Recognition is the secret weapon every leader must use: Yum Chair

Power of recognition: David Novak
Power of recognition: David Novak

David Novak is stepping down as Yum Brands executive chairman this month to pursue what he calls a new "vocation" — teaching business leaders and everyday people the power of recognizing the people in their lives.

"One of the things that I learned running Yum Brands is that there is a real, what I'm calling, a global recognition deficit. People are starved for recognition all around the world," he told CNBC's "Squawk Box" on Wednesday.

More than 80 percent of people feel they are not recognized by their supervisor for what they do, according to research commissioned by Novak's new company OGO, which stands for O Great One. Sixty percent say they value recognition as much as money, and 40 percent say they would put in more energy at work if they got more recognition.

"Recognition is a secret weapon that every leader really needs to use," Novak said.

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As part of his new endeavor, Novak wrote a book called "O Great One! A Little Story About the Awesome Power of Recognition." The parable follows a struggling toymaker's heir who after taking the helm realizes that no one in the company is happy.

Novak said he believes there are two main reasons people leave their job: They either don't feel recognized or they don't get along with their boss. He said companies that retain the best workers win out over time, while those with high turnover continually struggle.

He said that Yum Brands, the parent company of KFC and Taco Bell, was able to reduce its team-member turnover from more than 150 percent to less than 100 percent in part by creating a culture that "cascades" recognition throughout the company.

"We're keeping these people because recognition is a universal value," he said.