Does Employee Engagement Really Matter

In my mind, I have a great deal of important things to talk about, but maybe you don’t think so. I am assuming if you have gotten to this point though you are at least interested in exploring what I have to say a little more. For me, I usually don’t take things at face value, even though I tend to trust people until they prove that I can’t. When it comes to doing new things or launching head over heals into a new idea or strategy, I do want validation.

Validation that it adds value. Validation that others have made it work. Validation that there is some meat on the bones. Validation that there is cause and effect – if I immerse myself in this, there will be a positive result come out the other end. You get the point and I’m just imagining most of you feel the same way.

Well, I’ll try to stick to the facts, but even with facts, there is often a leap of faith and then there is always execution!

So, let’s get started with a question of common sense, not a bunch of empirical data.

That will come soon enough.

Who Performs Better

It is a simple question. Who Performs Better?

• Let’s start with those of you who like music. Who will sound better, an orchestra with 30 out of 100 musicians fully engaged or one with all 100 engaged?
• Now for you race enthusiasts. Which car is most likely to win a Nascar race, a nascar team with 6 of 20 team members engaged, or one with all 20 team members engaged?
• OK, football fans. Which football team is most likely to win the Super Bowl, one with 10 out of 52 fully engaged, or one with all 52?
• And now for all of you, a final one. Which company is going to perform best? One with 30% of its employees fully engaged or one with 100%?

OK. For the most part, I think you will agree, these aren’t questions we need a rocket scientist or a lot of analysis to answer. And, the same answer will hold true for any team, or organization. Of course, there is a little more to it than just being engaged. You need to have the right people, they need to be doing the right jobs, they need to understand the objectives and their role and value in achieving them, etc. We’ll talk about all those and their impact on engagement later, but for now let’s just focus on the one simple point, and that is the number of people who are fully engaged have a direct impact on the result, and on your ability to engage others, because engaged employees are contagious. No conductor/leader would think about putting an orchestra on stage without virtually 100% of musicians being engaged. The same is true for the owner/leader of his Nascar race team, and also the owner/leader of a football team.

It probably goes without saying that no organization is likely to have 100% of their people fully engaged for a boat load of reasons, but it is clear to me that the more you approach 100%, the more likely you are to improve your performance and help the people in your organization lead more fulfilled lives. So, engagement does really matter!!

To me, that raises the absolutely huge question we are here to talk about today – “why do the vast number of our businesses, and leaders of those businesses, put teams on the field with 70% of their employees unhappy and disengaged – that leaves 30% engaged.” Yes, that is what research shows. I’ll say it again, 70% of today’s employees are unhappy and disengaged.

The chart above shows engagement levels for 16 years through 2016. My experience and research shows we haven’t made much, if any, progress. The numbers have moved slightly by various accounts. Some saying as high as 32 – 34%, but regardless of how you look at it those numbers are dismal. Worldwide the numbers are lower – 13%.

As an employee, if you are unhappy and disengaged, you aren’t performing at your best, and you aren’t fulfilled; yet to the vast majority of today’s leaders this fact is lost or they just don’t know what to do about it. It hasn’t been any better for years, so despite all the talk and apparent focus, it just isn’t happening. Everyone knows it, research shows it, yet we continue to see this “downward spiral” present in today’s business failures, and those not reaching their potential, and more importantly, the number of employees who go home every day unfulfilled and disenchanted enough to have a negative affect on their family, their friends and society in general. Yes, our inability to address this issue worldwide has a social impact well outside the boundaries of the businesses our people work in. So, engagement, once again, really does matter.

Many of today’s leaders think business is something measured on spreadsheets (managerial acumen), with people being one of the many assets to be managed to achieve financial goals. There are many reasons for this, and many ways to improve upon it. Managerial /business acumen is important, but that isn’t people and leadership acumen, and that kind of strategic leadership is what companies and their people must have to reach their true potential and succeed. That is where my passion lies. That being said, I will spend one entire blog, upcoming soon, on the reasons leaders are not able to or just don’t address the engagement issue effectively. For now, this blog will be focused on just one of them, and that is the connection that doesn’t seem to exist for many on the performance gains achieved through greater engagement. That’s right, the plain lack of knowledge about its impact, the lack of capability to address it, or lack of belief that greater engagement improves performance. So, I guess you could call this post Engagement 101.

