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Building a High Performance Workforce :

A Study on Rewards and


Recognition practices in India
Aniruddha Limaye
Razeyeh Jalali
Divya Martyn

Research report by Great Place to Work Institute


Presented to you by Edenred

Acknowledgements
We would like to thank all the participating organizations for
giving us an opportunity to study their practices on Rewards and
Recognition. We are also grateful to the winning organizations
for allowing us to share their practices, knowledge and wisdom
developed with great effort over a period of time.
Authored by:
Aniruddha Limaye
Razeyeh Jalali
Divya Martyn
Supported by:
Joyoti Banerji
Yuvika Gulati
Rajkumar Gupta
Indias Best Companies for Rewards and Recognition
anchored by: Madhavi Katre

01

FOREWORD
Sandeep Banerjee, CEO, Edenred India, The growing
economy has presented an avenue of robust opportunities
for the ever demanding workforce. The evolving dimensions
of the work environment have triggered Indian organizations
to relook at their rewards and recognition programs in a
strategic and structured fashion. Apart from higher pay
packages and a host of tangible benefits, companies are
differentiating in their offerings with elements that can
contribute to the overall employee experience, personal
growth and development within the organization. Edenred
and Great Place to Work Institute continue this association
for the 2nd year in a row to applaud such organizations with
exceptional rewards and recognition practices that have
evolved themselves in order to maximize the performance of
the most valuable asset of the organization The Human
Capital. The outcome of the study - Indias Best Companies
for Rewards and Recognition 2013, will help organizations
benchmark their rewards and recognition initiatives with some
of the best in the country. We were thrilled with the response
and participation in the 1st year and this year over 105
companies from across industry verticals have shown their
enthusiasm and participated in the study ascertaining our
belief in Indias Best Companies for Rewards and Recognition
and our endeavour to take this association to the next level in
the years to come
Prasenjit Bhattacharya, CEO, Great Place to Work Institute,
India and Sri Lanka, - The best workplaces in India have
demonstrated a significant shift in mind set when it comes to
rewards and recognition. Not only are they talking about total
rewards encompassing aspects of financial, intellectual,
physical, social and psychological rewards, but they are also
recognising that talented employees are worth far more than
an average employee. There is growing realisation that
winning in the talent market is as important as winning in the
market for customers. We are grateful to Edenred who has
partnered us for the 2nd year in a row in bringing this pioneering
study to you all. The Top 15 companies featured in this study
demonstrate that rewards and recognition can go far beyond
conventional definitions and be a key driver of emotional
engagement with the employees.

02

Sandeep Banerjee.
MD & CEO, Edenred India

Prasenjit Bhattacharya.
CEO, Great Place to
Work Institute, India

Companies Featured
in this report
Accor Hotels, India

American Express India Pvt. Ltd.

Industry: Hospitality

Industry: Financial Services & Insurance

Number of Employees: 2548

Number of Employees: 6065

Years of Operation in India: 7

Years of Operation in India: 90

Year founded: 2003

Year founded: 1921

Ownership: Privately held

Ownership: Subsidiary division majority

Eli Lilly & Company (India) Pvt. Ltd.

Forbes Marshall Pvt. Ltd.

Industry: Biotechnology and Pharmaceuticals

Industry: Manufacturing and Production

Number of Employees: 435

Number of Employees: 1236

Years of Operation in India: 19

Years of Operation in India: 88

Year founded: 1993

Year founded: 1928

Ownership: Privately held

Ownership: Privately held

Intel Technology India Private


Limited

InterGlobe Enterprises Ltd.

Industry: Information Technology

Number of Employees: 7100

Number of Employees: 3452

Years of Operation in India: 22

Years of Operation in India: 13

Year founded: 1989

Year founded: 1988


Ownership: Subsidiary division majority

Industry: Transportation

Ownership: Privately held

Intuit India

Mahindra Intertrade Limited

Industry: Information Technology

Industry: Manufacturing and Production

Number of Employees: 652

Number of Employees: 120

Years of Operation in India: 6

Years of Operation in India: 12

Year founded: 2005

Year founded: 1999

Ownership: Publicly held

Ownership: Privately held

03

Companies Featured
in this report
Music Broadcast Pvt. Ltd.
RADIOCITY 91.1

NIIT Ltd.

Industry: Media

Number of Employees: 2895

Number of Employees: 354

Years of Operation in India: 30

Years of Operation in India: 11

Year founded: 1981

Year founded: 1999


Ownership: Privately held

Ownership: Publicly held

NTPC Ltd.

Paypal India

Industry: Manufacturing and Production

Industry: Information Technology

Number of Employees: 25230

Number of Employees: 1027

Years of Operation in India: 37

Years of Operation in India: 6

Year founded: 1975

Year founded: 2006

Ownership: PSU

Ownership: Subsidiary division majority

Philips Electronics India Limited


Industry: Electronics

Ujjivan Financial Services


Private Ltd.

Number of Employees: 7500

Industry: Financial Services

Years of Operation in India: 82

Number of Employees: 3530

Year founded: 1930


Ownership: Subsidiary division majority

United Colors of Benetton


Industry: Retail
Number of Employees: 277
Years of Operation in India: 20
Year founded: 1965
Ownership: Subsidiary division majority

04

Industry: Education and Training

Years of Operation in India: 8


Year founded: 2005
Ownership: Privately held

Executive Summary
The need to focus on developing, nurturing and retaining
human capital has gained prominence in recent years.
Organizations, in order to fulfil this need are turning towards
creative, unconventional and intrinsic approaches to
formulate their rewards and recognition practices.
Organizations look to a variety of methods that ensure
employee engagement, productivity and loyalty. Innovative,
viable and sustainable rewards and recognition programmes
are now must-have tools for an organization and its
managers to motivate employees.
Rewarding practices fulfil an employees need to be fairly
rewarded for their capabilities, efforts and contribution.
Organizations implement rewarding practices with an aim to
offer competitive salaries, bonus packages, and to share
the benefits of peoples combined efforts in a fair manner.
Incentive plans, profit sharing schemes and other
opportunities for wealth and ownership sharing are the
various forms of rewards organizations set out to present
their employees with.
Recognition practices are those that appreciate employees
efforts, contribution and results, thus positively recognizing
and reinforcing desirable actions and behaviours. Such
practices also help to create and maintain a Climate of
Appreciation in an organization with sincere appreciation of
good work and extra effort, regularly and in a wide variety of
ways. Such practices are of more intrinsic value to
employees as most often, they are carried out with no
attached monetary value.
The second edition of Indias Best Companies for Rewards
and Recognition saw a total of 107 organization compete in
the sphere of rewards and recognition. Sampled employees
from these organizations were sent a questionnaire
administered over a period of 15 days. Before or during this
time, the participating organizations also had to provide
information on its workforce strength, compensation
strategy, benefits policies, attrition rates, benefits etc. - this
formed part of the Culture Audit (2) submission.
In addition to this, organizations were required to share all
relevant information about their Rewards and Recognition
initiatives that have been implemented. This is done by way
of answers to a specific set of questions sent to each of the
participating organizations.
The study proposed two hypotheses:
1: Once a threshold point is reached in terms of
compensation, internal equity and transparency are more
important than the actual quantum of the rewards in
enhancing the effectiveness of rewards and recognition
(particularly rewards) programmes.
2: Higher frequency, genuine experience of appreciation
and greater inclusiveness in recognition programmes makes
them more effective.
Literature review also indicates that these are relevant issues
that organizations are grappling with as they try to enhance
performance, innovation and cooperation in organizations
and reduce stress and employee burnout.
Both points above were tested by comparing the differences,
between what the Top 15 in Rewards and Recognition,

2013 do vis-a-vis the other participating organizations .


Overall, on the statements related to rewards and
recognition, the Top 15 show significantly higher employee
feedback scores (and therefore experience) than the other
organizations. A high percentage of the winners of both
2012 and 2013 editions of this study have featured as
Indias Best Workplaces of 2012.
The differentiating (between the best and the rest) factors
that contribute to internal equity in reward mechanisms are:
Wider distribution across levels and roles
Liberal payouts and policies for medical benefits
Higher differentiation based on performance with lower
fixed and higher variable pay along with higher increment
payout at the highest end of the range.
Higher proportion of employee ownership schemes
(especially stock options) and a wider distribution
More grievance redressal channels contributing to a
sense of justice
The differentiating (between the best and the rest) factors
that contribute to climate of appreciation in an organization
are:
Greater variety and parameters for recognition including
greater opportunities for public recognition
Recognition for for effort and not only high performance,
including potential and skill levels
Inclusiveness in recognition and more focus on every day
recognition by managers than monthly, quarterly or
annual forums.
We envisage that these differentiating factors are useful for
practitioners and organizations seeking to enhance their
practices and could evaluate these for implementation in
their organization.
Equally it is also clear that some aspects have become
hygiene and are especially useful for organizations who
are starting this journey. Ensuring non-discrimination of
rewards vis--vis age, race, gender by ensuring audits,
basic medical benefits, long tenure recognition and
recognition for results in monthly, quarterly or annual forums
are some examples of these.
There are some areas that are still to be clearly implemented
by organizations and are practiced only by a few. These are
however important subjects of debate and discussion as
we prepare our organizations for the future. Employees
families need to be included not only in medical benefits but
in overall recognition as well. recognition for finding new
performance levels, personalization of recognition are some
of the aspects that have been discussed here. Lastly, an
important element to ensure continued success of such
interventions is the extent of participation and collaboration
in design and modification of policies and programs. These
ensure that there is a self-correcting mechanism in the
organization and that programs are designed to suit diverse
needs of different generations, gender and roles. There is
definitely scope for companies to do more in this area.
We trust you will find this report interesting and useful as
employees, HR practioners and leaders. We would like to
thank all participating companies for their involvement
without which this could not have been possible.
Good luck with your journey.

