Exploring the Factors Influencing the Effectiveness of Employee Recognition: An Analysis of Recognition Practices in Chinese Businesses

Zeng Xi

Durham University

Abstract: This research investigated the existing employee recognition methods in Chinese businesses and assessed their effectiveness.An in-depth interview was conducted in a commercial bank and a telecommunication company in China.Data was collected from thirty managers who were asked to share their opinions on employee recognition effectiveness and then analyzed using the thematic analysis method.The findings indicate that an effective recognition scheme included increased job satisfaction,employee motivation, work performance, and employee commitment.Furthermore, it suggested that organizational culture, the various forms of recognition practices, awareness of giving recognition, communication,and managerial skills, can all influence recognition effectiveness.This study adds to the development of a theoretical model to help understand what makes employee recognition more effective and to clarify the value generated by effective recognition.It also contributes to the understanding of employee recognition in the Chinese workplace.Practically, this study gives recommendations to managers regarding how to better evaluate their employee recognition systems and how to improve their effectiveness.

Keywords: employee recognition, recognition effectiveness, employee motivation,qualitative research

Employee recognition can be defined as a constructive response to employee behaviors and judgment of employee contributions and value (Brun & Dugas, 2008; Vadivelu, 2013;Saunderson, 2016).Previous researchers have mainly focused on the importance of recognition and calling for the adoption of recognition practices to increase employee motivation and improve organizational performance (Harrison, 2013; Ismail & Ahmed, 2015).To date, recognition practices have been applied widely in the managerial field.Nearly 75 percent of companies have implemented a recognition program in the US (Garr, 2012).However, managers rarely conduct a consistent evaluation of their recognition schemes and often fail to give any truly meaningful recognition to employees(Saunderson, 2004).Two-thirds of companies responded that their recognition programs were not effectively implemented (Garr, 2012).

Establishing the recognition policy is only the first step in the process.Ensuring that implementation of a recognition program meets its goals is often overlooked in organizations since there is a broad lack of set criteria for the managers to use when evaluating their existing recognition practices (Carder & Clark, 1992; Saunderson, 2004).Few studies have paid attention to the effectiveness of recognition schemes and how to make them more effective.

Defining effective recognition is an underdeveloped area of research, but previous articles have indicated some potentially useful factors in understanding the effectiveness of recognition.Saunderson(2004) indicated that an organizational culture that recognizes the value of personnel and associated managers’ awareness of recognition, are important parts of recognition effectiveness.Also, it is assumed that combining cash and non-cash recognition practices can better motivate employees(Long & Shield, 2010).These provided possible directions to explore what influences recognition effectiveness.

Little research in this field has a Chinese context.Thus, the current employee recognition practices in Chinese businesses remain unclear.This uneven focus invites further investigation into employee recognition in China.Besides, Schmitz (2019) finds that criteria defining expectations and requirements of Chinese workers have been evolving, and Chinese workers are becoming increasingly interested in their value and growth at work.This demands practices recognizing their value and it is necessary to explore employee recognition in the Chinese context, which could also contribute to a better general understanding of human resource management in Chinese businesses.

This study attempts to fulfill the research gap by answering three questions: what employee recognition practices are currently used in Chinese businesses; how to evaluate recognition effectiveness; and what the possible factors influencing recognition effectiveness are.Based on the empirical findings, this study develops a theoretical model to understand what makes employee recognition more effective and clarifies the value generated by effective recognition.

Literature Review

Employee Recognition

Brun and Dugas (2008) specified the concept of employee recognition based on a systematic review of previous literature.According to them, employee recognition is a positive response to the desired behavior of employees and a judgment of their personal value and contributions.Recognition can be given in formal or informal contexts, administrated monetarily or non-monetarily, and applied collectively or individually.There are five levels of recognition: organizational; vertical, horizontal,external, and social.Brun and Dugas (2008) integrated various recognition practices under different levels of recognition, which are shown in Figure 1.However, the recognition practices revealed in their research have not been tested in the workplace.

Figure 1. The recognition practices under different levels of recognition (Burn & Dugas, 2008)

The Positive Outcomes and Negative Side of Employee Recognition

The positive outcomes.

Much research has been conducted to explain the impact of recognition on workers in different countries and industries.Mohsin and Lengler (2014) revealed that employee recognition is positively related to job satisfaction and reduced turnover intentions in the fast-food industries.Sahl (2017)also examined the relationships among employee acknowledgement, overall staff satisfaction, and turnover intentions in one university in the western US.He argued that appreciation can make faculty members feel that they are liked and accepted by the whole institution, which contributed to increased job satisfaction, social acceptance, commitment to the workplace, and consequently the intention to leave decreased.

Employee recognition is an essential component of employee motivation (Pardee, 1990; Herzberg,2005; Magus, 1981; Seidel, 1974; Vallerand, 2000; Hansen, Smith & Hansen, 2002; Podmoroff,2005; Sachau, 2007; Baskar & Prakash, 2015).Gupta (2002) argued that recognition functions as an acknowledgment for employee achievements, which helps to satisfy employees’ self-esteem requirements.Recognition in the form of employee training and development opportunities can improve employee capabilities (and therefore usefulness), and secure existing talent (Hayek et al.,2016).Also, learning opportunities and career paths can satisfy employees’ inherent needs for ability of expression (Vallerand, 2000; Deci & Ryan, 2010) and personal achievements (Pardee 1990;McClelland, 2005).

