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Incentives and motivation: peer-to-peer reviews grow in popularity

The film awards season may be well behind us for another year, but who could fail to love the glitz and glamour of the Academy Awards?

Couture dresses and cringe-worthy speeches are staples of the Oscars. But why does winning one mean so much? Simple: it is fellow actors that choose the winners. The talent of the film industry achieving recognition from its peers...

And peer-to-peer recognition schemes are on the rise in the business world too, with companies as diverse as Virgin Atlantic, DHL Express, Oracle and UK nursery brand Mamas & Papas inviting staff to put forward colleagues who have 'gone the extra mile'.

The rewards run the gamut of a simple 'thank you' e-card and a £20 retail or leisure voucher at one end of the scale, to the chance of a major cash prize or holiday at the other. Often they can be tied in with staff-development programmes and performance reviews.

Encouraging colleagues to recognise each other is thought to be more engaging than having the boss select 'heroes' and 'shining stars'. "It shows how organisations are distancing themselves from traditional 'command and control' management styles, in favour of giving employees a voice and more ownership of the way they work and receive recognition," says Andrew Johnson, director general of the UK Gift Card and Voucher Association (UKGCVA). "These schemes don't suit all workplaces, but do particularly well where team members rely on each other and understand who is trying to do what. Because people on the frontline are closest to the effort being made on a daily basis, it is likely the right people will be recognised."

The limitation of managers nominating people for awards is they can't see everything, says Claudia Clark, head of reward and performance at international law firm Eversheds. "And we want people to go the extra mile and live brand values all the time, not just when the line manager is looking."

Building firm Barratt Developments launched 'Get Recognised' in 2008, with events and gifts partner Experience More/Buyagift. The scheme is designed to recognise exceptional individual and team effort - with an emphasis on peer recognition. 'Get Recognised' is a two-part programme of formal recognition through quarterly, annual and national awards, as well as informal 'Individual Instant Recognition' through spontaneous peer nominations, both of which offer opportunities for experiences valued at up to £1,000 to be 'won', explains Emma Balfour, HR and policy manager, Barratt Developments.

Like many companies, Barratt wanted more bang for its recognition buck. "A major benefit of the scheme has been maximising return on our recognition spend - from £750,000 in 2007 covering three roles, to £250,000 for all 4,000 staff, including 1,500 instances of peer- nomination," says Balfour. "We have seen a 50% increase uptake of peer-nominated recognition awards between 2008 and 2011."

While big firms tend to use specialist motivation agencies such as Grass Roots, Edenred or P&MM Motivation to have schemes designed and managed for them, small firms can simply choose from a host of corporate gift voucher providers such as Asda Business Rewards, highstreetvouchers.com, House of Fraser and Red Letter Days, to name a few. "It is important to make the gift card or voucher relevant to each individual to maximise the impact - they make people more conscious of being given a meaningful reward," says Johnson at UKGCVA. "Which is why in many cases companies choose to have multi-choice prizes - allowing the rewarded individuals to choose where they spend their voucher."

Peer-to-peer schemes are a great vehicle for helping to embed employer brand values across a diverse workforce, says Kuljit Kaur, head of business development at P&MM Motivation. "And with colleagues driving their own recognition schemes, individuals selected for awards are more likely to enjoy the kudos," she says. "With a culture of thanking people, you can create a genuine feel-good factor - at relatively low cost."

Kaur says there has been a huge shift away from high-value trophy incentives, due to the economic climate. "With austerity measures in place, big incentives such as an all-expenses paid trip to Mauritius just aren't compatible or affordable," she says. "Corporates are much more likely to invest in a softer, more subtle and cost-effective approach today," she says. "It just wouldn't seem right to be making a group of colleagues redundant and then throwing the carrot of big incentives to those remaining in jobs."

Colin Hodgson, sales director, incentives and motivation at Edenred, says for peer-to-peer recognition to deliver value, schemes must be carefully monitored, communicated and supported from board-level down. "HR will typically be driving schemes and monitoring progress, but the whole project must have strategic board-level backing," says Hodgson. "Peer-to-peer awards are all about celebrating how individuals are living wider employer brand values - so reflecting a focus on customer excellence, working for the good of the team, for example. If people seen to be bringing the values to life in their day-to-day work are thanked and rewarded by colleagues, brand values are more likely to be embedded. The board has a big role to play in being involved in the launch and acknowledging the awards being made. Presentation of awards can often be neglected," adds Hodgson.