05

Contents
1. Introduction

07

2. The 2012 study Lessons for 2013

08

3. Literature review and Key Hypotheses

09

a. Rewards and recognition explained

b. Defining rewards and recognition

c. Key hypotheses

4. Great Place to Work framework and study methodology

12

5. Key findings

14

a. Overall effectiveness

b. Findings on rewards

i. Quantum of compensation and internal equity

ii. Non- discrimination

iii. Distribution of rewards

iv. Fixed pay versus variable pay and differentiation

v. Employee ownership schemes

vi. Grievance redressal and perception of justice

c. Findings on recognition

i. Variety and frequency of programs

ii. Recognition for efforts and not only high performance

iii. Recognition for long tenure is a common trend

iv. Inclusiveness in recognition

v. Forms of recognition

d. Assumptions

6. Conclusion

25

7. References

26

8. Appendices

27

INTRODUCTION

The need to focus on developing, nurturing and retaining


human capital has gained prominence in recent years. To
this end, companies in India are restructuring their rewards
and recognition programs, as means to retain and motivate
their employees. Organizations today are turning towards
creative, unconventional and intrinsic approaches to
formulate their rewards and recognition practices. From
sophisticated single window employee rewards and
recognition platforms, to contextualizing rewards and
communication to the specific needs of every employee, or
even providing them with learning and development
opportunities for personal growth, companies are forging
ahead in the new era of rewards and recognition programs
which are in line with the needs and aspirations of the Indian
workforce. Edenred is adept in the rewards and recognition
space, designing structured programs for progressive
organizations to help them make their workplace come alive.
Great Place to Work Institute, on the other hand, has
extensive experience in research and consulting and
benchmarks best people practices at a global level. This
alliance drives a lot of synergies for both partners in their
areas of proficiency to be able to understand and honor the
exceptional rewards and recognition practices of
organizations in India to motivate talent and improve their
overall performance.

best workplaces. Over 2.5 million employees from over 7000


organizations in over 40 countries participate in the Best
Workplace study each year- making this the largest global
study of its kind in the world. The mission of the Institute is to
build a better society by helping companies to transform
their workplaces. The Best Workplaces Study in India is
inspired by the vision of Making India a Great Place to
Work. The institute has been conducting workplace studies
and has been recognizing the best companies in India for the
past 9 years now. Along with studies the Institute provides
advisory and consulting support for companies that wish to
enhance their workplace experience. Indias Best
Companies to Work For, conducted by Great Place to
Work Institute India and The Economic Times, is the largest
study of its kind in India.
Edenred is the world leader in prepaid service vouchers with
over 50 years of experience in corporate and public benefits.
In India, Edenred partners over 3,500 organizations with a
wide range of innovative Work-life Benefits, Rewards and
Loyalty Solutions. Edenred entered the Indian market in
1997 with Meal Vouchers & Cards, Gift Vouchers and
Rewards & Loyalty Solutions; and has become a major
player providing services to corporate clients and public
institutions.

Great Place to Work Institute is known globally as one of


the pioneers in the practice of studying and recognizing the

07

THE 2012 STUDY


- LESSONS FOR 2013

2012 witnessed the first edition of Indias Best Companies


for Rewards and Recognition (henceforth, R&R) Awards
and White Paper. A total of 76 organizations applied to
participate in the study. These 76 organizations represented
11 industries including Information Technology, Financial
Services, Media and Telecommunication.
Of the 76 organizations who participated, Great Place to
Work Institute together with Edenred felicitated the Top 10
in Rewards and Recognition. The first edition White Paper
highlighted the findings and unique practices from these 10
organizations.
This section outlines the major findings of the 2012
research. The 2013 edition of this study will build on a few
findings from last year, and will take a deeper look into a few
elements of both rewards and recognition, and the factors
contributing to its effectiveness in organizations.
To begin with, the report determined that an organizations
culture (basic values and beliefs) needs to be reflected in its
rewards and recognition practices. We have incorporated
this learning into this years study and we have looked at
organizations that recognise employees for displaying
behaviours that are true to its values. The report also found
that recognition practices have immense potential, many of
which are yet to be utilised to their full potential . This
recognition can be both public and private, can be nonmonetary (no budgetary constraints in implementing), can
be provided by all levels in the organization, can be more
proximate to the actions and results and can be done
frequently. It was also established that most organizations
have not been utilising the potential of effective recognition
practices effectively. Hence this study aims to understand
this in greater detail.
Employee perception of fairness depends on factors such
as internal equity, external parity, impartiality in assessment,
clarity on desired actions/behaviours and results that will be
rewarded, and, the level of transparency on the reasons or
parameters of a reward. The 2013 study will explore a few
of these factors in detail. Data relating to the establishment
of internal equity and employee perception of fairness will
be used to test the hypotheses discussed later on in this
report.
The previous study also reported that it was important to
involve employees in decisions on the various ways in which
rewards and recognition can be provided. Additionally, it
was also discovered that using recognition to drive certain
behaviours and efforts, not just results, increases the
positive impact of an R&R program. Personalised or
individualised gifts (without violating the essence of fairness

08

in the practice) make recognition elements more motivating


and meaningful. All three data points mentioned above will
be further tested in the current study.
Another factor that plays a vital role in the acceptance and
effectiveness of an R&R practice is communication.
Communication here not only refers to the process of
informing employees about what can be earned but also
refers to the medium used to transfer information throughout
the organization. Companies may choose to announce a
new Restricted Stock Units (RSU) scheme via internal mass
mailers. They may also choose to conduct country wide
road shows to gain face-time with employees from all
regions - to communicate the same initiative. The current
study will highlight a few such practices implemented by the
winning organizations.
A few factors contributing to effectiveness have emerged
from the 2012 data. The defined metrics of a programme
(what is achievable and who can achieve what), the
transparency of communication of these metrics and the
accuracy with which performance is calculated are factors
that positively contribute to an effective R&R programme.
The weight of the amount/gift/recognition needs to be
calculated in line with the values/goals of the organization.
If the weight is too little, employees will lose interest and, if
it is unrelated to demonstration and practice of desirable
behaviours, it will be perceived as unfair by employees.
The study conducted this year will build on these points and
will also attempt to answer questions relating to the exact
factors that ensure effective rewards and recognition
programmes. The benchmark to check and measure this
effectiveness is the employee feedback collated as
responses to the Trust Index questionnaire. Thus, for the
purpose of this report, the feedback scores of the Top 15 in
Rewards and Recognition will be used as a measure of
effectiveness.
Additionally employee referrals and voluntary separations
have been looked at as indicators of effectiveness. A
surrogate measure that has been considered is whether the
companies have featured as Indias Best Companies to
Work For ,2012 and 2013 - A Study by Great Place to
Work in partnership with the Economic Times.
In summary, the 2012 study provides some learning for the
current one, an opportunity to continue to test some of the
earlier hypotheses and critically examine some new ones
with data

LITERATURE REVIEW,

DEFINITIONS AND KEY HYPOTHESES

The war for talent today is one of the biggest challenges faced by
organisations, both large and small, and it has become increasingly
harder to attract and retain the kind of talent that is necessary to
sustain a growing business in the long term. Talent management
in India constantly needs to tackle two major issues. The first deals
with the employability of students being churned out of our
universities. The second deals with retaining talent in organizations.
A McKinsey study reported that only 10%25% of the 14 million
university graduates churned out by Indian universities work in
MNCs, mostly because they do not have the language skills,
cultural awareness or other competencies needed for the job
(Holland, 2008), required in global corporations. Equally challenging
has been their retention of knowledge workers beyond 23 years.
In India, the information technology (IT) and business process
outsourcing (BPO) sectors experience annual attrition rates of
30%45% (Bhatnagar, 2007). This is also the case in many other
industries in India today. As an article in Business Standard states
"India Inc. may see attrition rates as high as 31%" 2013), a study
has found that while IT/ITES (BPO) industry showed the highest
attrition rates in the country during the first quarter of the Financial
Year, it is closely followed by the Telecom industry (26%), Banking
and Financial Services (23%), Aviation and Hospitality (22%),
FMCG (21%), Automobile and Manufacturing (19%) and Real
Estate (15%).
Several research studies have revealed that this is not just an
Indian phenomenon. It has been estimated that in most significant
economies across the globe, around 55% - 60% employees are
either actively seeking alternative job opportunities or seriously
contemplating a job change.
What is recognition?
As much as this is a widely understood concept, there are some
definitions that capture the essence of the word well. One such
definition has been put forward by Brun and Dugas (2008) who
say Recognition is first and foremost a constructive response; it is
also a judgment made about a persons contribution, reflecting not
just work performance but also personal dedication and
engagement. Lastly, recognition is engaged in on a regular or ad
hoc basis, and expressed formally or informally, individually or
collectively, privately or publicly, and monetarily or non-monetarily.
Similarly, rewards are an important part of an organisations
system, and the right kind of rewards system helps in contributing
to employees feeling motivated and committed to their job
(Bonsdorff 2011). It has been long understood that rewards and
recognition in the workplace are important, and the integral
aspects of motivating employees, whilst keeping them engaged at
the work they do. Today, employees are not satisfied with just
going into work today. As studies done by Great Place to Work
Institute have shown us year on year, employees want a lot more
out of their workplace be it in terms of feeling like they belong to
a community, that they are valued and their differences appreciated,
or even in knowing that their management is taking them in the

right direction companies we have studied and identified over


the last 25 years as the best in their space have consistently
scored high on these elements.
There have been numerous studies in different industries trying to
establish a link between the right kind of rewards and recognition
programmes, and the impact on employees. A study conducted
by Bhattacharya and Mukherjee (paper 12) among Information
Technology organisations in India found that employees in the IT
sector placed a great emphasis on rewards. They also identified
many key aspects an effective rewards and recognition programme
will need to encapsulate, which include:
The need to be fair, transparent, inclusive, timely and varied.
The form of recognition should be appropriate to the contribution
that was made.
Recognition should be meaningful and reflect the preferences
of the recipient.
Any related activities should be respectful of workplace diversity
and must be done with the involvement of employees.
When recognition is the result of a group or team effort, all
contributing members of the team should be recognized.
The right kind of communication on recognition activities needs
to happen to promote a culture of recognition and pride among
employees.
Brun and Dugas (2008) have found interesting relationships
between recognition and the psychology of the worker. An excerpt
from their paper explains the relationship even better .
Brun and Biron et al. (2003) reveal that lack of recognition
constitutes the second-largest risk factor for psychological
distress in the workplace. Among managers, for instance, it would
appear to constitute a stress-tolerance factor and a key element in
their ability to handle difficult professional situations (Dany and
Livian 2002). One of the most important sources of organizational
mobilization and engagement (Wills, Labelle, Guerin and Tremblay
1998; Tremblay, Gay and Simard 2000), recognition plays a key
role in the success and continuity of organizational change
(Atkinson 1994; Fabi, Martin and Valois 1999; Evans 2001).
Moreover, it promotes on-the-job learning (Lippit 1997) and is a
building block of learning organizations (Griego, Geroy and Wright
2000). Finally, by contributing to employee job satisfaction,
recognition has a positive impact on organizational productivity
and performance (Applebaum and Kamal 2000).
What do companies mostly base their recognition schemes on? A
study conducted in the USA by the Society for Human Resource
Management in 2011 shows that 58% of the organisations
recognised tenure in the company, 48% recognised employees
who went over and above their regular call of work, 43%
organisations recognised employees for adding to the
organisations financial bottom line, 37% recognised employees

09

who behaved according to the values of the organisation, 9%


recognised employees for the high-quality outputs on work
projects and 2% on completing the projects ahead of deadlines.
This information is very important for organisations especially as
further research conducted by Globoforce, Intuit, and Stanford
Graduate School of Business reported that for a recognition
practice to be considered an important strategic tool within the
company, it had to involve 5%-8% of the employee base. If it did
not, the recognition scheme was irrelevant to the organisation.
As is obvious, there are many common reasons for implementing
rewards and recognition schemes within an organisation. Then
why do some companies not give enough emphasis to these
schemes, or look at implementing them in the proper manner
within their organisations? Studies have shown a plethora of main
reasons, and the bottlenecks that crop up for these continue to be
managers within the organisation. Brun and Dugas (2008) refer to
research that has found that managers are apprehensive of giving
recognition to their subordinates due to:
1.
2.
3.
4.