Furthermore, increased motivation from recognition is a predictor of better work performance(Werner, 1992; Deci & Ryan 2000; Abukhalifeh & Som, 2013).Ijosiga and Odubuker (2016)examined the extent to which recognition influences employee work performance.They found that utilizing employee recognition, especially the non-financial, can increase employee motivation, and then contribute to high-duty attendance, high-task accomplishment, and highwillingness to work overtime.Wang (2017) suggested that giving employee recognition can increase individual performance.Besides, Li et al., (2016) advanced that implementing formal recognition programs can boost individual performance as well as collective performance.According to Garr (2012), if the individual or teams are recognized by the company, the entire work performance of the company will be around 14 percent higher than the companies that do not have recognition schemes.

Tetrick and Haimann (2014), Merino and Privado (2015) investigated the positive effects of employee recognition on employees’ well-being.Their findings suggest that a lack of recognition is a main reason for workers’ psychological distress at work, and that positive psychological functioning mediates the relationship between employee recognition and employees’ well-being.

Moreover, some studies have examined the positive influences of recognition on employee commitment (Sghari, 2016), work meaningfulness, and work behavior (Milas, 1995; Montani et.al.,2020).As indicated by Sghari (2016), intrinsic acknowledgments, such as approvals build employees’sense of belonging to the organization which is crucial to strengthening organizational commitment and encouraging positive behavioral changes.According to Montani et al., (2020), managerial recognition can increase work meaningfulness for employees, and lead to more productive work behaviors and increased employee commitment.

Based on the research reviewed, the positive outcomes of employee recognition can be summarised as increased job satisfaction, employee motivation, performance, organizational commitment, well-being, and reduced turnover intention.Those positive outcomes highlight promoting employee recognition policies in enterprises.

The negative side.

The negative side of recognition has not gone unnoticed.From a perspective of social comparisons, performance recognition has the potential to increase competition between workers,and the fallout of this could be jealousy, a sense of unfairness, or a loss of trust (Brun & Dugas, 2008;Wang, 2017).Feys et al., (2013) argued that visibly recognizing one employee may have damaging effects on the emotions and subsequent interpersonal behaviors of other employees, and result in poor relationship qualities.According to Sghari (2016), financial recognition can cause conflicts among workers.Since staff performance varies from person to person, the differences in compensation and bonuses potentially lead to employee dissatisfaction.These studies contribute to developing a fuller picture of the effects of recognition.

Employee Recognition Effectiveness

The effectiveness and positive outcomes of employee recognition.

Employee recognition has been integrated into common human resource practices to achieve strategic goals in organizations (Hao et al., 2012).The effectiveness of human resource practices is deemed to be causally linked to organizational success (Poole& Glenville, 1996).Effectiveness therefore means, allegedly, doing the right things, solving problems, and creating value (Gibb, 2000).Similarly,recognition effectiveness is how much value the recognition practices create for the organization, and to what extent organizational goals are achieved(Daniel & Metcalf, 2005).Garr (2012)revealed that organizations with effective recognition programs will have higher employee engagement and a 31 percent lower turnover rate than those withineffective methods.

Figure 2. The indicators of recognition effectiveness

Saunderson (2004) investigated recognition effectiveness in American and Canadian public sectors.In this research, the effectiveness of employee recognition was measured by the subjective judgments of participants (managers and employees).There is a need for developing an objective measurement of recognition effectiveness to evaluate recognition practices.Daniel and Metcalf(2005) provided the basis on which to evaluate the effectiveness of employee recognition.According to them, it can be assessed through two dimensions: the aims of the recognition practices and the value generated by the recognition programs.On one hand, the main goals of recognition schemes are, in theory, to create a positive work environment, cultivate a recognition culture, motivate high performance, reinforce desired behaviors, increase employee morale, increase retention, and encourage loyalty (Daniel & Metcalf, 2005).These goals and objectives are similar to the positive outcomes of employee recognition discussed before.

On the other hand, these positive outcomes could be perceived as the value associated with recognition practices so that managers can evaluate their practices based on the positive outcomes advocated by previous studies.Garr (2012) found support for this through two online surveys, which illustrated how human resources managers and employees perceived the recognition programs within their companies.In his survey, recognition effectiveness was also evaluated based on the expected benefits of employee recognition.For human resource managers, the expected benefits are related to improved employee commitment, engagement, and performance.As for employees, the employees think that effective recognition practices can make them feel valued and appreciated by the company.

As a result, it is reasonable to link employee recognition effectiveness with the six positive outcomes of employee recognition.The first research proposition is:

The effectiveness of employee recognition can be reflected by increased job satisfaction, motivation,performance, commitment, well-being, and reduced turnover intention.

Factors Influencing Recognition Effectiveness

Establishing the factors that make up effective recognition is another underdeveloped research area.But previous research has indicated some potential factors influencing recognition effectiveness.

Organizational culture and recognition awareness.

Organizational culture is defined as a shared set of values, practices, and processes of a given organization, which continuously influence, therein, the attitudes, thoughts, feelings, and behaviors of employees (Garr, 2012; Stefano et al., 2019).Saunderson (2004) argued that effective recognition had happened in organizations whose cultures were strong and supportive of employees.As indicated by Gines (1998, cited in Appelbaum & Kamal, 2000), incorporating a recognition program into organizational culture was one of the methods to foster employee motivation.According to Brun and Dugas (2008), in an ethical view, the recognition practices can be in the form of establishing an organizational culture in which employees’ personal values are respected.If the values, behaviorsand the performance levels expected from employees could be expressed clearly in the organizational culture, they would develop a sense of being needed and valued, which could help contribute positiviely to accomplishing the organization’s goals.

