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Mgm grand integrating best recognition practice yields measurable benefits


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MGM GRAND - INTEGRATING BEST RECOGNITION PRACTICE

YIELDS MEASURABLE BENEFITS
A Recognition Professionals International White Paper
Every year Recognition Professionals International (formerly The National Association for Employee Recognition) honors organizations that exemplify standards of recognition program excellence.
The 2007 Best Overall Recipient is MGM Grand Hotel & Casino, which excelled in all seven categories. The organization institutes effective employee recognition practices consistently and MGM Grand officials believe these practices are instrumental in continuously improving employee satisfaction.
The company’s program has increased revenue, decreased employee turnover, and led to an ever more positive experience for their guests.
Recognition Professionals International 7 Best Practice standards of recognition program excellence are:


  1. Recognition strategy,

  2. Management responsibility,

  3. Recognition program measurement,

  4. Communication plan,

  5. Recognition training,

  6. Recognition events and celebrations, and

  7. Program change and flexibility.

The standards reflect thorough research that included examining successful recognition programs, reviewing academic literature, and conferencing with experts. They are meant to provide guidelines for the creation and evaluation of recognition programs for all organizations.


MGM Grand’s Director of Slot and Employee Events, Bette Gaines-Snyder, started working at the company in 1993 as a tour guide. She has been promoted 15 times and knows, firsthand, how recognition affects profit.
“You can’t put an actual number to it,” she said. “But I would say that at MGM Grand we have found that recognition is important business. It is clear that effective recognition, in all its forms, strongly enhances morale and ultimately increases productivity in the workplace. When you have an effective employee recognition program, that makes for good business and everybody wins.”
The MGM Grand recognition program consists of several components that ensure positive, targeted behaviors are recognized and rewarded. Some of these components are daily behaviors and others are periodic. Some involve token rewards and certificates and others involve substantial rewards and ceremonies. What all program components have in common is that they are effective, conducted evenly and fairly, and are continually evolving.
Given the depth and breadth of the MGM Grand program, it’s worth noting that they accomplish all of this with just three full-time events coordinators, one manager, and one director.

The city-like $1 billion MGM Grand Hotel & Casino lives up to its name, not only in sheer size, but also in offerings. The opulence starts outside, with the 100,000-pound, 45 foot-tall lion – the largest bronze statue in the U.S. The hotel features 5,000 rooms in four 30-story towers. Guests enjoy world-class shows, gourmet restaurants, nightlife in two A-list clubs, the 27,000 square-foot pool complex, the Grand Spa with more than 20 Zen-inspired treatment rooms, and gambling at the 171 square-foot casino. They can even tie the knot at the Forever Grand Wedding Chapel.


Overall Strategy
MGM Grand conducts a variety of successful company-wide recognition programs and employee events that identify and reward employees who provide exemplary service. In their interactions with guests, employees are expected to show commitment to MGM Grand’s mission statement, core service standards, core values, and brand values. Performance is measured against these internal standards. Company officials understand that in order to be effective, recognition must be valued by the employee and the criteria must be fair and consistent.
The MGM Grand recognition program is designed to achieve the following:


  • Encourage behavior that will contribute directly to the achievement of brand goals, which will help drive MGM Grand’s performance.

  • Recognize employees for superior individual and team efforts and outstanding contributions to quality improvement in the course of their duties.

  • Encourage managers to create and maintain a motivational environment that leads toward optimal customer service.

  • Give management the chance to develop, enhance, and maintain MGM Grand’s culture and improve guest service.

  • Recruit and retain the caliber of employees that MGM Grand needs to maintain a competitive edge.

  • Recognize more employees more often.

It’s no coincidence that MGM Grand was cited as the 2005 and 2006 winner of The Best Place to Work in Southern Nevada. The average length of service for an active employee at the company is five years and 165 days. The turnover rate is a mere 11.4 percent, while the turnover rate for the hospitality industry is 49 percent.


“Recognition is a major part of our culture,” Gaines-Snyder explained. “We have created an environment where employees feel appreciated every single day; and I mean every single day.”
The company has a dedicated department that develops and creates employee events from concept to production throughout the year. These events include;


  • Star of the Month luncheons,

  • Employee of the Year galas,

  • The Maximum Vegas Performance (MVP) program,

  • Voice Foundation fundraising celebrations,

  • Diversity events,

  • Patriotic celebrations,

  • Book and jewelry fairs,

  • Blood drives,

  • Talent shows,

  • Pet photo contests,

  • Summer fun events,

  • Employee holiday parties and more.



