When a client asks me questions on how to create a budget for recognition programs I respond, “You need to look at your company’s core values.” There is more to planning a budget than just numbers.
First you have to ask yourself, what is my business strategy? What am I trying to improve and what is the perceived value? For example, you might focus on retaining employees, customer satisfaction or increasing employee engagement. What is its value to your company? Maybe what you are spending needs to be reallocated. Many companies are finding out that it is not spending more money, rather spending it differently.
One of our clients used to recognize employees with hosting a drawing for a big ticket electronic item. To be included in this drawing, you had to complete a referral. Instead of having a random drawing, spend those funds to recognize all who reach this bench mark frequently with smaller rewards. When you recognize individuals for doing the “right things right” those behaviors are reinforced supporting what you are trying to accomplish.
Once you have the value determined, then you can start planning by answering the following questions:
- How many people will be earning?
- What type of behaviors (such as productivity, improvement, or recognition), and how many will you recognize for?
- Are the behaviors easy to achieve? If so, give less for these behaviors.
- Are the behaviors a stretch to achieve? If so, give more for these behaviors.
- How many people do you believe will participate? (About 20% of people do not play in a recognition program.)
Finally, take your budget and parse out by the number of behaviors you will recognize for, the ability/difficulty to achieve these behaviors, the number of people who will earn awards and save some of those funds to recognize for improvement like MORE quality referrals or on time resolutions.
