In the business world, praise is powerful and underutilized. From a management perspective, it requires minimal effort and can be a highly effective motivator.

Studies repeatedly show that a sizable percentage of the work force is “disengaged” - not committed to their employer and therefore not highly productive. (A recent Dale Carnegie national survey, for example, placed the number of “engaged” employees at 29% and "disengaged" employees at 26%, with the rest somewhere in the middle – meaning that, for a variety of reasons, barely over one-quarter of employees are working at full productive capacity.)

During my own decades in management for a Fortune 500 company I was involved in many employee engagement surveys, both as an employee taking surveys and a member of a management team communicating results and implementing changes that might be forthcoming. One thing that repeatedly struck me was the persistence with which employee recognition always ended up as one of the top issues. When it came to being recognized, employees never got enough.

Recognition of course can take many forms: It can be monetary, it can be a formal performance-related program, or it can be simple words of praise or encouragement from a manager. Companies tend to spend a great deal of time setting up fairly complicated recognition programs… but my own perspective is that what is really needed are well-trained managers who provide praise, where appropriate, on a regular basis.

Naturally praise shouldn’t be dispensed carelessly when not deserved. That helps no one and only undermines managerial credibility. But again, in my experience the business issue was never too much praise, but too little.

Following are four extraordinarily simple reasons why it doesn’t pay for management to be parsimonious with praise.

1. It costs nothing. Unlike many bonus programs, which can have a huge price tag (and of course are highly valued too), the cost of verbal praise is always the same: zero dollars and zero cents.

2. It requires little effort. “Thank you,” “Great job,” “I really appreciated your work on that project…” take less than 10 seconds to say. Maybe at most a couple minutes when you include some related follow-up conversation. (Again, my assumption of course is that the praise is deserved or you wouldn’t be giving it.) In any event, a most modest investment of managerial time and energy.

3. It makes employees feel good. Always preferable from a productivity standpoint to have employees feeling good, and not underappreciated and resentful.

4. When employees feel good, they work harder. Feeling valued is effective motivator. Positive morale raises energy levels right away.

Hey, I never said this was rocket science: The fact that it’s so fundamental, and the benefits so greatly outweigh the costs, make it so surprising that organizations get it so consistently wrong. (See Dale Carnegie study cited above.) Study after study, including the one just noted, show that the single most important factor influencing employee engagement levels is an employee’s relationship with his or her direct supervisor. Given this reality, the quality of that relationship is of crucial importance.

However the relationship develops, and regardless of the nature of the business, it’s in everyone’s interest to make thoughtful praise a key component of the managerial mix.

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Victor is the author of The Type B Manager: Leading Successfully in a Type A World (Prentice Hall Press).

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