Pre-Shifts
Daily pre-shifts are one regular venue that MGM Grand has for recognizing employees. Pre-shift information sessions, lasting 10-15 minutes, are delivered face-to-face to over 9,200 employees by 700 supervisors and managers in over 250 departments daily. The company uses these sessions to educate employees on core service standards and values. They are also a perfect opportunity for publicly recognizing individuals and teams who demonstrate these standards.
The six core values are:


  • Collaboration,

  • Communication,

  • Diversity,

  • Initiative,

  • Job mastery, and

  • Passion.

The 16 core service standards are:




  • Offer a warm welcome;

  • Make every moment memorable;

  • Smile;

  • Create a memorable final impression;

  • Eliminate the use of, “I don’t know”;

  • See each guest request through to fulfillment;

  • Be an ambassador;

  • Deliver timely service;

  • Think “quality” every day;

  • Communicate professionally;

  • Always be perfectly groomed;

  • Practice phone etiquette that reflects company standards;

  • Demonstrate teamwork with internal customers;

  • Protect the company’s physical assets;

  • Provide clear directions;

  • Maintain an immaculate, safe environment.


Daily Recognition
MGM Grand implements four major daily recognition outlets - FileNet Commendations, The Reporter Newsletter, MaxTV, and programs that are unique to departments.


  • FileNet is the company’s electronic HR files and forms management system. Through the system, commendations are awarded for an individual goal or assignment. Managers download the form, add comments, and print it out. A copy is permanently saved in the HR database and documented in the employee’s individual file. These commendations are taken into consideration for promotions, company transfers and the Star of the Month award.

  • The Reporter Newsletter is an internal publication that highlights employees in articles written by the communications team. Star of the Month and MVP winners’ stories are told. Pet Photo Contest winners are announced. Employee of the Year nominees are quoted, and photographs of culinary challenge participants are included.

  • MaxTV is MGM Grand’s in-house television station featuring employee success stories and accomplishments. It focuses exclusively on employees who make news both in guest interactions and behind the scenes. Celebrities often appear on camera, expressing kudos for a particular employee and a job well done.

  • Unique Department Programs include safety recognition programs, Casino Marketing Employee of the Week, and the Players Club Recognition. Each department is required to establish its own programs to augment company-wide programs. The plan must include recognition for a least 10 percent of the department’s eligible employees on a regular basis. Tangible rewards include a complimentary meal for two at one of the company’s premier restaurants.


Informal Recognition
The Maximum Vegas Performance Commendation (MVP) encourages managers to observe and reward employees’ performances on the 16 core service standards and six core values. If managers observe an employee providing exemplary service or epitomizing core values, they present the employee with an MVP commendation. The award is available to employees who hold positions that are below managerial.
Each quarter the MVP recipients are entered into a drawing. Prizes include dinner and show packages. The certificate also becomes part of the employee’s personnel file.
Formal Recognition
Among formal recognitions, the Gold Key Award is a way for guests to recognize employees. Meeting planners who bring in large convention business to MGM Grand present the award to deserving employees. During the convention-planning stage, planners receive between two and 10 keys in velvet bags, depending on the size of the group. They present the keys, at their discretion, to employees who provide excellent service.
Employees return the Gold Key to Convention Services for an invitation to the quarterly Gold Key luncheon with senior management. There they receive a $250 check for each key, and a certificate of appreciation.
Employees earn the Star of the Month award through extraordinary guest service, enthusiasm, dedication to excellence, or involvement in MGM Grand and community activities. Each month the company selects 12 nominees from one of five divisions; Food & Beverage, Hotel, Casino, General & Administration, or Entertainment.
Nominees attend gala luncheons in their honor at one of the company’s award-winning restaurants. Stars of the Month receive $500, their name in lights on the MGM Grand marquee, an authentic Hollywood Walk of Fame star plaque, a VIP parking space for the month, and an invitation to the annual Star of the Year gala.
Other prizes include a ride in a gold stretch limo to a shopping spree and breakfast with MGM Grand president Gamal Aziz, where he presents each with a check for $1,500, a trip for two (worth $2,500) to an exotic destination of their choosing, and a paid week off work.
Nomination Procedures
Nominations must reflect the diversity in each division and reflect employee-guest interactions and/or internal guest interactions. FileNet nomination forms must be clear, concise, at least two paragraphs long, and explain in detail the reasons for selecting the employee.
Departments must recognize employees who:


  • Demonstrate a strong commitment to MGM Grand’s mission statement, core service standards, and core values.

  • Participate in employee events and activities such as the Blood Drive and MGM Grand University classes.

