Rewards and Recognition
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Rewards and Recognition market report transcript
Regional Market Outlook on Rewards and Recognition
Non-cash awards are expected to grow as the focus on brand, culture, and innovation becomes more critical for business success. Gift cards will gain momentum in 2018. Mid-sized firms spend an average of nearly $500,000 annually on gift cards across all programs, whilst Fortune 500 companies spend over $1 Million annually. Top-performing companies feature higher non-cash incentive payouts annually for the average employee.
In the US, 84% of organizations use tangible non-cash rewards . This represents more than a three-fold increase from 20 years.
Reason for the shift from Cash to Non-cash rewards:
- This gain in popularity and use of non-cash, tangible rewards is due to a growing understanding of the advantages accompanying tangible non-cash rewards.
- There are psychological mechanisms underlying these benefits.
Market Trends of Global Rewards and Recognition Programs
Professionals in the non-cash rewards industry keep undergoing a large amount of transformation. From cultural changes to technical developments to an enhanced emphasis on risk and safety
Developing a brand-asset culture is a corporate necessity
- Non-cash awards to increase as organizations concentrate on brand, philosophy, and modernization.
- Companies with non-cash award programs must guarantee these programs are recompensing in several parts, brand-centric actions, flexibility, and revolution.
Social Recognition becomes a necessity
- Almost 40% of programs are now using social recognition.
- Employee engagement sponsors demand for social recognition benefits/value.
- Technological advancement, cloud computing, social media proliferation, and a wide array of automation tools have made social recognition a reality.
- Programs' power increases when they are integrated with other platforms such as SaaS, VR technology, AI etc.
- 34% of program owners have expressed, they are now integrating their programs with their sales force system
Growing capacity with progressively predicative analytics and intelligent technology
- Using predicative analytics, meeting planners can collect data throughout many events.
- They have a valued solution to uncover current in-house corporate data, forecast broader individual company patterns etc.
Gift cards continue to increase
- Employee reward programs are the largest category for R&R programs and the average spend will maintain and improve.
- The simplicity to obtain gift cards has influenced employees use in non-cash awards programs.
Products shifting to organic, local-sourced and custom-made
- Employees obtaining awards look for a profound reason for choosing a product, which has shifted the goal for products to be sourced locally, and simple to tailor.
- Rewards matter to employees when it has an individual significance and a customized distribution accompanying it.
Growth Drivers & Constraints
The increase in 22% of Gen X, Y, and millennial workers have changed the whole landscape of the R&R offerings. High attrition rate and turnover also fostered the growth of the industry. Recession and economic slowdown along with the risk of data pose a threat to the industry.
- Talent Management - Due to the shortage of skilled and efficient manpower, organizations are increasingly adopting R&R programs for better human capital management.
- Better Employee Engagement - It is estimated that about 75% of employees in an organization feel that R&R programs of any type boosts the morale of employees, thus, resulting in enhanced job satisfaction and improved motivation.
- Shift of HR from Technical to Strategic Model - Organizations expect HR employees to undertake strategic activities from regular tactical activities.
- Budget Constraints in Implementation - R&R programs involve HR and finance departments to allocate budget appropriately, but during financial crunch, organizations impose budgetary constraints.
- Time Constraint to Implement Recognition Ceremony - Time constraint is a challenging factor, as HR employees and mangers have to manage the R&R programs in-house.