Merino and Privado (2015) also advocated that the effectiveness of employee recognition was also related to the organizational environment and culture.Besides, organizational culture involves the display of values, which can eventually influence the behaviors of organizational members(Schein, 2004).According to them, when the managers felt that their organization had valued their contribution and recognized them, they would, in return, recognize their subordinates.The previous studies suggest that organizational culture can positively influence the thinking and behaviors of both employees and their managers, which in return enhances the effectiveness.

A strong cooperative culture, emphasizing employee value, can raise awareness of and engagement with the need to respect and recognize employee contribution within the organization (Saunderson, 2004).As indicated by Saunderson (2004), there was one thing that organizations giving effective employee recognition have in common: an awareness of the importance, impact, and need for giving it.Furthermore, Garr (2012) held the view that organizational culture might not be supportive of employee recognition if the senior leaders had not successfully communicated the importance of recognition programs to the members of their organization.It is argued by both Saunderson (2004) and Garr (2012) that recognition should become a key part of individual leadership.If those responsible for providing recognition could fully understand the importance of the role of employee recognition,they would be likely to utilize recognition programs.It will also support cultivation of a recognition culture inside the company (Garr, 2012).On this basis, the second and third research propositions are gleaned:

Organizational culture emphasizing employee value and contribution could enhance the effectiveness of employee recognition.

Managers’ awareness of giving recognition to employees can influence the effectiveness of employee recognition.

Combination of monetary and non-monetary recognition.

Scholars have put efforts into utilizing recognition practices in human resources strategies in real workplaces.One aspect in particular of employee recognition practice has been a focal point for researchers: monetary and non-monetary recognition.

Monetary recognition has long been widely applied within organizations to motivate employees and is closely related to the compensation and reward systems (Long & Shield, 2010).According to Brun and Dugas (2008), cash recognition reflects the “recognition of results” (Brun & Dugas,2008).For workers, financial recognition can be in the form of bonuses for achieving individual goals, planned rewards for completion of team projects, and scheduled (e.g.annual) bonuses based on performance targets (Bishop, 1887; Kerr & Slocum, 2005).It offers employees a sense of being valued and useful, a balance of effort and reward, then contributes to their perceptions of self-worth (Siegrist,1996).It also serves as feedback on performance (Long & Shield, 2010).

However, several studies show that financial forms of recognition through salary, incentive bonuses, etc., have limited impacts on employee performance over the long term (Bishop, 1987;Eisenberger and Cameron, 1996; Eisenberger, Rhoades & Cameron, 1999).As suggested by “cognitive evaluation theory” (Deci 1976), the use of extrinsic rewards or financial incentives can diminish employees’ internal motivation at work.Moreover, the development in motivational theory (Maslow,1943; Dunnette et al., 1967; Bandura,1999) confirms the positive role of non-monetary recognition on employees’ behavior reinforcement and work motivation.

Scholars, including Paré et al., (2001), Ramezani and Heidarzadeh (2014), also advocate the use of non-monetary recognition.They argue that non-monetary recognition can be administered as perceived marks of consideration and organizational support.Affected by this, organizations have incorporated the non-monetary means to motivate employees, which can be in the form of saying“well done,” appreciating and even adopting employees’ ideas and other contributions, and assigning more challenging work to employees, sometimes giving certificates, and bestowing special privileges (Gilley et al., 2009).

Having said that, non-monetary recognition is not a substitute for cash recognition (Long& Shield, 2010).Long and Shield (2010) conducted a quantitative study in Canadian and Australian companies to research non-cash-based recognition.They argue that non-monetary recognition is a way of fostering group behaviors, while cash recognition is mainly used for acknowledging and reinforcing individual contributions and performance.This calls for an approach that uses both.However, it should be noted that this research was conducted in two Western countries with particularly prevalent individualistic cultural backgrounds.It may not be appropriate for these research findings to be fully (or even partly) applied in other cultural situations.

According to Phillips (2004), the key to retaining employees is to use a combination of tangible and intangible, formal and informal recognition methods.Appelbaum and Kamal (2000) analyzed the utilization and effectiveness of non-financial incentives in small businesses.This research indicates that non-financial recognition is effective when the income of the employees allows them to meet their domestic needs.However, it is suggested by Sghari (2016) that financial recognition can cause conflicts among workers and lead to employee dissatisfaction.This suggests a need for applying both cash and non-cash recognition methods to avoid conflicts and dissatisfaction,mitigating the negative elements of financial recognition practices.Based on this, the fourth proposition is:

A combination of monetary and non-monetary recognition practices could enhance the effectiveness of employee recognition.

Other possible factors.

There are other possible factors influencing employee recognition effectiveness.

It is argued by Saunderson (2004) that timely recognition, meaningful work, fair compensation,and caring supervisors and managers are basic assumptions of any effective recognition scheme.Phillips (2004) suggested the leadership could also influence employee recognition.He argued that a lot of employees that were promoted to managerial positions did so without any training of their leadership skills, which identified the need to train managers to better fulfill their roles.To be qualified, the managers need to earn the trust of their employees, be effective communicators, and be flexible.Besides, Appelbaum and Kamal (2000) also argued that the implementation of non-financial recognition required skilled management techniques, and the managers’ abilities to understand employee , which could help them bolster their motivation.