  • Contribute to the department as a team player and as a role model.

  • Exhibit good communication and decision-making abilities.

  • Take action to prevent an accident or take initiative outside of regular job duties.

  • Demonstrate initiative resulting in improved work systems or environments.


Notification Procedures
Notification procedures vary widely, depending on the program. For example, supervisors present MVP winners with the certificate either in front of fellow employees or in private; and Star of the Month winners are informed in a letter presented at the luncheon.
Tax Procedures
Departments are informed of the tax rules and must follow the IRS guidelines as articulated by MGM Grand:


  1. All cash gifts are taxable.

  2. The cash value of prizes exceeding a certain amount is taxable.

  3. In-house comps to MGM Grand-owned restaurants, retail stores, rooms, or use of a facility (such as the spa) are generally not taxable.

  4. The cash value of all taxable incentive pay or awards will appear on the employee’s paycheck as part of the annual taxable income and is reported to the IRS.



The Role of Management
Management plays a critical role in the recognition and reward programs of all organizations and MGM Grand is no exception.
Management Responsibility
Senior management’s role in defining MGM Grand’s recognition strategy is significant. It begins with the president’s approval of the annual budget for employee recognition, which is over $500,000. He also decides on the Employee of the Year winner after interviewing the senior vice-president responsible for each of the final three nominees. Each senior vice-president will lobby before the president on behalf of the nominee. The president also selects employee gifts each year. This year MGM Grand gave each of their 9,200 employees a high-quality Seiko watch with the MGM Grand logo imprinted on the face.
Recognition programs are designed and modified every year to align with the company’s strategic plan. Recognition and employee satisfaction is tied into the annual executives’ bonuses; this means managers and above are held accountable and must recognize at least 10 percent of their full-time equivalent employees.
Directors and above are responsible for providing guidance concerning company-wide recognition programs; promoting the recognition awards; recommending policies and procedures; and recommending training courses. They must ensure that the program is administered fairly and efficiently.
Managers are instructed to conduct pre-shifts each day and participate in the MVP and Star of the Month programs. They can also participate in the various recognition committees within their respective divisions or on the Leadership Selection Committee.
Leadership Selection Committee
There are eight Leadership Selection Committee members and one HR facilitator at all of the selection meetings to ensure fairness. The Leadership Selection Committee chooses the Star of the Month finalist for each division. Committee members include senior vice-presidents, vice-presidents, and directors. Members are appointed by the president and senior vice-president of HR. All members serve for one year and are required to attend all scheduled selection meetings and maintain the confidentiality of the program.

Measuring Results
In 2004, MGM Grand began tracking the productivity of personnel in each department. Every quarter when department heads meet with the CFO and finance department to review profit and loss, they also look at the productivity of their workforces. They track productivity numbers to see if the communications, training, and culture of recognition is having a positive impact on performance.
The overall employee satisfaction score in 2005 was 90.3 percent; up from 87.5 percent in 2004. Eighty-nine percent reported that everyone has an opportunity to get special recognition. They’ve found that if they increase employee satisfaction through recognition and awards, they don’t necessarily need to increase wages.
Tangible Financial Benefits
In the slot department, slot club enrollments per employee increased from 1,052 in 2004 to 1,582 in 2005. That’s 34 percent. Officials predict that the 2006 figure will be over 2,000 enrollments per employee. Management believes that without the increased engagement provided by recognition and awards, employees would not be motivated to enroll more players while salaries remain the same.
In the MGM Grand wedding chapel, revenue per salesperson increased 13 percent between 2004 and 2005. In one of their fine dining restaurants, where employees are encouraged to up-sell, there was a 34.5 percent increase in revenue per full-time employee between 2004 and 2005.
In 2003, MGM Grand had annual revenue of $714 million. In 2005, they had annual revenue of more than $1 billion. Officials believe employee recognition programs played a key role.
Positive Publicity and Good Will Benefits
In 2005 and 2006, MGM Grand won best place to work awards, in part because of their outstanding recognition programs. The positive publicity generated by the award benefited many departments – especially HR.
For the last five years, employees have been the largest single business unit contributor to charity in the U.S. In 2006 alone, 9,200 employees gave $1.9 million from their paychecks to charities in the Las Vegas community.
Better Service
In 2001, MGM Grand won 18 AAA Diamond awards for outstanding service. In 2006, they earned 54; more than any other property in North America. These awards are based on the caliber of service provided by employees and management believes valued employees deliver better service.
Training
The MGM Grand University offers a series of management development modules that strengthen and enhance the critical skills and knowledge needed to motivate and recognize employees.
One of the most important management tools is a course called Keys to Powerful Recognition Management. In this course, which teaches recognition theory and implementation, participants learn the value of recognition to inspire and motivate employees and;


  • What recognition is and why it is important,

  • The top reasons why good workers leave,

  • The effects of a motivational environment on employees,

  • The three types of recognition and when to apply them,

  • The importance of tangible vs. intangible rewards,

  • How to implement meaningful recognition programs, and

  • The organizational benefits of recognition.


