We’ve been talking about this thing called employee engagement since the 90s. For decades before that, we talked about employee satisfaction. We measure it. We report the results. If the results report dissatisfaction, we try to figure out why our employees aren’t engaged and what we can do about it. If they are engaged, then we ask ourselves “what is it that we did that led to this engagement?” Many companies spend a lot of time and effort building programs and activities to enhance employee engagement. Is it worth their time and effort? What really works?
Is this just a management trend,
Employee engagement is most definitely an important business concern. Your company’s bottom line is directly tied to your employees’ engagement. In 1994 Harvard Business Review first reported on this relationship in an article that was so impactful, it was reprinted in 2008. Heskett, Jones, Loveman, Sasser, and Schlesinger presented a model – the Service-Profit Chain – which demonstrated the relationship between employee engagement [then reported as satisfaction] and the bottom line. Their model explained how job design and leadership practices affect employee satisfaction, which in turn creates superior customer service, driving customer satisfaction and loyalty, resulting in greater revenues and profits.
Buckingham and Coffman further explained this phenomenon five years later when they were with the Gallup organization. In First Break All the Rules, they reported on over 25 years of data from 18 studies across 24 companies in various industries. Once again, they found that engaged employees led to lower employee turnover and higher productivity, resulting in greater customer satisfaction and loyalty, and ultimately higher profitability.
In a 2010 study from Harvard Business Review, Davenport, Harris, and Shapiro observed that almost every company they studied placed an emphasis on employee engagement, including some well-known brands such as Starbucks and Best Buy. Why? Because these companies have figured out how to measure the effect improved engagement has on the bottom line. For example, Best Buy knows that for every .1% increase in store-level engagement scores, the corresponding store enjoys a $100,000 increase in annual operating income.
You’ve read about it… how Millennials work differently, and how they have different expectations in the workplace then those who came before them. Shuck and Herd (2012) emphasized that “the age of leader as position is quickly fading” and will be replaced with workplaces that emphasize how the work gets done rather than how much work is accomplished. As Generation Y just edged out the Baby Boomers as the largest group represented in the American workforce, employers have no choice but to design workplace practices that will attract and engage this important group. Shuck and Herd (2012) pointed out that these employees seek workplaces that understand their unique needs and offer meaningful work experiences. Millennials simply expect a culture that is foundational to an engaged workforce.
Engagement levels aren’t what you think.
Ok, so now you understand the direct connection between an engaged workforce and business success. You should also know that you may have been fooling yourself about your organization’s engagement levels, in particular if you’re a senior leader. Bain and Company reported that engagement declines at the lowest levels of the organization, suggesting that senior leaders might not realize their front line employees aren’t engaged when they themselves are engaged. Even more concerning, those employees who interact with customers every day, the sales and service teams, also experience the lowest levels of engagement.
Engaging your workforce comes down to a few core practices that must become part of the organization’s culture and leadership personality in order to move the dial toward higher engagement.
Leaders’ time should be spent learning about their employees, understanding and customizing solutions for their needs, ensuring each employee can do their best every day, and acknowledging each employee for such work. Unfortunately, most leaders spend their time attending meetings, often discussing and problem solving what’s not working, leading projects, and reporting on a variety of metrics. This doesn’t leave them the time for those crucial activities of just being with their employees. Are you willing to take that bold step outside the mold to truly build an engaged workforce? I’d love to hear about your successes! Please write to me here or at Lisa@BarringtonCoaching.com.
My greatest joy is helping people make bold transitions in their professional and personal lives!