awards, peer to peer recognition programs, and corporate awards together account for the remaining 46 per cent of all spending.
There are questions about whether spending on long-service recognition is generating a return on investment for organizations. This depends on whether the program leads to the desired outcomes. Does the program generate loyalty to the organization, thereby reducing turnover and ensuring valuable institutional knowledge is maintained? Will employees choose to stay with an organization to receive a letter, plaque, pin or even a gold watch after 25 years of service? It seems unlikely.
But before you scrap your long-service milestone awards, consider carefully the goals of your recognition program. Our research shows that for many organizations (62 per cent), the recognition program is designed to create a positive work environment—one in which employees feel valued. Recognition plays a key role in making employees feel appreciated whether it is for coming up with an innovative idea or dedicating 25 years of their career to a particular employer.
If your organization does continue to offer long-service awards, make sure you maximize your investment by:
- Focusing on employees’ accomplishments achieved during their tenure
- Considering employees’ preferences to make sure the reward is meaningful—employees might want to choose their own gift and may not want it branded with the company’s logo
- Delivering the long-service recognition in a way that best suits the individual—not all employees like to be recognized in a public manner
- Making sure the recognition is sincere by considering, for example, who is acknowledging the employee for their years of service