The Psychology of Employee Recognition vs. Reward

The human brain craves recognition, it thrives on it. When we receive recognition, it stimulates the hypothalamus (the part of our brain that controls our metabolism and stress levels) and increases dopamine production (the chemical that causes happiness) to improve the quality of our work and our productivity. In fact, 40% of employed Americans say they’d put more energy into their work if they were recognized more often.

It seems simple enough, right? If we recognize our employees, they’ll work harder and be more likely to stick around. But if that’s the case, then why do 82% of those employed Americans also feel that their supervisors don’t recognize them enough for their contributions?

Recognition vs. Reward

Acknowledging the success of our employees comes in two forms: recognition and reward. And by using each of them correctly, then the formula for retaining hard-working employees becomes simple. But what is the difference between the two and how and when should you use them?

By definition, recognition is the acknowledgement of achievement, service, or merit. A reward is a thing given in recognition of one’s achievement. But there’s more to it than that.

Rewards are tangible; recognition is intangible.

Rewards are something you can touch, feel, or experience — a bonus check or a new pair of AirPods. Recognition is invisible. It comes in the form or words or emotion and is just as valuable.

Rewards are impersonal; recognition is personal.

The tangible nature of rewards makes them less personal. However, recognition is all about human connection. These words of affirmation celebrate your employees for what they do and builds trust and between your workforce and their managers. You can always make a reward more personal by combining it with recognition.

Rewards are data driven; recognition comes from behavior.

Rewards should be given when an employee reaches a quantifiable goal, like three years at the company or crushing their quota. Recognition is earned when a manager sees an employee going the extra mile or having a good week.

Rewards are infrequent; recognition shouldn’t be.

While rewards should only be given when an employee reaches a desired outcome, recognition can and should be given more often. It can take place anytime a manager notices positive behavior.

Recognition=Retention and Success

As you can see, while it’s necessary to reward your employees for all their hard work, it’s purely recognition that your employees crave. Research has found that 79% of employees who quit their jobs claim that a lack of appreciation was a major reason for leaving. And improving recognition such an easy way to combat that.

At ZiZo, we help you get a handle on rewards and recognition. Our business intelligence dashboard allows you to keep an eye on your data, making it easy to recognize if an employee is having a particularly stellar week so you can congratulate them accordingly. And with our workplace gamification platform, your employees can see exactly where they are in their progress towards a goal (and ultimately a reward), motivating them to work harder to reach that tangible recognition