Posted by Adam Blanch on 28 October 2013
Employee engagement: what is it and does it really work to create a better business? Poorly defined and with no standardised measure, employee engagement is a modern business buzzword with some highly variable and conflicting stories to tell.
The Gallup organisation, in its 2012 State of the Global Workplace report, defines employee engagement as employees being “psychologically committed to their work”. But in its research, only 24 per cent of Australian workers are actively engaged, with 60 per cent disengaged and 16 per cent actively disengaged. These don’t present as strong figures if employee engagement is a predictor of productivity and business success – but is it?
Gallup says yes. According to the global research institution, engagement as measured by its employee engagement index has “proven linkages to performance outcomes, including productivity, customer service, quality, retention, safety and profit”. Apparently, it also positively correlates with employee health, though it is unclear whether engagement creates health or health creates engagement. Gallup also says that engaged workers have a better mood, more satisfying lives, are immune to commuter stress and are drivers of job creation. Sounds good!
However, not everyone agrees. Some commentary, such as this piece by human resources leader Jason Lauritsen of Talent Anarchy in the US, attests that engagement does not necessarily correlate with performance. Engagement as measured by overall happiness and commitment to staying in the job may not be a worthy goal without some measure of commitment to the business and performance goals of the company.
So, the research indicates that improved engagement leads to improved bottom line, but the relationship is not as straightforward as it first appears. Another study by Towers Watson highlights the difference between an employee’s willingness and their ability to be engaged. It concludes that engagement must be sustainable in order to produce real results, citing research that shows companies who promote sustainable engagement enjoy a 27 per cent operating margin as opposed to 14 per cent for traditional engagement strategies.
If we accept that engagement works, how do we create it? Both the Deloitte University Press and research by The Ken Blanchard Companies define employee engagement in terms of ‘passion’. The Blanchard whitepaper suggests that the key is management who are focused on the needs of their employees, rather than their own demands, which in turn creates a reciprocal commitment. Engagement then is the result of creating a culture that elicits the intrinsic desire to make a valuable contribution, rather than merely offering extrinsic rewards for extra effort.
It’s true that employee engagement is not as simple or as easy as we wished it was, and getting it right takes work. The good news is that even a non-optimal attempt to improve engagement can yield positive results.