David Sturt argues that recognition is at the heart of business success

In 2012, employees of one of the largest safety-net academic health systems in the United States were weary after years of serious financial struggles and constant changes in senior leadership. The turnover rate for first-year employees increased dramatically and the results of an ‘overall commitment score’ from a 2012 employee engagement study were well below the national healthcare average. Additionally, scores in other areas such as communication, trust, confidence in leadership and satisfaction with recognition all came back at unacceptably low levels.

Company leaders, however, had a vision of becoming one of Atlanta’s best places to work and they devised a plan to get there. Despite an evolving and challenging healthcare environment, their goal was to help employees develop an overall feeling of respect from management and recognition for doing great work. The company leaders were determined to retain their top talent and engage them in providing the highest levels of care.

The connection between recognition and producing great work has always interested me. I have often wondered which comes first. And what does it have to do with engagement and tenure?

The most recent research study from the O.C. Tanner Institute and Cicero – Employee Performance: What Causes Great Work?¹ – revealed that the number one driver of great work is recognition. In an open-ended, unaided survey question, respondents cited ‘recognition’ three times as often as any other reason for what caused them to be productive, innovative and make a difference that people care about.

Recognition was the top and most consistent response across workers of all ages.

So in reality, many of us have it backwards. By waiting to recognise employees for significant work anniversaries, managers are missing tangible opportunities to encourage employees to stay and to take part in the great work they could accomplish during their career.

Recognising employees early and often directly influences their desire to produce great work, consistently.

Additional insights from the study² show that reliable performers of great work – the very best employees – are 20 per cent more likely to be employed at organisations with excellent recognition or promotion practices. Consistent great work performers are also 21 per cent more likely than infrequent performers to have a high impact on the long-term financial performance of the organisation, regardless of seniority.

To highlight these facts, one could consider again the Atlanta-based health system, which for several years only presented service awards and certificates at five, 10, 15 years and above, and held an off-site luncheon to celebrate those who had given 20 years or more. By 2007, the service awards were gone, with only the luncheon to shoulder the load.

Not surprisingly, over the next five years, first-year turnover increased dramatically.

This was due to several factors of course, however, the programme that could have offered relief had been discarded.

According to a survey from the Society for Human Resource Management (SHRM), a staggering 79 perc ent of employees who leave their jobs cited a lack of appreciation as the main reason.3

Fortunately for the Atlanta-based health system, a new chief human resources officer understood the importance of recognition, had employee data to back him up and was able to design a comprehensive recognition programme with full executive team support.

The programme included training of 275 leaders on why recognition is important and how to do it right. Another 200 employees were trained as ambassadors to help get the word out about how to implement the new recognition programme across three main areas:

• First, online and offline thank you cards made it easy for managers and peers to recognise employees’ day-to-day efforts.
• Second, staff members who truly go above and beyond could be nominated for awards. Awards were presented in front of peers and leaders to encourage further great work and to inspire others.
• Third, career achievements were once again celebrated, but this time starting at the critical first year.

Within 12 months, there were 21,062 appreciation moments with 86 percent of employees receiving performance recognition. Overall, voluntary turnover decreased from 25 percent to 10 percent. And most notably, the best measures of the great work that was achieved – the company’s scores in patient experience, clinical quality and employee engagement compared to similar institutions – jumped 37 per cent.

Mentoring employees to recognise and appreciate others is the best way to inspire great work. And, of the people who report the highest morale at work, 94.4 per cent agree that their managers are effective at recognising them.⁴ 

Here are some ideas for how to communicate the difference they are making:

Tell a story

The German novelist and playwright, Gustav Freytag, is credited for his analysis of Greek and Shakespearean drama. He designed a storytelling map to explain the dramatic structure he saw in these successful works. His graphical representation of good storytelling looks like a pyramid. It begins with a situation. Action rises throughout the story and reaches a climax. Finally, a resolution is found – or, in appreciation lingo, results are achieved. This same format can be used to show appreciation through a ‘great work story’. You can create a memorable moment that resonates with the one being recognised, as well as with your audience.

This connection that you can create with your listeners by telling a narrative, is very real. A functional MRI study by Uri Hasson, Ph.D., associate professor of psychology at Princeton, recorded brain activity in listeners as a speaker told a story.⁵ “The results showed that not only did all of the listeners show similar brain activity during the story, the speaker and the listeners had very similar brain activity despite the fact that one person was producing language and the others were comprehending it,” said Hasson. During successful communication, the speaker’s and listener’s brains exhibit joint, temporally coupled, response patterns.

