A talented team is arguably one of the most valuable assets of any company. For startups and smaller enterprises, this statement usually rings even truer.
But it takes plenty of time and effort to recruit the right people. And, once on the team, making sure that your talent sticks around is an even bigger challenge. While some degree of staff turnover is natural, it takes time and energy for new hires to learn the specific ropes of your company, build relationships with colleagues and begin delivering results. If these new hires leave, it not only puts unnecessary strain on your operations but could also point to a larger issue.
Retention initiatives often look at how competitive compensation rates are, or whether work-life balance at the company could be improved. Employee recognition is often left out of the conversation but it is something that has a significant impact on any retention strategy. That’s because 36% of employees cite a lack of workplace recognition as the main reason for quitting, with 60% being more motivated by recognition than money.
And it’s not just retention rates that are at risk, but the performance of those employees who stick around. Research shows that employees on the receiving end of fair and consistent recognition from their leaders generated twice as many ideas per month as those who don’t receive the same close attention.
In a tight labor market, every founder can benefit from taking a look at how the individual achievements of each team member are currently being celebrated and being honest about where there may be room for improvement. Here are four ways that founders can strategically improve employee recognition to better retain their best performers and boost motivation across their companies.
Share your network with star performers
Founders and senior executives are often overwhelmed by requests to act as speakers or mentors at industry events. At times, it may be appropriate to consider sending a rising star from the company in your place. This not only helps to increase company representation at such events but also offers a highly valuable way to recognize your top performers.
For employees at an earlier stage in their career, getting named as a board advisor or mentor is an accolade that adds prestige to the individual’s résumé while also validating the presence of the company.
It’s important to communicate exactly why a certain employee has been chosen to represent the company.
For example, the former co-CEO of Salesforce, Bret Taylor, was also chairman of the board of Twitter in addition to his role at Salesforce, which helped draw attention back to Salesforce.
Equally, speaker roles at industry events are highly valuable opportunities for aspiring leaders, helping them to fast-track their visibility among peers and forge valuable connections on behalf of themselves and the company. Rather than hoarding such opportunities, leaders who choose to share the benefits of their established networks with star employees for the greater good are set to win in the long run.
Here it’s important to communicate exactly why a certain employee has been chosen to represent the company for such opportunities. In this way, other team members will know that it’s in relation to a specific achievement rather than a case of favoritism and gives others something to aspire to in the future.
Don’t limit recognition to internal comms only
Many managers just aren’t good communicators and are often what could be called “emotionally stingy.” Although employees report a general lack of recognition, it usually does happen in some form. However, in my experience, smaller wins and general team achievements are limited to a shoutout during company meetings or buried within performance reviews.
While this isn’t a negative per se, it often falls short if the goal is making employees feel properly valued for their contributions. For this reason, I’d advise founders to consider moving these shoutouts over to LinkedIn. Though some contributions may not warrant a shoutout, celebrating the most important staff achievements and milestones on a more public forum instantly increases the value and level of recognition that team members feel they receive for the same win.
This also helps to present a positive image of your company for any potential recruits, showing real evidence of the emotional intelligence of your managers. To make the posts engaging and relevant to the personal followers of your executive team, I’d advise acknowledging the individuality of the employee you’re celebrating along with some context about how their contribution related to the collective progress of the company.
In this way, achievements can be celebrated in a more public forum in a way that also makes sense for the audience. For example, as part of new employee onboarding, some startups craft a LinkedIn post welcoming the new hire to the company and sharing a few notes about their experience and what they bring to the team.
Performance prizes for all departments
In an era of job cuts and downsizing, it may not seem the best time to add an additional expense to the budget sheet. Yet I’d urge you to consider doing just so and offer your team monthly or quarterly prizes in relation to key metrics.
Given that 65% of Americans felt they weren’t recognized even once in a year, prizes offer another way to embed recognition into your company’s processes.
And the prizes don’t need to be highly expensive in order to act as a positive incentive. For example, in my company, we offer prizes such as weekend trips to team members who rank in top place against a number of predetermined metrics.
However, it’s important to note that these shouldn’t replace raise programs or bonuses that individual teams have in place, but rather act as a more informal competition that anyone in the company can be involved with. Remember to properly celebrate the winners of the prize at the end of each period to further boost morale and visibility across teams.
Lean into connection to enrich company culture
Understanding that your employees want to feel connected isn’t breaking news, yet the data suggests that this regularity doesn’t occur. Moreover, with the erosion of the traditional office-based team, the challenge of connection gets even trickier.
Over 9 out of 10 leaders say that the culture and connection are lacking for remote team members. Along with this, 75% of the C-suite say employees would make key sacrifices to work for another company where they’d feel more connected.
The good news is that efforts to improve employee connection can also help to enrich company culture. Leaning into the personal stories and achievements of your employees contributes to a connected, motivated workforce and can be done in a way that serves hybrid work environments. There’s no one right way to create an authentic company culture, but incorporating employee recognition into the picture is one way to increase the value of these efforts.
Appreciation is not one-size-fits-all, but founders can’t afford to ignore the issue of employee recognition. While one employee might prefer private praise, another might crave public recognition. What’s most important is building a range of systems that help senior leaders keep track of achievements and celebrate these fairly and consistently.
Appreciation isn’t just about gifts or praise. It’s about taking the employee — their experiences and interests — into consideration. But with a hands-on approach, every founder can find the right way to celebrate the important contributions of their team and nurture a positive work environment.