Communication can influence employee recognition (Seeger, 2005).Seeger (2005) conducted a case study of the Michigan Department of Transportation (MDOT) and a government transportation agency, to demonstrate how could this agency successfully apply employee recognition to increase motivation and commitment.He feeled that communicating recognition programs in the organization demonstrates the importance of recognizing employees.He also exemplified how MDOT communicated employee recognition to employees, by means of relatively traditional and simple forms including business memos, weekly newsletters, etc.,Phillips (2004) also indicated that communication can enable recognition programs to motivate employees.By “going inside” of employees, the managers can know what is important to them and offer corresponding and relevant recognition incentives.Also, Montani et al., (2020) argued that co-workers could influence recognition effectiveness since peer recognition could enhance managerial recognition credibility.

Since studies that focus mainly on employee recognition effectiveness are relatively scarce, the factors discussed in the previous articles such as management support need to be further developed to enable an understanding of how they influence employee recognition, while some factors affecting the actual effectiveness of recognition may not yet be fully identified.

Overall, previous research has been focused mainly on managerial recognition and its impact,and comparatively little research has been done on other sources of recognition.Although the importance of managerial recognition has been emphasized, its effectiveness seems to be underdeveloped.Moreover, most prior research related to employee recognition was conducted in a specific industry in primarily Western cultural contexts.Few have investigated this topic in Chinese industries.

To address these issues, this study was conducted using two Chinese companies to gain a deeper understanding of recognition effectiveness concepts in Chinese business and develop guidance for evaluating recognition practices.In this research, the main focus is on managerial recognition effectiveness (that being, the recognition from managers to subordinates), since it is the primary vector of recognition (Merino & Privado, 2015), and recognition from senior managers could have a powerful influence on shaping employees’ behaviors (Sghari, 2016).

Figure 3 is the conceptual framework developed based on the theoretical background reviewed and research propositions.It guides the research design in a later section.

Figure 3. The conceptual framework

Methodology

Study Site and Design

The research was conducted with two Chinese companies.The two companies were a commercial bank and a telecommunications company, located in the southwest of China.Both are medium-sized enterprises, employing workforces of around 500 employees.Human resource management practices in small and medium-sized companies are developing, which could give more useful managerial experience on employee recognition in the Chinese workforce.The qualitative design was used to explore how the managers perceive the effectiveness of employee recognition practices in their organizations, and the factors influencing it.This research was conducted in the form of in-depth interviews to acquire insights into recognition practices.Electronic semi-structured interviews were conducted for flexibility and ease of comparability.

Study Participants

In total, thirty managers from the two chosen companies participated in the in-depth interviews.The sample was purposely selected from the study population, which was the whole management group in the two companies.The inclusion criterion was that the participants were familiar with the recognition practices in their companies.The researcher sent 57 emails to relevant managers and called some of them to invite them to participate in the interview.Finally, thirty managers responded accepting the invitation to participate.The in-depth interview in this study required the participants to engage in a conversation of approximately one hour.Managers were busy with their work and had tight time schedules, hence the low response rate for accepting the interview.However, although the sample size is relatively small, it is relatively diverse: the participants are from different managementlevels, different departments, and have different work responsibilities in employee recognition practices.Therefore, it is deemed that the interview results can reflect different perceptions and evaluations of recognition effectiveness and what influences it.

Data Collection

The data was collected through in-depth interviews.The interview guide was organized into three main parts: opening questions, key questions, and closing questions.The key questions were linked to the proposed model.The content of the interview guide appears in Appendix 1.The interview guide was first drafted in English, then translated into Chinese.Before the formal interview, a pilot test was conducted to check whether the translation of the main concepts and questions could be clearly understood by participants, and to calculate the time needed for one interview.Two managers from the telecommunication company participated in the test.

All the formal interviews were conducted in Chinese.Before each interview, the participant was briefed with the researcher’s details, research purposes, usage of data, confidentiality, and anonymity of the data and time duration.The main concepts such as employee recognition were explained.During each interview, notes were taken, and a digital recorder was used after seeking permission.The average time duration was one half to one hour.The electronic interview was conducted through WeChat, a social media software widely used in China.It can enable fast communication and online audio-only or video and audio chat.

Data Analysis

This research used the thematic method to analyze the data collected.Since it is a flexible approach to collect and establish people’s views, opinions, knowledge, experiences, or values from a set of qualitative data, it also enables a mix of the deductive and inductive processes (Braun & Clarke, 2006).The analysis is guided by the trustworthiness criteria of the thematic analysis developed by Nowell et al., (2017).There are five main steps in the analytical process: transcription and anonymization; coding and developing codes; identifying themes; validating codes and themes; interpreting the data.

Transcription and anonymization.

The collected notes and audio recordings were transcribed into typed text.Since the interviews were conducted in Chinese, the transcripts required translation into English before analysis.After that, all the transcriptions were anonymized to protect the participants’ privacy, corresponding to the privacy notice.Identifiers such as names were removed.However, to maintain them in order, each transcription was assigned a number.Before developing codes, the researcher read all the transcripts three times and wrote memos to become familiar with the data collected.

Coding and developing codes.

Following familiarization with the transcripts, the memos were written during a reading process to divide the data into multiple appropriate topics and subtopics.The text of transcripts were highlighted and marked, and the abbreviation “codes” were configured to describe their content(citations).Each code describes the idea or feeling expressed in that part of the text.

