All hail the employee Article icon

All Caroline Poynton learns about the value of staff recognition schemes

For three years between 2009 and 2012, the IT systems at the Oxford office of market research company Frost & Sullivan kept grinding to a halt. So frequent and severe were the failures that management started to suspect foul play. They were proved right after they installed CCTV in the server room.

On a weekend in June 2012, 44 year old Edward Sobolewski was filmed spraying liquid into the computer grills before pouring it wholesale into the machines. His sabotage weapon of choice was a distinctive purple bottle of Cillit Bang. His gripe: being passed over for a pay rise.

The example may be an extreme one, for which Sobolewski received an eight-month jail sentence last February, but Frost & Sullivan is not the first firm to experience the destructive side-effects of staff disgruntlement.

While most employees will not resort to criminal damage, poor morale means low productivity. And increasing numbers are going online to complain. Sites like, which allows employees to post reviews of their firms en masse, can create the kind of negative press that could seriously damage a business's reputation and hamper any ongoing ability to attract talent.

No wonder perhaps that more businesses are focusing on reward strategies to keep employees sweet. According to a recent survey conducted by XpertHR, 61 per cent of respondent organisations are now operating some form of staff recognition scheme, with half of the remaining companies looking to introduce such a scheme in future. Such programmes generally aim to boost engagement and motivation by rewarding individuals and teams for high performance. Prizes vary but plaques, certificates and/or gift vouchers are typical.

Recognition versus cost

Dale Parmenter, managing director of DRP Group, thinks that such recognition schemes are a cornerstone to engaging a team. But in recent years he has seen recognition schemes cut back, or run on a tighter budget, due to financial constraints.

For others, however, the recession has only highlighted the need for good recognition programmes. 'Bizarrely, the impact of the recent recession has really put the spotlight on retaining talent,' says Gemma Bullivant, head of HR at management consultancy Bluefin Solutions. 'If you've gone through the process of reducing your workforce, then you need so much more from your remaining people.'

But Bullivant also believes that a social and generational shift makes such schemes vital. 'What a person values is now more important than the employer's agenda,' she says. 'Individuals have more job mobility than ever, and can give and gather opinion through social media. So employees are much more empowered. They are in the driving seat.'

This is something that seems to have been taken to heart at Glasgow City Council. Despite significant cutbacks in the public sector in recent years, the council's Flourish Team Excellence Awards scheme is still going strong. '[The awards] have grown over the last few years to become a really prestigious event and they drive improvement by encouraging people to be innovative and bold, and by highlighting good practice. They are also great for motivating and engaging staff,' says Colin Edgar, head of communication and service development at Glasgow City Council.

Teams are nominated for their work on an area that meets the council's objectives across various categories, such as improving the efficiency and effectiveness of services, increasing access to lifelong learning, making Glasgow a cleaner and safer city, building a prosperous city and improving health and wellbeing. There is also an individual award given to one staff member from each winning team.

Once a project is nominated, the members of the team make a presentation to an independent judging panel. The winners are announced at a ceremony in the City Chambers.

Such council awards may be understandably popular with staff, but they have not gone without criticism. Two years ago, for instance, Glasgow City Council got on the wrong side of campaign group The Taxpayers' Alliance, which accused it and other Scottish councils of unnecessary extravagance in spending thousands of pounds on 'back-patting award ceremonies'.

Figures at the time showed that Glasgow was spending a total of £79,529 on awards ceremonies, including £17,309 on the Flourish scheme - making it Scotland's biggest council spender on awards in 2010/11 and the second highest across the UK.

For the council, however, such investment is seen as more than worthwhile. 'It improves productivity and helps us deliver a better service to Glasgow's residents,' says Edgar. To put the sums in context, Glasgow City Council is also the largest local authority in Scotland, with a higher spend reflecting its larger annual budget.

Putting objectives first

Recognition schemes do not necessarily need to be expensive though. 'Many people think recognition schemes are about big prizes and lavish events,' says Parmenter. 'They're about being appropriate to the conditions, targeting the right people and being integrated into a robust and regular communication plan.'

Clear goals are key. 'The objectives of the scheme could be very different, from an increase in sales to a reduction in waste, a decrease in employee retention to an improvement in customer service,' says Parmenter. But, by creating a series of benchmarks linked to tangible objectives, he argues that it is far easier to measure the value of such schemes.

