The rewards stage of the performance management cycle

You’ve set goals, monitored progress, provided feedback and development and conducted a performance review. Now you’ve reached the final stage in the performance management cycle—recognition and rewards.  This is your chance to show appreciation, reinforce positive behaviours, and keep your team engaged for the long haul.

But it isn’t just about handing out bonuses or ticking a box in the HR process. It’s about genuinely acknowledging the hard work your employees put in—because when people feel valued, they stay motivated, engaged, and committed to your business.

The right approach can boost morale, improve retention, and drive better business results. So, how do you get it right?

Why recognition and rewards matter more than ever?

Think about the last time you felt truly appreciated at work. It probably felt great, right? Your employees feel the same way.

Here’s what happens when you get the rewards stage right:

• Higher engagement: Research has found that employees are 2.7x more likely to be highly engaged when they believe they will be recognised.

• Stronger retention: In fact, 79% of workers say that an increase in recognition rewards would make them more loyal to their employer, according to a recent survey.

• Better performance: It’s been reported that 81% of employees would work harder if they felt more appreciated.

On the flip side, research shows a lack of recognition is one of the top reasons employees leave. You don’t want your best talent walking out the door simply because they felt unseen.

Types of employee rewards

Not all rewards have to be financial. In fact, a mix of different incentives often works best. Here are some ideas:

Monetary rewards

• Bonuses and pay raises

• Profit-Sharing or commission

• Gift cards or prepaid debit cards

Time-based rewards

• Extra paid time off

• Summer Fridays or shortened workweeks

• Flexible work arrangements

Career-based rewards

• Training and development opportunities

• Promotions and new responsibilities

• Mentorship or coaching programmes

Alternative rewards

• Team outings or retreats

• Tickets to events (concerts, sports, theatre)

• Services (Wellbeing app, e-learning courses)

But it’s not just rewards that motivate your employees’ recognition does too. But recognition needs to be consistent, meaningful, and easy to implement—which is where an employee recognition platform can make all the difference.

How an employee recognition platform can help?

Recognising employees effectively isn’t always easy—especially when you’re juggling a million other tasks as a business owner. That’s where an employee recognition platform comes in.

These platforms help you:

• Make recognition consistent

• Encourage peer-to-peer recognition

• Track and measure impact

• Offer flexible rewards

Platforms like BrightHR’s Praise make it easy to build a structured and engaging recognition system—without adding extra admin work to your plate.

Recognition is powerful on its own, but pairing it with the right rewards can make it even more impactful. The key is to offer a variety of options so employees feel truly valued in a way that resonates with them.

How to make rewards meaningful

It’s not just about what you give but how you give it. Here’s how to make your rewards truly effective:

Make it personal

A generic “good job” won’t cut it. Tailor your rewards to each employee’s preferences. Some might prefer a bonus, while others would love extra time off or professional development opportunities.

Be timely

The sooner you recognise an achievement, the more impactful it will be. Don’t wait for an annual review—celebrate wins as they happen.

Be consistent, but not predictable

Employees should know they’ll be rewarded for good performance, but the type of reward can vary. This keeps things exciting and prevents entitlement.

Tie rewards to goals

Make sure employees understand how their actions contribute to business success. This helps reinforce the behaviours you want to see more of.

Bringing it all together

The final step of the performance management cycle isn’t just about checking a box—it’s about creating a culture of recognition. When employees feel valued, they work harder, stay longer, and contribute more to your business’s success.

So, ask yourself: Is recognition and rewards a regular part of your business, or is it something that only happens occasionally? If it’s the latter, an employee recognition platform could be the tool that transforms how you motivate and retain your team.

At the end of the day, people want to feel seen—and a little appreciation can go a long way.

Ready to start the cycle again?

Now that you’ve completed the rewards stage, it’s time to start again. Or if you need a refresher on any stage, check out the plan stage, monitor stage, develop stage and review stage.