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9 Mistakes That Make Employee Recognition Ineffective

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Employee recognition has become an integral part of an organization that enhances engagement.

However, when recognition efforts are undermined by fundamental mistakes, they can have the opposite effect. It can leave employees feeling undervalued, unmotivated, and utterly disengaged.

Employee recognition mistakes include things like unclear criteria for earning recognition, inconsistent implementation, and rewards that miss the mark. These missteps undermine the entire point of employee recognition.

What should be an uplifting experience that reinforces great performance ends up frustrating and demotivating employees instead.

In this blog, we'll uncover the common mistakes that companies make while designing their recognition programs. We'll also explore effective strategies to transform these flawed approaches into meaningful and impactful practices.

Key Takeaways

  • Why Employee Recognition Programs Fail?
  • Disadvantages of Employee Recognition Program
  • How to Build a Reward and Recognition Strategy That Works

9 Common Mistakes In Existing Employee Recognition Programs

1. Ill-defined Objectives


According to Gallup, only 26% of employees strongly agree that the recognition and praise they receive is meaningful to them.

Companies fail to hit the mark with their recognition programs because they don't define clear objectives. The biggest question being: What do you want to achieve through your recognition program?

The objectives can differ according to your company's needs. Do you want to shape a vibrant culture of appreciation in your company? Are you focused more on engaging a remote workforce? Or perhaps you want fair awards for every employee.

When setting objectives, be specific about your goals. A significant issue arises when these objectives are not aligned with your organizational values.

For instance, if your mission emphasizes teamwork but you consistently reward individual achievements, you may undermine the collaborative spirit you want to cultivate.

2. Unclear, Irrelevant Criteria for Rewards

Another problem with recognition programs is the lack of clear and relevant criteria for rewards. Without specific guidelines, the program can become random and meaningless.

If anything, and everything is recognized, employees might not understand what behaviors are truly valued, leading to confusion and frustration.

To make recognition meaningful, it’s crucial to establish clear criteria that align with your organizational goals. Specify the behaviors and achievements that warrant recognition, such as teamwork, creativity, reliability, or outstanding performance. This clarity helps employees know what is expected of them and motivates them to strive for these standards.

3. Rewarding Only Performance

One common mistake that causes employee recognition programs to fail is focusing solely on rewarding performance.

While it’s important to celebrate achievements and high performance, effective recognition goes beyond just numbers and results. It can also be for things like day-to-day tasks and teamwork efforts.

Performance-based recognition programs tend to stifle some essential qualities of an ideal employee. Qualities like integrity, punctuality, and teamwork also need to be encouraged.

Here are some recognition-worthy behaviors that goes beyond performances:

  • Reliability and Integrity
  • Emotional Intelligence
  • Teamwork
  • Consistency in performance
  • Creativity
  • Adaptability and quick learning skills
  • Mentoring skills
  • Punctuality

4. Infrequent Rewarding

Infrequent rewarding

A mistake that companies make while giving recognition is not being regular and consistent. Sporadic recognition gives little opportunity to employers to acknowledge their employees' daily efforts.

They may feel overlooked, undervalued and demotivated to work.

Every effort, big or small, should be appreciated at the right time. Timely recognition reinforces positive behaviors among employees. However, recognizing an employee for something they did months ago may not have the same positive impact.

5. People Getting Left Out

While acknowledging top performers can enhance morale, neglecting to recognize the efforts of others can leave them feeling unappreciated and undervalued. They will put in less effort at work, lowering the overall productivity.

People may feel alienated from the rest of the workforce if they are not given due appreciation.

The solution lies in developing recognition programs that are inclusive, highlighting remarkable achievements from employees at all levels, tenures, and roles. This reinforces the value and importance of every position to the company's success.

6. Having Only Yearly Awards

Annual employee recognition programs might not be enough to boost everyday morale. You’d want your employees to be motivated and committed throughout the year. You'd want a culture that supports the smallest efforts to the biggest of accomplishments.

An effective employee recognition program rewards employees weekly, biweekly, or monthly. In short, they run regularly and thus keep the employees motivated.

7. Not Personalizing Rewards


Recognition programs that use a one-size-fits-all approach can fall flat. Giving standardized gifts and rewards often fail to provide meaningful recognition.

The whole point of employee recognition is to make employees feel special. And what motivates one employee won’t necessarily motivate others. Some people like handwritten notes, while others prefer public recognition.

Learn what makes your employees tick and incorporate that into how you appreciate them. If you go that extra mile to connect with them, it will make the reward more meaningful.

8. Focusing Only on Top-down Recognition

Leaders praising employees can impact morale considerably. But focusing solely on top-down recognition might not be enough.

Leaders may not always be aware of the daily tasks and responsibilities of every employee. As a result, deserving candidates may sometimes miss out on the recognition they deserve.

On the other hand, peers often notice and understand employee contributions better than leaders do. Therefore, fostering a culture of peer-to-peer recognition is highly valuable. It not only builds camaraderie but also increases trust in the reward system.

9. Not Making Recognition Visible

Companies might plan great recognition initiatives such as spot awards, shout-outs, bonus programs. But if they keep recognition private or low-key, it loses a lot of its potential impact.

Visible recognition serves as a powerful tool to inspire and motivate other employees. If employees are recognized privately or without any fanfare, the recognition can feel less meaningful.

