Part I of II – The Importance of Employee Engagement

A CEO was asked how many people work in his company: “About half of them,” he responded.” It may be a joke, but in reality it can be a serious problem that a significant number of people had mentally “checked out.”

Quite clearly, CEOs and managers should be very concerned about a waste of time, effort and resources in their organizations. The reason is simple: If people are not engaged, how can these same leaders attain those business objectives that are critical to improving organizational performance?

What do we mean by employee engagement? How much does a lack of employee engagement cost an organization? What steps can leaders take to make employees want to give it their best? These and other questions are the focus of this article.

Do you, as a business owner or CEO, wake up in the morning excited to get out of bed and go to work? Are you excited to implement some new great ideas? Are you excited to meet your team and continue the project you’ve been working on the day before?

The real question is:
Are your employees just as excited as you are? Are they engaged in what they do?

What is employee engagement?
Employee engagement is about understanding one’s role in an organization, and being sighted and energized on where it fits in the organization’s purpose and objectives. Employee engagement is about having a clear understanding of how an organization is fulfilling its purpose and objectives, how it is changing to fulfil those better, and being given a voice in its journey to offer ideas and express views that are taken account of as decisions are made. Employee engagement is about being included fully as a member of the team, focused on clear goals, trusted and empowered, receiving regular and constructive feedback, supported in developing new skills, thanked and recognized for achievement. Employee engagement is about positive attitudes and behaviors leading to improved business outcomes, in a way that they trigger and reinforce one another. Employee engagement is about your employees feeling pride and loyalty working for our organization, being a great advocate of the organization to our clients, users and customers, going the extra mile to finish a piece of work. Employee engagement is about drawing on our employees’ knowledge and ideas to improve our products and services, and be innovative about how we work. Employee engagement is about drawing out a deeper commitment from our employees so fewer leave, sick absence reduces, accident rates decline, conflicts and grievances go down, productivity increases. And finally, Employee engagement is about organization actions that are consistent with the organization’s values. It is about kept promises, or an explanation as to why they cannot be kept.

In order to have an engaged employee we must have an engaged organization. Engaged organizations have strong and authentic values, with clear evidence of trust and fairness based on mutual respect, where two-way promises and commitments – between employers and employees – are understood and fulfilled.

Here are some facts that the Gallup Management Journal has published in a semi annual employment engagement index.
• Only 29% of employees are actively engaged in their jobs. These employees work with passion and feel a profound connection to their company. People that are actively engaged help move the organization forward.

• 54% of employees are not engaged. These employees have essentially “checked out,” sleepwalking through their workday and putting time – but not passion – into their work. These people embody what Jack Welch said several years ago. To paraphrase him: “Never mistake activity for accomplishment.”

• 17% of employees are actively disengaged. These employees are busy acting out their unhappiness, undermining what their engaged co-workers are trying to accomplish. Needless to say how detrimental this behavior is to the morale of the entire workforce.

Should business owners be concerned about these findings? It seems obvious that engaged employees are more productive than their disengaged counterparts. For example, a recent meta-analysis published in the Journal of Applied Psychology concluded that, “… employee satisfaction and engagement are related to meaningful business outcomes at a magnitude that is important to many organizations.”

A compelling question is this: How much more productive is an engaged workforce compared to a non-engaged workforce?
Several case studies shine some light on the practical significance of an engaged workforce. For example, New Century Financial Corporation, a U.S. specialty mortgage banking company, found that account executives in the wholesale division who were actively disengaged produced 28% less revenue than their colleagues who were engaged. Furthermore, those not engaged generated 23% less revenue than their engaged counterparts. Engaged employees also outperformed the not engaged and actively disengaged employees in other divisions. New Century Financial Corporation statistics also showed that employee engagement does not merely correlate with bottom line results – it drives results.

But what should leaders do, or consider doing, to increase the level of engagement among employees? I will let you think about it and we will discuss it in a future article.