Reward vs recognition: What works best when motivating employees?

When it comes to employee motivation, recognition is usually the best way to go. A 2015 study even showed as much, with recognition being the number one most important factor in motivation. This is before tangible rewards or an incentive program. Recognising your employees is the best way to get the most out of them.

However, it’s not the only way. Reward programs have their place in workplace culture and can also be a way to motivate your employees. So, the question becomes, which is best suited to keeping your employees engaged and motivated — reward or recognition?



Having an incentive programme is about celebrating an employee’s achievement with a tangible reward. Something like a gift card, an extra day off or a box of chocolates. All these are technically rewards. However, the real difficulty of an incentive programme is that rewards are fixed, unlike recognition.

The effort of the task becomes tied to the reward itself, where if the reward is not enticing enough you may not get the most out of your employee, and therefore there is no real guarantee of motivation. Instead, a reward fixes a short-term motivation problem, resulting in a short term positive outcome. If you’re looking to motivate employees towards a certain KPI then a rewards programme is perfect, but for long term engagement, a rewards programme is unsuitable & often unsustainable.

When is a reward suitable?

A rewards programme is more suited to a sales-based role, where you can directly correlate the reward to a set goal, often making it more financially viable. Having an incentive programme is good for a short-term goal, such as motivating employees to finish a task by a certain deadline or motivating a sales team to increase their numbers during a slump, but rewards can often be seen more as expected rather than earned.

Rewards should not, however, be ignored completely in any industry — they just shouldn’t be your sole tool for motivation. Reward programs are inherently impersonal, and so for less target driven sectors, a more personal reward system is needed.



Employee recognition basically boils down to showing people your appreciation for the work they do. Employee recognition doesn’t have to include a reward and in fact, it often doesn’t. Employee recognition is entirely intangible but is instead a social reward.

Broadly speaking, recognition falls into two categories: personal and social recognition. Personal recognition shows that you care about the employee on a personal level, celebrating their success. Social recognition enforces the employee’s role and status within the group, in relation to their peers. Both have benefits but generally, recognition is the best way to enforce not only a positive working attitude, but also to instil corporate values into your employees. We’ve all heard about ‘companies that care’. Well, a recognition scheme is a way to prove that you notice and appreciate hard work and want to celebrate each others successes.

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When is recognition the way to go?

As you often hear, humans are essentially group animals. We crave recognition for our efforts, to appear better for our peers. Patricia Odell cites “cash is no longer the ultimate motivator” in response to a study, whilst Gallup found that employees who felt they were not recognised for their achievements were twice as likely to leave.

If you are looking for a long-term solution to employee motivation, then an employee recognition scheme is the best way to go. It’s more effective than an incentive programme for motivating staff and is a good way to improve peer to peer relations, as publicly acknowledging achievement not only motivates the individual, but also provides an ideal to strive for.

It all comes down to human’s innate desire to be noticed. We fit within social hierarchies and generally crave the recognition of both our peers and our superiors. Having your supervisor notice your hard work, or compliment you on your increased performance is a simple but effective way of fulfilling that desire. It increases our social comfort and decreases feelings of anxiety. Essentially, by telling people they are doing a good job, you raise their self-esteem which causes happier, more confident and more productive staff.


Reward vs recognition: Which is better?

In general, rewards programmes simply don’t offer the long-term effects that a recognition programme offers. Recognition supports successful employees whilst motivating their peers to work harder. Simple things like praising an employee while in earshot of others, or praising them in a meeting, is a simple way of providing recognition to employees. What’s more, a recognition programme is generally cheaper to implement than a rewards programme but can be invaluable when it comes to productivity and staff morale.

Companies with employee recognition programmes have a 31% lower voluntary turnover and report that employees are happier on average. Personal recognition helps with employee confidence and ensures that you recognise a job well done. Social recognition has broader, more cultural benefits.

Peer-to-peer recognition or creating a culture of recognition within the company is also a vital part of implementing an employee recognition programme. By including other employees within the recognition, you expand the circle of those that are actively recognising good work from management to the entire workforce. It makes recognition a part of workplace culture and engages others with the programme. When recognition is free-flowing, productivity and employee satisfaction increases.

Incentive programmes don’t offer this. Instead, incentive programs can actively harm motivation and create an atmosphere of ‘expected rewards’. However, this doesn’t mean that rewards are entirely unhelpful. Working an incentive programme into your recognition programme can help actively enforce the benefits of recognition. Whilst rewards are impersonal, recognition is personal and by combining the two, you allow for your reward programme to become about recognising achievement. This can not only help you to ingrain recognition into your work culture, but also reinforces the motivation to keep working hard.


Get the right technological tools to help

Consider all of these elements when thinking about motivating your employees. You want to find an effective and long-term strategy that will improve productivity without costing you too much in the long run.

The right technological tools can help. Employee recognition platforms can be used on a web browser or via a mobile app to help implement a culture of recognition throughout your company. These platforms provide a way for managers to post about employees’ achievements on a social feed that the entire company has visibility over. This also makes peer-to-peer recognition easy too, as employees can acknowledge and celebrate each other’s achievements. Not only this, but like a social media platform, employees can even “like” and comment on posts — without the distraction that actual social media can cause at work.

These platforms can also provide a way to track employees’ achievements and reward them with certain benefits like discounted gym memberships or time off work. These small perks can keep your employees motivated and productive, which also helps ensure your employee retention levels don’t drop.

If you choose to use a tool like this in your organisation, ensure you do your research on what you want and get the right customisable fit for your exact recognition needs!

An employee being recognised for good work

An employee being recognised for good work