Principles of Organizational Behavior, 3rd Edition

12Recognizing Employees

JEAN M. PHILLIPS, KATHRYN E. DLUGOS, AND HEE MAN PARK

School of Labor and Employment Relations, Penn State University

Employee recognition is the explicit acknowledgment and praise of employee behavior, outcome, or achievement that appreciates, rewards, and motivates them. Providing recognition to employees outside of the employer's financial compensation system for exceptional performance, for demonstrating behaviors consistent with organizational culture and values, or for making sustained contributions to their workgroups or to the employer can enhance motivation and engagement. Although competitive pay and bonuses are important motivators, recognition, in its many forms, is another essential motivator desired by employees. Recognition from the employer, supervisor, peers, and even customers can improve customer service, profits, and employee retention (Peterson and Luthans, 2006). Effective recognition programs help to not only increase employee satisfaction and retention, but also improve organizational productivity and performance (Appelbaum and Kamal, 2000). Thus, recognition programs are of strategic importance for organizations and are often viewed as one of the core elements of a high-performance work system (Chuang and Liao, 2010). As one expert explains, “Recognition is often invisible in nature and yet priceless in value. You can give recognition without giving a reward. You should never give a reward without giving recognition” (Saunderson, ...