Here's what you need to know about Rewards and Recognition in the Hospitality Industry

If there is something that I’ve come to realize about the hospitality industry, it is that it’s always in motion, adapting to the ever-changing tastes of travelers’ preferences and expectations. The pressure is constant, whether it’s the hotel front desk manager juggling check-ins during peak season or the chef trying to deliver perfection on every platter. In this fast-paced and stressful environment, many are prone to overlooking the most significant motivator and performance driver, which is recognition.

Research shows that employee turnover rates for hospitality organizations are nearly twice as high as those for other private sector jobs. Well, this is not simply a recruitment problem; it is more of a culture problem. High turnover signifies inconsistent service and disengaged staff. Employees being disengaged get reflected in their guest experience, reviews, and eventually, in revenue.

But on the flip side, things turn positive when employees feel genuinely appreciated. Appreciation makes them happy, and happy staff go the extra mile, smile wider, respond quickly, and deliver services that feel more like an experience and less of a transaction.

That’s why I believe Rewards and Recognition in the hospitality industry should be non-negotiable. This blog will help you understand rewards and recognition, their respective usage, their types, and the best practices prevalent in the hospitality sector.

Defining Rewards vs. Recognition in the Hospitality Context

The very first thing that I need to address before proceeding with a detailed understanding is defining rewards and recognition by highlighting the differences. I’ve noticed that in the hospitality sector, rewards and recognition are often categorized under the same bucket and frequently used interchangeably. Therefore, it is necessary to understand the difference that will help you plan your employee engagement strategy accordingly and leave no room for confusion.

Let’s break it down:

• Rewards are tangible. They include gift cards, bonuses, extra leave days, or the much-needed weekend getaway for your top-performing concierge.

• Recognition, on the other hand, is emotional. It is about being seen, valued, and valued often publicly. A personal note from the General manager, a shoutout during a team huddle, and an appreciation from a peer all make people matter.

Let us understand these two through examples from the hospitality sector:

Here’s what I mean:

• A housekeeper receives a thank-you card and chocolate from the hotel manager for finding and safely returning a guest’s misplaced jewelry. That’s recognition.

• Rewarding a restaurant host with a spa voucher for consistently and gracefully managing peak-hour bookings is a reward.

Both cater to different purposes and are powerful in their respective ways.

When to Use Rewards vs. When to Use Recognition

Here’s a simple framework for assisting you while deciding when to use rewards and when to use recognition.

As you can see above, recognition must be frequently woven into everyday interactions. On the other hand, rewards can be best used selectively to reinforce key behaviors and achievements. In a nutshell, combining the two thoughtfully and strategically can create the necessary impact you wish to make.

Types of Rewards and Recognition Used in the Industry

One-size-fits-all rewards and recognition have never worked for any industry, and the hospitality sector stands no exception to this. From housekeeping to concierge, front desk agents to chefs, every role has different pressures, and there are several ways of feeling valued. Having said that, many successful recognition programs in hospitality blend monetary and non-monetary elements. Let’s understand them further:

Monetary Rewards

These are tangible rewards or incentives that impact an employee’s well-being. The following are some rewards that can be implemented in the hospitality industry.

• Shift-based performance bonuses: This bonus is given to staff who consistently perform well during peak hours (like weekend brunches or wedding events) and handle high-stress scenarios.

• Sales or upsell incentives: Frontline staff, such as front desk agents or servers, get incentives in the form of commissions for upselling spa treatments, premium suites, or wine pairings.

• Digital tipping platforms: Many hotels and restaurants are steadily adopting code-based tipping apps that allow guests to tip staff digitally, including those behind the scenes, like housekeepers or kitchen staff.

• “Concierge of the Month” rewards: These are role-specific rewards attached with a prepaid card or cash bonus for exceptional service or guest feedback.

Non-Monetary Recognition

Non-monetary recognition is more emotionally driven, and when done right, it can create a long-lasting impact. The following are some recognition methods for the hospitality sector:

• Spotlight board / Wall of fame: Many hotels create a dedicated space for highlighting their team members’ achievements, which is visible to both guests and staff.

• Guest review call-outs: A guest mentioning an employee by name in a 5-star review is celebrated during team meetings or shared through internal newsletters.

• Managerial shoutouts: A personal note or a simple “Thank you” from the GM motivates the employees, particularly during high-stress periods.

• Peer-to-peer recognition program: In such recognitions, colleagues or peers can appreciate each other for their support, guidance, and teamwork.

Source: Vantage Rewards and Recognition

Hospitality-Specific In-House Rewards

Some of the most R&R initiatives in hospitality can also be built using your company’s own services. They are as follows:

• Spa vouchers or massage credits: These can be given to staff for consistently performing high during demanding events.

• Team dinner at the hotel restaurant: This is one great way to celebrate team achievements like a seasonal high occupancy streak or a successful corporate event or seasonal high occupancy streak.