Research shows that worldwide the problem is even greater, with 87% of employees not engaged, and that many of the effected companies are blissfully unaware of the issue. Research shows and my personal experience support the belief that these understandings are due to seriously defective default assumptions that persist at most management levels in many companies. Specifically, many managers still believe that the outdated command-and-control model of management is best, and that pay is the only thing that motivates employees.

Businesses that place a priority on and actively pursue workforce engagement often find that the benefits extend well beyond on-the-job performance. They can and do permeate out into the world: “Engaged employees advocate their company or organization – 67% against only 3% of the disengaged. 78% would recommend their company’s products or services, against 13% of the disengaged. And, equally important is the positive contribution they make to their families, friends and society in general.

Actively Engaging Workforce

So, my experience bares out that engagement does matter! Actively engaging your workforce will boost workplace performance. It will transform paycheck mercenaries into lasting brand advocates – and help grow your bottom line.

So, swinging full circle, the Villian of business today—the largest reason by far that businesses fail—is quite simply disengagement.

So how does a business battle this Villian? The answer, of course, is engagement—working toward 100% engagement from 100% of your people.

But, how? Are there practical steps to reach the pinnacle of engagement and ignite The Power of People in your organization?

The answer is yes! But it is a tough journey that spans the breadth of an organization, and it isn’t one size fits all. I do feel there are some primary drivers, however, at the core of the engagement journey. Those drivers have these tenants:

• People are the priority,
• Purpose, with an aligned Vision, Strategy and Plans provide the direction—the food the people consume, and
• Culture and Communication are the glue that binds People with Vision.

If our leadership has the character and strength to take this journey and provide leadership in these areas, then the engaged people will do the rest. Again, yes, greater engagement produces a dynamic organization able to perform at higher levels, able to morph and change as needed to improve sustainability. So, yes, engagement does matter, a lot.

Many of you may be saying, yep, I get it, more engaged people produces a better result. But, how much better; and are there any other benefits other than better results. You say it is a journey, and I am sure an expense, so do the factual benefits outweigh the cost and the time?

Before going to more factual information, let’s take a look at the observation of Brad Byrd, Academy Award winning filmmaker, behind The Incredibles and Ratatouille: “The production team morale has the most significant impact on a movies budget – but never shows up in the budget.” He went on to propose a quantification of the impact morale can have:

“If you have low morale, for every $1 you spend, you get about 25 cents of value. If you have high morale, for every $1 you spend, you get about $3 of value. Companies should pay much more attention to morale.”

Let’s first recognize that there is more to engagement than morale, but without good morale, a positive vibe, I am hard pressed to say you can have engagement. Again, as with my examples above, intuitively the observations of Brad Byrd above strike a cord: it just seems right that having a positive and actively engaged group of people should be a good thing. But does it really have the bottom line implications that Mr. Bird suggests? He seems to indicate it is substantial, but is there information even more empirical?

There are numerous extensive studies done over decades that provide high-profile factual findings that prove the direct correlation between engagement and bottom-line results. Below are two. It would be overkill for me to show you more. Hopefully, this makes the point. There are virtually no studies I have found or that my personal experience doesn’t bare out, that show anything other than the positive impact of greater employee engagement. It also should be noted that while retention (both employee and customer), absenteeism, safety, quality and shrinkage are not specific performance measures; make no mistake that they have a direct impact on both performance and profitability.

In my next post, I will talk about characteristics of an engaged employee, but for now, just so we are all starting from a common place let me attempt to define it.

Employee engagement is a “workplace approach designed to ensure that employees are committed to their organization’s goals and values, motivated to contribute to organizational success, and are able at the same time to enhance their own sense of well-being and fulfillment.”

Employee engagement is about the way people behave at work and how the employer and leadership influence it. An ‘engaged employee’ is someone who sees their job as worthwhile or interesting and is therefore more likely to be fully involved in and enthusiastic about the things they do.

This goes beyond commitment and job satisfaction. It refers to the additional effort an employee puts into his or her work that delivers high performance, often referred to as ‘going the extra mile’.

Employee engagement is also about the way an organization listens to, builds trust and improves relationships with its staff. It’s about sharing a common purpose through a culture of communication and involvement that enables improvements in staff morale, retention and performance.

One of the most all encompassing statements or piece of research that summarizes this entire performance issue is this: “94% of the companies on Hay Group’s list of the World’s Most Admired Companies believe that their efforts to engage employees, creates a competitive advantage.” If you look at those companies you will find most of them are among the highest performing companies in the world.