How the Pandemic Year Changed Employee Recognition

Like everything else in the pandemic year, workplace recognition and managing teams for improved performance have been disrupted. In a virtual world, it’s harder to gauge team members’ needs, celebrate successes and make employees feel valued.

At the same time, human resource professionals and other workplace performance experts agree that taking steps to maintain a strong corporate culture, which includes frequent recognition, is more important than ever.

The virtual work world appears to be a reality for a majority of companies at least into the summer. Many companies have already announced long-term plans for a hybrid model of remote work and office time when it’s safe to return to offices. Thus, it’s wise to review recognition trends from 2020 to examine how businesses shifted to meet the challenges and what can be expected in the new work world that lies ahead.

“Employees continue to work in new — and for some people, unfamiliar — environments. It’s more critical than ever for organizations to find ways to inspire employee performance while instilling the larger feeling of being connected to their company,” says Stephanie Harris, president of the Incentive Research Foundation (IRF) and a longtime veteran of the incentive industry.

“Communications become such a clear differentiator,” Harris adds. “Those organizations that can clearly communicate to their employees about the value they bring — who can use communications to get them excited, who can use a combination of communication and virtual technologies to create celebratory moments — are going to be the ones that
find themselves with a more engaged work force and a more effective use of this work-from-home environment.”

Gift Cards and Merchandise
Get a Pandemic Bump

In a virtual world, touchless rewards make a lot of sense, so it’s not surprising that IRF surveys during 2020 showed a 26% increase in the use of gift cards in workplace incentive programs since the pandemic started. “Gift cards, especially, allow for high levels of flexibility, creativity, efficiency and speed when used to motivate important audiences during the pandemic,” states an IRF report on survey results.

Under normal circumstances, a number of companies create incentive travel programs for sales teams in which top performers earn their way on to a corporate retreat in an attractive location for a multiple-day celebratory event. Incentive travel was essentially shut down by COVID-19 in 2020 and continues to be suspended for the first half of this year. Some group events have been booked for the latter half of this year and even more have been scheduled for 2022. (See story on page 10).

Some companies simply postponed incentive travel programs until it’s safe to hold them, while others shifted incentive budgets to gift cards, merchandise rewards, points programs and certificates for individual travel, the IRF reports.

A 2021 IRF Trends Report states, “Looking ahead, the trend toward using more merchandise and gift cards continues. The IRF Industry Outlook for 2021 reports an overall predicted net increase of 33% for gift cards and 24% for merchandise. The average value of a merchandise reward is $160, and 32% reported their average merchandise value to be $200 and higher.”

Casting a Wider Incentive Net

The downfall of some sales incentive programs that reward with high-priced travel and merchandise is they mostly motivate salespeople who are regularly top performers anyway. The IRF reports that lower-priced merchandise and gift cards proved to be effective motivators to broader audiences during the pandemic, and many incentive program owners are applying the lessons learned in 2021 and beyond.

“Tiered programs might focus on expensive incentive travel programs at the top tier, then add in merchandise and gift cards at the second and third tiers, allowing for a wider variety in per-person spend,” the report states. “A wider reach for incentive programs could play a critical role during recovery. It might be necessary to rebuild morale, engagement, trust and collegiality, and these are behaviors that the majority of employees must observe to move the needle. Incentive program owners may be identifying and rewarding many new behaviors that will reestablish new corporate cultures. Many of these efforts could involve smaller, frequent rewards on a larger scale.”

Harris, who worked in the incentive division of American Express among other companies before heading the IRF, says the focus on moving the middle is a necessary shift.

“Since I have been in this business, the majority of high-end programs have been designed in such a way that your top 5% to 10% are earning the big rewards. The middle 60% of producers often get forgotten. I think that’s a missed opportunity, especially as organizations work to recover and you need every single person in your organization giving incremental effort,” she says.

Showing your employees they are valued and appreciated is at the core of what drives performance and motivates human beings to achieve strong results, says Jeffrey Brenner, past president of the Incentive Manufacturers and Representatives Alliance (IMRA) and the director of special markets for Seiko Watch of America LLC. Brenner says it’s not only increasingly important to incorporate incentive efforts when teams are working from home, it’s critical to create a buzz about your incentive programs and keep them front-of-mind.

“In an office setting, there is more opportunity to discuss and promote a program on a daily basis. The necessity [when working from home] of frequent communication is critical to reach set goals.  What we are seeing is the involvement of not only the employee/participant, but their family when selecting their reward, as they may now be more a part of the process due to the WFH setup,” Brenner says.

Embracing Digital Delivery

The ability to digitize gift card delivery, award points and merchandise award catalogs has existed for a decade or more, but more companies relied on these capabilities during the past year for obvious reasons. The IRF reports that many lessons were learned about the power of virtual engagement.

“Digital options enable immediate, coordinated, trackable delivery of rewards regardless of geographic location, and groups of employees can receive their reward at the same time, such as during a virtual meeting. Digital delivery can also increase control, enhance reporting, and reduce overall administration time for program owners.”

The IRF is encouraged by companies’ focus on maintaining a positive corporate culture and keeping workers motivated during the pandemic. IRF officials feel that bodes well for incentive and reward use this year and beyond.

“2020 was a year like no other, and 2021 will likely be unprecedented as well. With many industries anticipating recovery once the vaccine is distributed, what will emerge is a work force and sales landscape that in many ways has fundamentally changed,” The IRF report states. “Incentive, recognition and reward programs will need to be reimagined to motivate this changing environment, accelerate recovery, and meet the evolving goals of post-pandemic companies.”

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    Paul Nolan is the editor of Sales & Marketing Management magazine.

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