Fear of losing control,


Apprehensions about others creative power,
Resistance to more egalitarian relationships, and,
Detachment from employees actual work often caused by
new management constraints.

Other reasons for companies not giving due prominence to


rewards and recognition schemes for employees include biases
against recognition and the perception of recognition being
misconstrued as flattery and that they have to be handled carefully
and accurately, as they can have unexpected repercussions (Brun
and Dugas 2008). Brun and Dugas (2002) also point out that this
is an implication of the lack of time, knowledge or skill of managers
for implementation.
In summary current literature on the subject indicates that rewards
and recognition plays a key role in helping organizations achieve
employee commitment and result. It is important to be fair,
transparent and team oriented when recognising employees.
Additionally absence of it causes stress. Lastly the manager is the
key player in making it successful.
REWARDS AND RECOGNITION EXPLAINED
Rewards and Recognition is therefore a subset of the overall
framework of employee perception lays a vital role in creating trust
in the workplace. Organizations today are engaged in two major
battles: the battle for customers and the battle for the best talent.
An increasing number of organizations in India are realising that
the first battle cannot be won without winning the second.
Therefore, in addition to providing their workforce with a dynamic
work environment, organizations look to a variety of methods that
ensure employee engagement, productivity, and loyalty. Innovative,
viable and sustainable rewards and recognition programmes have
become must-have tools for an organization and its managers to
motivate employees.

Rewarding practices fulfill employees needs to be fairly rewarded


for their capabilities, efforts and contribution. Organizations
implement rewarding practices with an aim to offer competitive
salaries, bonus packages, and to share the benefits of peoples
combined efforts in a fair manner. Incentive plans, profit sharing
schemes and other opportunities for wealth and ownership
sharing are the various forms of rewards organizations set out to
present their employees with.

10

This study includes the following areas under Rewards and


Recognition:
1. Assured annual compensation
2. Special or annual increases in assured compensation
3. Increases in benefits and/or compensation with changes in
grade, role or position
4. Performance based variable pay, incentives, bonus (that may
be monthly, quarterly, half yearly or annual) or even longer term
rewards
5. Rewards for loyalty or long tenure
6. Rewards in gifts or cash for specific actions, behaviours, and
contribution
7. Rewards ingifts or cash for contribution from suppliers,
vendors, third party employees
8. Rewards in gifts or cash for family members contribution/
achievements
9. Personal recognition/appreciation for desirable actions and
contribution without any significant cash component in a
public or private manner
10. Wide range of benefits and perquisites i.e. those that are
beyond the statutory mandates.
11. Long term wealth sharing mechanisms such as restricted
stock units, stock grants, phantom stock grants, stock
options, discounted stock purchases, etc.

Thanking practices are those that appreciate employees efforts,


contribution and results, thus positively recognizing and reinforcing
desirable actions and behaviours. Such practices also help to
create and maintain a Climate of Appreciation in an organization
with sincere appreciation of good work and extra effort, regularly
and in a wide variety of ways. Elements contributing to this climate
of appreciation will be looked at while testing the hypothesis at a
later stage in this report. Thanking in most organizations is done
by creating a wide variety of opportunities for employee recognition.
Some of these are - peer recognition, awards for performance,
tenure of service, adherence to safety norms both at individual or
team levels and recognition for display of company values.
DEFINING EFFECTIVENESS OF REWARDS & RECOGNITION
PROGRAMMES
As mentioned earlier in this report, employee perception has been
measured using the Trust Index Questionnaire. This perception is
measured in the form of feedback on certain statements from the
questionnaire that relate to an organizations reward and
recognition practices. Effectiveness of the R&R programmes in an
organization is measured primarily on the basis of this employee
feedback. Therefore, this report adjudges an R&R programme as
effective when the following criteria are met:
1. There is positive employee perception about Rewards and
Recognition programmes i.e. the arithmetic mean of the
weighted average scores of the relevant Trust Index
statements for the best companies for R&R are higher than the
rest of the organizations who have participated in the study.

2. These organizations - the Best in 2012 & 2013 -(winners in


Rewards and Recognition)have also been featured in the list of
Indias Best Companies to Work For, 2012- A Study by Great
Place to Work and The Economic Times.
3. Finally, the rate of voluntary separations is lower in these
companies while the employee referrals are higher (both, in
terms of numbers and percentage of employees recruited) for
the Top 15 companies for Rewards and Recognition than for
others who have participated.
KEY HYPOTHESES
After having discussed the literature on Rewards and Recognition,
this report now sets forth two working hypotheses that will be
validated with the help of qualitative and quantitative data collected
from participating organizations.
1: Once a threshold point is reached, internal equity and
transparency are more important than the actual quantum of
the rewards in enhancing the effectiveness of rewards and
recognition (particularly rewards) programmes.

The first aim of this study is to prove that perceived equity, fairness
and transparency in a reward practice together have a greater
impact on the effectiveness that just the actual size/quantum,
amount or value of the reward. This study has already identified
that a high employee feedback score reflects effectiveness of
rewards and recognition practices. Therefore this hypothesis will
be proven only if the data collected reveals that for all (or at least
significant majority) of the elements mentioned below, the data for
the Top 15 is significantly different from that of the other
participants. Findings of the study will be used to demonstrate the
various factors that contribute to internal equity in an organization.
Secondly, this study suggests the ideas that, in order for recognition
programs to be truly effective, they must be frequent, close to the
action, reflect a genuine sense of gratitude and attempt to include
a majority of the workforce. Data on recognition will be used to
discuss and illustrate the points that validate this hypothesis.
This study will also look at those contributing factors/ characteristics
that have scattered evidence and may be points for discussion for
future practices.

2: Higher frequency, genuine experience of appreciation and


greater inclusiveness in recognition programmes makes them
more effective.

11

THE GPTW FRAMEWORK

Globally, Great Place to Work Institute has developed


research in the field of employee trust & engagement over
the past 20 years. This experience and learning has led to
the definition of a great workplace. Research has shown
that the key to creating great workplaces was not present
in any prescribed or predetermined set of employee
benefits, programs and practices, but in the building of high
quality relationships. Great Place to Work Institute defines
a Great Workplace as one where employees trust the
people they work for, take pride in what they do and enjoy
the people they work with. Thus, the fundamentals of
building a great workplace rely on three, core elements
Trust, Pride and Camaraderie.

Promotions go to those who best deserve them.


Performance of employees here is fairly evaluated.
RECOGNITION
Management shows appreciation for good work and
extra effort.
Everyone has an opportunity to get special
recognition.
Managers avoid playing favourites.
Performance of employees here is fairly evaluated.
THE CULTURE AUDIT FRAMEWORK
This report has already defined a great workplace from an
employees perspective. However, while managerial
employees are also employees, once in a managerial role,
their relationship with the organization, self, team and
individual goals changes. Therefore, from a managers point
of view, a great place to work can also be defined as one
where a manager is able to get people to achieve the
organizational objectives, give their personal best and
work together cohesively as a team/family - all in an
environment of trust.

Figure 1: Great Place To Work Model

The following statements have been considered as


indicators for employee perception on rewards and
recognition in the organization.
REWARDS
People here are paid fairly for the work they do.
We have special and unique benefits here.
Managers avoid playing favourites.
I feel I receive a fair share of the profits made by this
organization.

12

Employee feedback reflects an employees perception of


the practices, policies, processes, values and overall
cultural environment of his/her workplace as he/she
experiences it. Every manager plays a vital role in planning
and implementing practices and programmes that
contribute to this overall cultural environment of the
organization. Great Place to Work Institute, after several
years of research has identified 9 people practice areas
that complete an organizations cultural circle, and
encompass an employees life cycle within an organization.
The picture below illustrates the 9 people practice areas
that organizations are required to focus on in order to
develop into great workplaces.
Examples and descriptions of each practice area can be
seen in APPENDIX 1 .
Thanking and Sharing (Rewarding) are the two people

INTEL INDIA:
Customer Excellence Program
CEP uses an annual customer survey to generate toplevel customer improvements.
Feedback obtained from the CEP survey is analyzed
and compared with other Intel customer feedback to
identify issues that have a high impact on customer
commitment and retention.
Two days of pay per year are tied to the Customer
Excellence Program based on achieving their goal of
75% delighted customers.
_______________________________________________
Figure 2 : 9 People Practice Areas

practice areas that are relevant for the purpose of this report.
Although these practice areas will be discussed at a later stage, it
is important to understand the fundamental premise behind each.
Thanking: A manager (or peer, or anyone in an organization)
recognises and rewards good work and extra levels of effort.
The organization as whole strives to create a climate of
appreciation, gratitude, approval and reinforcement.
Sharing (Rewarding): Employees of an organization are allowed
to share the fruits of their labour in a variety of ways. The
organization also ensures that rewards are equitable and
egalitarian in nature.
METHODOLOGY
Indias Best Companies to Work For is an annual study which
rates Indias Best Employers. All organizations participating in the
2013 edition of this study were invited to participate and share
information on their Rewards and Recognition practices/
programmes and to compete in the second edition of Indias Best
Companies for Rewards and Recognition.
A total of 107 organization opted to compete in the sphere of
rewards and recognition. 75 organizations completed the 2 step
process and the winners of Indias Best Companies for Rewards
and Recognition have been selected from this lot. This is a 41%
increase since last year and a testimony to the growing awareness
and keenness of organizations to participate.
DATA COLLECTION PROCESS:
STEP 1: Organizations desiring to participate in Indias Best
Companies to Work For, 2013, registered themselves.
STEP 2: Organizations desiring to participate in Indias Best
Companies for Rewards and Recognition, 2013, registered
themselves for this award as well.
STEP 3: Information about qualification criteria was sent to
organizations. An organization was informed if it did not qualify to
participate.
STEP 4: As a critical process in the overall study, a questionnaire
was administered to all/a sample of employees within the
participating organization (depending upon what the participating
organization had chosen). This is the Trust Index questionnaire,

PHILIPS INDIA
Dronacharya Award for the Best Mentor (PIC)
To recognize the mentor who has shown dedication &
commitment to mentor the early career potentials of
PIC. The mentees and menteess managers are asked
for feedback about the mentors. The weighted average
of the feedback is taken and the mentor whose rating is
the highest is declared the winner.
This award is also announced during the Grand town
hall which happens in the end of the year.It consists of a
Certificate, memento & Cash award
_______________________________________________
UJJIVAN FINANCIAL SERVICES
Stock options at Ujjivan are available for everyone- right
from the driver to the CEO

which required employees to plot their responses to 62 statements


on a 5 point scale. These responses then formed the basis of the
quantitative analysis which was done.
STEP 5: The questionnaire was administered over a period of 15
days. Before or during this time, the organization had to provide
information on its workforce strength, compensation strategy,
benefits policies, etc. - this formed part of the Culture Audit (1)
submission. A detailed description of the practices implemented
by an organization for each of the 9 People Practice Areas was
submitted by participating organizations as part of the Culture
Audit (2) document.
In addition to this, organizations were required to share all relevant
information about their Rewards and Recognition initiatives that
have been implemented. This is done by way of answers to a
specific set of questions sent to each of the participating
organizations. This Rewards and Recognition submission is the
second part of what is analyzed to select winners in this sphere.
Excerpts and relevant points from these submissions will be
discussed at a later point in this report.
The participating organizations also provided information relating
to benefits, attrition rates, employee referral percentages, etc.

