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What Is Employee Recognition, and How Can You Implement It and Do It Well?

Doron Hafner
Doron Hafner

The companies on top are the ones that have the best employees and know the best ways to motivate and harness those employees to the companies' goals.

The work environment of today is ultra-competitive; every company is vying for the best employees, and the employees need to do their best to stay afloat. The companies on top are the companies that have the best employees. These employees have the skills to meet the company's needs and have the motivation to maintain and improve this skill set.

However, even the best employees won't maintain their skills if they aren't appreciated enough. At best, they won't work as well; at worst, they'll quit, to look for an employer who will appreciate them. Employees need motivation, and what drives motivation is appreciation. The employee needs to feel like they actually do mean something to their company, otherwise, they might find it pointless and lose the motivation they had. People are your No. 1 asset in a business, and you should treat them well. 

This is why employee recognition is so important to a work environment as well as the culture that surrounds that environment. The employee needs to feel like they matter to the company, and the effects are even better when they are also respected by their peers. Respect helps to motivate, and recognizing the great things someone has done is a sign of respect. But you might be wondering what employee recognition is? 

Employee recognition

"Employee recognition is the open acknowledgment and expressed appreciation for employees' contributions to their organization," according to It goes further to say that it can be done with small gestures, high-fives, shout-outs or even a bonus at the end of the month. Employee recognition can be done in many different ways, but doing it well is imperative. 

As just said, recognition can be done in a multitude of ways. That's why companies and organizations are constantly adapting and rethinking and modifying recognition programs. Recognition programs are very useful and can have many competitive benefits. If done correctly, it can increase productivity, morale, motivation and more. All of these benefits are important to maintaining a healthy work environment.


In an ideal work environment, everyone should give others recognition and appreciation. However, recognition is largely based on the situation and circumstances. Generally, recognition is given from a top-down system. This means that recognition is given to an employee by their higher-ups – their boss.

While constant recognition would be great for everyone, it's difficult to do. It requires the employee to be constantly monitored, reviewed and then potentially rewarded frequently. But keeping track of every employee all the time is way too tough on resources, which is why it's just not done. 

In place of this, the recognition is usually given in the form of the annual review. But those also highlight where the employee needs to improve, which can ruin the purpose of the recognition. The point is that recognition is great and beneficial, but it shouldn't be done constantly, nor should it be done rarely by bosses. 

Top-down recognition is great, but so is peer recognition. In a peer-recognition system, everyone has the capability to praise an employee for their achievements and accomplishments. Peers have the capability to understand all that a specific employee does and how their contributions help the company, simply because they are in the same situation.

Recognition is important; top-down, peer, and to add to that, bottom-up recognition is also important. There's nothing wrong with telling your superiors that they are doing a great job. Recognition provides benefits, benefits that can affect all who are praised, and even those who give praise. Utilizing all three systems allows everyone to praise and be praised.


Having an informal recognition program can be costly. The budget to recognize employees with celebratory events or gifts is usually accounted for. But doing the recognition manually is usually taxing on company leaders or employees part of HR due to the labor involved. With manual recognition, recognition is usually at random and just plain inefficient. 

Establishing a formal system for recognizing the feats and contributions of employees is important. If done correctly the system will pay for itself in the benefits that the system gives. Benefits such as productivity, motivation and engagement. Once the system is established and streamlined, resources will also be freed up, as compared to an informal manual system.

Why recognize employees?

Employees want to be respected, and they want to be appreciated –  they want to feel like they are making a difference. And being recognized has many benefits. The main benefits are increased happiness, improved employee retention, improved morale and increased engagement. 

The workplace should be a place where positive reinforcement is a norm and constructive feedback is cherished. Happy employees are productive employees. Having an employee be recognized will give the employee a feeling that they actually belong at the job they work day to day. 

Recognition and praise have shown to improve productivity, enhance the loyalty an employee feels towards the company they work for, and also promote collaboration with their fellow peers. All of these things contribute to employee retention.

Employee retention is the ability of an organization to keep its employees. One of the most important factors of any company is how well it can retain its employees. After all, what's the point of hiring, training, paying and motivating an employee if they are just going to leave soon afterward. This leads to a waste of time and money, and the lower the retention rate, the higher the waste.

One solution to increasing employee retention is implementing an employee recognition system. Especially a system that rewards with valuable prizes, such as raises, bonuses or even a promotion. Showing appreciation for employees is a step in the right direction for increasing the employee retention rate. A recognized individual is more likely to be motivated to work, which means they won't desire to quit.

