How to find balance between rewards and consequences

Photo illustration: TensorSpark/Adobe Stock

If you surveyed practice managers handling the human resources duties of their practice, you would likely find that employee engagement, retention, and turnover are top issues of concern. A recent survey by Joblist supports these concerns, finding that 40% of baby boomers, 27% of Gen X, 40% of millennials, and 44% of Gen Z employees were considering leaving their current employer for a new one.¹ What can stop the exodus and improve engagement?

The exodus of workers quitting—often referred to as the Great Resignation—can be stemmed with various strategies aimed at addressing the underlying reasons why employees are choosing to leave their jobs. Implementing a rewards and recognition (R&R) program can address some of the issues causing team members to quit. However, it must be done correctly to be effective.

Rewards and recognitions

To create an effective R&R program, you must follow a few guidelines. Namely, the program must be tied to your practice’s mission and strategic plans, be based on shared goals and realtime observations of desired behaviors, offer choices for your team’s diverse interests, and utilize data and measurable goals. It sounds like a tall order to fill, but more than just the team will benefit if done correctly. A well-orchestrated R&R program can achieve the following:

• Build up your brand and employee loyalty
• Demonstrate what the practice culture is to all employees
• Enhance the learning and development of personnel
• Increase employee engagement • Improve productivity and profitability
• Improve client service
• Improve the business’s ability to attract and retain employees
• Improve the performance review process
• Drive behavioral change and facilitate implementation of change management projects
• Reduce stress, absenteeism, and turnover

Given all these benefits, what stops you from developing your R&R program? The process can be simplified by looking at common R&R programs in other industries, such as formal, informal, and day-to-day approaches. Formal R&R programs include traditional career achievement awards or the milestones people are recognized for, such as length of service, retirement, public service, and attendance. Informal R&R is casual and spontaneous but still sincere. Examples of informal R&R are a handwritten letter of appreciation, a paid day off for a job well done, a special parking space, or tickets to a local event. Day-to-day R&R is what transpires between coworkers; for example, a sincere “thank you” or a peer-to-peer recognition system, such as posting a gold star when someone goes above and beyond their daily job duties.

The list of potential R&R ideas is endless. A Google search will produce more ideas than you can imagine. This is a great resource when working within a budget, which any R&R program needs. Typically, 0.5% to 1.0% of payroll is set aside for these programs. R&R programs must be designed to keep things fair and measurable and be linked to business goals. One would not want to set up a budget that is blown within the first quarter due to a lack of program design or mismanagement.

Poor design of the program can lead to negative consequences, such as an employee’s ability to game the system, as well as demotivation, loss of support from the top, and “foul” or “unfair” claims from the team. On the other hand, the design may be strong, but the presentation is weak, resulting in another type of failure—a form of “no bang for the buck” syndrome. Consider a person who has achieved a goal worthy of an R&R, then consider the result if the R&R is quietly slipped in their mailbox unbeknownst to anyone else. Do you think there will be a ripple effect throughout the team? Hardly.

Consider the presentation in the design of your programs. You want to achieve a “wow” moment, whereby the team knows who is getting the reward, why they are getting it, and why the contribution is vital to patient care, client service, and business growth. R&R presentations are conducted for a return on the investment in the program. Keeping it under wraps only snuffs out the flame, whereas announcing with a little panache can fan the flame for more high achievers.

Consequences

Every coin has a flip side. The flip side of R&R is consequences, which should be established for when goals are not met. Team members can be held accountable when goals are clearly defined and performance metrics are monitored.

Consequences are a form of recognition for poor performance or behavior. Consequences may be in the form of discipline, such as negative reinforcement or punishment, to reduce undesired behavior. A word of caution is needed here. Consequences can be overapplied in the form of public criticism and threats. Avoid stating any consequences you do not intend to follow through with, such as threatening termination when you both know you won’t carry through with it.

