The Importance & Benefits of Peer-to-Peer Recognition

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For HR leaders in 2023, the most important issues are still employee engagement and employee retention. ‘The Great Resignation’ dominated debate last year, becoming the source of most of the soul searching and head scratching done by businesses. A poll of over a thousand C-suite executives from around the world found that talent retention was a chief concern – not just for this year, but over the course of the next decade.

We know that one of the chief causes of employee turnover is a lack of engagement – a Gallup study of nearly 24000 organisations found that businesses with low levels of employee engagement experienced an average of around 51% more employee turnover than those with higher levels of engagement.

So, the question isn’t simply ‘how can we get people to stay’ – its how can we get the best out of our people? How can we get them engaged, motivated, and happy?

Surveys have shown that 82% of employees report that recognition is an important part of their happiness at work. Furthermore, 36% of respondents to one poll said that a lack of appreciation was a major reason they were considering changing jobs. Other studies have found that 37% of employees feel that recognition is key to motivation, engagement, and productivity.

These numbers are significant, and calculating the value of employee recognition demonstrates the impact recognition programs can have on any business in terms of improving engagement, absenteeism, and employee retention.

And while of course, manager and leadership-led recognition are integral, an often overlooked aspect of employee recognition programs is peer-to-peer recognition. 65% of workers say they would be happy to stay in a job with an unappreciative boss, so long as they felt appreciated by their peers.

Peer-to-peer recognition has a host of unique benefits, from improving collaboration, encouraging positive behaviour, and reinforcing company culture. Perhaps most importantly, these types of recognition programs help to foster and promote strong relationships amongst the workforce – and our research has previously demonstrated that strong relationships at work are not only more likely to keep employees in their roles, but go above and beyond.

So let’s dig deeper into what peer-to-peer recognition is, what it should look like, and how it can have a meaningful impact on your organisation.

What is Peer-to-Peer Recognition?

A peer-to-peer recognition program or scheme is a way of enabling and encouraging everyone in the organisation to recognise others in the workplace. These schemes make it easy to do this in a simple, timely, and intuitive way, encouraging everyone to get involved.

Peer recognition is a way for colleagues to express genuine appreciation for each other. It’s a way of celebrating successes and achievements that allows everyone company-wide – no matter their job title or seniority – to be involved in recognition-giving.

Most organisations understand the importance of recognition in the workplace – in fact, around 80% of businesses already have recognition programs in place. Yet most of these schemes place the responsibility on managers to recognise the achievements of their employees. Such manager-only, top-down recognition schemes limit the impact of recognition, confining it to simply employee performance discussions. This generally means the recognition is kept private between a manager and an individual employee.

Peer-to-peer recognition, by contrast, is public recognition; it is cross-departmental, allowing team members to shout-out and share their appreciation for one another. Peer-to-peer schemes are also 36% more likely to have a positive impact on productivity and financial results than top-down recognition programs.

The specifics of your peer recognition programme will vary between different organisations and will be unique to you. Factors such as workplace size, industry, and whether you primarily work remotely, in the office, or a hybrid of the two will impact the way you design your social recognition system.

The Importance of Peer-to-Peer Recognition

At a basic level, we all want to feel appreciated. Receiving praise for your peers makes you feel good; helps you to see yourself in a positive light, and feel as though the work you have done has meaning. Really, everyone wants to feel that the work they do is valuable, and that their peers and other employees have noticed. Its easy to understand how this can positively affect morale and motivation levels.

But beyond the fact of simply making people feel good and happy about themselves, it has numerous benefits to businesses as a whole.

It Helps to Promote Company Values

While many businesses promote a core set of company values, many organisations can struggle to truly embody those values. It can be easy to list company values on everyone’s desktop values, but actually promoting, rewarding, and enforcing those values can be a bit more challenging.

Peer-to-peer recognition provides a platform for co-workers to actually recognise and shout-out the right behaviours.

This is why linking your company values to any reward or recognition scheme is so important. It means that the right behaviours get rewarded. It actively encourages people to practice behaviours that align most closely to your company values, and it helps your people to actually feel affiliated with those values.

Instead of just being words on a screen, they become real, living, breathing ways of acting that clearly benefit all individuals within your organisation.

 It Makes Organisations Feel Less Hierarchical

A significant advantage of making recognition peer-to-peer rather than top-down is that it allows people to feel free to celebrate their colleagues without needing to go through hierarchical channels. It makes that recognition feel more personal, and it makes organisational structures feel flatter.

One study found that two thirds of participants would be happier with a flatter organisational structure. It helps employees feel more involved and engaged with company decisions.

Businesses want to improve employee engagement, and encouraging peers to recognise their co-workers is an easy way to help people feel more involved and engaged with the process of rewarding and celebrating hard work and company achievements.

It Improves Performance & Productivity

According to research by Gartner, feedback from peers can improve performance by 14%.

Another study by the Harvard Business School found that recognition from peers was a key driver of increased performance levels. Other studies have found that as many as 40% of employees say they would work harder if they felt more recognised.

Elsewhere, polls have found that workers are 5 times more likely to suggest that recognition – rather than salary – is key to motivation and productivity.

All of this evidence spells out something that should be obvious: happy employees are motivated employees, and rewarding and recognising their hard work will make them more likely to continue to work hard.

Peer-to-peer recognition then helps to drive high-performing company cultures, showcasing the day-to-day achievements and successes of employees, and providing that additional public motivation that encourages people to work harder, proactively upskill, and perform better.

It Benefits Employee Retention

This is the big one. With 79% of businesses in the UK struggling to recruit new staff and amid an ongoing candidate shortage, improving retention is a major priority for all businesses. This is where employee recognition – especially peer-to-peer – can have a huge impact.

According to a SurveyMonkey survey of over 1500 people, 63% of workers who were recognised for their hard work and achievements responded that they would be unlikely to want to find a new job within the next 6 months. That same survey also found that only 11% of people who did not feel recognised would want to remain in their current roles.

Of all the possible employee recognition programs, peer-to-peer recognition is one of the most effective ways to consistently ensure employees feel recognised, and this is proven to boost retention efforts. Valued employees are more likely to remain with your organisation.

How to do Peer-to-Peer Recognition

With remote and hybrid working now the default, and with many people no longer regularly sharing an office space with their peers, peer-to-peer recognition programs work best digitally, with software tools enabling the workforce to easily give and share recognition with each other.

XCD’s recognition tool, Appreciation, has been designed to make it easy and intuitive for people to provide recognition to their peers. Appreciation is a peer-to-peer recognition platform, so anyone can send a Appreciation, sharing the positive message with the whole organisation through the friendly ‘Chatter Channel’. Here, people can interact with their peers’ recognitions and achievements, building community and company culture together.

If you want to find out more about how XCD Appreciation can make your people feel recognised, appreciated, and motivated, click the button below to download Appreciation from the Salesforce AppExchange.