Employee Gifting: How to Recognise Performance Beyond “Employee of the Month”

The traditional “Employee of the Month” model was a simple way to recognize employees, but it has significant limitations in today's fast-paced, collaborative work environment. In modern organizations, recognition must be frequent, distributed, and relevant to a diverse workforce. Let’s explore how to adapt recognition programs for 2025 and beyond, with real-life examples and actionable insights.

Why Traditional Recognition Falls Short?

Traditional recognition models have three common problems that impact their effectiveness:

1. Limited Reach

Problem: Employee recognition is often confined to a small group of individuals. In a traditional “Employee of the Month” program, only one employee is selected out of a larger pool of employees, which means only a few individuals get recognized, leaving many others feeling overlooked.

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At a major U.S. retail chain, the “Employee of the Month” award was once a popular practice. However, with thousands of employees spread across hundreds of locations, only a small fraction were ever recognized. The company noticed a drop in morale among those who were not selected, leading to frustration and a feeling of exclusion. This caused engagement levels to dip significantly.

2. Perceived Bias

Problem: Traditional recognition often appears subjective. Employees may perceive the award as being based on favoritism, politics, or personal relationships rather than objective merit. When employees feel recognition is not earned fairly, trust erodes.

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A global tech company decided to assess their employee recognition program after receiving feedback that it felt biased. Managers were often choosing the “Employee of the Month” based on their visibility within the company, not necessarily on performance or contribution. This led to discontent and a feeling of inequity across various departments.

3. Delayed Feedback

Problem: Recognition in the traditional sense happens infrequently, usually at the end of the month or quarter. Delayed recognition means employees don’t get immediate feedback, which reduces the impact and effectiveness of the gesture. Employees are motivated by real-time recognition, not just retrospective acknowledgment.

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At Zappos, one of the most well-known examples of modern recognition, employees are praised immediately for their efforts through a peer-to-peer recognition system. This immediate reinforcement has led to a culture of positive reinforcement and high engagement levels.

Moving to Continuous, Distributed Recognition

The key to adapting to modern organizational culture is to decentralize and distribute recognition, making it frequent, inclusive, and aligned with business goals. Here’s how you can implement continuous recognition:

1. Peer-to-Peer Recognition

A shift from manager-only recognition to peer-to-peer recognition is essential. Encouraging employees to acknowledge each other for their contributions fosters a culture of shared appreciation and inclusion.

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At Salesforce, employees can send each other “thank you” badges via their internal social platform. These badges are visible to the entire company, creating a culture of appreciation that is not dependent on just one manager’s judgment. In fact, Salesforce’s peer-to-peer recognition has helped improve employee engagement and foster a deeper sense of community.

2. Micro-Rewards and Regular Acknowledgment

Employees should be recognized on a regular basis, not just once a month or year. Introducing micro-rewards, such as points or credits, for smaller contributions can add up over time and encourage consistent high performance.

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Insight:
According to a Gallup study, organizations with frequent recognition and feedback see a 14% increase in employee productivity. Micro-rewards can be tied to small wins like completing a project, offering help to colleagues, or hitting daily or weekly goals. Employees feel appreciated more often, which leads to a higher level of engagement.

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Adobe implemented a system called “Check-In”, which replaces the traditional annual performance review. Managers give regular feedback on employee contributions, and employees are able to earn rewards for achieving personal and team goals. This shift away from annual reviews has resulted in higher satisfaction levels across the board.

3. Visible Recognition on Internal Platforms

Visibility is crucial in ensuring recognition feels authentic. Make sure that recognition is visible across the organization through internal platforms, like intranets, Slack, or recognition portals. This amplifies the impact of the recognition and reinforces a positive culture throughout the company.

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At Accenture, employees are encouraged to use their internal tool to give recognition to colleagues. Once an employee is recognized, their achievements are celebrated across the company, ensuring that everyone sees who is excelling. This visibility reinforces the company’s values and motivates others to adopt similar behaviors.

Tying Gifting to Behaviours, Not Just Outcomes

Modern employee recognition should focus on behaviors as much as outcomes. While hitting sales targets or completing projects is important, recognizing ongoing behaviors that align with company values creates long-term engagement.

