Employees are not usually asking for gifts and extra money. They're usually asking that their supervisor care about them and appreciate the work that they do.
Many reward programs are started with great excitement - and then fizzle out.
The goal of reward programs is to create a gift that the employee will want so badly that they will work harder to obtain it. A secondary, unspoken goal is for the supervisor to have an easy program to institute so that they will not have to think too deeply about their employees. These programs normally do not work in the long run.
One of the reasons is that there are only a finite number of employees at any company. Eventually, all will have been awarded the "Employee of the Month" title. Of course, the other problem is that employees do not work harder for rewards. They work harder only if they want to work harder because they feel that they are making an appreciated contribution.
What really makes employees happy?
I train groups of people from all walks of life. When I stand in front of a group and ask, "What makes you happy at work?" nearly all of the time they reply "Recognition for a job well done". When I ask, "Do you mean that you would like an Employee of the Month certificate?", they clearly explain to me, "I want my supervisor to notice the work that I do, and tell me that I have done a good job".
We then go on to discuss how they want to be told, and it is pretty simple. They just want their supervisor to see what they are doing, and to say, with sincerity, "Good job" when it is a good job. No one else has to hear, they just want to know that they are appreciated.
The second most important thing to make them happy at work, according to the groups that I work with, is to feel that they are "in" on things. This means that they want to know what is going on with the entire company, and how their work fits in.
The easy reward program
If supervisors made sure, in their weekly or daily meetings, to tell their staff what is happening with the company, and then made sure to walk around and notice their employees while they are working, sincerely complimenting them for good work, they would notice a dramatic increase in dedication from their employees, and would see more work accomplished.