13

KEY FINDINGS

OVERALL EFFECTIVENESS
Overall on all statements related to reward and recognition,
the best companies show a significantly higher employee
experience than the other. (Statements to demonstrate the
difference in weighted average scores between the Best
Companies in Rewards and Recognition, and the Rest. )

employee perception about their organization as a great


workplace. The data below shows the number of
organizations who have also been featured as a Best
Employer for 2012- Indias Best Companies to Work For,
2012.
11 out of the Top 15 in Rewards and Recognition in 2013

Taking everything into accont, I would say that this


is a great place to work. Best-87%, Rest-82%

80%
75%

78%
76%

70%
65%

76%
71%

70%

69%
66%

65%

71%

67%

60%
59%

55%

58%

50%
People here
are paid
fairly for the
work they
do.

I feel I receive
a fair share of
the profits
made by this
organization

We have
special and
unique
benefits
here.

Promotions
go to those
who best
deserve
them.

Managers
avoid
playing
favourites.

Performance
of employees
here is fairly
evaluated.

Average scores for the Top 15-15 companies (4755)


Other organization-60 companies (21121)

85%
80%

70%

78%

82%
78%

75%
75%

70%

65%

69%

71%

60%
58%

55%
50%
Management shows
appreciation for good
work and extra effort.

Everyone has an
opportunity to get
special recognition.

Managers avoid
playing favourites.

Performance of
employees here is
fairly evaluated.

Average scores for the Top 15-15 companies (4755)


Other organization-60 companies (21121)

Figure 3: Perception of rewards- The Best versus the Rest.

Figure 4: Perception on Recognition- The Best and The Rest

The graph above shows that the perception for the Top 15
organizations is higher at granular as well as at an overall
level. The numbers in brackets represent the number of
employees surveyed. Employees are more positive about
reward practices and factors affecting fairness at the Top
15 organizations for R&R. Interestingly, statements relating
to employees getting a fair share of profits and managers
avoiding favouritism have lowest scores for the best
organizations as well as the rest. But in both cases the
average scores of the rest are lower than the best by 19%.

have featured in the 2012 edition of Indias Best Companies


to Work For. It will be interesting to see whether these
organizations will also feature as Indias Best Workplaces
for 2013. 7 out of 10 companies from the 2012 Best in
Rewards and Recognition list have been ranked as Indias
Best Workplaces of 2012. This goes to show that employees
at these workplaces (Best in Rewards and Recognition for
2012 and 2013) have a more positive perception of their
workplace than other organizations, and robust rewards
and recognition practices go hand in hand with building a
highly empowered workforce.

Employee perception on recognition follows a similar


pattern as that on rewards. However, the scores for all the
participating organizations are a little closer to the scores
for the Top 15 here and scores are higher for recognition
related statements than rewards related statement for all
participating organizations. It will be interesting to compare
analysis of the recognition practices for both sets of
organizations in the upcoming sections. One inference that
could be drawn here is that employees in both sets of
organizations have more positive perception about
recognition practices than rewards.
This report also set out to show the link between robust
rewards and recognition practices and overall positive

14

Employee Feedback-Trust Index (c) Score

Employee Feedback-Trust Index (c) Score

Taking everything into accont, I would say that this


is a great place to work. Best-87%, Rest-82%

Most organizations (91%) that have participated and have


provided R&R data (68 organizations) pay a bonus for a
successful referral. While this is a common practice, it is not
a differentiating practice which sets the best apart from the
rest. Organizations that are in the Top 15 (12 with data)
have an average referral rate of 36%. For the other
organizations, (40 with data) this average drops to 30%.
The average voluntary separation rate for those in the Top
15 who submitted this information (14 organizations) is
12%. This rate increases to almost 20% for other
participating organizations (40 organizations). Therefore,
there are fewer voluntary separations and more employee

referrals, in the Top 15 organizations. Employees at these


workplaces are less likely to decide to move on, and are more
likely to recommend their workplaces to their social and
professional circles.
The findings provide interesting learning on factors that differentiate
the best, those which are hygiene across the organization and
also areas that need to be considered in the future.
Let us now look at rewards and recognition separately.
FINDINGS ON REWARDS

UJJIVAN FINANCIAL SERVICES


External Parity
Compensation surveys are conducted from time to time
to benchmark against the industry compensation
trends. Ujjivan undertook a compensation survey at the
Industry level with MFIN (Micro- Finance Institutions
Network the Industry body similar to NASSCOM, CII),
this year for compensation benchmarking.

The following factors have been measured to infer about an


organizations internal equity and transparency of its rewards
programs:

_______________________________________________

Compensation of the CEO of the organization, when compared


to that of fresh graduates and /CAs as a multiple of the
compensation of these categories.

Focal Tools (annual performance appraisal tool) and


Base Pay Comparison tool which allows managers to
view the relevant position of their team members in their
salary range. The tools can show the internal parity
(within the company) and external parity (within the
industry). Any salaries which go beyond or below a
particular grades range are flagged and highlighted and
these cases are to be justified by the manager at senior
level meetings. However, such exceptions in salary
ranges are rare and not encouraged. All managers have
access to the CRT (Compensation Reference Tool)
which details out the salary.

INTERGLOBE ENTERPRISES
CLAP (Champions League Appreciation Program)
CLAP is a tool to recognize employees of our Air
Transport business, for living the values of the
organization namely Integrity, Customer Orientation and
Future Mindedness. CLAP Awardees are recognized as
Champions. The award consists of a Certificate signed
by Business Head and a token of appreciation a gift
voucher worth INR. 15000/-.

INTEL INDIA PRIVATE LIMITED

My Total Package:
Employees can view their salary range as well and can
find where they stand in their grades salary range.

_______________________________________________
PHILIPS INDIA
K.I.T.E. Awards
Keep Improving To Excel is a one of a kind competition
at Philips which aims at promoting Lean and Six sigma.
The program consists of workshops on Lean and Six
sigma initiatives. Post the training workshops, the
employees who are able to sustain results are given
projects. These projects become part of the business
improvement competition which is judged by the India
management team.
_______________________________________________
AMERICAN EXPRESS INDIA PRIVATE LIMITED
An in-house wellness program- Healthy Living which
promotes awareness on healthy eating habits within
their employees along with mental and physical fitness.
Under this umbrella, various initiatives such as the onsite clinic (Care@Amex), on-site gym and fitness
sessions, smoking cessation program, pregnancy care
program and Employee Assistance Program, Weight
management program etc. have been designed for our
employees.

Total compensation of Supervisors to Managers and Senior


Management Team Members.
Appropriate market corrections and internal corrections made
in the compensation level of deserving lower paid employees,
proactively, from time to time, to minimize anomalies and
inequities.
Non-discrimination in compensation, benefits and rewards on
the basis of gender, caste, race, language and religion.
Incentives and performance bonus availability across all levels,
roles and functions.
The parameters of rewards especially for incentives/
performance bonus and the amount of increments Wealth
creation/wealth sharing opportunities such as Stock Options/
Restricted Stock Units/Stock Purchase Plans, etc., made
available to the largest number and percentage of employees
regardless of their level, function and tenure.
Percentage of the organizations stock owned by employees
Grievance redressal/appeals that specifically deals with matters
relating to compensation, grade & salary fitment, performance
rating and increment/incentive/performance bonus and
promotions.

15

Accessibility of generic benefits which are not required to


perform ones role effectively to employees across levels, roles,
functions and locations.
Extent of feedback and inputs from employees, supervisors
and managers to decide on introduction, withdrawal or change
in benefits.
QUANTUM OF COMPENSATION AND INTERNAL EQUITY
Data indicates that the Top 15 do not have vastly higher
compensation at and between various levels, thereby suggesting
that the quantum of compensation need not be drastically high to
create an effective rewards experience.
The table shows the salary range for 3 different levels, and

RADIO CITY 91.1 FM


Proportion of variable pay depending on:
Organization Achievement
B1 - Senior Management 50%
B2 - Middle Management 25%
B3 - Junior Management 0
Individual Achievement
B1 - Senior Management50%
B2 - Middle Management 75%
B3 - Junior Management 100%

Average of Top
15
(INR lakhs)

Average of
Rest (60)
(INR lakhs)

Supervisory - Min

MAHINDRA INTERTRADE

Supervisory - Max

Overseas Incentive Scheme

Managerial - Min

14

12

Managerial - Max

17

15

Senior Managerial - Min

43

37

Senior Managerial - Max

52

52

Successful teams travel for 3 nights/4days on a leisure


trip. The organization takes pride in seeing the delight
in the eyes of employees, most of whom are from tier-II
and tier-III cities and many of these were on their maiden
overseas trip, courtesy the overseas incentive scheme.
In fact significant number of employees applied for a
passport as they were eligible for a company sponsored
overseas incentive trip.

Figure 6: Comparison of Minimum and Maximum Fixed Compensation

_______________________________________________

compares this between the Top 15 and the rest. Although the
minimum and maximum amounts for most levels are higher in the
Top 15, the difference in amounts is only marginal. The
compensation range 5 lakhs to 52 lakhs- for both, the Best and
the Rest is the same.
Equity in compensation

Total Compensation of the CEO of the organization, when


compared to that of fresh graduates and MBAs/Engineers/CAs is
a smaller multiple of the compensation of these categories. Given
the fact that CEOs (with some guidance & governance from the
Board of Directors and/or Compensation Committee of the Board)
significantly influence their own compensation, a lower ratio
between the CEOs total compensations and that of other
categories mentioned here, shows restraint and a sense of fairness
on the part of the CEO and the Board/Compensation Committee
and the organisation.
The data in figures 6, 7 and 8 suggests that the difference between
the CEOs salary and entry level personnel is significantly lower for
Ceo's Salary
compared to a
Fresh MBA -

Number of
respondents

AVERAGE of Top 15

18 times

AVERAGE OF THE REST

26 times

23

Figure 7: Comparison of the CEOs Salary to that of an entry level MBA.

