Igniting Passion: The New Rules Of Employee Recognition

Building a fire within, through authentic appreciation

What’s the best way to acknowledge exceptional employee performance and motivate someone to achieve even greater results?

Historically, Rewards and Recognition programs have centered on financial incentives like cash bonuses or gift cards, or being accorded Employee of the Year or Employee of the Month status.

But that doesn’t cut it anymore. The modern workforce, dominated by Millennials and Gen Z, prioritizes authenticity and alignment with personal values.

Jason Watt of Fortune 500 company Cardinal Health, whom I interviewed for my book Culture Spark: 5 Steps to Ignite and Sustain Organizational Growth, expressed it well: “You want to avoid setting fires under people but instead build a fire within people.”

Working with companies across the country, I’ve found that the following trends are making a difference in employee engagement and retention. Here are ways you can build that fire.

Make It Personal

Generic rewards are losing appeal in favor of platforms like Bonusly, where workers choose perks such as fitness memberships or charitable donations. Employees crave recognition tailored to their contributions and preferences. As Dr. Bob Nelson, author of 1501 Ways to Reward Employees, says, “Personalized recognition strengthens emotional connections, making employees feel uniquely valued.” 

Make It Frequent

A study by Globoforce/WorkHuman found that employees who receive regular recognition are five times more likely to feel valued and appreciated, six times more likely to invest in their work, and seven times more likely to stay with their employer. Annual reviews are outdated. Employees want real-time feedback to know their efforts are noticed immediately. 

Micro-recognition—small, frequent gestures like digital badges or team shout-outs—aligns with the fast pace of today’s business environment. Microsoft, for example, has a program called “Viva Engage” which enables instant recognition through likes, comments, and badges, fostering continuous appreciation for remote teams.

Make It Healthy

With mental health and work-life balance increasingly in focus, R&R programs now include wellness rewards like mental health days or meditation app subscriptions, reflecting the link between well-being and performance. Salesforce, for instance, has a program that offers stipends for gym memberships or therapy, with points earned for mindfulness challenges.

“Recognizing employees with wellness-focused rewards signals care for their whole selves, reducing burnout,” says Dr. Jennifer Moss, workplace well-being expert and author of Unlocking Happiness at Work.

Make It Peer To Peer

Top-down recognition is giving way to peer-driven systems where colleagues celebrate each other’s wins. This democratizes appreciation, boosts morale, and strengthens team bonds. Employees in organizations with peer-to-peer recognition programs have been shown to have lower stress levels and higher well-being in general.

Good examples are the Zappos “Co-Worker Bonus” platform, which allows employees to award points to peers, redeemable for personalized rewards like concert tickets, and Atlassian’s “Kudos” program, which lets employees send thank-you notes with redeemable points.

Make It Meaningful

Why not consider crowdsourcing the rewards and recognition program? Having employees themselves co-create the benefits ensures that they are on target and meaningful. It also builds trust and camaraderie and shows employees that their contribution counts. 

Furthermore, research by O. C. Tanner emphasizes that nearly 90% of employees have high trust in a leader who recognizes their accomplishments, compared to 48% who feel the same level of trust without recognition.

Final Thoughts

To truly honor exceptional employee performance and inspire greater heights, recognition must evolve beyond outdated rewards. By making it personal, frequent, wellness-oriented, peer-driven, and deeply meaningful, employers can spark genuine motivation and loyalty. As the modern workforce values authenticity and purpose, these strategies not only celebrate contributions but also cultivate a culture where employees thrive, trust grows, and organizations flourish.

Jason Richmond is the CEO and Chief Culture Officer at Ideal Outcomes, Inc.