Are You Wasting Your Investment in Recognition?

Globoforce just released the results of a survey (request download here) completed by 150 middle- and senior-level human resources, finance and procurement personnel about CEO perceptions of recognition programs as they relate to corporate objectives within their organizations, as well as the human resources reality of these programs.

The survey revealed a tremendous waste of resources as recognition programs fail to meet CEO needs and do not contribute to company strategy. Organizations still have a long way to go in aligning recognition programs with their company’s mission, values, strategic objectives and goals.

Key findings included:
• A clear majority of HR respondents (88 percent) believe their recognition programs
need improvement and that their CEO would agree.
• While an encouraging 58 percent of HR leaders believe their CEO would say their
recognition programs reinforce the strategy, values and appropriate behaviors of
the organization, an alarming 42 percent say their programs offer no strategic
benefit to their organizations, indicating a tremendous waste of resources and
misappropriated recognition dollars that have no effect on employee engagement and
motivation.
• Overall, HR leaders (45 percent) feel their programs fall short in driving bottom-
line results. Why?
o A staggering 42 percent of all organizations surveyed are not measuring their
program’s results in any way, leaving CEOs in the dark on the effectiveness and
true value of their recognition programs and effectively wasting the money
invested.
o These recognition programs are not designed to deliver against CEO requirements
-- aligned with strategically relevant objectives and mission as well as the
company values.

One way these issues could be resolved is by giving HR a strong seat at the executive table. Workforce Management recently reported:

Many HR leaders report recent progress in increasing HR’s strategic role, often as the result of new management refocusing HR operations on more business and mission-critical activities. Additionally, the study found companies that recognize HR’s strategic importance also tend to report higher levels of satisfaction with the entire HR function, including non-strategic transactional activities.

EquaTerra Global Research managing director Stan Lepeak, who co-authored the study with executive director Lowell Williams and managing director Brad Everett, said that the sizable minority of companies that don’t recognize HR’s strategic potential are putting themselves at an increasingly serious disadvantage.

“I would think the need [for strategic HR] is exacerbated by the economy,” Lepeak said. “Organizations are in turmoil, some of them are on the edge of bankruptcy, executives are being pushed out. How do you recruit new talent when you’ve got a tarnished image, or keep from losing all your best people? How do you keep productivity up? You should be looking to HR to help address these problems, and to put in changes that can keep them from happening again in the future.”

One reason HR may be designing recognition initiatives that don’t meet CEO expectations is because they simply do not know those expectations because they aren’t invited to the table. HR needs to prove their worth, show the value of their initiatives in a way their CEO cares about, and take that seat.

What’s your take on your own recognition programs? Does your CEO approve? Are you gaining strategic advantage from your recognition efforts? Be sure to take our weekly poll.