8 Signs It's Time To Ditch Your Manual Employee Recognition Process

Employee recognition is a powerful strategy companies can use to get the most out of their workforce. However, before investing in a tool like Nectar, many companies use a manual approach to ensure employees feel appreciated. Programs requiring manual effort are a great introduction to recognition, but they aren't always sustainable long term.

At Nectar, we help companies of all sizes build meaningful employee appreciation programs. Whether you are a small business with 30 employees or a large organization with thousands of workers, you can find value in utilizing an employee recognition platform.

But how do you know when it's time to go from a manual process to software? Today we will cover eight signs that it's time to ditch your manual employee recognition process.

1. Your Workforce Has Rapidly Expanded

There’s a famous book by Marshall Goldsmith titled, “What Got You Here Won’t Get You There.” In this book, he details what successful people do to become more successful in their chosen fields.

Keeping up with your culture and recognizing others is often easy when you have a small company. There aren't a ton of hoops to jump through, and ensuring every person feels appreciated is straightforward.

As your organization grows, you realize that recognition is much more complicated. Strategies like Employee Of The Month no longer work like intended. When you have 50 employees, an Employee Of The Month award recognizes 24% of your workforce. When you have 500 workers, an award like that recognizes 2.4% of your workers. That’s a drastic decrease.

One of the first strategies companies use to remedy this problem is changing their reward cycles. For example, instead of a total Employee Of The Month, you might let each department pick a winner. You might also limit how often an employee can win the award. This can expand the life of these programs, but there's still a large pool of people who won't get recognized (and people who deserve the recognition but are banned from getting it.)

If your strategies aren't working as intended, it might be time to invest in another method. Many large organizations turn to peer-to-peer recognition software because it democratizes the appreciation process. When various staff shoutouts happen inside and outside departments, workers throughout your organization can feel the love.

2. Your Employee Recognition Budget Is Unpredictable

Most often, recognition is tied to something tangible, even if it's just a thank-you note. If you have a recognition line item in your budget, you might notice that you spend a lot of money some months.

Unfortunately, sometimes you don't know where money is going until long after you've spent it. Wading through receipts and ensuring every dollar is accounted for is the stuff of financial nightmares. This is especially true when it comes time to tax employees for any rewards they may have received.

How does a tool like Nectar help you avoid this?

Budgeting

Before you invite users into the Nectar system, you'll work with our customer success team to discuss your Nectar budget. We can help you understand how points will be divvied up for:

• Shoutouts
• Birthdays
• Work anniversaries
• Challenges
• Awards

Depending on how granular you want to get (and how you stick to those budgets throughout the year), you should know the total number of points available for a year. Since ten points in Nectar equals $1, you should know how many total dollars workers can give in Nectar each year.

Prepaying For Spending

At Nectar, we have two options for paying for rewards, but our most common is a prepay option. With this option, you can fund your account based on your budget for the year. For example, you could choose to fund $3,000 upfront. Then, as employees redeem rewards, their rewards draw from that bucket of funds. Once you reach 20% of that number (in this case, $600), Nectar draws $3,000 from the payment method on file.

You can closely monitor how much employees are spending. As a Nectar administrator, you always have a pulse on where spending is going and how much you have left.

In-Depth Financial Reporting

Lastly, we offer in-depth financial reports for all the rewards your workers redeem in our system. You can pull this report as often as you like to ensure employees are taxed appropriately for the gifts they redeem. 

3. Your Analytics Around Recognition Are Subpar

One of the best parts about using software to run your recognition program is the helpful analytics that comes with it.

Employee recognition can have a profound impact on employees. A recent Nectar survey on employee recognition statistics revealed that recognition:

• Impacts workers’ motivation to succeed
• Makes employees more productive
• Increases employee engagement

But that only happens when workers and leaders use the recognition system you have in place. Having detailed analytics gives you peace of mind to ensure everyone is accessing the benefits of increased recognition.

At Nectar, we have a few interesting reports that help you understand where your team is trending:

Manager Report

Each manager in your system will have access to a team insights report that helps them understand how they are doing at recognizing their team.

As an administrator, you'll have access to a dashboard that features every manager in your organization. From this report, you can quickly get a feel for how managers are doing at appreciating their teams. If you need more context, you can drill down into each manager and understand how their team performs.

Users Who Haven’t Received Recognition

Another helpful report for companies is our "Users Who Haven't Received Recognition" report. This dashboard gives you an overview of who hasn't received recognition in the time frame you set up. We suggest a timeframe of 1-3 months, depending on the size of your company. Once you have a list of who hasn't received recognition, you can quickly reach out to their manager to ensure they get the credit they deserve.

4. Your Company Spends Too Much Time Running Your Employee Recognition Systems

If you are an HR manager, you know the time you have to work each week is special. Furthermore, if you're an HR team of one, you are likely dealing with everything from recruiting to onboarding to employee experience. As your HR team grows, you still want to streamline some areas.

Utilizing a manual recognition system like a nominations process can take several hours. You have to:

• Build a portal or form to accept nominations
• Promote that the program exists
• Read each nomination
• Determine a winner for the award
• Make sure that the winner receives the feedback and prize

…and that's just for a straightforward program. Some companies choose to make sure every person who was nominated gets their accolades. This adds hours of extra work, and it's not always easy to automate. Your nomination program might fall through the cracks because of the time it takes to administer. This isn't necessarily fair to the people who get recognition.

What projects could you tackle if you could depend on technology and spend less time organizing your recognition program?

How Much Is Your Manual Recognition Process Really Costing You?