16

Ceo's Salary
compared to a
Graduate

Number of
respondents

AVERAGE of Top 15

26 times

10

AVERAGE OF THE REST

46 times

25

Figure 8: Comparison of the CEOs Salary to that of a fresh graduate/


engineering graduate.

the Top 15, than in the other organizations.


Taking a deeper look into select industries, data demonstrates that
the financial services sector has returned the highest difference
between the salary structure of CEO and entry levels. The average
salary multiplier for CEO compensation compared with an MBA
entrant is 45; whereas, it is 25 and 21 for the IT and Manufacturing
industries respectively. Similarly, for fresher comparisons, the
CEO salary average is 68 times in Financial Services, while it is 32
and 40 for the IT and Manufacturing industries. This indicates that
there is greater sense of internal equity in these two sectors, when
compared with Financial Services.
Internal equity is also established when organizations regularly
track and compare their compensation and benefits with a suitable
basket of organizations. Compensation of newly hired employees
versus those with tenure (of comparable performance) is also
tracked. Appropriate market corrections and internal corrections
are made in the compensation level of deserving lower paid

employees, proactively, from time to time, to minimize anomalies


and inequities.
The data was tested to check whether organizations from this
study consciously made an effort to track their compensation and
benefits against others in the market. 60% of the Top 15 indicated
that they regularly conducted external benchmarking as against
32% of other participating organizations.
In an organization, internal equity can get disturbed in many ways.
Let us take two factors that can cause this quite often. First of all,
when an organization is growing rapidly and there is significant
pressure to hire new employees to keep up with the staffing needs,
recruitment team and hiring managers are sometimes tempted/
pressured to offer suitable candidates higher salary to get them to
accept the offer. This can lead to a situation where existing/loyal
tenured employees, doing the same/similar role and performing at
the same level, are paid less than the new employee(s), who had
to be made an attractive offer to get them to accept the offer and
join quickly.
As we know, for a variety of reasons, employees playing the same/
similar role are not at a single point in terms of their fixed
compensation. They are spread over a range. When in the course
salary increments, an organization offers the same % increase to
different employees doing same/similar job at the same
performance rating, the existing gap between two employees
widens e.g. if one employees fixed annual compensation is INR
500,000/- and that of the other comparable employee (in the
above aspects) is at INR 550,000/- (difference of INR 50,000/-), if
10% increase is given to both, the salary of the former will become
INR 550,000/- and that of the latter will be INR 605,000/-. Thus,
difference will increase to INR 55,000/- (10%). Over the years, this
can keep increasing. Best companies for R&R proactively track
such differences that may have arisen during the course of one
year or sometimes two years, and then, with the help of external
and internal benchmarking correct such anomalies, by determining
target salary for each job category and each performance level/
rating and bringing lower paid employees on par with those who
are being paid higher, nor for a sustainable justification, but due to
historical reasons.
The data indicates that 73% of the Best Companies for R&R track
these anomalies. In contrast, only 33% of the other organizations
carry out anomaly tracking procedures with this purpose. These
anomalies, after having been identified are attended to by, 67% of
the Top 15 and only 25% of the rest. This indicates that more
organizations in the Top 15 are consciously aware and are
proactive about establishing internal equity between peers at the
same level in an organization, who have the same performance
rating.
Thus the best companies put in far greater effort to manage
internal equity than the others.
Non Discrimination
Perception on fairness is also affected by an employees perception
on the extent of discrimination faced and observed in an
organization. An organization with a high level of internal equity will
have no discrimination in compensation, benefits and rewards on
the basis of gender, caste, race, language and religion. This
organization will also have conducted an equal pay audit or some
such similar process to ensure effective non-discrimination.

Non-discrimination in compensation, benefits and rewards on the


basis of gender, case, race, language or religion is the third factor
which contributes to internal equity. Companies conduct audit of
their compensation keeping this in mind and this process appears
to be fairly routine for most organizations with 100% practice in
the top 15 and 88% practice amongst other organizations.

UNITED COLORS OF BENETTON


Communication and branding
SMILE UNLIMITED - It signifies Benetton Indias
commitment to recognize, acknowledge and appreciate
Benetton-ians. Some current and past initiatives under
Smile Unlimited include wall of Fame, Pat on the Back,
Core Value Champion Awards, and Spot Awards,
Outstanding Awards, T 120, Biz Master, idea Champions
etc.
BENETTON UNLIMITED This campaign was launched
as a part of their internal branding exercise and formulate
defined platforms to various HR initiatives. Hence all the
Rewards & Recognition communication is driven
through the concept of SMILE UNLIMITED. Apart from
recognizing the top performers in public, there are
communications send across the organization
highlighting the winners and top performers who have
beenawarded.

Distribution of rewards
Internal equity is demonstrated by the fact that all levels, roles and
functions have the opportunity to earn meaningful amounts (% of
assured compensation) in terms of performance based variable
pay.
Companies in the Top 15 realise that equity is also established
when all types of roles, responsibilities and levels have an
opportunity to be rewarded. Data shows that a higher percentage
of the Top 15 reward all levels and roles in their organization.
Compared to 87% of the Top 15, only 35% of other organizations
pay performance incentives or bonus to all employees; including
those who are in non-sales and non-operations roles. Also, 87%
of the Top 15 for R&R extends this performance bonus incentive
to those in non-supervisory (front line) roles, while only 47% of the
others do so. Hence wide distribution of rewards across roles and
levels is a differentiating factor.
Fixed versus variable pay and differentiation
Data has also revealed that the overall trend for all organizations is
that the fixed component decreases while the variable component
increases as one moves up a grade/level. The following table
demonstrates this. What is interesting is the fact that, the
percentages of fixed compensation for the Top 15 at the Senior
Management level is lower than the Rest.

17

Average of variable %
Top 15

Rest

Supervisory

13.5

12.9

Managerial

17.1

16.4

Senior Management

27.9

22.2

Overall

19.7

17.3

Safety Awards

Figure 10: Comparison of Variable Pay across levels.

The average increase awarded to employees at all levels appears


to be similar for the Top 15 and the Rest. However, it is interesting
to note that the maximum annual increment that employees can
earn is much higher increase in the Top 15, than the Rest. This can
be seen in the following graph. This means Top 15 for R&R reward
performance and contribution more handsomely and create higher
differentiation for performance than the rest.
Interestingly, we notice a significant dip in the maximum increment
% for Top 15 vis--vis the Rest when moving up to supervisory
employees from front line employees.

Percentage increase

32%

30%

24%

20%

20%

14%

12%

0%
Non Supervisory

Supervisory

Managerial

Maximum increment: Top 15

Senior Managerial

Maximum Increment: Rest

Figure 11: Average Annual Increments

Employee Ownership Schemes especially stock options


Wealth creation/wealth sharing opportunities such as Stock
Options/Restricted Stock Units/Stock Purchase Plans, etc., are
made available to the largest number and percentage of employees
regardless of their level, function and tenure - at least a serious
attempt is made to create a sense of participation and ownership
in the organization for the largest number of employees.
Many organizations these days offer stock options, restricted
stock units and other long term retention cum wealth creation
opportunities to members of the senior and top management
levels. However, we notice that the Top 15 have discovered that it
is also important to offer such incentives to those at lower levels,
in fact, at all levels in the organization.
The table below highlights the following:
Category of Employees

% of the
Rest

% of Top 15

Non Supervisory

27%

13%

Supervisory

33%

13%

Managerial

47%

23%

Senior Managerial

60%

28%

Figure 12: Stock options offered to each level

18

_______________________________________________
NTPC INDIA
Manveeyata Puraskar

23%
13%

13%

10%

During the safety Week celebration i.e. from 4th March


to 11th March every year the organizations holds Poster
and Slogan competitions, which are open to members
and their children. Besides, there is also competition of
innovations and improvements done related to the
safety in the organization. The Best Slogan, Best Poster
and best innovation are awarded on the last day of the
Celebration i.e. on 11th March.

It is given to employees who have exhibited random


acts of humanity and kindness at their unit and
surrounding areas. An Appreciation Letter and a gift of
up to Rs 1,000/- are given.

Annual increases in increment


40%

FORBES MARSHALL

In addition to offering stock options to all levels, 33% of the Top 15


offers stock options to new employees, while only 7% of other
organizations do this.
Grievance Redressal and perception of justice
Perception of fairness with reference to grievance redressal also
determines the perception of equity within an organization.
Companies were asked to state and describe their grievance
redressal process which deals with issues relating to compensation
i.e. grade & salary fitment, performance rating and quantum of
increment and incentive/performance bonus and promotions.
73% of organizations in the Top 15 have formulated such practices
and procedures, while the percentage drops to 42% for other
organizations. Most organizations indicated that this grievance
redressal process could be used by any employee of the
organization irrespective of grade or level. Hence creating a sense
of justice and appropriate feedback channels appears to be a
lesson that the Top 15 have learnt and implemented.
The I- Club committee at Accor Hotels for example, is entrusted
with the job of sensitising management to employee unrest over
any decision made. This committee, along with the grievance
redressal system, is used to convey employee feedback on
rewards and recognition programs to managers and senior
management.
Benefits and Perquisites
Fairness (internal equity) in an organization can also be determined
by the distribution of benefits and perquisites across all levels.
Organizations were also asked to share data on the benefits
offered. They were also asked to indicate the specific levels these
benefits were offered to. The data has led to the following
interpretation:

47% of the Top 15 offers Domiciliary medical support to all


employees while only 28% of the other organizations extends
this benefit to the entire workforce. Those in the Top 15 also
offer a significantly higher amount for this purpose.
The Top 15 offer a vastly higher cover amount for Hospitalization
and Personal Accident Insurance relative to other organizations.
The Manufacturing and Production industry offers the highest
amount under this category in comparison to the other
industries.
80% of the Top 15 offer annual health check-ups to employees
compared to 57% of other organizations. Also, 27% of the
Best, extend this benefit to all employees, irrespective of level
or designation, compared to 15% of the Rest.
Inclusion of family members in insurance is a practice that is yet to
become a trend for the Top 15 as well as other organizations.
Nevertheless, the percentage of the Top 15 who currently extend
medical benefits to family members is significantly higher than the
percentage of other organizations who do so.
Table 1 shows that 33% of the Top 15 offers post-retirement
medical benefits to senior management as compared to only 7%
of the rest. This practice is mostly seen in the Manufacturing and
Production sector as compared to the others. Companies however
are not providing this benefit in a significant way across levels.

