A Losing Proposition: When Employee Recognition Goes Terribly Wrong

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On a near daily basis, I read lots of examples of employee recognition and reward practices, some good and some bad. And then some days, I see examples of the very good and the very bad.

One on the very bad scale of things is this example advocating for gamification out of the UK:

By linking your reward scheme to a game of chance, not only do you have the right to reward at a much lower level, but you also have the right not to reward when the agent ‘loses.’

Employing this type of gaming psychology in your reward scheme you will find that you can suddenly afford to be really generous with your cash rewards. This is because you are using a game of chance and your actual cash cost is much lower than by handing out cash rewards which are not linked to a game of chance.”

2 reason this is bad for recognition

This is a very poor plan for recognition for at least two reasons:

  1. It turns recognition into a game of chance, automatically creating losers. The response in employees’ minds is confusion: “Wait a minute. I thought I was being recognized for something good I did. Why am I now a loser?”
  2. It’s cash-based. The author of this article is clearly trying to come up with a lower cost way for recognizing employees. If she simply converted her program away from cash rewards – which do nothing but create a sense of entitlement and can never satisfy employee needs for self-actualization and esteem – she could save 50 percent of costs easily. (For more reasons on why cash isn’t a good award choice, check out this post from Paul Hebert on his i2i blog.)

Don’t do something that creates “losers”

Recognition gone right instead focuses on reinforcing in the daily work of all employees what is most important to your organization (your core values and strategic objectives). And there are countless low-cost ways of doing so that don’t involve gaming the system or creating “losers” out of what should be a celebratory moment.

For 10 low-cost ideas that really work, check out this article, which includes timeless and proven advice including this idea:

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Tell them: An often overlooked gesture, telling your staff specifically what you value in them is important. Seemingly small things are fair game to be called out – always on time for meetings, or making deadlines. ‘Thank you’ isn’t enough. Instead, fill in the blanks of ‘I value xxxx about you because xxx.’ ”

Have you ever had a recognition moment turn into a loser in a “game?”

You can find more from Derek Irvine on his Recognize This! blog.

Derek Irvine is one of the world’s foremost experts on employee recognition and engagement, helping business leaders set a higher vision and ambition for their company culture. As the Vice President of Client Strategy and Consulting at Globoforce, Derek helps clients — including some of world’s most admired companies such as Proctor and Gamble, Intuit, KPMG, and Thomson Reuters — leverage recognition strategies and best practices to better manage company culture, elevate employee engagement, increase retention, and improve the bottom line. He's also a renowned speaker and co-author of Winning with a Culture of Recognition. Contact him at irvine@globoforce.com.


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