June 11, 2012

Tips for Jump Starting Employee Recognition Program ROI

In our last post we noted that smart organizations are actively investing in their people. Measuring the ROI of these investments can be of great value.  In short, measurement can help justify, defend and improve these employee recognition programs.

Don’t know where to start? You’re not alone. The “paralysis of analysis” effect is common when companies decide that measuring results is a good idea. The beauty of the ROI Methodology® described in the previous blog is that it provides a logical evaluation framework and a process model, a step-by-step approach to getting the job done well.

Keep it Simple. The most important tip when getting started is to keep it simple. Keeping things simple reduces the risk of missteps and helps ensure that your measurement efforts are sustainable.

Four Tips for Getting Started

  1. Measure Lower Levels first
  2. Use Few, Simple Measures
  3. Calendar It, Then Do It
  4. Make Measurement Pay

1. Measure Lower Levels First

Return on Investment (Level 5) is undoubtedly the ultimate measure, but starting measuring ROI can be daunting. In contrast, measuring how participants think and feel about the program (Level 1, Satisfaction/Reaction) and whether they fully understand the program rules and expectations being placed on them (Level 2, Learning/Understanding) can be done easily and can provide amazingly rich insight. When done well, this level of measurement can effectively validate success and identify both barriers and enablers to performance. Knowing these can guide mid-program adjustments and show the way to evidence-based program improvements.

2. Use Few, Simple Measures

Determining measures is simply a process of identifying objectives for Levels 1 and 2. Ask yourself, “What does success look like?” Levels 1 and 2 objectives typically revolve around enthusiasm, confidence, trust, fairness, relevance, attainability, and planned action.

Next, be discerning. Measure only the things that you are prepared to take action on. For example, don’t ask sales people if they believe that the incentive program is attainable unless you are willing to consider modifying the rule structure.

3. Calendar It, Then Do It

Advance planning ensures that you measure at the right times. Poor planning can lead to questionnaires, interviews, and focus groups that are completed late and, therefore, of less value. This can frustrate participants and limit your organization’s ability to use the findings to make meaningful improvements. Ultimately, lack of timeliness may signal lack of commitment and damage the organization’s credibility among stakeholders.

4. Make Measurement Pay

Now that you have gained valuable insight into what’s working, what’s not, and what you can do about it, the fun begins. Create an impact report that includes an executive summary of findings, all relevant data and an action plan. Then, get it into the hands of key stakeholders and gain approval to implement the action plan.

In summary, the benefits from measuring results of people performance improvement programs can be huge. Use the four tips above to start realizing the power of measurement in your organization now.  In the words of General George S. Patton:

“A good plan executed now is far better than a perfect plan executed next week.”

Read More: Retain and Inspire through Employee RecogntionEmployee Engagement ROI Survey Results

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