Lesley Allman, founding director of Allman Communication, agrees. 'Employee engagement and recognition schemes are a useful way to reinforce messages around strategy, commercial objectives or values and to remind people what behaviours are important.' That means, she advises, that recognition schemes should be measured against specific SMART [specific, measurable, attainable, relevant, time-bound] objectives. 'The number of entrants is not an effective measure of effectiveness. What matters is behaviour change.'

The Royal Horticultural Society's (RHS) staff recognition scheme, for example, is directly linked to increasing levels of public membership. 'RHS staff and volunteers weren't keen on telling visitors about the charity's membership scheme because they thought they were there to help in gardens, not 'sell stuff',' explains Allman. 'An education programme (Membership Matters) helped them understand the benefits of membership - to the visitors and to the charity - and gave them some tools and techniques to help them to introduce the benefits into their conversations with visitors.' This programme was then reinforced by the introduction of the EMMA awards, which recognised those who went the 'Extra Mile to bring Members Aboard'.

'As well as encouraging increased sales, the scheme enabled colleagues to acknowledge and congratulate individuals or teams who they believed had delivered exceptional performance in relation to selling memberships, to share best practice across RHS sites and to provide central recognition for local achievement,' says Allman.

The rise of the peer-to-peer scheme

Broader schemes are more complex though. Bullivant was formerly head of HR, reward and engagement at Lebara Mobile, where the chief executive was passionate about reward initiatives such as 'employee of the month'. But not all staff were quite so enamoured. 'There was a population that loved it and others that were extremely negative,' says Bullivant. 'People can be sceptical if it's seen as the choice of the chief executive or senior managers.'

'Top down schemes, where senior staff recognise more junior colleagues, can create difficulties,' agrees Allman. 'There can be a perception that the top team don't really know who is most deserving and that the accolades only go to the 'usual suspects'.'

Recognising this scepticism, Lebara added another layer to its scheme, introducing online e-cards allowing colleagues to thank each other for a job well done. A copy was then sent to the relevant manager, creating a more bottom-up system of recognition and reward.

Insurance group Aviva has taken this approach with its Spotlight programme. The scheme operates via a website which gives all 22,000 staff at the insurance company the ability to send 'thank you' e-cards to colleagues as well as to nominate teams and individuals for additional rewards. Nominations are submitted to managers who then apply what they consider to be a suitable number of reward points to the individual's website account. These can be used to redeem a range of prizes from gift vouchers to experience days.

'We think this is successful because people are talking about it,' says Liam Hyland, head of reward design at Aviva. 'People refer to it as part of their everyday language, and the scheme always receives positive scores in our employee satisfaction surveys. This shows how it is contributing to motivating employees.'

Aviva is now investigating the introduction of a social media component into the Spotlight programme, using its already mature intranet as a platform. In Hyland's view, the advantage would be a process that is much more immediate, even instantaneous. This is something that Virgin Media has already tested with its Shout recognition scheme. The programme, which started as a paper-based project in 2007, has evolved into colleagues' Facebook-style pages on the company intranet, on which recognition 'Shouts' from colleagues are displayed. Shouts can be downloaded for use in career appraisals.

Such social media-based recognition schemes are growing in popularity for obvious reasons. The technology has improved, in the form of business social networking platforms like Yammer or Jive, and it is extremely cost-effective compared to more formal awards schemes.

But opening up recognition schemes to everyone in a form that allows for instant gratification may ultimately dilute the process. At one point late last year, Virgin Media was registering an average of 543 'Shouts' per day and 19,000 per month. For a company employing 18,000 people, that appears excessive.

Allman believes peer-to-peer schemes can ensure greater fairness, but the criteria must be really clear and well understood to ensure that the right behaviours are recognised. This could be difficult in a social media setting where the quantity of recommendations might quickly outweigh the quality.

Easier reporting online will no doubt help in this respect. At Lebara, the e-card system made it much easier to see exactly who was nominating who. 'We could then tactfully manage it,' explains Bullivant. A comprehensive reporting system similarly sits behind Aviva's Spotlight scheme. But as the use of social media recognition programmes rise, companies will have to work ever harder to ensure that systems are clearly aligned to organisational goals and behaviours.

Proof is in the pudding

Staff recognition schemes are fast becoming a standard element of employee engagement strategies. The most simple programmes might just involve ensuring managers remember to give positive feedback as well as constructive criticism. But some, particularly among larger companies, are rapidly becoming more involved and far-reaching. For all, the key to success will mean keeping a keen eye on the objectives. Whether that's avoiding a Sobolewski crisis, driving sales, or even both, it's not the process, but the outcome that counts.