Identifying themes.

Terry et al., (2017) recommends that using a mix of deductive and inductive strategies for theme development can give academic support to validate the codes and capture the unique issues raised by participants.Therefore, both deductive and inductive strategies were used to develop themes.Before reading the transcripts, a list of preconceived themes that were expected to be reflected in the interviews was developed based on the interview guide and the previous literature.For example, one of the factors affecting recognition effectiveness was identified as organizational culture.Moreover,based on the previous research on the effectiveness of employee recognition, the indicators of recognition effectiveness can be identified such as increased job satisfaction.These initial themes were then justified after reading the data collected.

Validating codes and themes.

When all the codes and themes were identified, they were validated through the 7Rs(Perreault &Russ,1974) criteria suggested by Terry et al., (2017): relevant to the research topic, represents the issue,recognized in data, repeated in data, raised by participants, ratified by others, retrieves applicable text segment.However, as there was only one researcher, the codes could not be ratified by others.

Interpreting the data.

After the validation, the themes were put into different pre-determined categories, these being Chinese employee recognition practices, the effectiveness of employee recognition, and what makes recognition practices more effective.This was to follow the framework in the interview guide and answer the research questions.

Ethical Concern

The data collection was conducted after the ethical approval of Durham University at the end of June 2020.To mitigate the worry of participants on privacy, the information sheet, privacy notice,and consent forms had been sent to the participants before the interview started.Only when the consent form was signed and returned to the researcher was the formal interview conducted.The participants were fully briefed that all personal information and interview transcripts would be kept securely.Additionally, the researcher demonstrated the purpose of the research and gave a brief explanation of the concepts and sought permission to record before the start.Moreover, they were also told the approximate interview time and reminded that they were participating voluntarily, and they had the right to refuse to answer any questions that they did not feel comfortable answering.

Findings

Description of the Study Sample

There were thirty participants involved in this study.The participants from the telecommunicationscompany were composed of eight male managers and six female managers.Four are top-level management and also the policymakers and implementors of employee recognition practices,and six are middle-level managers with implementation responsibility.Four are from the human resource department with the role of making employee recognition practices.The participants from the banking company were composed of nine male and seven female managers.Of these, nine are middle-level general managers with implementation responsibility for employee recognition practices,and three are top-level managers with the role of policymaker and implementor, also four managers from the human resources department in policymaker roles.

Table 1 shows the theme list developed based on the data collected and previous literature.The themes were separated into three categories to answer research questions.

Table 1 Theme List

Employee Recognition in the Chinese Workforce

As shown from the theme list, the current recognition scheme implemented consists of formaland informal, financial, and non-financial recognition practices.Common non-financial recognitions include holding commendation ceremonies, providing employee training and promotional opportunities, holding “excellent employee selection,” giving instant positive feedback to employees,and adapting employee suggestions, while the financial recognition is mainly the bonuses associated with employee performance.The formal recognition practices are holding commendation ceremonies,giving employee training and promotional opportunities, performance bonuses, excellent employee selection.The informal recognition practices are giving instant feedback to employees, adopting employees’ suggestions, and giving more challenging work to employees.

As indicated by the participants, the main goals of their recognition practices are to increase employee motivation, loyalty, job satisfaction, encourage employees’ contributions, and increase employees’ sense of self-worth and achievement.

Overall, the findings suggest that Chinese companies are implementing employee recognition programs from formal to informal, and from monetary to non-monetary.Moreover, the goals mentioned by the participants reflect that those managers are aware of the importance of employee recognition.

The Effectiveness of Employee Recognition

All the participants evaluated their current recognition schemes as effective and satisfactory.Their reasons for this are associated with job satisfaction, motivation, job performance, morale, and employee commitment.

First, thirty participants indicated that the current recognition schemes increase employee job satisfaction.According to the answers, performance-related bonuses can increase employees’income and raise employees’ living quality, and this leads to employees’ income satisfaction.Meanwhile, employees feel they are trusted and valued by the organization when they are assigned challenging tasks and given opportunities for promotion.Moreover, the compliments given during the commendation ceremonies give them honor and trigger a sense of achievement.

Second, thirty participants indicated that the current recognition schemes increase employee motivation.The data shows that financial recognition practices can link employee performance with compensation, which raises employees’ external motivation.The non-financial recognition practices link an employee’s ability and effort with promotional opportunities, which gives that employee more responsibilities at work and therefore more chances to demonstrate their ability.This works on employees’ internal motivation.

Third, thirty participants indicated that the recognition practices currently in place are capable of improving job performance.The research findings suggest that employees put more effort and time into their work after receiving praise from their managers and being promoted.This contributes to an increase in their work performance.

Finally, twenty-eight participants indicated that the recognition scheme also increases employee commitment.According to the answers, the positive feedback and encouragement from the managerscan make employees feel they are cared for and valued by the company, and the training opportunities can improve employees’ perception of organizational support so that employees establish an emotional attachment with the company, which increases commitment.

However, the findings fail to demonstrate that the recognition schemes increase employee well-being and reduce employee turnover intention.Only six of the participants agreed that their recognition scheme can contribute to increased employee well-being since the positive feedback or instant encouragement can make employees feel good and build confidence to overcome difficulties.Eight of the participants think that their recognition scheme can reduce turnover intention since they feel that their employees enjoy getting a sense of achievement from additional working challenges and enhanced compensation levels.However, most of them think that the turnover intention and psychological conditions are difficult to discuss since they do not engage in deep or personal conversations to understand the real intentions and observe the psychological conditions of their employees.It is therefore unclear whether employee recognition reduces employee turnover intention or has any positive influence on employee psychological well-being.

