Improving and sustaining performance through rewards

Performance of an employee can be determined by assessing the results with the initial target assigned to the employee. A good performance is when the results meet or exceed the initial target. It is comparatively easy to assess and reward performance as its results are easily visible.

Every employee expects a good performance appraisal in return for the dedicated services they have rendered to the company.

As an employer, you need a strategic performance appraisal strategy as well as a rewards and recognition system for your employees, which addresses these four essential aspects:

  1. Benefits
  2. Compensation
  3. Recognition
  4. Appreciation

Most companies incorporate rewards and recognition in their yearly performance appraisal reviews, but the outcome is usually ineffective. Various problems plague the rewards and recognition policies in today’s workplace. The most prevalent of these are:

  • Companies miss out on addressing at least one of these essential aspects — generally, appreciation and/or recognition.
  • Even if the aspects get addressed, they are not in proper alignment with the corporate strategies of the company.

Behaviour and performance

The crux of an effective performance appraisal system lies in recognising and rewarding two of the most important tenets of an employee — performance and behaviour. These two features determine whether the employee becomes an asset to the organisation or a liability.

Performance of an employee can be determined by assessing the results with the initial target assigned to the employee. A good performance is when the results meet or exceed the initial target. It is comparatively easy to assess and reward performance as its results are easily visible. For instance, you can formulate an incentive scheme for your sales staff to reward the top performers who consistently achieve their periodic targets.

But, how will you recognise and reward a particular behaviour? More often, identifying and rewarding a particular behaviour that created a difference in the company or enhanced the value of the company, is harder than recognising and rewarding for improving performance. Ask yourself, what kind of behaviours do you want to encourage? What are you compensating your employees for? These questions will help you find some logical answers to reward your employees on their behaviour.

For instance, are you encouraging your employees to spend long hours at the office, or, to close a sale ethically, without any errors? In short, are you rewarding your employees for limited productivity or for ethically doing the right thing? Observe closely, and you will see that the two aspects are as different as night and day. In the former, though the employees earn money, they will still be unhappy spending that much time away from home, while the latter will encourage your employees to feel good about their work.

You could also reward employees who devise innovative ideas and concepts to do a task effectively and efficiently. Sharing of ideas is also a good practice to inculcate in your employees. Rewarding for positive behaviours boosts the employee morale which helps in improving performance. This will pay back rich dividends for the employer in the long term.

You can start by identifying the behaviours that can promote the growth of the company. The activities may include improving customer retention, helping your employees enhance their skills of supervision of themselves and others, fine-tuning the vital processes, and so forth.


For an employer, it is obvious to hold compensation in the highest regard. This makes sense, as salary is a deciding factor for most employees. But effective compensation rewards and recognition strategy must include a monetary incentive plan in addition to the salary, and it should be aligned to your business targets for a particular period. Employee incentives are a great way to compensate your employees monetarily for achieving the specified goal. They not only boost productivity but also motivate the employees to perform better every time, which results in the overall growth of the company. You can implement monthly and quarterly incentive plans depending on your business targets.

Some companies also include a long term incentive plan for their key employees. These employee incentives mainly involve providing equity or ownership of the company.


Benefits are an integral part of the overall employee rewards and recognition program. Benefits are not necessarily monetary. Instead, they are the added features that an employer provides to their employees at work. Examples of employee benefits include insurance, wellness programs, gym memberships, free food coupons, travel allowance, and so forth.

An employer should be wise and tactful in providing employee benefits. Plus, the benefits should carry real value to prove fruitful for the employees. Your employees notice the kid of benefits that you offer them and compare it with your competitors. Companies that provide too little or too many benefits in comparison to the market, often face difficulty in attracting top talent and retaining their existing employees. This is the main reason why many businesses seek the assistance of professional organisations to give their employees access to a range of benefits.

Recognition and appreciation

Appreciation and recognition hold a significant place in employee rewards and performance appraisal strategy. Without these two aspects, your whole employee rewards program will amount to nothing. Every human craves for appreciation and recognition for the work they do, and your employees are no exception. So, make sure you create a comprehensive appreciation and recognition strategy — one that adds real value to your rewards and recognition efforts.

Appreciation and recognition are the secret ingredients of the winning formula for business growth. After all, why will an employee care to put in extra effort at work if they are not appreciated and recognised for it? These two components drive your employees to improve their efficiency and productivity.

Despite its visible advantages, many employers rarely give it the importance it deserves. This is extraordinary because, if you think it over, employee appreciation and recognition are lower on cost and provide higher returns. For instance, it doesn’t cost much for a manager to walk up to the employee’s desk and personally appreciate them for the good work they do. Rather, this act brings in exclusivity, which adds more value to the gesture. Plus, employees are always eager to know how they fare with their work and what they can do to improve further.

The art of recognition

True employee recognition is when an employer acknowledges and highlights the specific achievements and accomplishments of your employees in front of their peers. An employer should make it a point to recognise ethical actions taken at work, exemplary attitude and ethical behaviour while doing the work.

Awards such as ‘the best employee award’ is the most motivating kind of employee recognition that you can provide to your employees.

The art of appreciation

Appreciation is all about showing your heartfelt gratitude to your employees for their good actions. The employer should show employee appreciation by acknowledging their exemplary performance and diligent efforts.

Appreciation is an excellent way to highlight good employee behaviour, which you wish to promote among your other employees. Employee appreciation can be extended through simple words of encouragement by meeting the employees personally or even a personal email appreciating their efforts at work.

Every business wants to improve and sustain the high-performance levels of its employees, but fail to focus on the key aspects that will automatically ensure higher efficiency and productivity among the employees. The secret is the more you look after your employees, the more they will look after your company.

1 Star2 Stars3 Stars4 Stars5 Stars (1 votes, average: 5.00 out of 5)

Post a Comment

Your email address will not be published. Required fields are marked *

Subscribe For Newsletter

Subscribe to get the latest news and happenings around recruitment space

Please hold while we process the request.