It Is Your Best and Cheapest Employee Engagement and Retention Strategy
by Bruce Tannas
I have been an employee, manager, and business owner over the course of my career. I have had the opportunity to work for private business, corporations, non-profits and government. What I have often been struck by is the lack of consistent appreciation shown in some workplaces. I am not talking about receiving a pin or gift at the end of the year, but genuine appreciation shown to an employee for who they are and how they contribute to the organization. As a small business owner, showing appreciation can be your best and cheapest employee engagement and retention strategy.
Why Should You Provide Appreciation and Recognition?
There is some compelling evidence that proves that genuine appreciation shown to an employee can affect employee performance, engagement and retention. For example:
- Researchers at the Wharton School at the University of Pennsylvania “randomly divided university fund-raisers into two groups. One group made phone calls to solicit alumni donations in the same way they always had. The second group—assigned to work on a different day—received a pep talk from the director of annual giving, who told the fund-raisers she was grateful for their efforts. During the following week, the university employees who heard her message of gratitude made 50% more fund-raising calls than those who did not.”
So, appreciation can increase performance, but it can also help with engagement. According to a recent survey of six industries, seventy six per cent of employees noted that empathy in the workplace can lead to increased employee engagement (Businessolver – State of Workplace Empathy Study).
There is also clear evidence that appreciated employees are more likely to stay with a company. Burn out is a major cause of employees leaving their company. A recent survey by Deloitte, found that one of the major causes of burnout was lack of recognition or support from the company’s leadership. In addition, seventy five percent of respondents to a survey, conducted by the Centre for Generational Kinetics, showed that employees said that they would continue to work at an organization that cares about their problems and addresses their concerns. Further, the survey found that how the organization treated employees mattered more than what it said in its mission or values (Centre for Generational Kinetics and Ultimate Software – The Surprising Truth that Drives Employee Experience).
Practice Simple Employee Recognition and Appreciation:
The value of simple appreciation is sometimes overlooked in favor of more formalized programs. The good news is that appreciating and recognizing employees does not have to be complex. But it does need to become a habit with you and your management team. Professor Fehr at the University of Washington says that “one of the keys to a successful program is consistency. For example, adding a short gratitude practice to staff meetings or infusing internal communications with gratitude keep it top-of-mind. Employee awards once a year won’t cut it” he says.
When we were kids, our parents our kids taught us to say thank you. Oddly enough, that simple act is sometimes overlooked in the workplace. In a recent article in Forbes about “The importance of saying thank you in the workplace” the author cites that saying thank you keeps morale high and helps employees be more engaged. Appreciation can be a simple thank you, recognition at a staff meeting for a job well done, a thank you note, or taking an employee to lunch. Group recognition can be as simple as providing a treat (e.g., a cake or doughnuts) for the staff after a busy week. The key is to be consistent and timely with your appreciation.
Formal Recognition Programs
There is still a place for formal recognition program as a form of appreciation. Formalized programs can recognize safety, performance improvement, and other desired actions. Be sure to set goals for your formalized program and measure how effectively the program is shaping the desired behaviour. In a recent survey, ninety two per cent of employees agreed that when they are recognized for a specific action, they are more likely to take that action in the future (Achievers – Engagement & Retention Report).
A formal program does not have to be expensive, but you should offer rewards that have a high perceived value. Depending on the employee that could be anything from a small gift, a day off, a spa day, golf day, or a dinner out. The key is that the employee you are recognizing values what you are using to recognize them. So, you should personalize the recognition or offer choices of reward(s).
Formal recognition programs need to be regular and timely in order be effective. You should ensure that any formal recognition comes shortly after the desired behavior to maximize the motivation. Also, make sure that employees are aware of the program by announcing new programs and providing updates.
Get to Know Employees as People
All of your employees have value as people beyond the work they provide to your company. They are mothers and fathers, community volunteers, and friends. More companies are recognizing that it is important to show genuine interest in employee’s lives beyond the workplace. Seventy six per cent of employees surveyed said that empathy in the workplace can lead to employee engagement and productivity (Businessolver – State of Workplace Empathy Study). Some of the best employers like Southwest Airlines, named by Forbes as America’s #13 Best Employer of 2018, recognize the importance of empathy in the workplace. One way the company appreciates employees is by paying attention to special events in their personal lives—from kids’ graduations to marriages to family illnesses—and recognizing those with small gestures like flowers and cards.
The next step beyond simple acts of empathy and recognition, is providing more scheduling flexibility to pursue family and community needs (where possible). According to a study conducted by Manpower group “nearly 40 per cent of global candidates report that schedule flexibility is now among the top three factors they consider when making career decisions.” There are a number of potential ways to provide flexibility including: Opportunity for sabbaticals or career breaks (e.g., extended time off), flexible paid time off, caregiving leave, flexible arrival and departure times, full-time work from home/location independence, choice and control in work shifts, and part-time work from home. While not all workplaces are able to accommodate all these options, employers can usually provide some flexibility to their employees.
As you can see, showing appreciation can be your best and cheapest employee engagement and retention strategy. While most small businesses can’t afford to pay the wages and benefits that government or corporations offer, a savvy small business owner can offer some intangible benefits that they would find hard to duplicate. Because your business has fewer employees you have the opportunity to show appreciation and recognition on a one-to-one basis. You can design your formal recognition programs to reflect both your values and those of your employees. Finally, you can get to know employees on a personal level and provide them, where possible, flexibility with scheduling their work so they can meet their family and community obligations. If you do these things, then you will likely have a more engaged and productive employees who will want to stay with your company longer.
Connect4Commerce offers entrepreneurs and small business owners across the country a convenient and comprehensive place to connect, exchange goods and services, and advance their businesses. Be sure to check out further articles in our Small Business News blog for additional resources. Also, find learning & event opportunities for you employees on our site that can help you with keeping them engaged and provide ongoing training opportunities for your employees.