Based on these, the first research proposition is partly supported.It indicates that employee recognition can indeed have a positive influence on employee job satisfaction, motivation, job performance, and commitment.These four positive outcomes clarify the value of the recognition practices, and they can be interpreted as the four indicators of recognition effectiveness.

Factors Affecting Recognition Effectiveness

Organizational culture.

All the participants think that organizational culture influences organizational goals and policy making.According to the answers, organizational culture communicates the value of the company,and helps to increase employees’ and managers’ understandings of the policies.If the employees perceive that the organizational culture values their contribution and effort, they will think they have the opportunity to be valued by the company.Moreover, an organizational culture that emphasizes the employees’ personal value and contribution, encourages managers to give employees more opportunities to demonstrate their ability, and this could build employees’ sense of achievement and then contribute to their job satisfaction and performance.Based on the findings, the second proposition, that organizational culture can influence the effectiveness of employee recognition, is supported.

Recognition awareness.

Twenty-eight participants stated that most of their managers or employees in a supervisory role will give recognition to their employees in their workplace.They think that their management team has a strong awareness of the importance of giving recognition to subordinates.Twenty-four participants think that recognition awareness of managers can influence recognition effectiveness since it enables the employees to receive more informal recognition, like timely feedback, and thus feel valued by their managers, which contributes to their sense of job satisfaction and commitment.This supports the third proposition, when most of the managers in the organization have a strong awareness of recognition—the recognition scheme is more effective.

Combination of monetary and non-monetary recognition.

Thirty participants indicated that their company had used both cash and non-cash recognition policies, and they hold the view that employing different kinds of recognition practices could help them make recognition more effective.Both the implementors and the policymakers think that the combination of financial and non-financial recognition practices can better satisfy employees’different needs and then enhance work motivation.Eight of the implementors think that their recognition practices are more flexible to implement.For example, the manager assigns more challenging work to raise an employees’ sense of achievement rather than waiting for the formal performance assessment to recognize improved ability.Moreover, nine managers said that recognition such as instant messaging thumbs up can give an employee timely and relevant encouragement and form a closer employee-manager relationship.This supports the fourth proposition that utilizing monetary and non-monetary practices together can make the recognition program more effective.

Communication.

Twenty-six participants indicated that communication is important when they design recognition programs.As indicated, communication can help the managers understand what employees really want and what can motivate them, so that they can give meaningful recognition to employees’performance and effort.This could contribute to employees’ job satisfaction and motivation.Moreover, the managers should clearly communicate the organizational goals and performance objectives to employees, so that employees can understand what is expected of them, and this itself could contribute to increased or improved work performance.This suggests that communication can foster recognition effectiveness by increasing employee job satisfaction, motivation, and work performance.

Managerial skills.

Twenty-two participants mentioned that the managerial skills of recognition givers will influence recognition effectiveness.The management skills mentioned in the interview were mainly related to leadership and communication.Eight participants indicated that some newly promoted managers lack leadership skills, causing them to fail at properly assigning work, setting attainable objectives,and giving support to their subordinates.This can negatively influence employees’ performance and reduce employees’ chances to receive recognition rewards.Ten participants mentioned that the interpersonal skills of the recognition givers will influence their personal relationships with the employees.According to the answers, if the managers have strong communication skills and an easy-going personality, they are able to establish a close relationship with employees, and this could enable them to understand employees’ needs and motivations.Therefore, the research findings suggest that strong managerial skills of the recognition givers can increase the effectiveness of recognition.

Based on the above interpretation, factors affecting the recognition effectiveness are organizationalculture, the combination of financial and non-financial recognition practices, awareness of giving recognition, communication, and managerial skills.

Comparison of Different Organizational Contexts

In order to understand the recognition effectiveness in different organizational contexts, the results of these two different companies were compared.Some similarities emerged.First, both companies had implemented varying recognition practices including monetary, non-monetary, formal and informal practices.Second, they evaluated their current recognition scheme as effective and satisfactory.

However, differences did emerge.The first was that there are different branches in the commercial bank, which were perceived as work teams, meaning that the recognition practices of the commercial bank had team-based recognition incentives, and awards in the form of cash rewards and certificates.In the telecommunications company, little team-based recognition was mentioned.Moreover, the organizational culture differs between the two companies.In the commercial bank, there exists a people-oriented culture, where they emphasize employees’ efforts, value, and potential within the organization.As such, they are integrating non-financial practices in their effort to satisfy employees’internal needs.At the telecommunications company, however, although they also use a combination of monetary and non-monetary recognition, there is more focus on the performance incentives to motivate employees.This is because their culture is based more on value from employees’contributions and achievements, which are performance-based.Also worthy of note, the commercial bank is going through a period of expansion, and employees’ workloads and pressures are increasing.It was suggested by the four policymakers from the bank that policy modifications were the key to keeping recognition effective.

Theoretical Model

Based on the results and previous interpretations, the theoretical model shown in Figure 4 was established to understand what makes employee recognition more effective and clarify the indicators of an effective recognition scheme.

