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Recognition Done Right: Reduce Turnover and Create a Culture of High Performance

Thursday, August 23, 2018

Take a look around your office. Are your employees happy to be there? Are they engaged in their work? Would it surprise you to learn that 70% are not? According to a Gallup poll, less than 1 in 3 American workers are engaged, costing the nation $450 billion to $550 billion per year in lost productivity.

We recently interviewed Mike Farrell, Business Development Director at BI Worldwide for a podcast titled “Recognition Done Right: Reduce Turnover and Create a Culture of High Performance.” BI Worldwide partners with businesses to engage employees, develop incentives and increase customer loyalty. In the podcast, Mike discusses the role of behavioral economics, employee value propositions, and the rewards efficacy continuum in keeping employees engaged.

Behavioral Economics
Behavioral Economics refers to the effect that psychological, social, and emotional factors often have on our decision making process. “More than ¾ of the time people use the part of their brain responsible for emotions, creativity, art, and irrational behavior to make decisions,” Mike says. “In fact, we only use the part of the brain responsible for math, reason, and logic to make decisions about ¼ of the time,” he adds. Employers must leverage Behavioral Economics in order to recognize and reward positive behaviors in a way that resonates with employees and builds loyalty.

Employee Value Proposition
An Employee Value Proposition (EVP) should represent everything of value that you offer to an employee, from pay and benefits to training and career development. “A great EVP will attract, retain and engage your employees from their first day, every day, to include service anniversaries, and finally to a day when they may refer someone else to come work at the company—as a senior employee or as a retiree,” says Mike.

Rewards Efficacy Continuum
In the land of employee rewards, cash isn’t necessarily king. Behavioral economics has proven that there are many other ways to reward employees that actually rank higher than money. Mike explains, “When you reward employees with cash, the majority of the time they will spend it on everyday necessities. They may intend to save up for travel/luxury goods, but life gets in the way.”

Efficacy refers to the ability something has to produce a desired result. BI Worldwide’s research led them to create an efficacy continuum, which ranges from cash (low efficacy) to experiences (high efficacy). “Cash rewards work, but they are expensive and do not work as well as luxury merchandise or travel experiences, which are at the top of the spectrum,” adds Mike.

LISTEN TO THE PODCAST: Recognition Done Right: Reduce Turnover and Create a Culture of High Performance

 

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