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EMPLOYEE RECOGNITION

Rethinking Employee Awards

I Love Rewards and other businesses find ways to bring meaning to corporate award ceremonies.

Keat Teoh

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The Academy of Motion Picture Arts and Sciences honors the year's finest film. The PEN/Faulkner Foundation honors the year's best fiction. SurePayroll honors the year's most impressive screwup.

Winning Best New Mistake is a signal distinction at SurePayroll, a $23 million online payroll-processing company based in Glenview, Illinois. The company, which was recently acquired by Paychex, celebrates the end of its busy season with a ceremony called the SureChoice Awards, of which Best New Mistake is the breathlessly awaited culmination. Employees nominate themselves; management receives about 40 proud admissions of error each year. There are three winners (gold, silver, and bronze), and the perpetrator of the gold gaffe receives $400—twice as much as do winners of the company's other, more traditional, awards.

"We underline the new part," says SurePayroll's president, Michael Alter. "There's no award for making the same mistake twice." Last year's winner tried to streamline a process for customers and ended up frustrating them instead.

Alter dreamed up Best New Mistake to remind staff that, in a culture of innovation, failure is always an option. "If you don't encourage people to take risks, then you end up with incrementalism forever," says Alter. "Mistakes are the tuition you pay for success."

Best New Mistake is one example of the effort to inject relevance and excitement into what, at many companies, are staid and symbolically sterile artifacts: annual awards. Over the years, the President's Award, the Leadership Award, the Customer Service Award, and their ilk tend to come unmoored from a company's mission. And employees start to forget what those awards were meant to recognize—if their significance was spelled out in the first place.

A few companies are trying to invigorate this creaky tradition by rethinking what they honor and how they honor it. The Disruption Award sounds like all those innovation prizes that became ubiquitous in the '90s, when everyone started reading Clayton Christensen. But at ADG Creative, a $6 million marketing firm in Columbia, Maryland, the Disruption Award goes to the person whose personal life was most disrupted by his or her job that year. "We give it to the person who is relentless, not because we expect them to kill themselves but in the spirit of sacrificial leadership," says ADG's founder and chief creative officer, Jeff Antkowiak.

Typically, the recipient is someone who volunteers for an ambitious project that keeps her at the office late at night and on weekends. The winner receives a bag of espresso beans, a neck pillow, and—more substantively—a five-day weekend and $2,000. Last year, three employees won for overseeing the transition to a new office space while keeping the old one running.

Most annual awards are meant to encourage desirable behavior by spotlighting role models. But that relegates a company's best employees to a passive role: people who have already proved themselves and are now held up as objects of emulation. Bob Nelson, a consultant and motivational speaker and the author of 1001 Ways to Reward Employees, argues that awards should instead propel recipients into new roles with greater responsibility. "If it's the Leadership Award, don't just give them a check and send them to Hawaii," advises Nelson. "Say part of the honor is to become a mentor. Or if it's the Innovator Award, give them a budget to develop one of their ideas." Nelson also recommends ditching the one-award-one-winner formula—which forces leaders to draw artificial distinctions among high performers—and instead honoring all the brightest stars in a company's constellation.

That largesse is feasible if the award is a call to service rather than a fat check. I Love Rewards, a San Francisco-based company that helps human-resources departments implement staff-recognition programs, inducts about 10 employees into its president's club every year. And, yes, they do get a trip (last year, it was four days in the Bahamas). But once back home, the honorees become part of the CEO Insiders' Circle. The Circle, which consists of staff members of various departments and employment levels, meets quarterly to help CEO Razor Suleman evaluate big questions. In recent gatherings, it has discussed how to scale the company's culture as I Love Rewards expands.

"When you ask your best employees what you need to do, they know," says Suleman. "And when other employees see that top performers helped develop the strategy, you get amazing buy-in."

More important than what awards consist of is what they signify. Award ceremonies are great opportunities to remind employees of the company's core values by demonstrating how individuals embody them. "Someone gets the President's Award—well, what the hell is that?" says Nelson. "The CEO should state what that person did and tie it back to the mission and strategic goals. Now, at least people are learning from it."

Ideally, the mention of a particular award will conjure the image not of a trophy or a check but of the honoree busy doing whatever makes him valuable to the business. "We give away trips, but we don't want people thinking about trips," says Antkowiak. "We want them thinking about what's so amazing about their co-workers."

POLISHING THE TROPHIES
Employee awards don't have to be stale gestures. Here's how to put meaning back into the plaques and trophies.

Spell out the criteria. Write down what each award recognizes, including examples of past winners and why they won. That way, the honor remains consistent and is less vulnerable to charges of favoritism. Says author and motivational speaker Bob Nelson, "You don't want people saying, 'Wait a minute. Isn't that what that person is paid to do?'"

Customize prizes. Find out whether individual winners would prefer money, time off, a trip, or something else. At ADG Creative, managers discreetly ask imminent winners about their preferences. "We want to make sure we give them something they actually want," says ADG's founder, Jeff Antkowiak.

Recognize multiple top performers. Don't place arbitrary limits on the number of people who can receive a company's top award. If several employees have had bang-up years, honor them all. "Why put a quota on excellence?" says Nelson. "You don't have to give them all $1,000."

Limit the kinds of awards. It's tempting—and fun—to create awards recognizing every accomplishment, from most-improved presentations to best-decorated cubicle. But don't create so many that they become meaningless. "There's this great line from the movie The Incredibles," says Antkowiak. "'When everybody is extraordinary, nobody is extraordinary.'"

From the July/August 2011 issue of Inc. magazine

LEIGH BUCHANAN | Staff Writer | Editor-at-large, Inc. Magazine

Leigh Buchanan is an editor-at-large for Inc. magazine. A former editor at Harvard Business Review and founding editor of WebMaster magazine, she writes regular columns on leadership and workplace culture.




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