Do You Recognize Your Employees? Not Doing So May Cost You

Recognition cultures are associated with positive employee well-being, which has a direct effect on a business's top line.
Aaron Drapkin

A new report from pollsters Gallup, in collaboration with Workhuman, has found that a failure to recognize employees in their place of work can have a plethora of negative effects for businesses.

Nowadays, significant productivity gains can be made by using project management software and other efficiency-boosting tools, but improving the well-being of employees is just as important.

The more businesses that adopt the five pillars of strategic recognition, the more productive the economy will be.

Recognition: Key to Employee Well-Being

The report, which compiled the opinions of over 12,000 employees across 12 countries, found that staff who feel “recognized” at work are up to 10 times as likely to agree they belong at their organization.

Staff who have high-quality and regular recognition experiences “are up to seven times as likely to strongly agree that they have meaningful connections or a best friend at work,” Gallup says.

Fulfilling employee recognition is not only linked to “better social well-being,” the analysis suggests, but also “increased overall life evaluations,” “reduced levels of burnout,” and “improved daily emotions.”

Employees of companies that have a recognition culture are up to 91% more likely to be thriving, while employees who strongly agree that they get enough recognition at work are up to 84% more likely to be prospering.

Employees Can't Be Left Feeling Lost

Despite all this, 81% of leaders say recognition is not a major priority for their organization – even though companies bereft of mechanisms for identifying staff successes are virtually certain to be negatively impacted by it.

According to Gallup, employees that lack a strong sense of belonging are up to 12 times as likely to be disengaged and five times as likely to be looking for alternative employment.

According to Gallup, the cost of “voluntary turnover due to burnout” amounts to 15-20% of payroll budgets.

The costs of neglecting employee wellbeing are, to put it bluntly, eye-watering. Gallup and Workhuman estimate that $20 million dollars of opportunity loss is incurred per 10,000 workers due to low well-being and the subsequent impacts on performance.

Globally, around $322 billion in turnover and productivity losses are incurred when low well-being turns into employee burnout.

The Five Pillars of Recognition

So, what should businesses have in mind when looking to recognize employees and promote employee well-being?

Gallup identifies 5 pillars of recognition. Firstly, there’s fulfilling employees’ recognition expectations. If it fails to meet the standard staff expect, then it won’t have a tangible impact on their wellbeing.

However, recognition also needs to be authentic, personalized, equitably distributed, and embedded within any given company’s culture to have the desired effect. Recognition has the most impact, Gallup says, “when it satisfies each of these core criteria.”

If the analysis discussed in this article is anything to go by, properly recognizing staff will have the kind of tangible, immediate impact on productivity that efficiency-boosting project management software can have – all whilst employees are feeling happier, healthier, and ultimately, more at home when they're at work.

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Aaron Drapkin is a Senior Writer at Tech.co. He has been researching and writing about technology, politics, and society in print and online publications since graduating with a Philosophy degree from the University of Bristol three years ago. As a writer, Aaron takes a special interest in VPNs and project management software. He has been quoted in the Daily Mirror, Daily Express, The Daily Mail, Computer Weekly, and the Silicon Republic speaking on various privacy and cybersecurity issues, and has articles published in Wired, Vice, Metro, The Week, and Politics.co.uk covering a wide range of topics.

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