When was the last time you gave an employee a pat on the back—or a day off in exchange for a job well done?

It may seem like an insignificant action, but according to a recent survey of 10,000 Fortune 1000 employees, 40 percent said they left their job because of a lack of recognition, and Gallup reports that 65 percent of Americans claim that they receive no on-the-job recognition at all.

But do recognition programs really work? “They really do work,” says CJ DuBe’, Managing Partner and Co-Founder of Oberon, LLC. “If recognition is incorporated successfully, employees will learn more, grow faster, and mature into top performers, which ultimately grows business as a whole.”

Christi Gibson, Executive Director of Recognition Professionals International in her Incentive article, “Why 40 percent of Employees Leave,” agrees that these programs are a must. “In order to ensure you hold on to the top workers in productivity and innovation, you must respond positively and appreciatively to their efforts,” she says.

Early engagement and incentive programs have been proven to not only decrease turnover, but to increase employee satisfaction and productivity—and company success.

“When people are positively and actively engaged, they will give you all they have to give, and then some,” says Gibson. Gallup agrees, noting that recognition programs are linked to higher employee loyalty and satisfaction, and even improved workplace safety.

If creating and implementing a recognition program sounds complicated and you’re not sure where to begin, here are some tips from the experts on what makes for a great program.

Educate Your Managers

No program can succeed unless managers understand the value of recognizing employees. “Few managers use recognition as a motivational tool because they don’t know how, don’t feel it is their job, or do not feel their employees value it,” say Mel Van Dyke and Rick Garlick in their Leadership Excellence article, “Recognition and Reward.” Communication is key: Training should address not only what recognition is, but also why it’s important. “Listen, watch, and train all of your employees on how to deliver recognition in a meaningful and motivational way,” says Gibson.

Reflect Your Organization’s Values

“The most successful employee recognition programs are those that are catered to the cultural environment of the company and the needs of its employees,” says DuBe’. Van Dyke and Garlick agree: “Recognition programs should be designed to clearly communicate and encourage the [organization’s] desired values and behaviors,” they say.

In order to prevent yourself from recognizing everything employees do and offering incentives for an unfocused set of good deeds that don’t amount to much in the long run, it’s important that your program be based on your company’s values—what you see as most important to the success of your organization.

Know What Employees Respond To

Creating meaningful incentives is another important piece of a strong recognition program. If your employees aren’t interested in the recognition you’re offering, it won’t prevent them from perusing the job boards. “Most people are not consistently recognized in ways that are meaningful to them… managers and leaders need to understand what types of rewards and recognition are most meaningful—from verbal praise to merchandise to parking spots,” say Van Dyke and Garlick. They recommend using assessment tools to discover what truly motivates employees.

DuBe’ agrees that different employees respond to different recognition stimuli. “Varying the type of reward given may be the best way to suit everyone’s recognition preferences,” she recommends. “Yet if you’re able to key into which rewards are the most stimulating for your employees, you’ll be able to make your recognition program even more personal.” She also mentions that recognition can be just as effective in simple forms. “Praise doesn’t have to be elaborate—it can be as simple as ‘great comment!’ or ‘that report was over-the-top!’”

Make Recognition Inclusive and Frequent

Many traditional recognition programs—especially in the sales world—have typically focused on recognizing 10-20 percent of top performers, but results have shown that programs that include more employees, and recognize them more often, are more successful. DuBe’ recommends giving recognition equally to all employees. “No employee should feel as if he or she received very little recognition compared to his or her colleagues,” she says.

Not only that, but the most successful programs allow employees to take ownership by giving them the power to recognize their peers for a job well done—by sending “thank you” emails to nominating one another for gift cards or other rewards. “Engagement is key to any successful recognition program,” says DuBe’. “Everyone involved should feel as though they are included and their input matters.” This type of system can take some of the weight off of management’s shoulders, build closer relationships among employees and create an atmosphere of praise that is a consistent part of everyday life at an organization.

Start Early

If you can enroll an employee in your company’s recognition program the moment you hire them, you’ll create a sense of engagement from the get-go, which is especially important in an age where half of 20-24-year olds remain with their employer for a year or less. Including an employee at an early stage can also help new hires adapt more quickly to their duties, and give them a sense of belonging and identity within the organization early on.

DuBe’ offers a final word of advice: “Focus on giving people growth, whether it’s upward growth or horizontal growth within their current role. By consistently challenging employees in a positive way, they will feel as though they are highly valued—this contributes to keeping retention up and ultimately assisting the company’s bottom line.”

In a nutshell, recognition programs can help employees understand that they’re a key part of your organization—and may be the key to your company’s success.

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