1. Collaboration and Teamwork

Recognize employees for cross-functional collaboration. In today’s work environment, many high-value projects require input from multiple departments. Recognizing employees who foster teamwork encourages others to collaborate.

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Spotify acknowledges employees who go above and beyond to collaborate with different teams, especially when they help solve complex problems. Employees can earn collaboration badges for successfully completing joint initiatives.

2. Innovation and Problem Solving

Encourage employees to think creatively and recognize those who solve difficult problems or contribute to innovation within the company. Rewarding innovative thinking nurtures a culture of problem-solving and continuous improvement.

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At 3M, the company fosters a culture of innovation by rewarding employees who contribute breakthrough ideas. “Innovation rewards” are given for new ideas that solve significant challenges or lead to major improvements in processes or products. This has led to high levels of employee retention and a reputation for innovation.

3. Customer-Centric Actions

In customer-facing roles, recognize actions that go above and beyond to support customers. Customer-centric behavior encourages employees to be empathetic, responsive, and proactive, which ultimately boosts the company’s brand reputation.

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At Zappos, employees are encouraged to go the extra mile for customers, such as extending return windows or personally connecting with customers. Zappos has created a “WOW” award to recognize employees who do something extraordinary for a customer. This recognition has built a loyal customer base and increased employee satisfaction.

4. Mentoring and Inclusion

Mentorship and diversity are pillars of modern organizational culture. Recognize employees who mentor others or contribute to creating a more inclusive environment.

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Google has a well-established mentorship program where senior leaders provide guidance to newer employees. Those who go above and beyond to help others are recognized as “Inclusion Champions” within the company, reinforcing the value of diversity and inclusion.

Give Employees the Power to Choose Their Own Rewards

A modern employee gifting program allows employees to choose their rewards, rather than receive standard, one-size-fits-all gifts. A reward store gives employees the freedom to select rewards that match their personal preferences, making recognition feel more meaningful.

1. Customization & Flexibility

With a reward store, employees can choose from a wide array of rewards, including experiences, gadgets, learning opportunities, and wellness items. This level of customization ensures that employees feel their individual needs and preferences are considered.

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At Accenture, employees are given the option to choose their recognition reward from a curated reward store. Options include gift cards, experiences like concerts or spa visits, and learning programs to support career growth. The flexibility has led to greater employee satisfaction with the recognition process.

2. Global Consistency with Local Relevance

For global companies, it’s critical to ensure that the recognition system feels consistent across different regions while also being locally relevant. A reward store can support regional preferences, allowing employees to choose rewards that align with their culture and location.

Benefits for HR, Finance, and Leadership

A structured employee gifting platform powered by a reward store offers numerous benefits for HR, finance, and leadership:

1. Tracking Participation and Sentiment

HR can track which employees are being recognized, how often, and for what behaviors. Insights into engagement levels can help HR refine recognition strategies and align them with company values.

2. Clear Visibility into Spend and ROI

For finance teams, understanding how much is being spent on recognition and whether it’s driving positive business outcomes is critical. A reward store offers real-time visibility into spend and ROI on recognition initiatives, ensuring the budget is aligned with financial goals.

3. Reinforcing Company Values

For leadership, recognition is a powerful tool for reinforcing company values. By recognizing the right behaviors, leadership can create a culture that prioritizes things like collaboration, customer-first thinking, and inclusion. This is key to creating a workplace culture that attracts top talent and retains high performers.

Moving Beyond "Employee of the Month"

Employee recognition has evolved beyond outdated models. Instead of spotlighting one employee once a month, modern recognition programs are continuous, inclusive, and tied to company values. By offering personalized rewards and leveraging the flexibility of reward stores, organizations can build a culture of continuous recognition that drives engagement, motivation, and performance.

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It’s time to move beyond “Employee of the Month” and embrace a system that celebrates everyone, everyday.

About The Reward Store

The Reward Store helps organizations build modern recognition programs with:

• Peer-to-peer recognition tools
  
  
• Micro-rewards that can be given regularly
  
  
• Flexible reward catalogues for personalized employee gifting
  
  
• Real-time analytics for tracking recognition and ROI
  
  

Visit The Reward Store to learn how we can support your employee gifting and recognition initiatives.

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