Paul Vick wrote a bit about ShipIt awards some time ago. Joel Spolsky apparently didn't like them at all. I joined Microsoft well after ShipIt awards were introduced, so I didn't witness what people thought about them back then. I personally like those little plaques, they remind me when exactly certain product was shipped and what was I doing at the time. They also won't suddenly disappear like actual product boxes sometimes do. I believe I have seen four different models. Here are mine (older and current models):

ShipIt - pre 2002

ShipIt - current 

Typically you get a plaque for the product if you contributed sufficiently enough to the product release with code, testing, spec writing, etc. You don't have to work in the product group or even the division to get the recognition. For instance, I have plaques for shipping Office 2000 and Office XP while I never actually worked in the Office division. I got them for shipping Microsoft Script Editor (which is a slimmed down variant of Visual Studio) that can be found in Tools | Options in Word and Excel. I also have IE 5.0 and 5.5 plaques, primarily for improving MSHTML editor code back in IE5 days. I worked on Visual Studio 2002 actually back then and since IE team was busy at the time and could not deliver features we needed for the HTML editing in VS, I proceeded with writing necessary code myself.

Some members of my team will get ShipIt for Offfice 2007 since they contributed quite some amount of code to the SharePoint Designer 2007, specifically in ASP.NET control support, dynamic intellisense schema generation, ASP.NET markup intellisense and CSS intellisense areas.