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How Can I Reward My Employees On A Budget?

Businesses often face the dilemma of wanting to recognize employees’ efforts and performance, but during difficult financial times they may have very limited budgetary resources to do so. However, rewarding employees and motivating performance does not always require a tremendous outlay of money. You may be surprised to learn that if you were to ask some of your employees they may actually prefer other types of recognition.

Starting an employee rewards and recognition program can be overwhelming at first. And the task can seem impossible when you are trying to figure out how to incentivize employees to perform well while staying within a tight budget. In tough economic times, however, small and mid-sized businesses must keep in focus what they want to reward while being creative in coming up with ways to keep the troops happy.

Rewarding Employees on a Budget: Your Goals

Creating an employee rewards program is a great way to to create some acknowledgment and motivation for your company team. The purpose behind a recognition program is to help motivate your employees to earn the rewards and ultimately help you meet business goals. Here are steps you can take to design an effective employee rewards program:

  • Identify what you want to reinforce. The first step you need to take is to identify the activity or activities that you seek to reward. This can include job performance, such as achievement of sales targets or product development goals or meeting customer timetables ahead of schedule. You can also choose to reward behavior, such as exceptional customer service or team work or leadership.  Once you establish what it is you want to reward, those things should become the focus of the program.
  • Motivate your employees. The goals of your employee rewards program can only be met if you get staff “buy in” or participation. If you let the employees know that you are establishing a recognition program, even when the budget is tight, they will see that it is important to you that there be recognition of their good work and extra effort.  If you are unsure of what will motivate them, ask them.  If you have budget constraints, let employees know so that they are more creative with their suggestions.  The biggest bonus that you will notice is an almost immediate strengthening of employee moral and company loyalty.
  • Make sure it works for the company. There’s no point in starting a recognition program that is not going to motivate employees or help you achieve business goals. So in addition making it work for employees, you have to make sure that it works for the good of the company. That’s why it’s so important to put thought into the methods of recognition you use and how effective and practical they are for the company. What works for one company may not work for another.

Rewarding Employees on a Budget: Types of Rewards

Money is not the only way to recognize employees and surveys have found that some workers actually prefer a more personal “thank you” note, being singled out in front of colleagues, or other forms of recognition.

However, when people feel that they are being fairly compensated, then the best rewards for performance or behavior don’t line your pocketbook or wallet.

People like recognition. People enjoy being thanked for their work. Employers have to be more creative about how they go about recognizing the good work. There a number of ways this can be done, with little or no financial investment. Some types of ideas include:

  • Opportunities. Sometimes the most meaningful form of recognition involves some type of opportunity as proof that an employee is valued by an organization.

-Being asked to sit in on a Manager’s Meeting or Important Panel

-Mentoring or Training Opportunitity

-Attending a National Conference or Industry Trade Show

  • Exposure. Another meaningful form of employee recognition is giving that person exposure to the rest of the staff, to important clients, or to others in their field.

-Employee of The Month Parking Space

-Wall of Fame – Recognize their accomplishments publically

-Take them out to lunch one on one.

  • Experience. Sometimes the most sincere form of flattery is being trusted with more challenging work.  If the company trusts you with new challenges, or tells you that you’re too valuable to take vacation at the same time as a senior manager — that may be all the recognition you need.
  • Praise. Something as simple as writing a personal thank-you note to an employee for a job well done can leave a lasting impression. Don’t undervalue the weight of a hand-written note.  Personal thank-yous can be very powerful. Some people keep them for 10 years.
  • Allow flexibility in an employee’s schedule. Extra efforts can also be rewarded with understanding of the family/life balance that many workers are trying to achieve. That can range from allowing an employee to telecommute one day a week in exchange for high performance to allowing them flexibility to start earlier and leave earlier.
  • Gift card rewards. Use a limited budget for employee rewards to buy a series of gift cards at popular coffee shops, book stores, or online retailers and let the employee choose one when they have done something positive or noteworthy. These can also be administered by co-workers to employees who have exhibited positive behaviors, either helping other staff members, going the extra mile in serving a customer or by their team work.

In order to strengthen your team environment, stimulate positive behavior and reward your employees it doesn’t always take a ton of money.  You just need a little creativity, time, and the ability to thank those that help you to provide the services making your company the valuable asset that it is.

Resources:

How to Reward Employees on a Budget

Dig Deeper: Employee Recognition and Reward Programs 

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Additional Resources

How to Reward Employees –– Without Raises or Promotions
HR.com is a business that helps spread HR best practices.

How to Give Effective Praise
Nelson Motivation is the website for Bob Nelson, a columnist and author of 1001 Ways to Reward Employees.

The Carrot Principle
Blog by Adrian Gostick, co-author of A Carrot a Day: A Daily Dose of Recognition for Your Employees with Chester Elton .

25 Ways to Reward Employees without Spending a Dime 
The consummate list by HRworld.com.