In The Carrot Principle, the latest book in the best-selling “Carrot” series, coauthors Adrian Gostick and Chester Elton show managers and senior executives how to use recognition to elevate a team’s performance. Gostick discussed with JCK how jewelers can develop their own “carrot principle” to gain a competitive edge in the marketplace.

What are some key issues for smaller companies that want to implement a recognition program?

To an employee, the manager is the organization, whether you’re a store with 10 employees or 1,000. It’s the interaction with the boss that makes or breaks an employee’s relationship with their company. A lot of managers at smaller companies we interviewed give a performance review every six months and occasionally take the staff to lunch and think they are doing a good job. This is not recognition. In the most engaged environments, we found that people got individual recognition once per week.

Why do most companies fare poorly at recognizing employees?

Because of the biases of the manager. Many are afraid of what it will do to the budget, or are afraid that employees will come to expect it and take advantage of them. So they create these complex systems that don’t work. Our research found that only 26 percent of managers in the United States believe in recognition.

What traits do managers who recognize employees have in common?

The ability to communicate frequently and openly with people. They truly care that employees trust and believe in them, and they hold people accountable for their actions—good and bad. They also use recognition as an accelerator to drive positive behaviors that reinforce the company’s values.

In a business like jewelry, what types of “carrots” can a manager use?

To recognize a purchaser or designer in the back room, you look for innovation and new ideas that have benefited the company. For people on the sales floor, the biggest worry is customer service. Every supervisor on the floor needs to recognize behaviors that support this core value. You can do this by recognizing the employee in public by telling stories about their work that reinforce the goals and values important to the business. You can’t do it with a poster in the break room. The recognition has to be extremely correlated to the behavior you want to reinforce—such as customer service—for it to be effective.

How can jewelers learn what their employees would value most?

Cash is important, and commissions are an incentive, but when used for recognition, they may harm your company’s integrity by leading people to cut corners and do things they wouldn’t normally do to maximize their dollars. Nobody wants to buy from a jeweler they don’t trust. You have to recognize people in ways that support integrity, not just for hitting sales numbers. For a smaller store, with 10 people or less, the owner or manager needs to take the time to get to know each person on the staff and find out what they like and value. Then, you develop a customized rewards program that gives each person something they really want of appropriate value. This is what really bonds managers and employees. The trouble with many smaller companies is that they believe they know everyone, that they are “like a family.” But the reality is that they don’t know what their employees value because they haven’t asked them.

What are some low-cost recognition ideas for jewelry stores?

Sending something home to the family, such as a gift basket with a personalized note telling a spouse you appreciate them for letting your employee come in and work long hours for you is something that costs little, but is very powerful. Of the 200 to 300 people who told me they’ve used this type of recognition, I’ve never heard of a bad experience. Be generous with thank-you notes; they cost nothing, but your people will treasure them. Also, you can start a fun tradition in your store. If someone hits their quarterly sales goals, for example, have the boss take over for them on the sales floor for a day, give them the commissions, and let the employee have the day off or work in the office answering the phone. For reaching a big team goal, you can have the owner or manager wash every team member’s car in the parking lot.