27 Apr 2021 | by Ami Dorkings

The COVID-19 pandemic impacted most areas of life as we knew it, and reward and recognition was no exception. When conducting our research into the changing face of reward and recognition, we knew that many traditional reward trips were unable to go ahead due to COVID-19 restrictions. Therefore, this stripped away a huge element of reward for a lot of companies that solely focused on big annual incentive trips, prompting them to consider new ways to recognise and reward their employees. 

In 2020 the EU economy shrank by 7.4% and the US economy shrank by at least 3.5% as a direct result of the global COVID-19 pandemic. Lockdown, or enforced stay at home orders, and business closures are still having a disastrous financial impact across all industries. The impact on a company’s reward and recognition programme is no exception. In such times of austerity, history has taught us that such ‘luxuries’ are the first things to go. 

There are, of course, many other ways to reward and recognise individuals, and we wanted to delve into whether companies were getting creative and implementing other forms, or whether their reward and recognition programmes came to a hard stop.  

Reward and Recognition Research - the impact of the pandemic

We conducted focus groups with eight different companies across various sectors to determine what the restrictions had meant for them and their reward and recognition strategies, and to understand how they had responded to restrictions. We identified that there had been three main reactions to not being able to conduct face-to-face events: 


A pause on reward 

We found that with such uncertainty in the world came nervousness around rewarding employees altogether. With possible redundancies looming and individuals furloughed, some of our contacts felt that the perception of bonuses and rewards would not have landed well, and so they felt the best option was to ‘pause on reward’ until the time was right.  


Complimentary recognition 

With annual reward budgets being cut in some cases, organisations recognised their teams in other ways. Reward concepts ranged from additional days added to their holiday allowance, congratulatory phone calls from directors, and commendations broadcasted on internal intranets. 


Alternative reward and recognition 

Although they were unable to do their usual incentive trips abroad, some companies quickly began executing alternative ways of rewarding and recognising individuals. Whether that be in the form of hampers sent to their homes, vouchers, cash bonuses, household reward programmes or virtual award ceremonies, they were able to show their appreciation to team members and keep them motivated despite the restrictions.  


While each of these approaches evoked different reactions, we found that in instances where organisations had implemented alternative forms of reward and recognition, individuals felt more appreciated because it was a personalised form of recognition that they were not necessarily expecting. It was determined that none of our contacts had stuck to one single ‘replacement’ for face-to-face communication, because there really is no equivalent. There was a need for innovation, with some of our contacts looking to their partners for guidance on creative ways to recognise their teams. This tells us that although COVID-19 has impacted the industry greatly, reward and recognition will come back with vengeance as soon as restrictions allow.  

After conducting a survey last year, we found that the desire for face-to-face events is increasing month-on-month, with our most recent survey showing that 99% of individuals would attend a live event in the next six months. This highlights the importance of the traditional reward trips 

While no one could have predicted the last year we have had, our findings have shown that it is how companies react to change that holds importance in keeping teams engaged and motivated. CLICK HERE to read the full report or CLICK HERE to listen to our reward and recognition expert Abbie Hanton discussing the future of reward and recognition on a podcast by M&IT.

Consistent reward and recognition can improve productivity by up to 44% and Penguins can support you in finding your solution; we are ready to start building your strategy for successful reward and recognition programmes post-pandemic so get in touch today.

Ami Dorkings

By Ami Dorkings

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