First, Why Should We Care About Employee Engagement?
According to Rachele Williams, SPHR and Advisory Services lead for APQC, one of the world’s leading business benchmarking, best practices, and knowledge management research consultancies, “Employee engagement is to HR what customer loyalty is to marketing and sales. It is that often elusive frame of mind that goes beyond satisfaction and ensures the long-term and productive tenure of the faithful employee with the employer.”
Disturbingly, a recent Gallup survey concluded that 63% of American workers are not engaged in their work, while another 24% are ‘actively disengaged.’ Disengaged workers are more likely to look for other opportunities, or worse, drag down the productivity of the rest of the team. Gallup estimates that the cost of disengaged workers lies somewhere between $450-$550 billion each year in lost productivity.
High levels of employee engagement have been correlated with high levels of quality, productivity and attendance as well as new product innovation. Gallup suggests a 20 percent or better boost to productivity and profitability for companies with high engagement. In one publicized example organization that has put a strong focus on employee engagement over the past four years, results include:
- Reduction in team member turnover of 19 percent
- Reduction in workers’ compensation claims of 27 percent
- Increase in net revenue of 22 percent
- Increase in EBITDA of 43 percent
Determining the level of an organization’s employee engagement can be intimidating, as it involves significant effort and requires asking questions and analyzing data that can be difficult to digest and interpret. See how Catapult Systems is driving employee engagement with our Fuse intranet solution >>
The first step is to define what employee engagement means to your organization. Williams says “every organization should define employee engagement to ensure that the information it is gathering from the workforce can be put into practice.” Here are some example definitions that may provide you with a good starting point:
- Commitment, work ethic and loyalty
- A combination of perceptions—including satisfaction, commitment, pride, loyalty, sense of personal responsibility and willingness to be an advocate for the organization—that have an impact on behavior
- An individual sense of purpose and focused energy, evident to others in their display of personal initiative, effort and persistence, that is directed toward organizational goals
Once you know what engagement means to your organization, you can break it down into component areas and measure your organization’s baseline engagement level.
Surveys (such as the Gartner Q12—where employees are effectively asked, through various types of questions, to rate their own level of engagement) are one type of tool for gathering feedback.
Ryan Fuller, CEO and co-founder of VoloMetrix, a people analytics technology company, cautions: “Assuming honest survey responses, the [survey] approach provides good input into the employee attitude side of the equation (i.e., how engaged they perceive themselves to be), but, unfortunately it doesn’t do a good job of gathering objective data on just how engaged employees actually are.”
When surveys are combined with objective metrics, actual employee engagement can more effectively be measured. Some examples of objective metrics include:
- Discretionary effort (The amount of work that occurs outside of normal working hours such as during evenings and weekends)
- Non-core network connections (The number of network connections and time spent with people outside of immediate team or region)
- Voluntary participation rates (The percentage of participation in ad-hoc meetings and initiatives vs. recurring meetings and processes)
- Employee retention and time-in-position
- Average weekly time spent in one-on-ones with manager
- Average time spent in skip-level leadership (meeting with organizational leadership outside of direct manager)
- Average percent of manager’s weekly time spent with team
- Ratio of highly engaged employees vs. low on the team
- Hours per week spent in meetings with more than 20 attendees
- Calendar fragmentation (not enough meaningful time—about 2 hours—between meetings)
Collecting the data required to perform analysis can be a challenge—sometimes requiring the gathering and processing of massive amounts of email traffic, calendar appointments, absence information and activity data.
It is easy to see how employee privacy concerns can become a stumbling block to successful data collection and analysis.
Handling Employee Privacy Concerns
Most companies desire to respect employees’ boundaries and personal information. According to the Harvard Business Review, some best practices to ensure that employees’ privacy is balanced with data collection and analysis include:
Since employee engagement is often thought of as something very subjective, the next step, Analyze, is often overlooked or ignored. However, by breaking employee engagement into component parts and measuring at this level, it becomes more practical to perform a detailed analysis and gain key insights into:
- Engagement areas where the organization is not meeting expectations
- Potential contributing factors and/or root causes
- Prioritization of focus areas for improvement
The analysis must be performed by individuals that understand the corporate culture, historical context and organizational constraints.
Once engagement areas are baselined, specific initiatives can be launched or refined in an effort to effect the desired improvements. One example of an employee engagement initiative could be an improved corporate communication portal that incorporates enterprise social and mobility aspects. Rich Hein, Managing Editor for CIO.com, notes the importance of executive sponsorship for these types of initiatives stating that, “if you are going to move the needle on engagement it has to start from the top down.”
Control and Sustain Engagement
Organizations that successfully improve engagement view it as a journey, not a destination. They establish organizational effectiveness practices and programs around improving and sustaining employee engagement.
One approach that provides a natural mechanism for continued improvement in employee engagement is the concept of “gamification” or, the process of incorporating social/reward aspects of games into processes and systems aimed at making them more enjoyable and motivating.
Rajat Paharia, Founder and Chief Product Officer at Bunchball, said “When done right, gamification is incredibly effective at motivating employees…and this motivation leads to greater satisfaction, which in turn drives higher productivity and performance, and this simultaneously fuels employee retention, customer satisfaction and business results – that is, it is incredibly effective in driving active participation and links that activity to measurable business value.”
An example of gamification in action relative to employee engagement would be a badge/reward system applied to an employee knowledge sharing area of a corporate portal.
The Importance of Measuring Before and After Key Initiatives
The bottom line is that in order to understand the effectiveness of key employee engagement initiatives, it needs to be measured before and after the initiative is rolled out.
A “maturity model” approach provides a clear picture on how successful a given initiative is and where an organization may need to spend additional time and energy. This approach also provides clear accountability and justification for future investment in additional employee engagement initiatives.
References / Further Reading
Fuller, Ryan (Harvard Business Review, November 2014) – A Primer on Measuring Employee Engagement. http://bit.ly/1EUyEwM
Hein, Rich (CIO.com, July 2014) – Tips for Measuring and Improving Employee Engagement. http://bit.ly/1qrd1On
Nielsen, Shantrelle (Harvard Business Review, September 2014) – Collect Your Employees’ Data Without Invading Their Privacy. http://bit.ly/1MqnU1D
Williams, Rachele (Workforce.com, January 2010) – Employee Engagement Define It, Measure It and Put It to Work in Your Organization. http://bit.ly/1ftMIQr