A holistic approach to employee engagement
Each year, companies are spending nearly three-quarters of a billion dollars in an effort to improve employee engagement, yet you’ll get wildly inconsistent answers if you ask managers what that means. Academics, consultants and leaders have been grappling with that question for decades.
That murkiness is a problem, because there are still signs that engagement—whatever it is—has bottom-line implications. In a Gallup survey, organizations whose employees reported high engagement had 25 percent to 65 percent less attrition than their peers (depending on whether they were traditionally low- or high-turnover organizations). They also received higher marks in productivity and customer satisfaction.
For the most part, companies oversimplify things by viewing personal satisfaction as a proxy for engagement. As a result, they miss key behavioral signals. What use are Mary’s positive thoughts about her manager, for example, if she is not giving her maximum effort at work every day? Other companies use people analytics to examine employees’ behaviors and organizational performance but then fail to take individuals’ perceptions into account. John may be interacting with clients outside work, but is he happy doing so, or is he burned out and miserable? It’s critical to look at all these factors to figure out which levers to pull to engage the individuals who work for you.
For the most part, companies oversimplify things by viewing personal satisfaction as a proxy for engagement.
Truly understanding employee engagement
When my colleagues and I work with organizations, we conduct surveys and interviews to gauge employees’ perceptions in six areas: culture, job function, advancement, company leadership, management and total rewards. We also examine self-reported behaviors in six categories: level of effort, personal development, company loyalty, recreation, relationships and temperament.
This approach enables organizations without people analytics capabilities to start seeing relationships between employees’ perceptions and actions. Those that already gather and analyze on-the-job behavioral data can use surveys and interviews to capture additional information. Over time, organizations can track how their employees’ engagement changes and how it relates to key performance indicators, such as sales, customer satisfaction, and attrition.
This holistic approach to understanding employee engagement will yield more-detailed insights into what makes people stick around and do their best work. Instead of viewing engagement in terms of low, medium and high, organizations will be able to understand how employees perceive them, how that perception relates to their behavior, and in aggregate, how those factors drive bottom-line performance. If organizations don’t dig deep like this, they risk misunderstanding their employees and missing out on all the benefits of high employee engagement.