Events and Celebrations
The MGM Grand hosts several annual employee events designed to reward and motivate employees and give back to the community.
Charitable Events
Every March and April the company holds a fundraiser to benefit local charities. Last year, in just eight weeks, employees donated $1.6 million. Employees of the next largest corporate donor, which had 500 more employees, donated only $600,000. MGM Grand employees are the single largest charitable donor in the State of Nevada and the largest single donor in the U.S. hotel and hotel/gaming sector.
There are three jewelry and book fairs each year where 25 percent of the jewelry sales and 20 percent of the book sales are donated to charity.
“There are many factors that motivate our employees to give to our Voice Foundation,” Gaines-Snyder said. “And when they give, we celebrate and recognize our employees for their generosity, which in turn encourages our employees to contribute and give back time and time again each year.
“At MGM Grand we consider ourselves to be a ‘community within a community’ and our employees realize first hand that it feels good to give back to the community in which we all live.”
Annual Employee Holiday Parties
The holiday party is a lavish 24-hour gala for all employees, which takes three months to produce. Each employee gets a corporate gift – one year it was a CD player and another it was luggage.
Summer Fun
Employees have a choice of either four movie theater tickets, four Blockbuster movie night rental cards, amusement park tickets, or minor league baseball tickets.
Cultural Celebrations
Celebrations for holidays such as the Chinese New Year, Black History Month, Asian Pacific Heritage Month, and Cinco de Mayo show employees that MGM Grand values their heritage. During these cultural celebrations, employees display personal memorabilia. For example, during Black History Month employees brought in African-American art, jewelry, and photographs.
Patriotic Celebrations
Employees who are armed services veterans bring in old military uniforms, war artifacts, and news articles for display in MGM Grand’s Stars dining room. Employee guest speakers who have just returned from military leave, share personal experiences with lunchtime crowds and local ROTC units perform color-guard protocol.
Maximum Stardom Talent Show
MGM Grand holds auditions and a full dress rehearsal before its talent show. The top winners get to perform live in a lounge on the Las Vegas strip and see their names in lights on the marquee.
Pet Photo Contest
During “Pets Count Too” week, employees bring in photos that are posted on a giant doghouse. Winning photo categories include “the cutest” and “so ugly it’s cute.” Prizewinners get gift certificates to Pet Smart.
Other events include Voter Registration, an employee Super Bowl Party, and a Thanksgiving Turkey Giveaway.
Variety is important,” Gaines-Snyder said. “There is no other company in this city that provides the number and caliber of events that we do. Employees who go to work somewhere else come back and say they miss the events. If we want our employees to wow our guests, we need to keep doing it for them.”
Provisions for Change
In 2001, MGM Grand began an evolution of product, service, and employee culture that resulted in the creation of more than 36 major venues. As they expanded their properties, they put a premium on maximizing employee buy-in and enhancing the events and recognition programs.
Initially the recognition program was associated with their branding goal, “The City of Entertainment” which was tied to the Wizard of Oz. The program’s recognitions, which capitalized on the stage theme, included “Grand Thanks”, “Cast Applause”, and “Caught in the Act.”
As the branding goals and initiatives changed, MGM Grand’s mission statement also underwent change. The recognition program became less of a gimmick and more of an honor. The MVP award was streamlined to tie-in to the core values and core service standards that are a barometer of excellent customer service. The new changes were ushered in during manager’s meetings and pre-shifts, which kept everyone focused on the same goals.
Since the changes were implemented, MGM Grand has enjoyed a measurable increase in employee morale and retention. The success of their five-year events and recognition evolution is evident in their soaring financial and customer satisfaction statistics.
People always say they don’t have time to recognize their employees, but they need to make time,” Gaines-Snyder said. “It doesn’t have to cost a lot of money. There are all sorts of ways to recognize employees without spending a dime.”
Because MGM Grand provides one of the most comprehensive employee recognition and award programs in the U.S. and has steadily raised the bar on the program’s quality, presentation, professionalism, and variety, they were an easy choice for Recognition Professionals International Best Practice Overall Award.

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