Management Accounting Section Midyear Meeting

The Effects of Non-Monetary Recognition on Engagement and Performance: A Field Experiment

• In Event: Incentives and Compensation V

Abstract

We conduct a field experiment at six fast-food franchise restaurant locations to investigate the effects of a formal, non-monetary employee recognition program on employee engagement and performance. Firms frequently use recognition programs to engage and motivate employees, but minimal research has tested their effectiveness. We find that adoption of the recognition program leads to improvement of several measures of employee engagement such as unexcused absences, arriving late to work, and employee turnover. We also find that adoption of the recognition program leads to improvement of several measures of performance such as employee productivity, restaurant-level financial performance, and restaurant-level customer satisfaction. Collectively, our results support the use of formal, non-monetary employee recognition programs as effective controls to increase employee engagement and motivation to perform.

Authors

• Adam Presslee, University of Waterloo

• Greg Robert Richins, University of New South Wales

• Sasan Siay, University of Waterloo

• Alan Webb, University of Waterloo