Recent research from the Harvard Business School confirms what we have often suspected and what Alfie Kohn told us in his book “Punished by Rewards” in 1999.

Not only do most employee recognition programs provide us with less than stellar results, but poorly designed ones may in fact have the unintended consequence of demotivating the best employees.

We have long known that programs with unclear objectives, which are subjectively awarded and that have more losers than winners are ultimately organizationally demotivating as individuals evaluate themselves against the winner and can find no good reason, because they “worked every bit as hard.”

This new research however demonstrates another problem that is perhaps more significant.  Exceptional employees who previously had excellent attendance and were highly productive ended up suffering a 6 to 8 percent productivity decrease after the recognition program was introduced. This suggests that these employees were actually turned off—and their motivation dropped—when the managers introduced awards for good behavior they were already exhibiting. 

This is not to say that there aren’t good recognition programs, simply that good ones are difficult to design.  The SCARF Model that David Rock created in 2008, which is a summary of a variety of discoveries from neuroscience about how people interact in social environments, makes this point by connecting the way the brain behaves when status, certainty, autonomy, relatedness and fairness (SCARF) are brought into a “threat” state.  The brain treats these social ‘slights’ in much the same way as physical threats and rewards.  Interestingly, and unfortunately, reward and recognition programs are perfect for ‘attacking’ each of these domains.  Status is threatened when our importance relative to others is in question.  Unclear criteria makes it difficult, if not impossible, for certainty to be satisfied when your behavior may be found insufficient.  Autonomy is removed when the desired behaviors are too specific and when a variety of behaviors would also satisfy the outcome requirement.  Relatedness, a sense of safety with others is threatened when a higher status person makes subjective judgments about another.  Finally, fairness is challenged with and brought to a threat state if the system is not seen as an equitable exchange.

Ultimately the message is that reward and recognition programs are a tool and like most tools can be misused if not carefully considered.  I recommend the following reading from which this was derived.

Find the Harvard Business School research at (http://hbswk.hbs.edu/item/6946.html)

and David Rock at http://www.scarf360.com/about/index.shtml