Restart to Recharge: Engaging Employees During and Following Economic Downturn
Globoforce survey reveals 92 percent of companies plan to maintain or increase recognition spending in 2010; Offers seven tips for how to re-ignite a workforce
Southborough, Mass. and Dublin, Ireland (Vocus) June 2, 2010 The economic downturn in 2008 and 2009 forced many businesses to adjust their human capital strategies and budgets. While this resulted in many companies pulling back or eliminating monetary recognition programs, it also demonstrated their importance. In fact, according to a recent study by Globoforce®, the leading worldwide provider of global, strategic, employee recognition solutions, 92 percent of business and HR leaders plan to maintain or increase recognition spending in 2010.
Today, in the midst of an economic recovery, businesses are faced with what to do next to re-ignite and re-engage their workforce. However, like many strategic HR programs, recognition budgets were impacted by the economy. According to the Globoforce study, "Restarting Recognition during the Recovery," 46 percent of survey respondents said they had cut recognition budgets during the economic downturn while just 12 percent increased spending on recognition. The impact of the budget cuts were evident, as 42 percent of organizations that had cut spending during downturn plan to increase recognition spending in 2010. Additionally, companies who had increased their employee recognition budget expressed they will continue the investment in 2010.
This recognition budget forecast follows lessons learned from the recession, as companies that increased recognition spending experienced a significant increase in employee engagement compared to companies who cut their recognition spending. According to the survey, the majority of respondents (71 percent) that held steadfast in their employee recognition programs and increased spending saw an uptick in employee engagement, whereas 59 percent of companies that decreased spending saw a dip in employee engagement. Not surprisingly, respondents from organizations that increased spending were far more likely to report increases in employee engagement, performance, and retention than organizations that cut spending.
"The recent economic downturn presented businesses with one of the most challenging environments in decades. However, it also provided them with an opportunity to discover, with hard data, which programs were most critical to the growth and innovation of the company," said Derek Irvine, Head of Strategy Consulting and CMO, Globoforce. "Our survey showed that whether companies cut or increased their recognition budgets during the downturn, the conclusion was the same: employee recognition programs have a positive and measurable impact on engagement and culture and are crucial to short and long-term success."
So, why would companies not invest in recognition? According to the Globoforce survey, 21 percent of HR leaders said their organization did not have a recognition program because they had no executive support and 10 percent said there was no perceived link among management between employee rewards and performance.
Seven Actionable Recommendations to Re-Ignite Recognition
Globoforce advises the following seven recommendations to help properly calibrate recognition programs for the recovery:
- Give employees plenty of culturally relevant options: After years of doing less with more, employees want to have a choice for a change.
- Use recognition to reinforce company values: Proactively manage your company culture to become the organization you want to be by identifying the values that will drive the success of your company, then recognizing and rewarding behaviors that align with those values.
- Leverage social networking and social recognition: As social networks have become more popu¬lar and people have become more comfortable sharing personal and professional accomplish¬ments, giving employees the opportunity to share recognition in their own networks can extend the reach of a company's culture and employer brand.
- Implement better dashboards to help understand the ROI: Organizations using dashboards to track recognition metrics in real time will have the abil¬ity to turn employee recognition and incentives data into business intelligence for accurate ROI calculations, program adjustment and optimization, and global oversight and governance.
- Make recognition mobile: Mobile is the way of the future. Future-proof your program with mobile access to recognition tools today.
- Offer consistent global recognition: For global companies, recognition should be culturally relevant, locally available, and highly valued.
- Remember, it isn't all about the money: Don't forget the simple power of a thank you. Employees ultimately value the simple acknowledgment that their hard work during the downturn is genuinely appreciated and has positioned the organization for success today.
About the Survey
Globoforce recently presented findings from the study and white paper "Restarting Recognition during the Recovery" in an online webinar. To request a copy of the webinar recording, click here. To request a copy of the white paper, please contact Kevin Mullins at email@example.com