Most consequences are in the form of reprimands, warnings, or performance improvement plans. Starting with your standard operating procedures and policies, you inform the employee of the policy, document the behavior that is not up to policy standards, arrange for coaching or learning the skills required, establish a time line, and follow up on the progress.

Holding your team members accountable requires their knowledge of what is expected of them. Written policies, job descriptions, regulations, ongoing feedback, rewarding outstanding work, establishing performance standards, and penalizing poor performance are all necessary for accountability. Failure to hold people accountable places patient care, client service, and business goals at risk.

Making it work across generations

The 3 rules for a R&R program include the following:

1. There is no one-size-fits-all approach to rewards and recognition.
2. R&R should be valued and desired by the employee.
3. There is an inherent complexity in generalizing any group.

For example, consider the baby boomer group; numerous ideas exist about how this group functions because of loyalty and sticking with 1 employer for their entire work career. Suggested R&R programs focus on health care, retirement benefits, and promotions with titles. However, refer to rule No. 1, and you will quickly find that some baby boomers have no plans to retire, whereas others will retire as soon as possible. Now, what do you do for R&R?

Gen Xers may be dealing with sending their children off to college while moving their aging parents into a retirement home or their own residence. They are concerned with financial planning and retirement savings, and they not only want opportunities to grow professionally but also flexibility to tend to personal obligations.

Millenials also may be dealing with mortgages, student debt, and having children. They value mentorship, flexibility, and skill development.

Gen-Z, the youngest in the workforce, value workplace diversity, inclusion, and authenticity. They are deciding between college vs vocational training and navigating what adulting will cost them when payments start on their student debt, along with other cost-of-living expenses.

Generational differences are not the only dominating factor when determining what rewards to offer or how to deliver recognition—life stages also come into play. These would be stages such as expectant parents, raising young children, and being responsible for the care of older adults. You can probably think of a millennial who is involved in providing care for an older parent or grandparent, or a baby boomer who is now raising their young grandchild. The rules would apply to these 2 examples.

To develop your R&R program, you should analyze your workforce and understand individual behaviors, generational group tendencies, and life stages to create a program that satisfies everyone. The wide array of choices can make it easy to become discouraged. Incentives may include cash, gift cards, paid time off, travel, flexible work options, entertainment, dining, merchandise, and education opportunities.²

Different people desire and value different rewards, and things can get complicated when you generalize your team into a single group with 1 or 2 rewards. For example, say a cash bonus for scheduling more dentals appointments is announced. Perhaps this is popular for the first month but is all but forgotten a few months later, and some employees did not even realize that the bonus was included in their paychecks. This program is lacking a complete R&R strategy.

Understanding that your business must have some control over the R&R offerings, start by surveying your team to get ideas for your unique program. Online survey services offer templates for easy use, or to use as a starting point in developing survey questions.

You may be surprised to find that everyone on your team wants flexible work hours—but for different reasons. Some are interested in time off for volunteering. Sabbaticals are rated important with baby boomers and millennials, whereas mentorship time is higher on Gen X’s list.¹ You can create your own plan or tap into the services of an outside source to help you set up and manage a program.

Engaged, motivated, and satisfied

With proper setup and management, the R&R program for your veterinary practice should positively affect your workforce. There should be positive changes in behavior across all generations on the team—most notably, reduced turnover, increased engagement, and higher morale. This change in the team cascades to other areas of the business, such as patient care, client service and satisfaction, and business profits. Therefore, creating a R&R program based on a strategic plan is important to ensure success when so many other areas of the business are affected.

REFERENCES

1. Grensing-Pophal L. Is your employee recognition program falling flat? Society for Human Resource Management. November 30, 2022. Accessed May 3, 2024. https://www.shrm. org/topics-tools/news/benefits-compensation/employee-recognition-program-falling-flat

2. Schweyer A, Presslee A, Atefi Y. General expectations of incentives. Incentive Research Foundation. Accessed May 3, 2024. https://theirf.org/research_post/generational-expecIBEX.Media - stock.adobe.com tations-of-incentives-effective-rewards-for-a-rapidly-changing-workforce/