Budgets are tight - how can I recognise and reward my staff?

Budgets are tight - how can I recognise and reward my staff?

Author: Jane McNeill, Director, Hays Australia

Recognising top performers has long been viewed as a good strategy to motivate future performance. Along with proven engagement and retention benefits, offering employee rewards or recognition allows you to acknowledge the results or behaviours that help your organisation achieve its objectives, which incentivises future similar behaviour.

But when budgets are tight, how can you reward your employees? Regardless of how well-deserving they are, if the money isn’t available then the bonus or raise an employee may have otherwise expected can no longer be given.

It’s at times like these that managers can be left unsure of how to give recognition to employees. The good news is that, for many employees, non-financial benefits are just as important as the monetary component of any staff recognition program. In fact, many employees prefer non-financial forms of recognition.

After all, a little appreciation can go a long way and the fact that recognising employees costs considerably less than rewarding them with monetary bonuses doesn’t make it any less effective. In fact, the opposite is often true, since taking the time to acknowledge good performance is likely to result in a more considered and personal approach, and is therefore a more effective way of recognising staff.

Here are nine ways to recognise top performance when budgets are tight:

1. Treat people as individuals

Firstly, it’s important to identify and recognise what motivates each individual employee. Good recognition starts with gaining feedback from your employees to ensure the rewards you offer will motivate them. After all, not everyone is motivated by the same things. Therefore, open a dialogue with your employees and invite them to identify which non-financial recognition and rewards they would prefer.

Based on this, you can personalise the recognition you offer based on the motivations and preferences of each individual employee.

2. Say ‘thank you’

A genuine and heartfelt ‘thank you’ can be highly motivating and increases an employee’s feeling of appreciation. There are different degrees of recognition though, so decide which will work for the employee in question. For example, some employees find it very satisfying to receive formal public recognition, while others prefer a deliberate ‘thank you’ in a smaller team or one-on-one meeting. A team email or thank you note are other options that allow you to acknowledge an employee for their hard work.

Regardless of the method you select, offering words of gratitude to an employee for their efforts and acknowledging the value they’ve added to the team or organisation shows you’ve not only noticed their success but value their contribution. It shows that you understand their effort is worthwhile and important.

3. Social media

Many modern recognition programmes also use internal social media, such as recognition-specific tools or apps, to instantly recognise employees who go the extra mile. Managers and peers can single out high performance, with the results displayed on the staff intranet or organisation’s social channels so that anyone can see them.

4. Career progression 

Many employees are highly motivated, so offering an opportunity to design a career progression plan to help an employee reach their goals is another way to recognise outstanding performance. Sitting with an employee after their annual review, for instance, to determine how they can position themselves for a future promotion can be very meaningful. It shows you are invested in their future, while acknowledging their strong performance in the here and now.

5. More challenging tasks

Not everyone is motivated by a promotional pathway though. For other employees, the opportunity to work on more challenging or varied work and expand their skills may be more meaningful. Or perhaps you could consider giving them the opportunity to lead a project or scope out an identified opportunity for growth.

6. Merit-based promotions

It’s important to continue to acknowledge and action merit-based promotions, even when budgets are tight. While you may not be able to offer a pay rise, you should still honour any pre-arranged commitment to promote an employee who has met the targets and objectives required to qualify for advancement. Failing to keep your word by not recognising such a success would demotivate an employee who has worked hard to be eligible for a promotion and may potentially create an engagement and retention risk.  Furthermore, it could have wider-reaching effects, such as by harming your employer brand and reputation in your market.

7. Learning and development 

No one wants to feel that their skills are stagnating. Therefore, offering ongoing learning and development opportunities can be a great way to reward top performers. There are various ways this can be achieved, such as through coaching, a mentorship, the chance to sit in on important meetings, cross-collaboration with another department or a stretch opportunity.

Taking on additional responsibilities allows you to reward an employee in a way that will aid their longer-term career. They can learn new skills, hone others and gain exposure that will aid their promotional prospects or help them do their existing job even better. At the same time, you can encourage the development of skills that are in short supply within your team, thus helping you to overcome any skill gaps, which is a win-win for both you and your employee.

8. Flexible working options

Flexible working options are very important to today’s skilled professionals. Many people have experienced remote working, for instance, throughout the COVID-19 lockdown, and have come to see the benefits it offers.

But flexible working does not only encompass remote working. You could also consider rewarding a top performer with flexible working hours or flexible leave options. Part-time employment and job sharing are other examples of flexible working in action.

While not all workplaces can offer all these strategies, for those that can it is a strong benefit you could provide in lieu of financial recognition and reward.

9. Work-life balance 

For many people, receiving additional time off to spend with their family or friends, or on social or leisure activities, can be highly rewarding. After all, if time is money, then this could be an ideal middle ground when financial rewards are unavailable.

You could, for instance, offer a top performer the opportunity to take an afternoon off or have a long weekend. Offering an additional day of annual leave each year is another option. Such staff rewards help your employees feel that their efforts have been recognised while giving them an opportunity to rejuvenate, which is particularly important if they’ve just completed a complex or all-encompassing project.

Final points to keep in mind

  • When you are considering how to reward your staff, remember that recognition can come from many people, including the managing director or department head, peers and even customers.
  • The level of reward you give an employee should correspond to the performance you wish to recognise and continue to encourage. A free coffee can acknowledge a quick win gained by handling a customer enquiry in a particular way, but an afternoon off is more appropriate for a team who worked overtime to meet a set deadline.
  • Before offering any recognition, make sure you are clear about what you are recognising someone for. While you can acknowledge their results, also recognise how they went about achieving it. That way, you reinforce the behaviours that led to the successful outcome and allow others to understand how to achieve a similar result.
  • Recognition should also be fair. There should be a clear criterion to determine who is rewarded and employees must understand exactly what is required to qualify for recognition.

 

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