How Well Intended Rewards Backfire

Not long ago I listened to a frustrated company owner describe what he thought was a lack of appreciation for his ongoing generosity. For a number of years he recognized a special day in the company with a small, $50, monetary gift for his employees. It had also become a long-standing tradition and in his mind, it was a way of saying thank you. This year however, was different. He chose to eliminate the monetary gift for a number of reasons. Unfortunately, the understanding he expected to get from his years of generosity was met with complaints and he took them personally.

This is not an uncommon story. It’s often experienced around the holidays when a customary holiday bonus is delayed, deferred or cancelled. For many well intended leaders, the experience is less than heartwarming and catches them off guard. What should have been a nice company gesture was not only unappreciated but may have turned into a negative experience leaving some to say, “I’ll never do this again”.

While there’s no formula to ensure getting the desired response, there are a few simple things that can help prevent an employee gift from becoming a morale buster.

  • Frequency and its resulting predictability matter. When something is repeated it can become predictable. When that happens, a sense of entitlement can emerge. It fits the pattern of our lives and what once was an appreciated gift becomes an expectation. Unfortunately, when something we’ve come to rely and depend on is changed or removed, it creates anxiety.
  • Language and words matter. Psychologically, the word “bonus” and “gift” connotes different expectations. The notion of a bonus conjures up thoughts of it needing to be earned whereas a gift is seldom thought of as earned. We also don’t expect gifts to continue indefinitely, but bonuses are more easily tied to an event, even if the event is a recurring day on the calendar. The words “holiday bonus” and holiday gift” have much different feelings and connotations to them.
  • The sense of something being earned or unearned can also matter a great deal. The human condition in all of us responds to a work/reward response. If we’ve been conditioned to expect a reward for something we’ve done it becomes hard to remove the reward without an adverse reaction. There’s certainly a place for compensating someone for their contribution but that’s much different than a thank you or a gift. I pay my plumber for his work. It’s not a “thank-you” gift. When it comes to showing appreciation for someone, unexpected and unearned are always best. An unexpected gift means so much more than one I’ve come to expect. Alphie Kohn in his 1995 book titled “Punished By Rewards” wrote, “As it happens, most studies have found that unexpected rewards are much less destructive than the rewards people are told about beforehand and are deliberately trying to obtain.”.
  • The unit of the gift can play a big role too. Should the thank-you be monetary or something else? When my kids were young they got to a point of asking for money for birthday gifts. My wife would instead buy a special and thoughtful gift. While it didn’t carry the transactional monetary value they were hoping for, it meant a lot more to her and to them. The same holds true for employees. A thank-you gift should be just that, a gift, not a check. It doesn’t have to be big or of great value. Remember – It’s the thought that counts. Many times it’s a remembrance for something. While it might not be convenient to hand out turkeys around the holidays, a gift-certificate to the supermarket carries more meaning than a check for the same amount.

It can hurt when best intentions aren’t appreciated. I was taught not to expect something in return for a gift. If I did, it probably wasn’t a gift, it was a negotiation. The first step to avoiding disappointment is to not expect something in return. Money has value but little meaning and when you’re expressing a heartfelt thank-you gift, meaning matters. Also, make it an unexpected surprise. You’ll be remembered for that.

If you’d like to learn more about how to make your rewards more satisfying and effective, reach out to me through our website or the “contact us” tab on this page.

This entry was posted in Corporate Finance, Human Capital, Leadership, Operations, Strategy and tagged , , , , , , , , , , , , . Bookmark the permalink.