AMERICAN EXPRESS
American Express follows an employee relations
guideline of 21 days advance communication in case of
changes to the variable pay plan.
This provides employees an opportunity to evaluate the
changes & raise/ clarify any concerns and subsequently
participate in the program by declaring acceptance of
terms & conditions.
_______________________________________________
AMERICAN EXPRESS
The RewardBlue is owned by Global Compensation
and Benefits team. Each Business can custom awards
as per their population. So, awards are not budgeted by
number, but by the number of people in each business.
_______________________________________________
INTUIT INDIA
Incentive Plans
All employees participate in one of three incentive plans:

Top 15

Rest
(60)

Overall

All

7%

2%

3%

Supervisory

20%

5%

8%

Managerial

27%

7%

11%

Senior Management

33%

7%

12%

Table 1: Post-retirement medical benefits

The process of actively seeking feedback on practices and policies


is also indicative of an attempt to create a sense of participation
and collaboration within an organization when deciding modifying
rewards and benefits. 30% to 40% of the deciding to modify
participated in this study actively seek feedback from their
employees before introducing, changing, modifying or withdrawing
any HR policy or Benefit. A larger proportion seeks feedback from
senior management than other levels.Hence there is scope here
for companies across the board to do more.
An interesting practice at Philips is Parivartan.In order to involve
employees in the decision making process for changing/
implementing the benefits/policies, Philips has created a progam
called Parivartan. Parivartan means change and this is an
initiative to make employees part of the change that they want to
bring in the organisation. This is a bottom up approach where
employee representatives also called employee champions
collect feedback about new/existing policies and make a proposal
to the management, with its pros and cons. These employee
champions are not only responsible to assess the viability of
implementing the benefit/policy, but are also responsible for
putting in place the guidelines and procedures and communicating

Intuit Performance Incentive awards


Customer Care Incentives teamwork focus customer
Sales Commission Plans

the change. Once the changes are approved the employee


champions ensure that the same is circulated through Philips own
social network page to all employees. The team of Parivartan in
the last year has co-developed 8 policies for e.g., optional leave
work from home, etc.
Based on the above data we can conclude that the organizations
who have been rated as the Top 15 in terms of Rewards and
Recognition make conscious efforts to build internal equity and
transparency in these programmes and practices and have indeed
succeeded in achieving this result far more than the Rest.
FINDINGS ON RECOGNITION
Recognition practices are more effective when they are frequent,
targeted at all employees and demonstrate a true sense of
gratitude. This study measured effectiveness of recognition
practices defined as follows
a) Variety of programmes to recognize and appreciate different
category of employees for different types of tasks, behaviours,
efforts, achievements for which they are recognized.
b) Frequency of programs represented by how often employees
are recognized.
c) Private & public recognition provided to the largest number
and percentage of employees during the course of any period
d) Recognition provided to employees across levels, roles,
functions and locations. This includes employees in revenue

19

Variety and frequency of recognition practices


INTERGLOBE ENTERPRISES
UABD (United Airlines Baggage Desk) Champions
How would you feel if you get to sit on a fabulously
decorated workstation designed especially for you?
This amazing feeling is earned by UABD Champions for
their well-deserved performance. UABD floor has a
spot-light workstation where employees who have
performed exceptionally get a chance to enjoy the glory
of championship for a month!
_______________________________________________
INTUIT INDIA
Awards given in 2012: 3557 (31 Service Awards, 63
Employee Referral Awards, 3337 Performance Awards,
126 Wellness Awards).
_______________________________________________
RADIO CITY- 91.1 FM
RING A LOUD
Objective: To be vocal about departments extra ordinary
achievement and share the same with all Radio Citizens.
To express gratitude, and appreciate the efforts and
hard work of functions and teams .
earning & customer/client impacting as well as enabling
support functions.
e) Employees are recognized and appreciated for their loyalty
i.e. long tenure.
f) Recognition of results or outcomes along with effort which
take the form of going the extra mile, demonstration of
desired actions and behaviours, adherence and upholding of
values, etc.
g) Inclusiveness of recognition defined by the fact that it flows
from and in all directions not only from seniors to juniors, but
between peers, from juniors to seniors, across functions,
business units & locations, to even outsiders and from
outsiders (such as clients, suppliers, business partners,
service providers, industry peers, etc.).
h) Recognition and celebrations are done for not only work
related efforts and achievements/results, but for achievements
which are beyond work as well .
i) Achievements of family members are also recognized,
appreciated and rewarded publicly within the organization.
j) Family members are informed and thanked and/or invited to
participate in events and functions where employees are
being recognized and felicitated.
k) Forms of recognition i.e. private and public, emotional &
personal as compared to the ones with trophy value.
l) Personalization of gifts and forms of recognition i.e. thought is
given to what the recipient of recognition really likes book(s) to
a bookworm, movie ticket(s) to a movie buff, music CD(s) or
ticket(s) to a music concert to a music lover, coupon to a
restaurant to a foodie, etc.
m) Extent of feedback and inputs sought from supervisors,
managers and employees on what should be recognized and
appreciated.

20

Top 15 Extent of Variety of


Recognition Programmes

Rest (60) - Extent of Variety


of Recognition Programmes

Yes

No

Yes

No

80%

20%

55%

45%

Figure 13: Comparison of Variety between the Best and the Rest.

To begin with, the data collected was used to test whether the
best in rewards and recognition did indeed have a wide variety of
recognition practices.
The Great Place to Work guidelines have been used to measure
the variety of practices and programs (see appendix). It can be
seen from the table that the Top 15 companies in rewards and
recognition do indeed have a wider variety of recognition
programmes (80%). In contrast, only about 55% of the remaining
organizations offer a wide variety of recognition programs to their
employees. However knowing this alone, does not give a clear
indication on the frequency of these programs.
The next graph illustrates the frequency of the recognition
programs within organizations that are in the Top 15 this year.

UNITED COLORS OF BENETTON


At United Colors of Benetton, India, those with 5 or 10
years of experience are recognised at the quarterly
Town Hall with certificates. For those with more than 15
years of tenure in the company receive an all expenses
paid holiday with family to a location of the employees
choice in addition to a Certificate from the Director HR
& Managing Director at the yearly town hall. Also, for
someone who has worked at the organization for more
than 20 years, educational sponsorships for his/ her
child are used as a form of recognition.
_______________________________________________
INTEL INDIA
Environmental Excellence Awards
These are awards which are given annually for
outstanding employee achievements in environmental,
energy conservation and pollution prevention programs
and performance. Intel won the #1 place in Green500
and theCEO Justin Rattner came to India especially to
reward the Intel Labs team which contributed to this
award.
_______________________________________________
INTEL INDIA
Volunteering Road Shows
Winners of the Social Initiatives Drive get to showcase
their work to other employees through road shows and
this helps them form larger teams of other interested
collaborators, often with complementary skill sets to
work on their projects.

When we compare this to the other organizations who participated,


it can be seen that while most organizations reward and recognize
employees every year, quarter, and, even every month; very few
organizations follow the practice of rewarding employees regularly
over shorter periods.While monthly/quarterly/annual recognition
has become a common phenomenon; it is the everyday aspect of
recognition which seems to be the differentiator.

Frequency of Recognition Programmes


100%
80%

73%
60%

60%

60%

73%
65%

0%

18%

75%

63%
53%

40%
20%

93%

87%

25%
12%

PAYPAL INDIA
Innovation AwardsLabrats & Innovation is one of the
key features of theorganization. The Labrats and
Skunkworks is a forum where employees have the
opportunity to innovate outside their work sphere. Here,
they can bring their Ideas to life. This is one among the
hot favorites with the employees. With whopping prize
money, this sure a great platform for people to innovate
and bring in their ideas to the organization and their
business. This award recognizes employees who have
gone above and beyond in their work on specific
projects, or in showing leadership ability and bringing to
life PayPals values and behaviours.
_______________________________________________

7%

FORBES MARSHALL
Daily

Weekly

Fortnightly

Monthly

Top 15 in Rewards and Recognition

Quarterly

Half

Annual

Other Organizations

Figure 14: Frequency of Recognition Programs

Organizations such as Intel, UCB, etc., have also implemented an


On the Spot recognition philosophy. This not only allows
immediate felicitation for a job well done; but it also ensures that a
culture of appreciation or thanking one another is created. This
also leads to more proximate positive reinforcement of the desired
actions, behaviours and/or outcomes. Most of the Top 15
organizations this year extend this Spot recognition opportunity to
employees as well - where they are allowed to recognize the
efforts of their managers or mentors too. It is important to know
the frequency of recognition programmes in an organization in
order to decide where there is a Sense of Spontaneity in the
nature of rewards given to employees.
Another contributor to this sense of spontaneity of recognition
programmes is the manner in which employees are recognized.
For example, most organizations may acknowledge the efforts of
all employees, by conducting one large event once a year. Some
organizations may also implement initiatives where employees
receive a decorated desk as surprise recognition for good perform
ers. Alternatively, organizations also use simple Post It notes on
subordinates lockers as a means of saying thank you.
Another aspect of an effective recognition programs deals with the
number of opportunities employees feel they have to be
recognized. As a part of this study, organizations were asked to
select the different types of parameters used for recognition at
their workplace. 53% of the Top 15 considers up-to 7 parameters
for recognition whereas 13% of the rest have that many parameters
which they use to recognize employees. Thus, the frequency of
recognition in workplaces is also affected by the exact behaviours,
performance levels, that are rewarded and the variety of techniques
used to do so
The most common methods for recognition as reported by
organizations are:
1. Recognition for long tenure or long service.
2. Recognition for outstanding performance and results
3. Recognition of only the Top 3 in each category
4. Recognition for exceeding the laid down norm/performance
level

Rewards for Internal Trainers


Many of the technical trainings are given to the members
by the Internal Trainers. These trainers are doing
something other than their role for the betterment of the
members and developing talent in the organization.
Thus every year these trainers are rewarded by gift
coupons of varying amounts depending on the number
of trainings they have delivered. Rewarding these
trainers is a kind of motivation for them to continue the
best that they are giving to the company.