Storytelling about individual achievements should be a daily workplace occurrence. It not only has the power (given in the form of recognition) to elevate an individual’s performance, but it also elevates the performance of everyone who hears the story.

Consider the psychological impact the following story could have on a team: “Heather, we had only a couple of days to submit our project, and you still pushed us to explore something new – to be more creative and innovative in our approach. Thank you. Because you insisted that we try one more time, we generated some great new ideas.”

Heather becomes more confident that she is making a difference. Knowing this, she is further motivated and engaged in her work. Other team members recognise Heather’s contribution as meaningful and appreciated, where they could have felt frustration toward her. Her team was inspired to apply new thinking and had a clear roadmap to achieving their own great results.

Tell stories about smart ideas, extra effort, a job well done, team success, great service – or any behaviour you would love to see again. When efforts are noticed, they are repeated.

Purposeful storytelling is key to being a good leader. It is a foundational aspect of progress – when we hear how others overcome problems or situations, ideas begin to fill our minds, inspiration takes hold of our hearts, and our actions begin to create the stories that will be shared tomorrow.

Focus on the positive

Several years ago, O.C. Tanner acquired an established promotions and incentives distributor in the UK in order to commence its operations in that region as O.C. Tanner Limited. The success that followed over time eventually resulted in another acquisition. However, this time significant changes in management and ongoing restructuring left the company in a corporate cultural crisis.

Blame became the focus of daily battles; communication, respect and trust were lacking as confusion over company goals and priorities ruled the day. Staff turnover peaked at 75 per cent. Ironically, this new branch of a company known for creating cultures of appreciation needed to evaluate its own culture – and fast.

How does a company go from self-defeated to thriving?

The turnaround was an exercise in practicing what we preach. To transform a company from a reactive and negative environment where uninspired employees operated in an atmosphere of blame, the new management team used appreciation as an accelerator to successful leadership.

“No one wants to come to work and do less than their best. We had to re-adopt that basic assumption,” said Hitesh Patel, financial controller. “For so long we were so focused on all that was going wrong. We had to develop the recognition tools that would support the culture we were trying to create and then clearly train managers on a new way to communicate; one that was more positive, more frequent and more focused on the bigger goals of the company. Our recognition programmes helped us achieve that new way of thinking.”

Recognition became strategic and its acknowledgement focused specifically on the action being honoured and the company goal it supported. Focused and positive communication radically changed the culture. It went from being a “truly dreadful place” – in the words of one employee, to becoming a place where the cultural practices were “transforming the way people feel about their work” – according to a comment from an independent evaluator.

This example underscores the importance of finding recognition and appreciation moments even in the most difficult circumstances and with the most difficult employees. Begin by clearly defining your goals and then make time to offer positive feedback about specific actions that you see supporting those goals.

Take advantage of the moment

Recognising great work has its own unique etiquette. If you want to inspire someone to achieve great work, then recognise him or her in the moments when they are giving the most effort or at least directly following their achievements. When the recognition is not timely, the appreciation starts to lose its value, but late is better than never!

Consider the Olympics. Medal winners don’t have to wait a week or two, or even a day, to be recognised for their achievement. They are recognised while the sweat is still dripping down their forehead and while their heartbeat is still thumping from the event.

Admittedly, leaders need an easy way to recognise great work, to know what is appropriate and to have access to a variety of tools and ideas. When leaders have the right tools, it’s easier to express appreciation and recognise the accomplishments of their people more often.

And that’s important because employees report the desire for some form of recognition every seven days, yet more than half of leaders only provide recognition once a quarter or less and still believe their company is above average at appreciation.6 

Mix up your appreciation repertoire with a variety of reasons to recognise employees. A short, yet sincere thank you note is an easy way to appreciate someone who helps you out or a team member who goes above and beyond what is expected. Use merchandise, gift cards or symbolic awards for little victories along the way and for big wins that produce noticeable results. Reserve significant cash awards for ultimate achievements. Career celebrations at milestones as early as one year help employees feel part of the team.

The bottom line is, [pullquote]don’t wait for the ‘right’ moment, but rather help create moments that build a culture of appreciation and great work[/pullquote]. Teach others to value the difference people make day in, day out and year-to-year, and they will begin to notice immediate results.

A fully-referenced version of this article is available on request.