Home » Why is Employee Recognition Important? – A Quick Guide


In this guide:

What does it really mean to appreciate an employee?

Employee appreciation, or employee recognition, is the initiative taken by a company, boss, or co-worker to call attention to an employee’s great contributions. This can take many forms: positive feedback, rewards, accolades, and even a pat on the back.

There are many forms of positive employee recognition, but the best way to show you appreciate an employee is to let them know you see and value them as an individual. Personalized employee appreciation is key.

Employees who believe that management is concerned about them as a whole person—not just an employee—are more productive, more satisfied, more fulfilled… which leads to profitability.

Anne M. Mulcahy, Business Innovator, First Female Chairman & CEO at Xerox

Why does showing employee appreciation matter?

Employee recognition is more important than ever now that remote work has become the norm. Personal connections with co-workers are becoming more difficult to establish and maintain. At the same time, scouting and hiring have grown more competitive and job options have opened up worldwide for many roles that used to be office-based.

Remote or not—the key to keeping your employees happy and productive goes beyond good pay and perks—it’s all about employee appreciation.

Feeling valued is fundamental to workplace happiness. Happy employees work both harder and smarter (and spend less of their workday secretly job hunting) than unsatisfied workers.

Employee appreciation is about optimizing employee well-being, productivity, innovation, loyalty, and overall outcomes by creating an ideal work culture and environment.

Risks of Failing to Recognize Employees

Irrelevance is the feeling that an employee gets when they don’t see how their job really makes a difference in someone else’s life in some large or small way.

Patrick Lencioni, Author, Business & Team Management Expert

Companies that fail to prioritize employee appreciation leave themselves open to several risks:

Risk #1: High Employee Turnover

Why is employee recognition important?


1 in 3 employees have left a job because they didn’t feel their employer cared about them as a person,” according to Limeade’s 2020 Employee Care Report. The Society for Human Resource Management (SHRM) says total costs of employee turnover can range from 90% to 200% of the employee’s annual salary.

Overall, employee turnover costs businesses over $600 billion every year, according to the Work Institute.

Employees who are not recognized for their hard work wind up looking elsewhere for a job. Even new employees lose enthusiasm quickly when they see a lack of employee appreciation in the organizational culture.

Risk #2: Low Productivity

Prevent an environment where employees show up just to punch the clock. Failing to recognize hard-working employees tells your staff there is no point in going the extra mile. It signals they might as well do the bare minimum because top effort and high performance will go unnoticed.

Risk #3: Obscure Company Values

Most ambitious organizations have a list of company values they strive to embody throughout the business. When you miss the chance to recognize an employee who has gone above and beyond to represent one of your company values, you weaken the integrity of your organization.

Failing to consistently tie your company values to human behavior and actions can lead to a lack of accountability for all employees.

Risk #4: Hiring Difficulties

Glassdoor reports that 86% of employees and job seekers research company reviews and ratings to decide on where to apply for a job. In a competitive job market, your top job candidate may be considering several job offers.

When pay and benefits are comparable, the final decision comes down to the applicant’s impression of your company culture. If they don’t get a strong sense that your people feel valued and appreciated, your dream employee will pick the other offer.

Business Benefits of Employee Appreciation

Employee appreciation starts with a concerted effort to make individual employees feel recognized and valued. But the real magic happens when that initiative snowballs into a positive company culture that improves several areas of output:

Benefit #1: Employee Well-Being

Employee Recognition

96% of organizations believe that well-being is an organizational responsibility, and 80% see it as important or very important to their organization’s success. It makes sense…

Work takes up a significant portion of our adult lives and has a strong influence over our sense of well-being. In many cases, it even impacts our health. Strong leaders help make work a happy place for all employees by promoting togetherness and rewarding great performance.

Benefit #2: Productivity

In a world where excellent work is rewarded, more workers strive for excellence. When you appreciate an employee for their great work, make sure to involve other employees and make the praise visible. Showing other employees a positive example to strive for can be extremely effective, and that’s how social proof works:

The more attention you give to positive, productive behavior, the more likely it is to be replicated.

Benefit #3: Creativity

Use your employee recognition efforts to celebrate diversity, inclusion, and uniqueness. Creating a safe space at work where employees feel valued and increasingly comfortable with one another is the best way to invite questions and ideas that drive innovation for your business.

Benefit #4: Loyalty

Employees who feel valued are less likely to leave. True, some may still end up leaving. But that doesn’t have to mean burned bridges or bad reviews. People who feel a sense of bonding and loyalty to their former coworkers, boss, or company will likely speak more fondly of the organization than those with no personal ties to the team.

Benefit #5: Strong Company Culture & Values

One of the great features of employee appreciation is the ability to tie rewards and recognition directly to your company values. Aligning employee recognition with company values gives other employees a concrete example of what it really means to live out each value.

The outcome? A stronger company culture with high integrity and increased loyalty.

Benefit #6: Business Reputation

Employee Recognition

It might be a Glassdoor review seen by 86% of job seekers or a social media post visible to customers. Each employee has a voice and many ways to share their experience with your company. Employee reviews can impact everything from talent acquisition to partnerships, revenue, and other key performance indicators (KPIs).

One extra benefit of prioritizing employee appreciation is that it leverages the rule of reciprocity to turn employee voices into a major advantage for your organization. Your effort to express how and why an employee is important to you and the business inspires them to return the favor with positive feedback. 

The result? Reviews, ratings, and word of mouth about your company will be more positive and abundant, which will skyrocket your reputation as an employer and business.

The Key to Showing Employee Appreciation: Personalized Video

Smart companies make certain their managers know how to balance being professional with being human.

Travis Bradberry, Author, Influencer, & Expert on Emotional Intelligence

We recommend employee appreciation videos as the best tool for any company looking to humanize work relationships, appreciate colleagues, and drive positive company culture. A video montage showing how much you appreciate an employee lets you collaborate with co-workers to create a gift that is meaningful and easy to share.

The employee of honor will feel deeply appreciated when they see co-workers together in their employee appreciation video. Meanwhile, the video format doubles as a great way to publicly showcase your company values and employee recognition efforts. Recipients are eager to share their videos with the world, which is a great look for you and your employees!

How to Make an Employee Appreciation Video Montage

Tribute is the most user-friendly employee appreciation video maker. In a few simple steps, you can collaborate with others, gather videos, and use the easy video editor to bring it all together. Or our concierge service can professionally edit your videos for you!

  1. Invite friends.
    We send the invitations with all the information your friends and family need to participate.
  2. Collect videos.
    We provide the prompt for your participants to make a video and upload it.
  3. Compile the video.
    We make it easy for you to drag and drop the collected videos into any order you like and then share the final Tribute video.
  4. Get premium service (optional).
    Let one of our concierge editors manage the project and compile your final Tribute video.

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