This model shows that organizational culture, a combination of monetary and non-monetary recognition, awareness of giving recognition, communication,and managerial skills can influence recognition effectiveness.The five factors can be categorized in three aspects of the employee recognitionscheme: its design, the implementation environment, and the implementors of the scheme.First,considering communications, utilization of various practices when designing a recognition scheme can contribute to recognition effectiveness.Second, an organizational culture emphasizing employees’personal values can be supportive of implementing a recognition scheme.Finally, the implementors’raised awareness of giving recognition and strong managerial skills can make the recognition more effective.

Figure 4. The theoretical model based on the research findings

This model indicates that an effective recognition scheme is associated with the factors of employees’ increased job satisfaction, motivation, work performance, and commitment.These four positive outcomes can be interpreted as the four indicators of recognition effectiveness.

Discussion

Theoretical Implication

Employee recognition in the Chinese context.

This study offers an overview of the employee recognition practices in Chinese businesses.According to Brun and Dugas (2008), recognition can be personal recognition, recognition of results, recognition of work experience, and recognition of dedication.The Chinese practices are mainly focused on the recognition of employee work performance and work results.Chinese managers employ both non-financial recognition such as commendation ceremonies and monetary acknowledgment in the form of performance bonuses, to recognize outstanding performance and employee achievements.Some of the practices used also recognize employees’ personal ability and work experience.Moreover, the forms of employee recognition in Chinese businesses are varied, from informal programs like a personal message containing positive reinforcement feedback to formal programs such as excellent employee selection.The practices identified in this study correspond with the recognition practices suggested in Brun and Dugas’ study (2008).This study supports these practices in the workplace.

The effectiveness of employee recognition.

The theoretical model clarifies the value created by the effective recognition practices, which are increased job satisfaction, increased motivation, increased job performance, and increased employee commitment.This also confirms the positive outcomes of employee recognition identified in previous studies from the perspective of managers, by means of a qualitative research design.

First, this study adds to the findings that effective employee recognition can increase employee job satisfaction, which confirms the research findings of Mohsin and Lengler (2014) and Sahl (2017).This study, however, fails to support the notion that effective recognition can reduce employee turnover intention from the perspectives of managers.

Moreover, the results also support the existing evidence that employing employee recognition programs can increase employee motivation both intrinsically and extrinsically, and as a resultimprove performance.This confirmes the views of Vallerand (2000), McClelland (2005), and Deci and Ryan (2010).The data shows that Chinese managers use financial recognition to associate employee performance with compensation, raising employees’ external motivation to work, and meanwhile non-financial recognition practices link employee’s abilities and efforts with promotion opportunities which contribute to satisfying employee needs for achievement and abilities.

Also, this research supports prior research into the relationships between employee recognition and employee performance.Applying employee recognition can increase employee motivation, and then contribute to improved staff performance within the government (Ijosiga & Odubuker,2016;Wang, 2017; Masri & Suliman, 2019).This is also supported by this study, from the managers’perspective.This study also revealed that implementing a strategy for recognizing employee performance and contribution can have a significant impact on improving commitment (Saunderson,2004; Daniel & Metcalf, 2005).However, this study failed to provide indications that employee recognition can positively affect employee psychological well-being, which was suggested by Merino and Privado (2015).

Factors affecting employee recognition.

What makes employee recognition more effective lies within the underdeveloped research areas,which were explored in this research.The theoretical model in this study identified five factors affecting the recognition effectiveness from the managers’ perspective.

This research also supports previous findings that a combination of monetary and non-monetary recognition practices can contribute to recognition effectiveness.This confirms the suggestions of Phillips (2004), Long and Shield (2010), and Sghari (2016).According to Long and Shield (2010),both kinds of programs can acknowledge employee work results and raise employees’ feelings of selfworth.The research findings also show that monetary recognition and non-monetary recognition work together to motivate employees and develop employees’ sense of being valued.This study further indicates that the focus on cash or non-cash recognition varies according to a company’s culture and values.

Saunderson (2004) argued that effective recognition happens in organizations with a strong and supportive organizational culture.This study supports this view and further demonstrates the reasons.The findings indicate that the organizational culture can communicate the value of the company and increase employees’ and managers’ understanding of the policies.If the employees perceive that the organizational culture values their contributions and efforts, they will think that they have the opportunity to be recognized and valued.Moreover, an organizational culture that emphasizes the employees’ personal value and contributions will allow managers to give employees more opportunities to demonstrate their abilities and strive for good results, and this could build employees’sense of achievement and then contribute to their job satisfaction and performance.

Furthermore, this study supports the contention that managers’ awareness of giving recognition to employees can influence the effectiveness of employee recognition and this confirms the findings of Saunderson (2004).If the recognition givers fully understand the importance of employee recognition,they are likely to utilize recognition programs (Saunderson, 2004).The interview results also indicate that the recognition awareness of the managers is linked with the frequency of informal recognition.The stronger the awareness is, the more frequent informal recognition, like instant feedback and verbal praise, is given.This makes employees feel valued by their managers.

This study suggests that communication plays an important role in designing effective recognition schemes.This also corresponds with the arguments of Phillips (2004) and Seeger (2005).Both of these researchers indicate that communication can help managers understand what employees really want and therefore what can motivate them so that they can give meaningful recognition to employees’ performance and efforts.This could contribute to employees’ job satisfaction and motivation.Furthermore, it also confirms the opinion of Seeger (2015) that the managers should clearly communicate the performance objectives to employees so that employees can better understand what is expected of them, which could improve performance and enhanced work quality.

