Rewards and Recognition Drive Global Employee Engagement

Employee engagement is driven by a number of factors including management and leadership within a company, career opportunities and enabling infrastructure – whether or not employees have the tools and training to do their jobs well. Conventional wisdom also suggests that while compensation is a motivational factor, it is a less important driver of employee engagement. According to AON Hewitt, this may no longer be the case.

Results from the AON Hewitt study indicate that rewards and recognition may, in fact, be the most important factor driving employee engagement on the global scale today. While leadership and opportunities for growth within an organization remain important motivators, rewards, and recognition, which previously ranked third, now ranks as the number one driver of engagement globally.

The authors acknowledge that few organizations can significantly increase compensation across the board. Instead, they recommend that organizations recognize the global factors driving engagement levels down – the external political and technological changes contributing to anxiety in the workplace – and find other ways to reward their employees and address issues that may negatively affect their feelings about the compensation they receive.

For example, adding more transparency to an organization’s compensation system can go a long way to eliminating real and perceived issues of fairness that can negatively impact employee engagement.

Workers also want value-added employment

According to the AON Hewitt study, employee value proposition – the organization’s ability to communicate and deliver benefits that attract and help to retain employees – emerged as the second most important factor driving engagement. These results suggest that while companies can’t control worldwide events that are negatively affecting employee attitudes, they can make the workplace more appealing to employees through positive solutions. Supportive approaches can increase a company’s value proposition by providing benefits such as:

employee career development,

wellness programs,

more flexible work schedules,

ensuring that workers have the training and tools needed to perform their jobs.

According to AON Hewitt, the employee value proposition is fundamentally about creating a “magnetic sense of belonging” to an organization. With this idea in mind, aligning rewards and recognition with a company’s culture and vision can also improve motivation by giving employees a greater sense of belonging and a better understanding of how the work they do contributes to not only their own career but also to the growth of their organization.

What can we expect in the future?

Only time will tell if the recent decline in global engagement levels will continue. It is, after all, a single point along a trendline. However, according to the AON Hewitt study, the factors driving this decline are external forces that companies can do little to change. Going forward, companies will need to adapt quickly if they are going to effectively respond to the external challenges of rapidly changing politics and technology. By recognizing the impact that such externalities have on the worker experience, companies have an opportunity to help reverse the recent decline in engagement by implementing approaches that improve rewards and recognition for their employees and give them a greater sense of belonging. With a direct correlation between workforce engagement and organizational success, companies can treat this small warning sign as a big opportunity.