PAS-It-On Vol 11 Issue 3
Ask yourself this question: How satisfied am I working for my company? That simple question reflects many things working beneath the surface. Do I like my company overall? Do I like my job? Do I like working for my boss? What about my coworkers? One more basic question probably did not come to mind: Does my satisfaction matter?
For decades, companies and academics alike have grappled with the question of whether employee satisfaction makes a difference in actual results for the organization. Studies have shown some relationship between the satisfaction and results, but the link has never been strong enough to garner sufficient interest regarding what to do about it. Something was missing between satisfaction and results. Over the last decade or so, consultants and academics have been refining this missing link: Employee Engagement.
What is Engagement?
While employee satisfaction was a term that was relatively simple to define and understand, the concept of employee engagement has been more difficult to pin down. Engagement, it turns out, is more of a whole- brain experience than the contentment one has with an employer. It includes the feelings employees have toward their company, coworkers, customers, boss, as well as their job. It also includes the mental calculus employees perform about their situation: Are they treated fairly? Compensated fairly? Do your company’s mission and values align with theirs? How do the conditions at your company compare to other places they have worked? Finally, engagement encompasses how employees behave: Do they work hard? Do they work well with others? Will they work through difficult conditions? Will they stay with the organization over time?
These three components—the Emotional, Rational, and Behavioral—combine to create an overall concept of engagement. While there are many definitions of engagement out there, we offer the following definition to bring together these ideas:
Engaged employees feel energized, enthusiastic, and passionate about their work and demonstrate loyalty and support for the firm and its mission.
Why Does Engagement Matter?
There is a growing literature on the benefits of having an engaged workforce. The more engaged employees you have, the more their cumulative effect shows up in your organization’s performance. Companies who have the highest proportion of engaged employees see the following benefits:
- Increased customer satisfaction and increased customer loyalty.
- Better financial results in terms of sales growth, operating margin, and shareholder return.
- Improved productivity in work groups.
- Lower employee turnover
The last point can be one of the biggest impacts for the organization, as turnover creates many hard and soft costs to the organization. Employee engagement provides strong protection against turnover. One study found that disengaged employees were ten times more likely than highly engaged ones to be actively looking for a job. In addition, two-thirds of engaged employees have no plans to leave their organization, whereas only one in eight of disengaged employees are similarly loyal.
While employee satisfaction was a term that was relatively simple to define and understand, the concept of employee engagement has been more difficult to pin down
How Do You Measure Engagement?
Once you understand the impact engagement can have on your organization, the next question you should ask yourself is, How engaged are people at my organization? There are two fundamental mistakes we see companies make when it comes to measuring engagement: not measuring it at all, and measuring it, but taking no action on the results.
Most organizations conduct a survey to measure engagement annually or biannually and use the results to pinpoint areas of disengagement. Some organizations build more robust engagement sensing systems, adding periodic focus groups and more frequent but shorter “pulse” surveys to get more real-time feed- back on the climate of the organization. Whatever model you use, you should have a plan for how to process the feedback, share it with employees, and build concrete plans to keep engagement high.
How Do You Increase Engagement?
There is no single approach to building engagement for an organization. As mentioned earlier, engagement arises from both the rational and emotional appraisal of the organization by each employee. Engagement begins with the culture of the organization. Is there a match between the espoused values that live on posters and coffee mugs, and the lived values they see every day? Does the culture communicate that employees are valued for their contribution and commitment?
To build an engaging culture, there are several items that should be addressed in any engagement strategy:
- How are managers promoted and rewarded? For technical skills and business results alone, or are they evaluated for their ability to connect with and lead others?
- How are managers trained for their roles? Do we leave them to figure it out on their own, or do we give them the leadership skills they need?
- How are employees rewarded? Does the feedback and reward system recognize positive engagement or does it only look at near-term performance?
- How are toxic employees dealt with? These are the ones who produce strong results themselves, but poison those around them. One toxic employee, not addressed, can sink an entire group’s engagement.
- How do our policies and benefits compare to our competition for talent? While these elements do not positively contribute to engagement, they can quickly become drains if they compare unfavorably. An engagement strategy is not something built overnight and executed at one town hall meeting. It permeates HR policies, talent and leadership development strategies, communication from senior leader- ship, and the overall employee value proposition. A strong engagement strategy should be part of your business strategy. Creating a strong, engaging culture makes the rest of your strategy work.
Did You Know?
PAS is available for consultation on organizational, work group and leadership development. Organizational, forensic and clinical psychologists provide unparalleled consultation and guidance in developing strategies to mitigate high risk situations, resolve workgroup conflict; and improve employee engagement, productivity and well-being. Contact us at (800) 356-0845 to request a consultation with PAS’ Organizational Development Department.