Do You Know the Difference Between Reward and Recognition?
by Sharon Day,posted Jun 26 2013 9:34AM
Although many times the word reward is synonymous with prize and gift, when it comes to your employees it means something quite different. Simply stated employees should be rewarded, i.e., compensated, for the job they are required to do. Once agreed upon personal benchmarks are achieved, they are then recognized for those achievements.
Below are three of my philosophies on this subject in the spirit of provoking thought and helping to eliminate confusion, disinterest and distrust amongst the team.
1. Always think of rewarding your employees for helping you achieve the growth you desire. Looking at it that way you’ll put together a compensation package based on what you expect them to contribute. This would be explained in detail during the interview process, certainly well before extending an offer of employment. Employees, especially sales people, must understand the correlation between their pay, performance expectations and your goals. Sellers who can’t easily figure out how to calculate their commissions rarely produce at the levels you’d desire.
2. If you’ve modified your company’s key goals for the coming year make sure your commission structure clearly reflects those changes. For example, if business development is critical to your growth, pay/reward new business with higher commissions. Be clear as to how you define new business. Remember sellers do the things they’re paid/rewarded to do; and, how they’re paid proves to them what you really value. Meaning, if you claim to value new business which requires much effort but pay that at the same rate as existing business, there will be a disconnect and you’ll struggle to motivate the team.
3. Another way to think about this is reward equals compensation commensurate with contribution. Every employee contributes something. Some employees must endure greater stress, pressure, extended hours, etc., all of which factors into their contribution. So when approached by non-sales employees who want to be considered for sales your reply might be: “That’s great, I’d enjoy speaking to you about that. Let me tell you a bit about how different a sales role will be from what you currently do. You’ll agree to a monthly, quarterly and annual goal that you’ll be expected to meet. You’ll also be expected to do whatever it takes to develop new business – meaning reaching out to people you don’t know, networking, long hours, nights and weekends attending events, etc. So, think about it for two more days and if you’re still interested, let me know.” 95% of the time they never pursue it further. The ones that do are worth taking to the next step.
As for recognition, well that’s what we give when someone attains a desired goal or, better yet, over delivers somehow. Recognition can be public and/or private depending on the employee’s preference and should be something meaningful to them. Not a watch because you’ve always given out watches, but a watch because that’s what they really want. Have a conversation with everyone on your team to discover what motivates or is important to him or her. A former seller once told me that all she’d want is for me to let her father know. Wow, that’s powerful stuff that’s easily provided. Recognition is meaningfully personal and completely separate from compensation/reward.