Like the other benefits, another aspect of work that is sometimes underappreciated is the morale of the staff. Recognition doesn't have to be in the form of a bonus or promotion; they are great incentives to do a great job, but they don't always have to be that big. Recognition can be as small as a greeting or a good job. Anything that tells the other person that you have respect for them.

A work atmosphere that promotes appreciation, respect and recognition is an atmosphere that boosts the morale of the staff. Ultimately, better morale contributes to boosted motivation and thus boosted productivity. 

One of the last main benefits to be mentioned is increased employee engagement. Employee engagement is how passionate about their jobs employees are. This is similar but not the same as employee satisfaction. Satisfaction has to do with how happy or content employees are. Engagement levels can have a significant impact on how much work an employee can achieve and the overall contributions they will make.

A survey from Harvard Business Review which surveyed over 500 different companies with 500 or more employees, found that 71% of managers feel employee engagement is one of the most important factors to success. It also found that employees engaged in their work were the most productive.

Goals and considerations

Before implementing a recognition program, ask yourself some questions about the company and the work environment. First, you have to figure out what the goals of the program are. You also have to consider many things to get the best possible result. 

Considerations might include whether the program might be intrusive and interrupt the day-to-day routine of employees. Another important consideration is if the company's core values are being reinforced. The rewards are also important to consider – not all rewards may be useful. Some employees react better to smaller gestures of respect than others. Not everyone will be OK with a simple "good job!"

However small the question or consideration may be, all are important in building the recognition system. Building the perfect recognition and reward system is not easy by any means, but when everyone's needs are met, there are massive benefits to be reaped.

What it means to implement a good recognition system

Building a good recognition system means that it needs to meet the needs of the employees. If you want a good example of what is needed from life and from work, look at Maslow's Hierarchy of Needs. Most employees have their safety and physiological needs sated. The needs that a place of employment should fill is love and belonging, and esteem needs. 

Love and belonging are based on friendship, intimacy, family and a sense of connection. Those are needs that a job can fill with a healthy work atmosphere. And a healthy work atmosphere can be achieved with a good recognition system. Building an environment that reinforces praise and acknowledgment on any level is key to having a healthy atmosphere.

Esteem is built out of respect, self-esteem, status, recognition, strength and freedom. A good recognition system can recognize any employee for the contributions they have made to the organization. It builds the respect one has for themself while also building the respect others have for the praised employee.


Recognition can be given in the form of a high five, a pat on the back or something else that doesn't have a monetary value. On the other side of the spectrum, recognition can be given in the form of a raise, a bonus or a promotion. While both are good for giving respect and giving praise to an employee, one is definitely more compelling than the other. A good recognition system is one that carries both types of rewards rather than one. 

Chances are, there's a correlation with the value of the reward with the recognition felt by the employee being praised. This makes sense given that very few would be satisfied with a simple "good job" for doing their best on a difficult task. This is not to say that the only rewards should be monetary, but the reward needs to match the accomplishment made. 

Recognition system and work environment 

If you want to do a recognition system well, the system must blend into the current work environment seamlessly. Tracking the system and ensuring that it works all the time can be tough, especially when you might be having to worry about many other tools and systems at the same time. That's why the system needs to be frictionless.

Anything that involves the system, such as any tools and apps, as well as any other additional implementations, needs to work into the routine of the employees seamlessly. If the system alters the way of life for every employee, then it just might ruin the benefits it’s supposed to make. There are many things to consider, especially how the system actively interacts with employees.

Employee recognition

An employee recognition system is a great addition to any workplace. If done well, it can have many benefits that ultimately add to increased productivity, engagement and employee retention rates. Employees want to be recognized for the contributions they make to a company; they want to feel like they are making a difference.

It's up to employers to fulfill those needs of being wanted, belonging and connecting with those in their workplace. A good system promotes a healthy work atmosphere that motivates and boosts the morale of employees. There are many things to consider when deciding on a system, including what the rewards will be, but ultimately, it works if the employees feel respected and recognized. 

Image Credit: fizkes / Getty Images
Doron Hafner
Doron Hafner Member
I'm a tech entrepreneur in the online and offline fields. I am a certified NLP coach, experienced working with business owners, startups, and sales teams, while I am also serving as a mental rehabilitation coach in a psychiatric hospital, treating and recovering mentally ill patients. For developing this dual set of skills, of helping businesses to improve their performance, and helping people that are fighting mental illness to improve their well being, I've dedicated thousands of hours for learning how to make people understand what they want, and how to achieve what they want. I love history, cooking, nature, running, biographies. I'm driven by inspiration. The knowing that people can do amazing things.