December 12th 2022
By: Benjamin Lafrenière-Carrier

The art of saying thank you

In a context of increased competition, financial pressures associated with inflation and where the labour shortage means that employees have more than ever the possibility of choosing their employer, the question of employee recognition has never been so topical. It is a lever that allows an organization to stand out without significantly increasing its payroll expenses. According to Brun and Dugas (2008), this practice, which is necessary for the well-being of employees at all levels, involves an interaction rooted in respect, in which appreciation is communicated, with or without an associated reward, for the person himself, the results he achieves, the professional practices he adopts or the commitment to work he demonstrates (Brun and Dugas, 2008). According to many, this is an important driver of commitment and motivation at work, which can in turn have a positive influence on organizational performance (Brun and Dugas, 2008; Luthans, 2000; Masri, 2019).

Activating this lever is not as simple as handing out a few blanket compliments to every employee. For recognition to be meaningful, the employee must be able and willing to receive and value it, which inevitably calls for a contextualized approach. With this in mind, some thoughts based on adjacent fields of activity are suggested to guide efforts in this direction.

A Question of Needs to Be Met 

A first approach involves considering recognition as a component of total compensation, which then becomes an element that contributes to the value proposition that an organization is able to offer its employees. Thus articulated, this practice is part of a larger system that must also be considered, especially if we consider that the different components of compensation are called upon to meet distinct needs (in the sense of Maslow, 1943). In other words, even if it does not allow certain basic needs to be met, which must instead be targeted by other components of total compensation, recognition allows certain psychological needs to be met. This has been observed by some authors, who associate recognition with positive psychological impacts and well-being (Merino and Privado, 2015).   

Figure 1: Recognition and needs (inspired by Maslow, 1943)

Decreasing Marginal Utility

Although it is essentially intangible in nature, recognition is also not immune to the economic concept of diminishing marginal utility (Horowitz, List and McConnell, 2007). According to this concept, each additional consumption of a good or service provides a lower level of satisfaction than the previous consumption, as illustrated by the following example:

George is hungry. You offer him a plate of berries and George appreciates it greatly. You offer him a second plate of berries and he enjoys it since he is still hungry. You offer him a third plate of berries and he is satisfied, but not as appreciative as the first two handfuls. (…) you offer him a twentieth plate of berries and shows no satisfaction because he is no longer hungry.   

In the case of recognition, the first compliment an employee receives, especially if it meets one of their needs, is likely to have a great deal of importance for the employee and therefore a great influence on how they feel. However, if you offer the exact same compliment or form of recognition every day for a month, the initial satisfaction could become an irritant.

An Adapted Recognition

Then, how can we properly dose and align the recognition offered to an employee? Unfortunately, there is no single recipe, and in order to ensure that the alignment and dosage are as fair as possible, one must inevitably get to know the individual and their needs. Similar to the different approaches that can be used to engage an employee, some forms of recognition will be better received by an employee because they are more in line with their values and deep identity. Around what subject (work, people, efforts, outcomes), using what medium and in what way should a given recognition be articulated? The answer depends largely on the recipient’s preferences!

Ultimately, the exercise goes well beyond the formal practices or process implemented for performance management. It is transmitted through the relationship between a supervisor and their employee (or even between two employees) and, in a way comparable to best practices in leadership, must have a form and frequency that are adapted to the situation and the recipient. It is a relationship that can hardly be rushed: one must take the time to get to know the other and then understand what will work best with them in terms of recognition if it is not to be perceived as artificial and devoid of the authenticity that makes it so valuable.

 
Benjamin Lafrenière-Carrier, B.A.A., CRHA

Senior Consultant, Talent Management at EPSI
Ph.D Candidate in Industrial Relations at the Université du Québec en Outaouais

References

Brun, J. P. et Dugas, N. (2008). An analysis of employee recognition: Perspectives on human resources practices. The International Journal of Human Resource Management, 19(4), 716-730.

Horowitz, J., List, J. et McConnell, K. E. (2007). A test of diminishing marginal value. Economica, 74(296), 650-663.

Luthans, K. (2000). Recognition: A powerful, but often overlooked, leadership tool to improve employee performance. Journal of Leadership Studies, 7(1), 31-39.

Masri, N. E. et Suliman, A. (2019). Talent management, employee recognition and performance in the research institutions. Studies in Business & Economics, 14(1).

Merino, M. D. et Privado, J. (2015). Does employee recognition affect positive psychological functioning and well-being?. The Spanish journal of psychology, 18.