5 Ways to Convince Executives to Fund A New Recognition Solution

When you know you need a new recognition solution but aren’t sure your leaders agree, one of the most important things you can do is get executive support before you start your search for a new provider. Prepare a solid business case for why a new recognition solution is necessary and getting those precious resources approved will be infinitely easier.

Here are 5 questions executives want answered before they support the purchase of a new recognition solution.

Just starting your search for a recognition partner? Check out our buyer’s guide for practical advice, useful tools, and valuable insights to help you prepare and search confidently.

1. Why do we need a new employee recognition solution?

Reasons for needing a new recognition solution are often unique to an organization but should always be tied to something bigger than simply employee recognition.

• Are you losing too many of your best people and struggling to replace them?
• Are you trying to combat burnout?
• Do you need to improve your workplace culture and create a sense of community and belonging?
• Are employee surveys showing low engagement and low morale?

Whatever the reason for your employee recognition search, communicate the “why” of recognition (and the cost of not doing recognition well) to your executives. Tie employee recognition to business goals and outcomes.

Ask yourself: How does recognition help with your executives’ biggest business issues? Some executives understand the importance of recognition in building a thriving workplace culture and keeping employees engaged, productive, and loyal. Others need more convincing (see question #2 below). Connect the dots on what recognition will do for your organization, and what will happen if employees don’t feel appreciated and valued at work.

For example, perhaps executives are struggling with how to engage and connect their hybrid or remote workforce. Help them see how frequent recognition helps hybrid and remote workers feel more engaged, included, and a stronger sense of purpose, opportunity, and success.

2. What ROI will we get from investing in employee recognition?

According to Gartner, the top priority for CEOs is growth, followed by tech and workforce issues like retention, hiring, and DEI. As you present your business case to executives, be sure to include data and stats like the ones below on how a recognition solution can help with these issues.

Retention

• A whopping 79% of employees leave because they don’t feel appreciated
• An effective years of service program alone increases employee tenure 2-5 years
• Companies with recognition programs see 31% lower turnover than companies without

“[Recognition] is the greatest retention tool in the world.”
— Russell F. Cox, President and CEO, Norton Healthcare

Productivity and innovation

• Odds of great work increase 13x in organizations with high recognition integration
• Employees who are recognized are 33% more productive and generate 2x as many new ideas per month

DEI

When recognition is an integrated part of an organization’s culture, employees are:

• 4x more likely to feel a high sense of inclusion
• 22% less likely to feel excluded
• 13x more likely to feel they belong at the organization

Business results

Organizations with highly integrated recognition are:

• 4x more likely to have highly engaged employees
• 2x more likely to have increased in revenue over the past year
• 73% less likely to have layoffs over the past year
• 44% less likely to have employees suffering from burnout

Don’t take our word for it—see the ROI some of the top companies have found with recognition:

TD Bank Group: Both giving and receiving recognition has a moderately strong correlation to lower attrition rates.

GE Appliances: Overall risk of attrition was reduced by 58% when an employee received recognition in the prior month.

Ohio Living: Recognition leads to lower hospital readmission rates, lower nursing and staff turnover, lower infection rates, better patient outcomes, and higher market share.

Norton Healthcare: Engagement survey results went from the 55th percentile to 83rd in the healthcare market and overall retention is in the top 70^th percentile.

Find more recognition ROI stats and ways to measure impact for your business case.

3. What type of employee recognition solution do we need?

Chances are, you aren’t approaching your executives without first doing some research on what type of recognition solution you want to implement. Show them you’ve put a lot of thought into the best tools for your organization.

Here’s a checklist of recognition features that are a must-have for your solution:

• Easy to use (for employees and HR)
• Offers a variety of recognition tools (monetary and non-monetary, leader and employee tools, online/offline, symbolic awards, individual, team, and company-wide recognition)
• Can recognize a variety of reasons—great work, extra effort, years of service, company celebrations, team celebrations, innovation, top performance, life events, etc.
• Has a mobile app for on-the-go recognition
• Customized to your organization—looks and feels like you
• Is flexible enough to be customized to individual business units or locations
• On a highly secure, cloud-based system
• Includes great awards (with global options if needed) and custom award capabilities
• Has tools and reporting to track recognition, enable budgeting, and send automatic reminders
• Can be integrated into your existing technology
• Offers social tools to share recognition across the organization

“Our CEO is a big sponsor of the MomentMakers program. He engages with it, holds leaders accountable for recognizing, and is a strong advocate for the program. His support helps make MomentMakers so successful in creating a culture of belonging, inclusivity, and caring at CIBC.”
— Jackie Goldman, Senior Vice President, Rewards, Recognition, and Performance, CIBC

See how CIBC updated their recognition solutions to create an award-winning recognition culture.

Learn more about essential features for your recognition solution.

4. Could we do employee recognition on our own?

You could. But it would take a lot of work, and resources you may not have.

Talk to your executives about the recognition that is currently happening at your organization. Are employees recognized often? In a meaningful way? That connects them to your purpose, accomplishment, and one another? For demonstrating your company values? Without a robust solution, it is often hard to track what recognition is happening, how it is being given, and how much is being spent.

Recognition outside of a centralized solution can also be very manual, using precious people resources to track, administer, and deliver recognition. Think about the ramifications of not having a new recognition solution. Does it hinder the employee experience and put undue stress on people leaders or HR teams, who could be spending that time on other culture-building activities?

Case study: Capital One

Before upgrading their recognition solutions, Capital One took an inventory of all their associate recognition programs and solicited feedback from their business units to learn best practices they were doing and what additional support they needed. Armed with this data, the team began to create a recognition strategy and vision that gained a high level of executive support.

Says Kelley Lynch, HR Director at Capital One, “I've had some meetings with leaders who weren't fully bought in and one of the first things I asked them is tell me about a time when you felt really impacted by recognition or appreciation. Everyone has a moment. So, if you put that moment with data and tell this story, then it's a much easier road to convince folks, especially in finance and other areas, why this is important.

How does this tie back to actually improving your return on investment? Because the power of recognition and appreciation can impact engagement. It impacts attrition, it impacts net promoter score. There is a business return when you do it the right way.”

5. How much will this cost?

The answer to this will depend on when in the buying process you are soliciting executive support. You may already know the cost if you’ve found a partner, or need to provide an estimate if you are just beginning your search. Either way, you can use the following guidelines for recognition spend:

• WorldatWork recommends spending up to 1% of total payroll on employee recognition each year
• Aon’s number is up to 3% of your total HR budget
• Recognition Professionals International (RPI) says at least $100-$150 on performance recognition per employee per year alone
• The O.C. Tanner Institute recommends spending at least $200-$350 per employee per year for things like daily informal and formal recognition, service awards, onboarding, and recognition during holidays and events.

One final note: make sure you are getting the right leaders involved. If you are working directly with your CEO it can be easier to get a yes, but it may be an executive team you plead your case to:

• Your CHRO. They have a vested interest in finding a successful recognition partner.
• Your IT leader. Since a new recognition solution will need to work within your existing IT environment, your IT leader will want reassurance that this won’t come with security risks or disrupt your IT systems.
• Procurement leader (if you have one). They will ask questions about the purpose of the solution, the business reason behind it, and if you’ve looked at all other possible options before purchasing a new solution.
• Communications executive. Show how recognition can be aligned to any internal branding efforts and reinforce company values.
• Global sponsors or line of business leaders. They may have similar recognition needs that can all roll up into one solution.

Looking for a recognition solution that your executives and employees will love? Check out Culture Cloud.