The management skills of recognition givers will influence the effectiveness of employee recognition (Appelbaum & Kamal 2000; Phillips, 2004).This was also confirmed by this study.This study also identified specific and effective management skills involved in implementing recognition programs, which include good leadership skills and communication skills.If managers have strong supervising and communication skills, they are more able to establish a close relationship with employees, and this could result in enabling them to better understand the needs and motivations of their employees.

This study has discussed employee recognition in a Chinese context, clarified the value of effective recognition to develop the criteria for evaluating recognition practices, and identified five factors important to recognition effectiveness.It contributes to filling the research gap in Chinese recognition practices, the effectiveness of employee recognition, and what makes employee recognition more effective.

Practical Implications

The results also give some implications for management.First, this study calls for an evaluation of employee recognition.Regular and timely evaluation of current recognition practices is essential to keep them effective (Blumberg, 2005).An effective program must create value for the organization(Daniel & Metcalf, 2005).The findings of this study clarify the value of effective recognition for managers, which are increased job satisfaction, increased motivation, increased job performance,and increased commitment.Thus, human resource managers and other relevant managers can use these criteria together with the goals of their recognition programs to test the efficacy of their existing recognition schemes.

Moreover, the theoretical model presented here provides as impetus for business managers to make their employee recognition programs more effective.The results suggest that in order to increase recognition effectiveness, a company can work from three aspects: the design of their program, the implementing environment, and the recognition givers.

From the perspective of program design, business managers need to be keen and effective communicators to understand the real motivations and needs of employees, which can help to motivate employees and give them meaningful recognition.Also, employing monetary and nonmonetary recognition helps to satisfy employees’ various needs (Burn & Dugas, 2008).Both types of programs can acknowledge employee work results and raise employees’ feelings of self-worth (Long& Shield, 2010; Sghari, 2016).

From the aspect of the implementing environment, managers need to create an environment that can cultivate self-motivation in employees (Blumberg, 2005).Establishing a type of recognition culture emphasizing employee value and contributions can increase employee and manager understanding of the policies.Employees are self-motivated to achieve their value and make contributions to the organization.Moreover, under this type of culture, the managers, who are recognition givers, will give employees more opportunities to demonstrate their ability and strive for good results, and this could build employees’ sense of achievement and then contribute to their job satisfaction and performance.

From the aspect of the recognition givers, human resource or other relevant managers need to give more management support to the recognition givers, especially those managers who are newly promoted to a managerial position (Saunderson, 2004; Brun and Dugas, 2008).The management support involves arranging training for the recognition givers, helping them gain competence to implement recognition schemes, and raising their awareness of the importance of employee recognition (Appelbaum & Kamal, 2000).This could help managers give recognition timely and effectively.

Finally, although the research findings of this study emphasized the positive outcomes of employee recognition, the dark side also needs to be discussed in the literature review.Managers need to be aware of the negative influences of employee recognition programs when they are implementing them, to try to avoid issues of employee jealousy, perceived unfairness, loss of employee trust, and other counterproductive behaviors (Brun and Dugas, 2008; Wang, 2017).For example, it is suggested that managers utilize non-cash recognition to reduce the conflicts generated by differentiated performance pay (Sghari, 2016).

Limitations and Future research

This study was conducted with just thirty Chinese managers in two locations: a telecommunications company and a commercial bank.Due to the sample size of this study, a meaningful generalization may not be reasonably made to the whole situation and context of Chinese businesses.Since the recognition effectiveness concept framework was developed based on the literature reviewed, statistical analysis is needed to verify its correctness.This calls for future studies to explore the effectiveness of recognition programs through a quantitative research design with a larger sample size to generalize and verify the research findings of this study.

Also, this study consisted of manager perspectives on the effectiveness of managers, andemployees’ views were not collected due to the time constraints of this research.Employee turnover intentions and wellbeing need to be evaluated by the employees in terms of their own feelings.Future research into recognition effectiveness could investigate this from both employee and manager perspectives.This could help managers better understand the positive outcomes of employee recognition related to employee turnover intentions and phycological well-being.

Finally, the question of what makes employee recognition more effective has yet to be fully investigated.Based on the theoretical model proposed here, five factors influencing recognition effectiveness were identified, but they need additional analysis in both theory and practice.The identified factors could be further developed as independent variables in future recognition effectiveness research to analyze the influence paths and mechanisms more clearly.

Conclusions

Existing studies tend to be more focused on the influence of employee recognition, few studies actually pay attention to the effectiveness of recognition practices after they have been applied.This study has investigated employee recognition in a Chinese business context.In the Chinese workplace,recognition practices are mainly focused on the recognition of employee work performance and work results.Both non-financial recognition and monetary acknowledgment are employed to recognize outstanding employee performance and achievements, which corresponds to the ways in Western countries.The research findings were integrated into a theoretical model addressing the factors that could support better understanding of what makes employee recognition more effective and clarifying the value generated by an effective recognition program.

This study contributes to filling the research gap in Chinese recognition practices by providing a snapshot of employee recognition schemes within the Chinese business community.It supported the effectiveness of employee recognition by specifying four indicators, and five factors that make employee recognition effective.To make employee recognition programs more effective, the theoretical model calls for human resource managers, or other relevant managers, to regularly conduct evaluations of their employee recognition programs, focusing on three aspects: the design of their recognition program, the implementing environment, and the recognition givers.