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Your Employees Feel Underappreciated. Here's What You Can Do to Fix It

Stuart Hearn
Stuart Hearn

When employees feel undervalued, it's usually not about money

Do you get the impression that your employees are increasingly disgruntled, disengaged and frustrated with their roles, or even your company in general? Given the increasing importance placed on employee experience, it is vital that we investigate and get to the bottom of what is costing us dearly in terms of talent and resources. What toxic element within your organization is causing your employees to become disillusioned with their working lives?

A recent workplace study conducted by Clear Review, a performance review software system, found the number one workplace frustration to be a lack of appreciation regarding effort and performance. A remarkable 40 percent of employees, from a diverse range of fields and positions, stated that employee recognition was simply not a priority in their business, something that limited their motivation to truly excel.

We have known for a long time that employee recognition is a critical aspect of performance management. As a result, many companies make it a point to acknowledge employee performance during monthly check-ins. But how can employee recognition benefit a company? And how can you give your employees the appreciation they deserve? [Find out how PEO services can help you with employee management.]

Employee recognition improves engagement levels

Many sources will attest to the fact that recognition is a fundamental human need. In order to feel engaged at work, we need to know that what we are doing actually matters, and that it is appreciated. Without this knowledge, employees consider their role purposeless, and employee engagement levels within your organization will plummet. In fact, recognition has consistently been shown to be a top engagement driver. If, however, you dedicate time and resources toward developing an employee recognition program, employees will become more loyal and positive toward their company.

To further demonstrate the effect of recognition on employee engagement, we can look to the following facts and figures:

Employee recognition boosts productivity, motivation and satisfaction

Increasingly, employees care more about recognition than money. In fact, one source states that as much as 82 percent of employees would prefer praise to a gift. A further survey found that 30 percent of employees would rather be recognized in a company-wide email from an executive than receive a bonus of $500. This desire for appreciation is particularly true of millennials. Generation Y desire frequent feedback, both in terms of constructive criticism and recognition for efforts.

In terms of job satisfaction, the shift from weekly to daily recognition has the power to increase the number of satisfied employees from 85 percent to 94 percent. And if there is one thing satisfied, engaged employees are likely to do, it’s work harder. After all, if an employee is more likely to be praised and rewarded for their efforts, it makes logical sense that they would put in extra effort to receive further recognition. If you want further evidence, we can look to data from Socialcast, which shows that 69 percent of employees would work harder if they felt they would be appropriately recognized and appreciated.

Employee recognition builds trust

It’s already widely known that the employee-manager relationship has a huge impact on employee engagement levels and performance management in general. Employees need to be able to communicate with their managers, preferably in regular one-on-one performance meetings that allow relationships to develop.

The foundation of this relationship is trust, and it is clear that the exchange of honest recognition fuels levels of trust. In fact, an incredible 50 percent of employees believe that a simple "thank you" from their managers enhances trust and transparency, which is of critical importance when you consider the connection between financial performance and employee trust.

Saying 'thank you' can improve employee turnover and reduce absenteeism

It is logical that an employee who feels valued, appreciated and supported feels more inclined to remain with a company than one who feels superfluous. Employee recognition doesn't have to be pricey; in fact, it can be something as small as a simple "thank you." Putting in this minimal extra effort can save you substantial time and money when it comes to replacing existing staff.

Remarkably, C-Suite executives remain oblivious to the value of recognition. One large-scale study that shows 34 percent of their senior decision-maker respondents did not believe recognition had a significant impact on retention. The same study showed that 49 percent of employee respondents from the U.K., U.S. and Australia stated they would leave an organization if they failed to receive regular recognition.

In support of this trend, we can look to another source that shows companies with recognition programs have 31 percent less voluntary turnover. In this highly competitive business environment, this isn't a risk you can justifiably take, particularly given how simple recognition can be.

Advice on delivering employee recognition

So how can you adjust your performance management system to facilitate the exchange of honest recognition and appreciation?

First, it's important to not limit your performance discussions to a single performance appraisal. This doesn’t allow for fluid communication between manager and employee, and it's not conducive to a trusting relationship. Instead, follow in the footsteps of corporate giants such as IBM by switching to more regular check-ins. On top of recognition, this allows you to cover objectives, performance concerns and development opportunities.

Gallup has shown that the most effective recognition is individualized and honest. The same Gallup poll also showed that recognition is most memorable when it is given by a manager or C-suite executive. Other research shows that timeliness is critical when it comes to feedback and recognition. If you're a small and growing business and can't afford to invest any money into recognition, you should be aware that there are a number of meaningful ways of doing so that won't put you out of pocket.

Image Credit: pathdoc/Shutterstock
Stuart Hearn
Stuart Hearn Member
Stuart Hearn has twenty years of experience in the HR sector. He co-founded plusHR, a leading UK HR consultancy, and previously worked as International HR Director for Sony Music Publishing. Stuart is currently CEO of Clear Review, an innovative performance management software system.