According to ZipRecruiter, the average human resources salary in the United States is about $47,617 per year or $23 per hour. Based on all the work it takes to run a manual recognition program, let’s say you spend 10 hours a month on your program. That equates to $230 a month and $2,760 per year.

Since you were going to spend this money anyway, it might not seem like much to continue a manual path, but it comes down to a simple question: If you weren’t running this program, could you do something more cost-effective with that time?

If you believe your time would be better spent elsewhere, it's likely time to ditch your manual recognition process.

5. Only A Select Few Employees Are Being Recognized Each Month

Creating a recognition system where a variety of employees get recognition is challenging. If you’ve been running a program manually, you’ve probably seen the same handful of workers get recognition.

Unfortunately, these employees are typically the most extroverted or the most prominent personalities. These programs leave little room for employees who keep to themselves but still manage to do amazing things for colleagues.

Another downfall of only capturing a select few employees in your recognition process? These employees are typically already company leaders and managers. So how do you find new leaders when the employees who make the most significant impact are already leaders?

Some companies have found ways around this by giving out awards like “New Employee Of The Year,” but this method still leaves something to be desired.

When you switch to a recognition system like Nectar, employees are encouraged to think outside the box. Recognition becomes about the small things that make an impact vs. the sum of all the actions employees take over a month or a year. The result is a program where more employees can feel the appreciation that frequent and meaningful recognition gives them.

Guardrails

While you want your system to encourage more users to get recognition, sometimes people are drawn to the same few individuals. Nectar has created a guardrails feature to stop employees from gaming the points system or sending their points to the same people month after month.

6. Your Current Recognition System Is Underutilized

Next, it might be time to start the recognition software selection process if you are seeing poor usage of your manual system.

Here, we are going deeper than a lack of employees being recognized. If workers aren’t aware of your manual solution or only a handful are participating, your system is underutilized.

Underutilized systems are hard to maintain because it makes it hard for your HR personnel to care. If you get five responses a month, you likely won't care to read the nominations or find a winner. This creates three negative scenarios:

1. HR stops maintaining the system, and it slowly dwindles down.
2. Employees don’t have a way to recognize each other.
3. Workers who were getting recognition likely won’t receive it.

So, how do you fix an underutilized system?

Introduce Your Process Early

When do you share your employee recognition system with employees? Do you wait until they’ve been with your company for a few weeks, or are they immediately welcomed into the system?

Recognition can make a huge difference with potential workers and new team members. So as you are thinking of ways to onboard new workers, why not take a few minutes to introduce them to your recognition platform?

Nectar can sync with your HRIS tool and then quickly welcome employees to your company communication tools like Slack/Microsoft Teams. So from the start of their work with your organization, they'll know that recognition is vital to your company.

Reintroduce It Monthly/Quarterly

Once an employee joins your team, they should get frequent reminders of how much you value recognition.

Whether you are using a manual process or switching to software, you need to spend some time championing the act of sharing recognition.

Here are some simple strategies you can use to reintroduce this process:

• Read the latest recognitions posted to the group at an all-hands meeting.
• Give a shoutout to someone who always goes above and beyond to recognize others.
• Carve out a five-minute block on everyone’s calendars to send a company-wide shoutout once a month.

7. Employee Recognition Gets Lost Or Undelivered

Next, you may need to move to another system if you have trouble with recognition delivery.

Manual processes can get pretty taxing. Instead of delivering recognition promptly, some shoutouts might get lost or undelivered.

This presents two problems:

1. Employees giving recognition will trust the company less and provide credit through untraceable channels (or not at all.)
2. Workers who received recognition won't get it and won't know how much their coworkers value them.

Platforms like Nectar have made it much easier to deliver these critical messages. Workers receiving praise get the messages almost immediately. When someone gets a shoutout, they are notified via email, Slack/Microsoft Teams, and even push notifications on their phone. We also have in-app notifications that keep employees in the loop.

8. Employees Frequently Discuss Feeling Underappreciated Or Undervalued

Last, it might be time to switch to a digital process if your workers still discuss feeling underappreciated or undervalued. While you can't flip a switch overnight and make people feel cared for at work, it shouldn't take years to turn the tide.

If your manual process has been working for a while, are you still getting complaints during employee engagement surveys, exit interviews, or 1:1s with workers? It might be time to have deeper conversations with employees about the role recognition takes in your company.

Furthermore, drill down into the statistics of who you are recognizing. Are you giving shoutouts to the same handful of workers? Is there anyone who hasn't received recognition? How does that align with employees who want to feel more appreciated?

Switching to a tool like Nectar doesn't solve every issue overnight, but it gives you the tools to quickly understand where you can improve your recognition process. For example, our "Users Who Haven't Received Recognition" report will provide you with the tools to make sure more employees receive good feedback. 

Conclusion: Create A Stellar Recognition System With Nectar

Creating a recognition system can drive fantastic business results, but it can also be a pain to administer. Employee recognition software can streamline these processes and make them easier to manage.

So, to recap, here are the signs it’s time to ditch your manual recognition process:

1. Your workforce has rapidly expanded.
2. Your employee recognition budget is unpredictable.
3. Your analytics around recognition are subpar.
4. Your company spends too much time running your recognition process.
5. Only a select few employees are getting recognized each month.
6. Your current process is underutilized.
7. The praise employees give gets lost or underdelivered.
8. Employees frequently discuss feeling underappreciated or undervalued.

When you’re ready to update your recognition systems, request a demo of Nectar to see how we can help. Our sales team will give you a full walkthrough of the Nectar platform and all the tools that will make your job easier and more effective.