A common sight, often at the entrances of stores, is a board emblazoned with the title “Employee of the Month,” sporting a picture of a chosen employee underneath. But regardless of how common they are, do such efforts to praise and inspire retail employees really work?

The goal of employee-of-the-month programs is to reward hard work and inspire similar efforts among the rest of the staff. Some programs offer mainly public recognition, such as a picture on the wall. Others might add a cash bonus. In addition, beyond just general hard work, many programs seek to inculcate particular values or initiatives. For example, a restaurant looking to increase dessert purchases might offer a special “dessert seller of the month” award temporarily. Other specific rewards might acknowledge which cashier smiled at the most customers, or which stock room clerk moved goods onto shelves most efficiently.

As long as the programs have such clear-cut standards, they appear likely to work. But in many cases, they have not been well defined, such that employees remain unsure of exactly what they need to do so become employee of the month. In that situation, the accolade creates a risk of resentment too, because others might wonder what left them less deserving than a colleague who seemingly has not done much that is special. Accordingly, some firms make sure that everyone is named the best employee at least once, which takes away from the meaning of the award.

Another challenge to such programs is the inability to reward team effort. If a group of employees comes up with a great new retail display or develops an innovative way to serve customers as a team, who gets the recognition? The very presence of individual rewards might discourage team efforts. It also may lead managers to assume they do not have to provide more extensive performance feedback.

To address some of the problems, some retailers have introduced a democratic approach, such that all employees vote on who will receive the monthly award. Another option is to enhance the fun aspects, turning the award presentation into a game that brings a sense of enjoyment to the process, such that the game is more to the point, rather than just the reward.

Discussion Questions: 

  1. What are the advantages and disadvantages of employee-of-the-month programs?
  2. What are the characteristics of a good employee-of-the-month program?
  3. If you were running a retail enterprise, would you have an employee-of-the-month program?

Source: Tom Ryan, Retail Wire, April 11, 2017