Therefore, to enhance the effectiveness of your recognition program, start by making recognition events public. Ensure that everyone in the organization sees and appreciates these accomplishments.

Disadvantages of Employee Recognition Programs

1. Unhealthy Competition

Employee recognition programs are designed to motivate employees, but they can sometimes have the opposite effect. It could foster unhealthy competition by pushing employees to prioritize their own goals over the team's success.

When the focus shifts towards outperforming peers for recognition, it can breed a toxic atmosphere in the workplace. Employees may become more concerned about outdoing their colleagues rather than contributing to the organization's overall success.

2. Favoritism and Bias

Even with the best intentions, employee recognition programs can fail miserably when favoritism and biasness creep into the process.

The managers or decision-makers tasked with recognizing top performers may unconsciously favor certain employees over others. This may lead to a sense of unfairness and resentment among the rest of the team. They may start to question the fairness of the recognition system and lose faith in the process altogether.

To make matters worse, this perceived unfairness can also contribute to high employee turnover rates. Top performers who feel their efforts are not being recognized may seek opportunities elsewhere.

3. Peer Resentment

Employee recognition programs help to celebrate top performers and motivate others to strive for excellence. However, when only a selected few are consistently recognized, it can have the opposite effect. It breeds resentment among peers who feel overlooked and undervalued.

Employees may start to question their worth and contribution, leading to a dip in morale and job satisfaction. Moreover, peer resentment can foster a toxic work environment, where colleagues view each other as competitors rather than teammates. This can undermine collaboration, knowledge-sharing, and teamwork.

4. Perceived Unfairness

Research by Gallup revealed that only 26% of employees strongly agree that the recognition and praise they receive are fair.

For an employee recognition program to be successful, it needs to be built on a foundation of fairness and transparency. However, when the criteria for recognition are unclear or poorly communicated, it can lead to a perception of unfairness.

The lack of clarity can foster a belief that the recognition process is based on personal biases rather than performance. Employees may start to believe that no matter how hard they work, they might never be recognized. This can lead to distrust in the recognition system.

5. Financial Burden

Implementing and sustaining recognition programs can be costly, especially if they involve monetary rewards or expensive incentives. The cost can increase rapidly, and it can quickly become a significant financial burden.

For smaller businesses or those operating on tight budgets, these recognition program costs can become a major financial drain. Even larger organizations can feel the pinch, especially if the recognition program isn't properly managed or scaled appropriately.

Building A Reward And Recognition Strategy That Works

We now have a clear picture why employee recognition programs fail. Now it’s time to make things right. But it is crucial to note that every company is unique.

Many organizations struggle with ineffective employee recognition programs due to the lack of clear criteria, inconsistent distribution of rewards, and misaligned rewards.

To avoid these issues, it's crucial to take a strategic approach to designing and implementing your reward and recognition framework.

1. Measure the Reward and Recognition Pulse of Your Company

Your employee recognition program is up and running. But it'll fall flat if you don’t assess its performance. Therefore, it's essential to continuously assess its effectiveness.

By actively seeking feedback from employees through surveys and questionnaires you can ensure it remains relevant, fair, and effective over time.

To achieve this, consider the following strategies:

Employee Sentiment

Evaluate how employees feel about the rewards program. Do they feel recognized, appreciated, and motivated?

Utilize a variety of methods such as employee surveys, focus groups, and one-on-one conversations to gather comprehensive insights.

Engagement Metrics

Analyze whether the program positively impacts key metrics such as engagement levels, productivity, and retention rates. Monitor and track relevant KPIs to assess the program's tangible effects on the organization.

2. Use a Powerful Framework to Evaluate and Design Your R&R Program

The most successful recognition programs are personalized, authentic, and impactful. They are easy to understand, consistent, and fair across the organization. Achieving these qualities requires careful planning and a clear strategy from the start.

A structured framework can help guide the design and implementation of an effective R&R program. One such approach is the AIRe Framework for Employee Recognition, which focuses on the key drivers of human motivation in the workplace.

AIRe Framework.png

The framework prompts you to evaluate whether your program truly appreciates employees, provides motivating incentives, reinforces desired behaviors consistently, and connects with employees on an emotional level.

Specifically, it encourages you to ask questions like:

  • Are you clearly defining and reinforcing the behaviors you want to see?
  • Do employees understand how the program works and what's expected of them?
  • Are you recognizing employees in a personal, consistent way that resonates with them?
  • Are the incentives and rewards motivating and aligned with your workforce's values?

Using this comprehensive framework, you can assess your existing efforts or design a new program that helps you build an unforgettable recognition experience.

Elevate Your R&R Strategy With AIRe Framework: Annual Rewards and Recognition Report India: (2024-2025)


Employee recognition should be more than just a checkbox. It should be a powerful driver of engagement, motivation, and success within your company. Now that you understand the common pitfalls and have explored strategies to overcome them, it’s time to take action.

The key is to empathize with the employees. You need to put yourself in their shoes and think about how you’d like your company to recognize you.

This article is written by Shikha Moni Gogoi, a member of the content team at Vantage Circle. She is an avid reader and likes to spend her days immersed in books and movies. For any related queries, contact editor@vantagecircle.com.

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