How to Reward Employees When You Can't Afford a Bonus

Money is always appreciated, but it isn't always possible. Five other ways to show your gratitude

Written by Advisory Board

Welcome to Advisory Board, a weekly department in which a panel of experts—made up of entrepreneurs and professionals—answer questions you have about how to run your business better.

This week, a reader asks:

“My company recently won a major contract, and my staff worked very hard to close the deal. I’d like to reward them, but the business is not currently in a financial position to give out bonuses. How can I recognize my employees’ achievement without breaking the bank?”

Here’s what the experts have to say.

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“Many employees might appreciate time as much as money. Offering extra vacation days instead of a monetary bonus can be a smart move—and it’s reasonable to negotiate with the staff to take these during slower periods for the business. Sometimes the best way for a team member to feel appreciated for their hard work is a good old-fashioned “thank you’ Make it personal (in-person or hand-written note), and specifically address how each individual contributed to the overall win. Showing your team you care about them as individuals will do wonders for staff morale, and build stronger relationships and loyalty with your team.”
—Sarah English, managing director, Usability Matters, Toronto

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“Talk openly about this with your team. In the absence of information your staff WILL make stuff up to help them comprehend what they observe, and it will almost never be given a positive spin. If they observe a large contract being closed and you say and do nothing, they may conclude that they are not valued and you are greedily raking in the big rewards with not a single thought towards them. I give the above advice to clients when it comes to almost all matters that impact employee stakeholders: Don’t hide bad news, because they probably already know it anyway, and if they don’t they’ll resent finding out after the fact. I’ve never had a client approach me after a project and say, €˜You know Charlie, I think I communicated WAY too much on this project.’ Talk about how you feel and what your realities are. Just make sure you don’t go out and buy a new car right afterwards.”
Charlie Reid, Charlie Reid & Associates, Kingston, Ont.

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“The important thing is to make sure that you thank everyone. Let each employee know that you think they have done an outstanding job and that you really appreciate them. Personal recognition will have the most positive impact, so ideally you would have these conversations one-on-one. A new major contract will make the company stronger and eventually more profitable, so even if you can’t give out bonuses immediately, at some point it is going to pay off for employees.”
John Wilson, founder and CEO,CEO Global Network, Toronto

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“Positive reinforcement and acknowledgement is important to employees, whether it be a large gift or a gesture of appreciation. Small tokens of appreciation that reflect that you know what your employee enjoys are a good way to recognize them for a job well done. Take the time to learn about your employee’s interests and find them something that shows you put some thought into recognizing them for their efforts.”
Phoebe Fung, proprietor,Vin Room andVR Wine, Calgary

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“Here are two options for you, one creative and one a tad cliché, but both super-meaningful. The cliché one is a personalized card or note. Rather than a quick chicken-scratch on a scrap piece of paper, thoughtfully pick out the perfect card, script the note beforehand so that what you are saying is actually meaningful. and then carefully and beautifully write it out. You’ll be surprised at how many people will keep the card and refer to it for years. Want to give something a little more concrete? I got funky mugs made up with our Accent Inns logo on them, bought a pen that writes on porcelain, wrote a quick personal thank you note on each mug, and then handed them myself to each of our team of 175. They were a hit!”
—Mandy Farmer, President and CEO, Accent Inns and Hotel Zed, Victoria

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Originally appeared on PROFITguide.com