How do you usually encourage or acknowledge a certain employee for their good work? Do you do it in a group setting while others are also privy to your comments or do you do it during a one-on-one? I feel like there are pros and cons to both, but wondering what the common approach here is...

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There is no common approach. You should tailor it to the employee.

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You could always acknowledge their work in a 1:1 meeting and ask them how they feel about you bringing up their achievement in a team meeting/setting. Another avenue would be if your department/team does quarterly awards/recognitions or something like that.

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Depends on the employee. Some like public praise, some don’t.
If you don’t usually praise anyone in meetings, this would be awkward for everyone. If that’s the case I would do it in a 1:1

I would definitely lean toward the side of creating a culture of appreciation. I think it has nothing but good pros - it motivates other team members to be better so they can experience the same appreciation. And by showcasing exemplary work to them, they get better with their understanding of what good work should look like.

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