It’s not about the money

Employee engagement is all about the ‘little things’. Studies show that yes, organizations must pay employees enough to be in line with industry standards - but beyond that, financial compensation is not a strong long-term motivator for employee engagement. According to author, Stan Phelps employee engagement is about everything else: All the actions beyond compensation that demonstrate to your employees that you value their contributions. Ultimately though, it’s about feelings and emotions.

It’s about feeling valued

It turns out, the feelings and emotions of your employees matter more than you probably think. Ad executives know something critical to employee engagement: buying decisions are 80% emotional and 20% rational. According to organizational performance expert Paul Herr, the research in neuroeconomics shows that your employees make decisions the same way - an employee’s decision to work hard, slack off or find a new job is also 80% emotional.

High-achieving companies have an engagement strategy in place that associates fun and good feelings with employee contributions. They are giving employees what Herr calls an ‘Emotional Paycheck’, so that employees feel appreciated, recognized, valued, and respected for their hard work. One of those good feelings absolutely has to be a feeling of organizational fairness that occurs when recognition and reward is earned through individual performance.

It has to be fair

Employees thrive and reach top performance in companies that demonstrate fairness in recognizing employee contributions. This is made clear in the Reward Fairness-research report from WorldatWork. The report stresses just how crucial a feeling of fairness is to employee engagement stating, “…practices that are not perceived as fair will not successfully attract, retain and engage employees”. Researchers asked 5000 professionals from various industries to identify the most important determinant of fairness for rewards and recognition. The results show that employee recognition and rewards must be based on individual-performance for organizations to be perceived as fair by their employees. In fact, the study showed that basing recognition and rewards on individual performance is by far the most important determinant of organizational fairness by employees. In other words, to be perceived as fair, your engagement strategy must emphasis individual-performance above everything else.

Recognize individual-performance to promote collaboration

It is surprising but true that recognizing individual-performance is essential to encouraging collaboration and teamwork. This is because fairness starts with recognizing individual contributions first and teamwork second. If employers encourage and recognize teamwork without also acknowledging individual contributions then employees perceive the recognition as unfair. It feels unfair because employees that really step up get treated the same as employees that coast along or even detract.

Using this information as a guide organizations can find new ways to include regular recognition of individual employee and team contributions. RedCritter Connecter is a great way to make this happen.