Reward

The Impact of Recognition on Employee Performance: Theory, Research and Practice

Fred Luthans University of Nebraska Department of Management Lincoln, NE 68588-0491 e-mail: [e-mail]

Alexander D. Stajkovic University of Wisconsin-Madison Department of Management and Human Resources

The Impact of Recognition on Employee Performance: Theory, Research and Practice Introduction Although money receives the most attention as a reinforcer and incentive motivator, and is even equated with reward systems by practicing managers, there is increasing evidence that contingently administered recognition can be a powerful reinforcer to increase employee performance. The purpose of this paper is to provide reinforcement and social cognitive theoretical explanations and research results on recognition, explore the moderators of the relationship with performance, present some specific guidelines for effective implementation, and review representative applications. Theory and Research Background As a reward for employee performance, recognition is defined as acknowledgement, approval and genuine appreciation (not phony praise). This recognition can be set up on a formal basis (e.g., employee of the month or million dollars in sales round table) or informally used by a supervisor/team leader in managing individual employee or team behavior. It can be administered on a public (staff meeting, newsletter, or banquet) or on a one-on-one private level, verbally or written. There is a fine line between recognition as defined here and other positive reinforcers or rewards such as money and feedback. For example, providing a merit increase in pay or a bonus and feedback about performance can be considered forms of recognition. However, this paper focuses on nonfinancial recognition and does not necessarily contain information about performance, although some formal recognition programs may involve prizes, dinners or plaques that cost money and both formal and informal

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