Employee recognition drives retention and productivity

Employee recognition is an important cornerstone for the engagement and retention of a workforce. Employee engagement surveys conducted by Energage in 2020 showed that appreciation was the top driver of employee engagement. It was one factor that strongly resonated with the surveyed employees to stay connected with their work. 

The Covid-19 pandemic further emphasized the importance of employee recognition where employers needed to prioritize their well-being and safety.

Top workplaces know the value of showing employees how much their hard work and contributions matter. And it is the least expensive and most impactful way to improve motivation among employees and drive productivity and retention.

Appreciation and recognition are not something you do one-off at the end of the year by giving a monetary reward or mentions; it should be an ongoing process and weaved into the very culture of an organziation. 

Here are some ways you can create a year-round culture of appreciation.

Small Gestures go a long way

A simple thank you and well-done compliments go a long way in making an employee feel appreciated and noticed. Mention the good work done in a team meeting, single out the name if you think someone has done outstanding work. Do not let it be lost in teamwork.

Having a culture of periodic recognition within the organization is a good idea. Explore various recognition strategies that fit in with your company culture.

A culture of peer-to-peer appreciation goes a long way in employee job satisfaction. Nearly  32% of companies had dedicated recognition budgets in 2019 compared to 21% in 2015. 

Zappos, an online e-retailer, has a peer-to-peer format. Employees share low-cost, high-frequency rewards with each other, and can earn “Zappos Dollars” for training participation as learners or volunteers, both. These dollars are redeemable in the office via branded vending machines. These dollars can be donated to a partner charity organization. Other recognition perks include a special parking place for a week for a nominated employee ( they are rare to come by). In addition, there are Hero awards with a special cape thrown in.

These appreciations and rewards might seem small, but they are a token of being seen and recognized for the hardwork put in by one’s colleagues and supervisors, and management.


When employees know they’re appreciated, it shows in their work. 90% say that recognition motivates them to give more effort. It is said that what gets recognized gets repeated. If hard work, innovations, out-of-the-box thinking, and even plain old diligence are recognized, then productivity also increases.

At General Electrics, managers hold meetings where they do a regular check-in with their team members’ well being. A wall-mounted dashboard highlights performance and achievements. Employee recognition is formalized as part of monthly team briefs, and six-word success stories of employees’ are publicly displayed.

These gestures drive engagement and a willingness to work harder and go that extra mile for the company.


More engagement with the company and its brand means that much more honesty is involved in selling the organization and its products. Rewarding hard work generates loyalty and builds an emotional bond with your organization.


Recognition and appreciation lead to job satisfaction, which means an employee is less likely to look for alternative employment. Organizations that rate their culture of recognition highly are also 3 times more likely to see increased employee retention. If an employee earns a median salary of $45,000 a year, this would cost the company $15,000 per person to replace — on top of the annual $45,000

Employee Satisfaction and Happiness

High morale affects the day-to-day running of an office. If employees are satisfied with their jobs, they are happy to report to work each day and are enthusiastic about the tasks at hand. 

During the holiday season, Apple gave its employees an extended holiday so that the entire workforce could take a week’s break. Instead of just one day off for Thanksgiving, Apple offered paid holidays for three days in a row. Additionally, this could be customised locally. Workers in a different part of the world could get paid time off during an equivalent holiday. Retail workers who put in work on holidays receive a similar award at alternative times.

Unsurprisingly, employees at Apple are highly satisfied with this arrangement.

Diana Coker
Diana Coker is a staff writer at The HR Digest, based in New York. She also reports for brands like Technowize. Diana covers HR news, corporate culture, employee benefits, compensation, and leadership. She loves writing HR success stories of individuals who inspire the world. She’s keen on political science and entertains her readers by covering usual workplace tactics.

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