A well-designed rewards and recognition program is a catalyst for employee and organizational success. By tailoring these programs to the unique expectations of each generation, employers can inspire and motivate, leading to increased productivity and a more positive work environment. - BY Joseph Warren

The practice of rewarding and recognizing employees is an effective strategy for motivation and retention. It celebrates achievements, motivates high performance, and promotes a positive, engaging workplace culture. However, the 'one-for-all' program approach has become outdated.

With the rise of multigenerational workforces, adapting to the changing times is crucial. By 2023, it's estimated that up to 80% of global organizations will have a multi-generational workforce, each with unique expectations about the rewards and recognition characteristics that hold the most value. Understanding these differences and building a rewards and recognition program that motivates and engages all generations is key to attracting, engaging, and retaining employees.

Focusing on Employee Engagement

A multigenerational workforce is increasingly common in today's global economy. While specific percentages vary by country and industry, a large majority of the global workforce is multigenerational. Generations include baby boomers, Generation X, millennials, and Generation Z working together. Each generation values recognition and rewards differently, making it challenging to develop a program that works for everyone. Employers must understand those differences to create clear, transparent criteria for recognition and rewards programs to ensure fairness and gain the most significant advantages for employees and the organization.

In summary, numerous studies on generational differences have found baby boomers value monetary rewards, public recognition, and plaques and awards. Generation X prefers a balance between monetary rewards and personal acknowledgment, which includes professional development. Millennials want frequent feedback and recognition, explaining the appearance of recognition programs and concepts like “nudges,” which could be short suggestions or reminders sent via text as positive feedback and behavioral reinforcement. Millennials want career growth opportunities, experiences, and social recognition. The youngest employee group, Generation Z, appreciates instant digital recognition, gamified rewards, and career progression.

A thoughtfully constructed rewards and recognition program is built on what employees need to have a great experience. Using only monetary rewards and awards is inadequate when people of so many ages make up the workforce now. Lack of recognition, especially associated with career opportunities, is a top driver of attrition.

There is a difference between motivating employees with compensation and benefits and engaging them as productive, satisfied, collaborative employees who understand how their work efforts contribute to organizational success. Pay and benefits are important, but are short-term motivators and cannot develop genuine employee engagement. In addition, small businesses may not be able to give regular raises. Still, employee engagement is just as meaningful to their employees as it is to the employees of global corporations.

Developing an Engaging Recognition and Rewards Program

The first step is developing a recognition and rewards program that works for a specific multigenerational workforce and identifying the workforce's unique characteristics. Some system elements will suit all employees regardless of age, and some should appeal to different generations. Analyzing the workplace demographics and gathering employee feedback on their needs and preferences delivers the data needed for decision-making. The generational differences explained earlier are only guidelines. Employers need to know what employees want and find commonalities across the generations. For example, perhaps all employees want recognition from managers, so a recognition and reward platform like Achievers or Bonusly may establish a good foundation. Digital platforms enable real-time recognition between employees at any level, encouraging inter-generational collaboration and allowing employees and managers to make the recognition public. The public acknowledgments are non-monetary rewards. Monetary rewards include the traditional salary increases and bonuses, but today, they also include gift cards that employees can use at their favorite store, restaurant, or venue. Experiential rewards are where opportunities to attend professional development opportunities are available. Flexible rewards let employees choose among reward options. Developing a mix of recognition and rewards resources works for a multi-generational workforce. In addition to digital platforms, personal recognition remains important, even in the digital age. Depending on the employee's schedule, leaders should hold one-on-one meetings, either in person or virtually. Team recognition is also crucial and can promote inter-generational collaboration. Remember, employee engagement and organizational culture are the top goals because they influence the success of talent management systems. One of the risks associated with hybrid and remote work schedules is excluding some employees from recognition opportunities. Organizational leaders also need to ensure all employees have equitable access to recognition and rewards opportunities, that cultural differences are considered, and that managers are trained to recognize and avoid biases in the distribution of recognition and rewards.

Think: Employee Experience

Given the different preferences across the ages, communication of the available benefits needs tailoring. For example, older employees may prefer email, while younger employees prefer texts. The rewards program can be structured to encompass all reward types, but it is the employee experience where the most flexibility appears.

Some employees may prefer tuition reimbursement and training opportunities, while older employees looking towards retirement have other interests. Some employees are more interested in work-life balance. Baby boomers are not interested in maternity leave, but they may need the reward of a flexible schedule for caregiving responsibilities.

Developing a culture of recognition and rewards incentivizes employees when the recognition and rewards fit generational needs. Some want money. Some want social recognition. Some want the opportunity to earn gifts. There are points-based recognition programs where employees earn points tied to designated recognitions. Points are redeemed for rewards with the most meaning. Some want professional development. Employers can engage employees in health and wellness programs through incentives or by giving them a choice of projects. In other words, employers can use their creativity to deliver the recognition and rewards that meet their employees’ needs.

Empowerment in Recognition and Rewards

Employers should always approach program development and implementation with flexibility. However, by understanding generational differences, establishing clear criteria, offering diverse rewards, personalizing recognition, promoting inclusivity, encouraging peer recognition, regularly reviewing the program, and communicating effectively, it is possible to create a recognition and rewards program that is fair, inclusive, and motivating for employees of all generations.