Why non-financial rewards can be equally as valuable as financial ones

Employers don’t have to just rely on cash incentives to show their appreciation of high performers.

Employers’ pockets have been hard hit in recent years which has made the giving of financial rewards to employees – such as salary increases, bonuses and profit share initiatives - increasingly challenging.

For those leaders who believe that rewards must be financial, they’ve had to considerably cut back on their reward programmes, no doubt impacting engagement and retention.

However, such cutbacks can be avoided - even when purse strings are tight - as rewards don’t always have to be money-focused.

In fact, non-financial rewards can be just as valuable and impactful.

This is so long as the reward is meaningful, and the accompanying recognition is authentic and personalised.

True value of non-financial rewards

It's understandable how financial incentives, such as bonuses and profit-sharing, serve as direct pocket-lining motivation for employees.

These rewards are tangible and can deliver immediate benefits, proving useful for rewarding high-performing employees and those who go ‘above and beyond’.

However, despite financial rewards fulfilling a basic and important need, non-financial rewards can prove just as – if not more – valuable and impactful.

Rewards for connection and memory-making

Non-financial rewards can take a number of forms. They really come into their own, however, when focused on nurturing connections and making memories.

Providing a free team lunch, for example, brings people together so they can form closer bonds.

Plus, gifting points that can be redeemed for items and experiences of the employees’ choosing, allows families to be a part of the gift selection, making the moment all the more special.

Symbolic awards also bring colleagues together and can deliver powerful emotional responses.

When a symbolic award is thoughtfully created to reflect a company’s history, purpose, values, culture, and community, as well as the employee’s hard work, it’s likely to be admired and cherished for years’ to come.

People who experience employee appreciation that includes a symbolic award are three times’ more likely to remember that experience, with symbolic awards building connections to leaders and teams, and elevating the employee experience.

Similarly, ‘Yearbooks’ are a meaningful and intensely personal way to show appreciation, with some companies gifting them during career celebrations.

The Yearbook celebrates an individual's contributions with tailored messaging and personalised comments and photos from managers, colleagues and even family members, providing a unique and emotive keepsake.

Small but meaningful gestures

It’s important to remember that rewards shouldn’t be reserved for large, one-off shows of appreciation, but should be frequently given.

Small, meaningful tokens of appreciation can prove highly effective so long as the reward adequately matches the employee’s contribution.

It wouldn’t be appropriate to gift a small chocolate bar to your highest performing salesperson, for instance.

Having said this, if an employee has demonstrated great teamwork or has chosen to stay late to help with a project, for example, it’s important to show appreciation.

This could take the form of a handwritten thank you note with a bunch of flowers or even a homemade cake.

So long as the recognition is heartfelt, personal and timely then the recipient will feel that warm glow of appreciation.

Think beyond the money

While financial rewards are an important part of a rewards strategy, they shouldn’t be seen as the “be all and end all”.

Organisations that gift a range of both monetary and non-monetary rewards, with a particular focus on rewards that nurture connections and create memories, are more likely to have employees who feel highly valued.

This, in turn, deepens their commitment and loyalty to the organisation.

All research insights in this article are from O.C. Tanner’s Global Culture Report.