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The 50/30/20 Rule

Cindy Ventrice Posted by Cindy Ventrice.

Cindy Ventrice is a management consultant and workshop leader with over 20 years of experience. Through her company, Potential Unlimited, she helps organizations improve performance by improving work relationships.


The 50/30/20 Rule

Employees want recognition from a number of sources. They need it to come from their manager. They also want it to come from the organization, in the form of inherent recognition and big awards. And, finally, they expect it to come from their peers both formally and informally.

There seems to be a preferred mix for these three sources: manager, peer, and organization. Overall, employees want about 20 percent of recognition to come from the organization, 30 percent from their peers, and a full 50 percent from their managers. Fifty percent manager, 30 percent peer, 20 percent organization—this combination is the 50/30/20 Rule.

I often hear from managers who want to address employees’ need for recognition through peer programs. Peer programs are important, but if managers successfully distance themselves from the recognition process and ignore the 50/30/20 Rule, employees will be frustrated by the lack of manager recognition.

Case Study

Here is an example of the 50/30/20 Rule: Athleta is a women’s sportswear company that was a start-up when described in the first edition. It was featured for the inherent recognition the company provided by trusting employees and offering them a great deal of autonomy.

In 2003, the inherent recognition provided was so compelling that the company only experienced about 5 percent turnover each year. Yet, at that time, according to Rick Scott who was Director of Team Support, many forms of recognition were missing at Athleta. He said that few managers coached or trained employees or worked to provide them with appropriate new opportunities. He told me he believed that managers did little to specifically address the recognition needs of employees. They were virtually ignoring 50 percent of the preferred mix—the recognition that comes from the manager.

A 2002 survey of Athleta employees showed less than 50 percent satisfaction with recognition overall. Although the organizational culture and the support of both leadership and peers provided recognition, the missing component was recognition that comes from an employee’s manager or supervisor. The survey confirmed what senior management suspected. They needed to train managers and supervisors to better meet their employees’ recognition needs. In doing so, they would work to address the preferred mix of recognition sources.

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This research and case study were excerpted from Cindy Ventrice's book, Make Their Day!  Employee Recognition That Works