• Free stay vouchers for employees and families: These can be offered to employees to celebrate work anniversaries or employee-of-the-year winners.

How Can One Bridge the Gap of Recognition and Rewards in the Hospitality Sector?

The above-mentioned types of recognition and rewards are a must-have in your program. However, delivering them, especially in this particular sector, is somewhat of a hassle. Therefore, using Phygital Recognition can be crucial in closing the gap.

In the hospitality context, recognition should not only be limited to guest-facing staff; housekeeping, kitchen staff, and maintenance should equally be recognized, for they are the unsung backbone of hospitality, working behind the scenes. Make sure to include them in every R&R initiative.

Phygital recognition as an approach blends both physical and digital modes of recognition and rewards. Such a token of appreciation ensures that the field workers and those working behind the scenes receive the acknowledgment they deserve. As a result, it bridges the gap between those who are frequently recognized and those who often go unnoticed.

Positive Employee Behaviors That Deserve Recognition

What genuinely sets your brand apart is when your employees naturally embody your brand values without any force. And the best way to achieve this is by using recognition. Recognizing the behaviors and core values can encourage employees to embody them naturally in their professional journey.

According to a study, 86% of value-based recognition programs show an increase in workers’ happiness.

So, why don’t we explore some employee behaviors that deserve regular recognition in hospitality, which often go unnoticed? This will help you stay vigilant about employees’ behaviors and make them feel valued through recognition.

1. Exceptional Customer Service

Personalized services, ranging from remembering a guest’s name to anticipating their needs, are considered a gold standard in hospitality. If you notice an employee receiving rave guest feedback, make sure to recognize them publicly and promptly.

️

2. Conflict Resolution with Grace

One of the standout traits in the hospitality sector is how employees or staff handle conflict situations, whether a long wait at the restaurant or a double-booked room. Pay attention to team members who can calmly tackle conflicts and make sure to recognize them. This not only acknowledges their ability to stay calm under pressure but also cultivates a culture of professionalism and maturity.

3. Teamwork & Cross-Function Support

Hospitality thrives on collaboration. Consider a server stepping in to assist housekeeping during a shortage or a kitchen staffer helping at the front desk during check-ins; these instances of teamwork and cross-functional assistance deserve absolute acknowledgment.

4. Multilingual Support

In global hospitality, multilingual communication can potentially elevate guests’ experience. Employees who go the extra mile to bridge language gaps demonstrate a clear sign of empathy and cultural competence. Hence, recognizing their efforts helps in shaping an inclusive and welcoming environment.

5️. Sustainability & Eco-Conscious Actions

In an era where being eco-conscious is the need of the hour, employees embodying sustainability goals, such as minimizing food waste and encouraging guests to reuse towels, deserve recognition. These efforts perfectly align with modern guest values and the brand’s commitment to responsibility.

6️. Empathy-Driven Actions

Empathy-driven actions are something that needs to be recognized. Whether it’s a housekeeper leaving a thoughtful note for a grieving guest or a concierge arranging a surprise for a honeymoon couple, these are thoughtful moments that money can’t purchase, but only recognition can amplify.

Business Benefits of Rewards and Recognition in Hospitality

No wonder investing in Rewards and Recognition will keep your employees happy and engaged. However, it is significantly used as a business strategy to guarantee long-term business resilience.

Having said that, we will discuss the range of benefits that a successful run rewards and recognition program will bring to your organization.

1. Boosts Morale in High-Pressure Environments

It is no secret that hospitality roles call for emotional labor, such as managing demanding guests, smiling through long shifts, working on holidays, etc. So, how do you think employees can get the courage or motivation to navigate the pressure? Recognition here comes to the rescue to give them a reason to keep moving ahead, assuring them that their efforts will not go unnoticed.

Having said that, a “thank you” gesture at the right time can boost an exhausted team more than anything.

2. Reduces Turnover and Increases Retention

With turnover rates peaking in the hospitality sector, retention is a critical business priority. Recognition is key to making employees more loyal. And in this industry, loyalty translates to more consistent service and lower training costs.

Gallup research shows that well-recognized employees are 45% less likely to have turned over after two years.

3. Drives Engagement and Productivity

Regularly recognizing and rewarding employees makes them feel seen and valued, which further drives them to bring more energy, innovation, and ownership to their work. In this way, they will willingly want to elevate the guest experience.

4. Mitigates the Threat of Automation

Recognition can potentially reinforce the value of irreplaceable human skills such as creativity, empathy, and intuition. No wonder that AI takes care of all the operational tasks; however, it is the recognized human experiences and behaviors that draw the guests to frequent.

In a nutshell, R&R shifts the focus from replaceable tasks to creating and valuing irreplaceable connections.

5. The Ripple Effect: Recognition to ROI

Recognition sets off a chain of reactions, referred to as the ripple-effect model. This will help you grasp how recognition ultimately drives ROI.

