By Lynda A. Rizzo, J.D.

The Carrot Principle, the latest book by Adrian Gostick and Chester Elton, summarizes one of the largest studies ever conducted on employee recognition in the workplace. Gostick and Elton surveyed 200,000 employees over 10 years to come to some very enlightening conclusions on employee recognition and its larger implications for a company's bottom line.

In a presentation at WorldatWork's 2007 Total Rewards Conference in Orlando, Scott Christopher of O.C. Tanner hit upon some of the major themes and findings contained in the book. According to Christopher, "when employees aren't having fun and being recognized, they become disengaged." This may seem like common sense, but the fact is that employees do not feel adequately recognized, and it is employers that are suffering.

There are several reasons why employers have recognition programs. Employers want to create a positive work environment, create a culture of recognition, motivate high performance, reinforce desired behaviors, improve morale, and support the organization's mission and values. It is how a recognition program is actually executed, however, that will determine if these goals are met.

Some striking findings from the study include:

• 73% of employees feel engaged when their employers are ranked as giving "high recognition"; this number drops to 16.7% when employers are ranked in the 3 rd quintile for recognition.
• 70% of employees want to stay with their employers when their employers are ranked as providing high recognition.
• Managers ranked salary and job security as the top concerns for their employees, while employees reported that appreciation for work done was their top concern
• 79% of employees leave their jobs due to lack of appreciation

So, how can employers fix this and effectively recognize their employees? Christopher offered three basics of recognition.

1. This is stuff your mom taught you
2. Create informal recognition moments
3. Make a powerful presentation

Managers are the key to implementing these basic principles. According to Christopher, "managers are the conduit for anything good that can happen in the company." Managers need to offer recognition that is sincere, specific, personal, frequent, and timely. If managers are insincere in their praise, the trust between employees and their managers will be broken, a result that is worse than not giving any recognition at all.

Informal recognition can be as simple as a "thank you" or a "pat on the back." Employers can also offer rewards such as movie tickets, a special parking space, a half day off, remembering special days, or letters of praise. Informal recognition should be used to praise employee efforts. Formal recognition should be used to reward results.

Managers cite a number of reasons why they do not recognize their employees, including not wanting to get too familiar with their employees, a lack of time, a "what's in it for me" attitude, a concern that recognition will lose meaning, that other managers aren't doing it, and the belief that employees will just ask for more money or recognition.

But, the power of recognition is real. Employers that have adopted the "carrot" approach to recognition have seen real results, including increased retention, engaged employees, sustained productivity, higher profits, and higher customer satisfaction.

To sum up, Christopher listed some of the "do's and don'ts" of employee recognition. Things employers should do when recognizing an employee include:

• Invite others
• Be specific
• Link accomplishments to recognition
• Be timely with recognition
• Let others participate

Some things employers should not do are:

• Come unprepared
• Embarrass
• Make promises
• Waste opportunities
• Offend

Employees will want to remain with and do their best work for an employer that offers the carrot rather than the proverbial "stick."Employers will reap real benefits by taking this approach. When employers recognize good performance by their employees, chances are they will see that good performance again.