How should schemes be administered, to eliminate collusion and make sure the system isn't being abused? "Even assuming everyone is being honest, one individual can be far more generous than the next, so there needs to be central control around recognition," says Hodgson. "Line managers are best placed to keep track of the process of nominations and approval. Often companies link the frontline recognition awards to bigger quarterly or annual awards, so it helps to have the admin systems in place to manage that."

Edenred has a web application called Webcentive, which enables companies to run multiple incentive programmes. Nominations can be submitted through the portal for the line manager to administer, records can be kept and e-cards be created and issued. "Systems such as this enable transparency, so top-level management can see where awards are being made, which divisions are being overlooked, or where bottle-necks in awards might be happening," says Hodgson. By giving the award-winners plenty of profile - online, in group meetings, on bulletin boards - the maximum impact can be achieved. "This is all serving to show the brand values in action, so it is creating awareness, and driving a positive cycle of engagement," Hodgson adds.

Balfour of Barratt Developments says it has worked closely with its reward provider Experience More/Buyagift to ensure the prizes remain valued by people who win, and that its Get Recognised programme is at the front of people's minds when they want to reward someone for their contribution. "Regular, targeted communication of our winners and the reason for their success, as well as feedback from winners has been an important part of the high profile of the scheme," she says.

Schemes should be designed so as not to alienate certain departments and individuals, notes Johnson at UKGVCA. "Organisations have to be wary of overlooking corners of the business where it is hard to measure achievements. A regional sales team may be generating great figures, but has anyone ever thanked and rewarded the IT, admin and finance staff who make it all possible?"

Another question is to determine what constitutes an 'extra mile' when nominating someone. "A common problem is people are nominated for things that are part of their job anyway," says Clark at Eversheds. It is also vital to plan criteria to ensure you reward at all levels of the firm.

However schemes are implemented, it is important to make clear which behaviours will qualify individuals for an award, and to really encourage people to nominate in line with this.

Case study

Name of scheme: Eversheds' Everyday Heroes

Launched: May 2011

Gift: A £100 pre-loaded credit card that can be spent anywhere

The concept: Any member of the 2,500 staff at international law firm Eversheds can nominate a colleague who has gone 'above and beyond' in living the Eversheds values. It might be an administrator working extra hours to prepare for a pitch, a member of the IT team delivering a time-saving innovation, or a lawyer giving outstanding client service. 'Everyday Heroes' is linked to an existing quarterly awards scheme, so individuals can go on to be nominated for bronze, silver and gold awards, worth £200, £500 and £1,000 respectively.

How it is managed: P&MM Motivation created an online system for the scheme and design agency Epigram delivered the internal branding and communication. With the nomination, there must be written justification of why the individual has been nominated. Line managers accept or reject the nominations and are empowered to deliver smaller rewards - such as a bottle of wine - where they think a full award isn't quite justified. The £100 credit card reward is presented with a personalised card, which states the details of why the award has been given. The £100 does not go through payroll, so Eversheds pays the tax.

Management at Eversheds was conscious that by only hosting annual staff awards, many examples of good work throughout the year were going unrewarded, says Claudia Clark, head of reward and performance. "We wanted to show appreciation for habitual good work that positively impacts on team performance. We were aware some department managers were better than others at thanking people for their extra efforts. Putting in place a proper structure for colleagues to nominate each other has proved very successful, because it means anybody at any level can get involved. When people nominate their peers, it brings to the attention of the line manager things that are happening in the business - and gives us a great vehicle to publicise how colleagues are successfully living the Eversheds values," adds Clark.

She says the online system allows proper governance and continuity of the scheme. "We get on average 14 nominations a week and, as not all are accepted, there have been about 130 awards in the first three months of operation. As well as the awards themselves, there are ongoing costs for management of the online system, but really the total cost for Everyday Heroes is a very small proportion of our salary and bonus budgets."

She says the majority of employees are positive about the scheme and appreciate having small achievements recognised regularly. "It is particularly encouraging for our junior staff," says Clark.