Case Study

Accor, a renowned global hospitality company, operates across 110 countries with 10,000 food and beverage outlets. The company sought to inspire and motivate its global workforce to place customers at the heart of its business.

As such, it sought a digital solution that could elevate employee experience worldwide. The challenge was finding a platform that offered flexibility and scalability, catering to the workforce’s requirements. Additionally, Accor wanted a platform that could provide a comprehensive financial wellness package with unique benefits and corporate discounts as well as a distinct point-based rewards system.

Onboarding Vantage Circle’s flexible recognition and rewards platform, Accor was able to implement an employee-centric and user-friendly digital solution. The platform helped the company maintain a happy and satisfied workforce, which was also reflected in its overall customer success.

In the year 2020, Accor witnessed an average increase in recognition of more than 53%, and the rise in Engagement was more than 25%.

Learn More: Get an in-depth understanding about Accor's rewards and recognition journey.

Best Practices for Hospitality Recognition

Recognition should not be reduced to a mere “box-ticking” activity; it must be more about building a culture around it. In the hospitality industry, where every interaction carries significance, make sure to equally pay importance to how to recognize employees and not only why to recognize them.
Having said that, let us delve into the best recognition practices that work wonders for the hospitality industry.

According to research, 42% of hospitality workers identify a lack of recognition and advancement opportunities as the primary obstacle to career growth.

1. Recognize Frequently and Timely

Recognition works best when it is instant. Waiting for the end of the quarter or annually will only diminish the impact you wish to create on your employees. An immediate or instant “shoutout”, kudos, or thank you for a well-handled client can leave a lasting impression on employees.

2. Match Recognition Type to Achievement

It is often noticed that the recognition employees receive does not really match their achievements. For instance, a “thank you” would suffice for small wins. However, when someone saves a client relationship or secures a return booking despite a bad review, that goes beyond a casual thank you. Such efforts deserve a formal reward, be it a voucher, a bonus, or public recognition. Hence, be vigilant about the achievement and align with the recognition accordingly.

3. Embrace Peer-to-Peer Recognition

Your managers may not see everything, but your peers or teammates can see it. Hence, encouraging peer-to-peer recognition is a stepping stone to inculcating a recognition-driven culture where peers can appreciate each other and keep the momentum intact.

Source: Vantage Rewards and Recognition

4. Incorporate Guest Feedback into Recognition

If you ever witness a guest leaving with a satisfying review by mentioning a team member’s name, ensure to use that in your recognition platform or during staff meetings. This feedback from guests makes employees feel elated and valued, knowing that they have made a real impact.

A study by Marriott International found that hotels with higher employee satisfaction scores had higher guest satisfaction scores.

5. Personalize the Recognition Experience

Many recognition attempts fail to deliver the necessary impact due to the lack of personalization. A one-size-fits-all approach to recognition and rewards has never been fruitful. Instead, a personalized or customized recognition approach based on the preferences of individual employees will give them the value they seek. Some employees appreciate public praise, while others value a handwritten note or extra time off. Figure out what resonates with each individual and then proceed.

6. Make Recognition Inclusive Across Roles

Behind a successful running business, lies the contribution of every member and department. Therefore, recognition must be equally distributed, keeping every member in mind without making anybody’s efforts go unnoticed, irrespective of their roles.

7. Celebrate Personal and Professional Milestones

Avoid limiting recognition only to performance; instead, make recognition a celebration of personal and professional milestones. From birthdays to work anniversaries or completing certifications, celebrating milestones demonstrates your care for your employees as individuals, and not only their performance.

8. Gamify Recognition with Challenges and Badges

Gamifying recognition can add an engaging twist for employees. For this, introduce friendly challenges such as “Quickest Turnaround Time,” “5-Star Feedback Hero,” or “Team Player of the Week,” display leadership boards, and reward them with digital badges to make the experience more fun and motivating.

Source: Vantage Rewards and Recognition

9. Train Managers to Recognize Effectively

Not every manager is naturally expressive. So, make sure to invest in training managers to give authentic, specific, and timely recognition. It’s one of the highest ROI leadership practices in hospitality.

10. Communicate the Recognition Program Transparently

The first and foremost thing is to openly communicate about the recognition program to your employees. Clearly explain how the program works, the criteria for recognition, how they can be acknowledged, how they can recognize others, and how winners are selected. This form of transparency helps build trust and further encourages participation.

Conclusion

By now, you have garnered a sound understanding of the significance of recognition and rewards in the hospitality sector, including the types and best practices to strengthen these practices. In addition, you have also found clarity on when to use recognition versus rewards.

It’s time that you put this knowledge into practice and shape a recognition-oriented culture striving toward growth and excellence.

Author bio: This article is written by Riha Jaishi, a content marketing professional at Vantage Circle specializing in recognition and rewards. As she draws from her years of experience in employee recognition and rewards, she continues weaving narratives through her thought-provoking blog posts. For any related queries, contact editor@vantagecircle.com