5. Recognition for demonstrating potential


6. Recognition for carrying out a specific role/for possessing a hot
skill
7. Recognition for carrying out desired actions/behaviours/
initiatives
8. Recognition for adherence to values and principles of the
organization.
Recognise for effort and not only high performance
Outstanding performance and good results are, by far, the most
common basis of recognition used by organizations. Of those who
participated in this study, 89% stated that they recognised
employees who out-performed the rest. In contrast, only 55%
organizations recognise employees for meeting or exceeding a
laid norm, or new performance level. 67% of the top 15
organization recognise potential, in contrast to the 33% of the
other 60 organizations. Similarly a higher percentage of the Top 15
recognise employees for their skills or for performing in certain
roles than the other participating organizations.
The following table shows that the top 15 base recognition on
more parameters that the rest and thereby create more extensive
and frequent opportunities to recognize.
7 parameters

6 parameters

5 parameters

Top 15

53%

60%

73%

Rest

13%

32%

50%

Figure 15: Difference in number of parameters rewarded. Total parameters = 8

21

FORBES MARSHALL
Internal and External Coaches
There are many FM members who are internal coaches
and also external coaches. They also coach graduation
students from institutes like COEP, Cummins College of
Engineering, SCMLD etc. These members are
recognized and rewarded in the Annual Conference.
Also some of themembers devote time to various
finishing schools to help students get industry interaction
and exposure.
_______________________________________________
MAHINDRA INTERTRADE
Hamara Sitara
This is a unique initiative targeted at employees families
and also recognizes the outstanding academic
achievements of employees children.
_______________________________________________

80%
50%

Top 15 in Rewards and Recognition

67%
40%
20%

22%

13%
5%

Medha Pratiyogita:A quiz competition, for the children


of NTPC employees and Employees featuring renowned
Quizmaster Derek OBrien and his team, at the Project,
Regional and Corporate levels. The winners in all
categories are felicitated by CMD/ Director
Sports Events: The Sports Council at plant level
organizes various games and sport competitions for
families of NTPC employees like swimming, cricket,
football, table tennis etc. The winners in these
competitions are given gifts by the Business Unit Head.

22

7%

5%

Other Organizations

Figure 16: Flow of Recognition

Those in the Top 15, enable the flow of recognition from external
stakeholders as well. Although this practice is not common
amongst those in the participants, a higher percentage of the Top
15 realise that recognition from a customer, or a supplier helps
create a culture of recognition within the organization and tend to
motivate employees to give their best.
An increasing number of participating organizations have begun to
involve family as part of their recognition initiatives. Few
organizations have also made it a practice to reward the
achievements of family members. 67% of the Top 15 organizations
are in the practice of involving family members as part of an annual
awards day, an annual offsite or by simply sending a thank you gift
to an employees family.
The all- inclusiveness factor of an effective recognition program is
also affected by the amount of feedback solicited from various
levels within the organization. Including employees in the decision
making process, or simply allowing employees to share feedback
on a certaininitiative, and making appropriate changes to this
initiative has a positive effect on the over all perception of inclusion
at the workplace.
Overall

NTPC LIMITED
Family Included

27%
18%

Vendors/
Business

58%

53%

Clients/
Customers

87%

Industry,
association

87%

63%

Juniors

87%

Other
Departments

Recognition is considered to be all inclusive even when it flows


from all directions to all directions in an organization. Some winners
of Indias Best in Rewards and Recognition have realized this and

100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%

Peers/Team
Members

Inclusiveness in Recognition

Who can recognize employees?

Immediate
Supervisor

While many organizations have begun to switch to a model where


employees are rewarded purely on the basis of meritocracy; there
still are a vast number of organizations who reward employees
based on the tenure completed in the organization. In todays
competitive market for talent, organizations across the board
realise that it is important to reward long tenure, as a symbol of an
employees loyalty towards the organization. 73% of the 75
organizations represented in this study recognise employees for
their long tenure.

The graph below shows difference in the flow of recognition of


the Top 15 compared to the other participants. There is a vast
difference in the percentage of organizations who allow peers
(from the same and different teams) and juniors to recognise their
peers and seniors respectively.

Head of
Department

Recognition for Long Tenure is a common trend

have planned and implemented initiatives that allow felicitation of


vendors, customers and family. Simultaneously, others in this top
15 category have ensured that employees can be recognized by
external stakeholders as well.

Senior
Management

Recognition amongst those who are not in the top 15 does not
seem to be based on display of behaviours or values. In both
instances, the percentage of organizations from the top 15, who
recognise these aspects, is much higher.

Average
Yes

No

Non Supervisory/ Front Line

37%

63%

Supervisory

37%

63%

Managerial

37%

63%

Senior Managerial

40%

60%

Figure 17: Feedback on recognition programmes

The data collected from participants does not display any


significant difference between actions of the Top 15 in comparison
to other participating organizations. Although, overall, organizations
are less inclined to include all levels of the organizations in decision
regarding rewards and recognition practices;- there are a few

organizations that have been carrying out very innovative practices


that establish employee involvement throughout the organization.
Forms of recognition
There is no single method of recognising employees. Recognition
in an organization can take various forms (as mentioned earlier in
the report). Organizations need to fine tune their programmes to
ensure that there is the right combination of public recognition
(which increases the prestige value of a reward) and private
recognition (a simple thank you from a supervisor). There also
needs to be an appropriate mix of rewards with a medium to high
financial value as well as those which are of trophy value only. The
Averages & Percentage. of
Responses for Yes / No
Top 15

Rest (60)

Average

Average

67%

53%

87%

70%

Emotional, trophy value

87%

70%

Small gift or little cash

73%

67%

Substantial gift or cash

53%

58%

Personalized gifts

40%

25%

Essentially emotional &


symbolic
Symbolic and trophy value

Figure 18: Forms of Recognition

ACCOR HOTELS
Hotelier Awards
A unique example of external recognition given to
employees can be seen in the hotel industry. Accor
Hotels,India (and other well-known hotel brands)
conducts the annual Hotelier Awards where members
of different organizations can facilitate each other.
_______________________________________________
MAHINDRA INTERTRADE
Mahindra Intertrade is in the practice of recognising its
third party personnel who have significantly contributed
to the organizations productivity.
_______________________________________________
INTEL INDIA
Spontaneous Recognition Award (SRA) acknowledges
above and beyond performance by an employee.
SRA recipients demonstrate a spirit and attitude that
inspires others. Their actions often exemplify fire
prevention rather than fire fighting; making a contribution
that affects peers or projects within their team or
department. Anyone can nominate an SRA candidateand any Intel employee is eligible to earn the cash
reward.

data collected from participating organizations in the figure below


shows that most of the (87%) winning organizations recognise
employees through some form of public recognition. This
recognition also has a high emotional and trophy value. It is
interesting to note that a higher percentage of the other
participating organizations (58%) use high value gifts or cash as
recognition.
Participating organizations from the Manufacturing Industry use
recognition tools that have a high trophy value. The data collected
suggests that organizations in this industry are least inclined to
personalise gifts or recognise employees with a substantial gift as
a reward. Companies from the IT industry however, use small gifts
or cash amounts and a means of recognition. Once again,
personalising gifts for employees is a practice that is yet to be
followed by many in the industry. Data shows that the Financial
Services sector uses recognition that has both symbolic as well as
emotional trophy value to reward employees. This sector also
uses a fair amount of high value cash or gifts to show appreciation.
Therefore, the data from the table above suggests that recognition
tools vary from one industry to another, and organizations need to
understand what the best fit is for them given a variety of
constraints.
To sum up, we can see that inclusivity and frequency have a
positive impact of the perception on employees about their
recognition programmes. It also appears that even the Best and
certainly the Rest could utilize the potential of recognition as a
reinforcing and motivating tool even further.
With the second year of the study we continue to believe that, a
robust program allows an organization to cover the largest number
of their employees doing right and reinforce those desirable
behaviours,actions that lead to sustained high performance more
frequently at a minimal cost. An interesting point here is that higher
frequency or variety of recognition does not actually incur higher
cost. Hence it is the practices of best workplaces and efforts of
managers to implement it that determine this experience for
employees.As other studies cited in this research paper have
indicated, such programmes not only create positivity and high
performance, they reduce stress, which could help employees
maintain better health and minimize the chances of burnouts.
It is relevant to note here that the role of the manager is very pivotal
in the context of recognition. Studies by Great Place to Work
Institute continue to indicate that at the best companies, the
quality of the managers interactions at the workplace with team
members creates high trust and high performing teams. This is a
phenomena called Giftwork.Creating a learning environment for
frontline or first time managers to embody the spirit of Giftwork is
a critical success factor for organizations.
Assumptions of the study:
1. The data used for the study relies on what organizations have
shared. It is assumed that companies have provided accurate
data for the purpose of the study.
2. Data & inferences are based only on the information collected
from the companies that have participated.

23

Essentially
emotional &
symbolic

Symbolic and trophy value


(public recognition,
considered prestigious)

Emotional,
trophy
value

Small gift
or little
cash

Substantial
gift or cash

Personalised
gifts

Information
Technology (25)

56%

64%

60%

72%

64%

20%

Manufacturing and
Production (11)

73%

73%

91%

64%

36%

27%

Financial Services and


Insurance (12)

33%

75%

75%

58%

67%

33%

Figure 19: Industry- wise recognition

UJJIVAN FINANCIAL SERVICES


A recent staff murder in Bihar has left the Industry and
branch staff worried. Senior management from the
National / Regional Leadership levels connected several
times to visit the branches and haveone-to-one
discussions with staff listening to their concerns. Being
in Cash business, the staff appreciated that their role
involves risks but the concerns were more in term of
benefits for family in case of any untoward instances
that happen at work. Ujjivan took a Term Life Insurance
with Birla Sun Life Insurance to ensure that staff feel
comfortable.
These benefits are communicated in local language,
explained to staff, informed to take it home for the family
members to know the benefits.
_______________________________________________
ELI LILLY
Inclusive Rewards
The top sales performers go on a week-long Lilly
International Incentive trip (to exotic destinations like
Italy etc.) along with spouse/1 family member/ friend.
Even a sales rep is given the same equity (stock units)
award as the NSM, which could be upto 75% of the
annual salary in some cases.
_______________________________________________

NIIT INDIA
Redeemable points
Hats Off e-Shopping Portal is an online shopping site for
NIITians to redeem their Hats Off Points. The Portal has
a wide range of products which allows NIITians to buy at
a click of a mouse. It also provides host of additional
features such as personalized account, transaction
tracking and a dedicated customer care. Monthly
discounts and special promotions make it even more
alluring.
CARE FOR FAMILY:
Little NIITian Care Leave: NIIT understands the need of
the new parents to spend time with their newly born
kids. Hence, NIIT allows NIITians to work on half day half
pay arrangement for 6 months during the first year of the
child. If both parents are in NIIT, they can both avail this
scheme.
_______________________________________________
AMERICAN EXPRESS INDIA PRIVATE LIMITED
Blue Box Values Award

PHILIPS INDIA
Recognition @ Philips (Global Level): redeemable points.
A program that allows people managers, where
appropriate, to financially recognize employees across
the globe. Here people managers can give recognition
points to appreciate any effort or good work
demonstrated at workplace, by any Philips employee,
displaying Philips Behaviours. The Employee can
redeem the accumulated points in form of Philips
Products and non-Philips products.

24

This Peer recognition can be used by any employeeto


recognize their colleague for extraordinary displayof any
of the eight Blue Box values.

