Every small business should make it a point to recognize its team members and the value they provide to the company. Team recognition will improve employee morale, helping you retain employees and potentially improving the customer experience. It will also make your company attractive to new
talent.
Explore the importance of team recognition and some best practices to ensure that your team members know they are valued.
Recognition vs. Appreciation
Most people use the terms appreciation and recognition interchangeably when it comes to employees, but there are technically some differences.
Recognition looks at what someone does, while appreciation looks at who they are. So, appreciation praises your employees for the inherent value they provide, letting them know that they are worthy. By contrast, recognition is more performance-based and looks at tasks or projects completed. It is also limited and comes from the top of the organization.
While those differences technically exist, we follow the general use of the terms, and appreciation and recognition are used mostly interchangeably in this article. But even just knowing that the two terms refer to slightly different situations is helpful. With that, you will better understand that there are multiple scenarios you can show your employees that they are valued.
Recognition Boosts Engagement and Productivity
Employees who feel appreciated have higher rates of engagement and productivity. Remember that engaged employees are more likely to be aligned with the company’s goals and core values. They are also more likely to be willing to put in the effort to reach those goals. Nearly 70% of employees would be willing to work harder if they felt more appreciation. And employees who expect recognition are 2.7 times as likely to be highly engaged.
In fact, 85% of companies that spend at least 1% of their payroll on employee recognition notice a boost in engagement. Or consider that companies with strong employees for employee recognition are 12 times as likely to experience strong business outcomes.
When employees know their efforts will be recognized and appreciated, they are more willing to put in additional effort. This results in higher productivity.
Employee Satisfaction Improves
When you recognize your team’s skills, they tend to feel more valued. This will improve their satisfaction with their job, which in turn reduces absenteeism and stress. You will have a lower risk of employee burnout
and other mental health issues. Consider that companies with recognition programs have frustration levels that are 28.6% lower than those without these programs.
Note that people who feel recognized at work are twice as likely to become employees who go above and beyond. They are 2.2 times more likely to report that the company embraces innovative thinking. And they are 2.6 times as likely to believe that promotions are fair.
 It Is One of the Easiest, Most Cost-Effective Ways to Improve Productivity and Morale
Employee recognition boosts productivity, engagement, and employee satisfaction. More importantly, it is one of the easiest and most cost-effective ways of achieving these goals. That makes it great for your bottom line — especially if you have a small business with modest margins.
“The #1 reason employees leave their job is because they do not feel appreciated.”
(Gallup, Tom Rath and Donald Clifton, How Full Is Your Bucket? Positive Strategies for Work and Life, 2001)
Recognition Improves Employee Retention
A natural result of your employees being happier at work is that they are less likely to leave. Recognition also improves employee loyalty to your company, further improving employee retention.
Employee retention saves you the costs of hiring and training new talent. It also prevents the loss of internal knowledge about your business. This is a key issue for small businesses having only one or two people in each role.
One study found that businesses with recognition programs have voluntary turnover rates that are 31% lower. And consider that lack of recognition is the top reason people leave their job.
It Attracts New Talent
Attracting the right talent is harder than ever before. Turning your employees into brand ambassadors will exponentially benefit your talent pool. Potential employees will be more attracted to your business if they know you value your workforce. Tangible recognition, such as incentives and awards, can provide an obvious appeal. But even just knowing that your employees are happy can be enough to encourage them to choose to work for you.  READ MORE ABOUT ATTRACTING THE RIGHT TALENT
You Will Have a Better Team Culture
Employee satisfaction also helps produce an improved team culture. People will feel more confident in their skills and be more inclined to work together. Creating a culture of recognition and praise can encourage your team members to praise each other, further improving inter-employee relationships.
Your Company Could Win Awards
While it shouldn’t be your primary goal, a bonus of a strong employee recognition program is the potential to win an award for that program. That can be a huge boost to your company’s reputation, both among customers and potential employees.  Winning awards can catapult your brand’s credibility.
Customer Satisfaction Increases
When your employees are happier and more productive, customer satisfaction also improves. Employees who feel valued are likelier to go the extra mile to deliver good customer service. This can boost your company’s reputation and help you boost sales.
Learn More:
Sources:
https://hbr.org/2019/11/why-employees-need-both-recognition-and-appreciation
https://www.greatplacetowork.com/resources/blog/creating-a-culture-of-recognition
https://www.quantumworkplace.com/future-of-work/importance-of-employee-recognition
https://topworkplaces.com/employee-recognition-benefits/