Conclusion
We hope that based on differentiating evidence, this research
paper has been able to persuasively argue that it is not the
quantum of money alone, especially after a critical threshold
is crossed, that help R&R programmes work for the
employees, and in turn, for their organizations.Essentially it is
a sense of fairness along with frequent, inclusive and heartfelt
appreciation that really make these programmes and
practices impactful.
All organizations have put in place some practices to create
a robust rewards and recognition program. These have
become hygiene. These would be aspects like ensuring nondiscrimination in rewards through audits and some benefits
e.g. hospitalization, health check -ups and domicialliary
medical benefits. Monthly, quarterly and annual programs
especially focused on recognizing performance, results and
loyalty (i.e. tenure) have become common now.
On the other hand the differentiators are:
1. Systems and mindset for internal equity in compensation
especially after reaching a particular threshold

effort, there is still little recognition for exceeding norms or


finding new performance levels. This could very well be what
can drive innovation among employees. Personalization of
recognition programs is one other area where organizations
are not investing a lot of time or energy. In a technology
enabled age driven by social media and group think, this
could well be a means of touching the emotional chord in
people with significant psychological, social and economic
benefits.Lastly an ongoing area of focus remains the extent
of participation and feedback that an organization takes from
across levelsto continuously improve its practices.
In conclusion both the hypotheses are validated and are
differentiating practices in reward and recognition i.e,
1. Once a threshold point is reached, internal equity and
transparency are more important than the actual quantum
of the rewards in enhancing the effectiveness of rewards
and recognition (particularly rewards) programmes.
2: Higher frequency, genuine experience of appreciation and
greater inclusiveness in recognition programmes makes
them more effective.

2. Wider distribution of rewards across levels and roles


3. Higher payouts for medical benefits
4. Greater differentiation based on performance indicated
by the fact that fixed is lower and variable, as well as
maximum increment percentages are higher for the Top
15.

We hope more and more organizations and their business


and HR leaders are inspired to learn from the Best and add
to the repertoire of best practices in this all important area,
thereby benefiting them and providing more valuable ideas to
others.

5. Stock ownership both as a percentage as well as spread


across levels
6. Higher variety, inclusiveness and frequency of recognition
7. Recognition for potential and skills, behaviours apart from
results and contribution
8. Grievance redressal channels for employees to ensure
strong execution and sense of justice.
Some factors continue to be areas that all organizations
could look into. These are aspects that have scattered
evidence but could well be leverage areas for employees and
organizatons in the time to come. These are family
involvement in both recognition as well as benefit programs
e.g. inviting family members to recognition events and
applauding their role in the achievement of the employee or
insurance cover for family members. Medical benefits on
retirement is another such area. It is also interesting that
while companies are recognizing employees for results and

25

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20. Ostrow, P. (2011). Sales performance management 2012: Rewards and Recognition as a vital compensation component
21. Roberts, R. L. (2005). The relationship between rewards, recognition and motivation at an insurance company in the western cape.
(Magister Commerci), University of Western Cape.
22. Saks, A. M. (2006). Antecedents and consequences of employee engagement. Journal of Managerial Psychology, 21(7), 600-619.
23. Shore, T. H., & Strauss, J. (2012). Effects of Pay and Productivity Comparisons in the Workplace on Employee Attitudes: An
Experimental Investigation. International Journal of Management, 29(2), 677-686.

26

Appendices
APPENDIX 1: CULTURE AUDIT PRACTICES
1. HIRING

Focus is on hiring for potential and character of the person, rather than
primarily on skill set. New employees are welcomed and assimilated
into the team with orientation programs, personal sponsorships, and
the like.
2. INSPIRING
Employees learn and understand how their job has meaning for the
organization and for society, beyond earning a salary and making a
profit for the business.
3. SPEAKING
Management goes to great lengths to be open and transparent,
offering access to information across the board, enabling and
encouraging employees to contribute beyond the scope of a narrowly
defined job.
4. LISTENING
Special open systems for incorporating peoples ideas, for including
people in decision-making, and enabling them to air their concerns
and grievances.
5. THANKING
Recognizes and rewards good work and extra levels of effort; strives
to create a climate of approval and reinforcement.
6. DEVELOPING
Focus is on nurturing individuals gifts to foster personal growth and
development as well as offering job-specific training.
7. CARING
A multiplicity of systems and programs are put in place for creating a
caring environment for the individual and his/her family.
8. CELEBRATING
Celebrations of both personal milestones and company successes
are built into the way people work together.
9. SHARING
Employees share in the fruits of their labour in a variety of ways;
rewards are equitable and egalitarian in nature.

rewards and recognition, this time around, statements that pertain to


rewards were treated as a separate category from those statements that
pertain to recognition in organizations. As mentioned earlier employees
responses are measured on the truth scale (veracity cum frequency
scale) rather than the agreement/disagreement scale. The two sections
below specify the statements used for subject and the rationale behind
this measure.
Employee responses from each participating organization were sampled
and the feedback on the question mentioned above was considered.
Employees were asked to rate their organization using these statements
on a 5 point scale with 1 being the lowest (that is, whatever is mentioned
in the statement is almost always untrue) and 5 the highest measurement
of positive perception (that is, whatever is mentioned in the statement is
almost always true) in relation to each statement. 25,930 employees were
surveyed for the purpose of this study. The data collated and analysed will
reflect the perception of employees based on this sample.
The Great Place to Work Model measures or rates an organization using
two lenses. The first, measures employees perception on their workplaces
using scores for the statements mentioned above and comments of
employees in their own words about what is special and unique about their
workplace which makes it a great workplace or what needs to be changed
or improved to make their workplace a better workplace. The second
aspect measures/assesses and scores the people practices implemented
in an organization - by management/human resources function, which are
captured in the Culture Audit Documents.
As has been mentioned earlier, organizations who participated for R&R
Awards were asked to answer questions related to the rewards and
recognition initiatives that have been implemented in their organization.
These responses were also studied and evaluated. Scores of relevant
employee responses as well as scores of people practices (R&R) have
been used to rank the winners for Indias Best Companies for Rewards &
Recognition, 2013. A copy of this questionnaire can be seen in Appendix
2.

DATA SELECTION
SELECTION OF THE TOP 15 IN REWARDS AND RECOGNITION
The employee response discussed in Step 5 above represents employees
perception of their workplace. Although all 62 statements were used to
gather data for this overall analysis, 10 statements that relate directly to an
organizations reward and recognition practices and their effects on
employee perception have been used for R&R Award.
Rather than combine statements from the Trust Index that relate to both

Although both forms of data (the Trust Index Questionnaire and the
practice questions- Culture Audit) were used to consider organizations each section had different weightage. Employee perception (an equally
weighted combination of statement scores for both rewards and
recognition) was assigned 2/3rd weight of the overall score. The remaining
1/3rd weight was assigned to the score of R&R practices. The following

REWARDS
STATEMENT

Weightage out of 100.

People here are paid fairly for the work they do.

20

We have special and unique benefits here.

20

Managers avoid playing favourites.

15

I feel I receive a fair share of the profits made by this organization.

15

Promotions go to those who best deserve them.

15

Performance of employees here is fairly evaluated.

15

27

RECOGNITION
STATEMENT

Weightage out of 100

Management shows appreciation for good work and extra effort.

30

Everyone has an opportunity to get special recognition.

30

Managers avoid playing favourites.

20

Performance of employees here is fairly evaluated.

20

parameters were employed to analyse and assess people practices.


1. Variety: To what extent are the programs/initiatives varied? Do they
involve a variety of methods of delivery? Does the variety in the
programmes aim to achieve a different purposes, seeks to reward or
recognize different categories of employees?
2. Originality: To what extent are the programmes implemented differ
from those implemented in other organizations? Are these programmes
creative, innovative? Do they capture some relevant aspects of the
companys culture? Do they create a unique brand that employees can
relate to?
3. Human touch: To what extent are the programmes generous, caring
and to what extent are they delivered with a true sense of appreciation?
4. All Inclusiveness: Do the programmes target all groups/grades/
demographics of employees of that organization? To what extent are
the programmes egalitarian/classless?
5. Integration: To what extent do the programmes fit in with the
organizations values, culture and people strategy? To what extent do
programmes and practices pull in the same direction within the R&R
aspect as well as across other people practice areas?
Finally, the analysis team also considered the standard deviation and the
inverse standard deviation of responses for each organization in order to
gauge the consistency and universality of employee responses. This
allowed for a more comprehensive view of employee perception in each
area.
DEVELOPMENT AND
QUESTIONNAIRE

TESTING

OF

THE

TRUST

INDEX

interviews following their use of the survey instrument to begin determination


of the validity and reliability of the instrument.
Survey statements were reviewed to eliminate duplicates, confusing
wording and overlapping statements. Testing was then conducted with
employees to get feedback on the effectiveness of the instrument. This
feedback helped us understand the importance of using a truth (veracity
cum frequency scale that is, how often what is stated in a statement is
untrue or true) scale instead of an agreement/disagreement scale for the
answer code. It was found that the importance of the survey results are
determined by an employees ability to actually indicate, based on their
actual experience, the degree to which something is true for them (that is,
does the event or behaviour mentioned in the survey statement actually
occur in their workplace) versus any sense of agreement in the abstract
with a concept that is embodied in a survey statement. Although, the
survey instrument can be administered to seek employee response relative
to two relationships (the workgroup and the employees immediate
manager, and the other, the organization and its top leadership), were
created, this research report reflects only those responses that use the
employees responses related to their organizations and top leadership.
The rationale behind the statements used for this study will be discussed
in the methodology section of this report. the above section to be in
appendix.
INDUSTRY DISTRIBUTION
Others include:
Transportation
Agriculture, forestry and fishing

The survey instrument used in this research report (hereby called the Trust
Index or TI )measures the extent to which a company is considered to
be a great workplace by its employees. The questions are based on the
extensive employee interviews Robert Levering and Milton Moskowitz
conducted for their best-selling book, The 100 Best Companies to Work
for in America (1984).
The 56 core statements on the Trust Index are categorized into five
dimensions of the Great Place to Work Model. The 56th statement
captures the overall perception- whether all things considered, this is a
great workplace or not. The first three dimensions-Credibility, Respect and
Fairness-measure employee trust in management, while the final two,
Pride and Camaraderie, assess employees feelings about their jobs and
their enjoyment of the workplace. In India, six more statements have been
added to the core instrument to seek employee perception on issues
which deal with the contextual concerns here.
The development of the Trust Index can be viewed within the context of
the Qualitative-Quantitative Interactive Continuum, in that both quantitative
and qualitative data was used to develop and test the survey instrument,
with appropriate feedback loops.
The survey design process began by reviewing transcripts from the above
mentioned interview research to determine common themes and create
possible survey statements. The initial review led to the creation of
approximately 120 statements, which were eventually narrowed down to
the core 56 statements used today. This narrowing process was the result
of extensive testing of the survey instrument with groups of employees and

28

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