Category Archives: Engagement

Guess Who’s Trying to Sink Your Boat!

crew team

At a Gallup presentation the audience was asked to imagine their business was a ten-person crew boat.

The speaker then went on to share data (at the time) indicating approximately 30% of the US workforce fell into the “engaged” category, which meant that they were invested in their work and workplace, that they made a strong discretionary effort, and worked at a very productive level.

If these people were on your crew boat, they would be diligently ‘manning their oars.’

We were then informed that just over half of the US workforce fell into the disengaged category. These people were not highly-motivated and, though they made a fair effort each day, they were more likely to do only what had to be done – and sometimes less!

If these people were on your crew boat, they would occasionally dip their oars in the water but mostly sit idle looking at the scenery.

The remainder of the nation’s workforce, we were told, fell into the actively disengaged category. These people tend to undermine the work, spread rumors, call out sick at higher rates and do only the bare minimum.

If they were on your crew boat, they would most likely be trying to sink it!

Makes a strong case for implementing a formalized engagement plan, wouldn’t you say?

Developing Teams – Start the Engagement Process Early

Onboarding

When engaged in continuous improvement (CI) it’s important to frequently assess our approach, starting with the foundation.

When it comes to engaging employees, the process begins with onboarding, which is the process for welcoming new employees. Among other things, onboarding is an opportunity to make new hires feel confident in their decision to accept the position as well as in their new role and team.

Despite the fact that onboarding sets the tone for the rest of your new employee’s experience at your company, and despite the fact that effective onboarding has a strong impact on retention and productivity levels, data shared by SHRM, Indeed, and others indicates that over 80% of businesses don’t have a very good onboarding plan.

If you’d like to improve your employee onboarding process you might start by considering the following best practices:

  • Start communicating before your new hire’s first day
  • Prepare well in advance
  • Set up the employee’s workspace before they arrive
  • Send out a new employee announcement including name, role, etc. If done by email, cc them
  • Pair new employees with a peer mentor / “buddy”
  • Ask new employees for their feedback early-on in the process and several months into the process

Rewards & Recognition Fundamentals

rewards and recognition

Rewarding or recognizing members of the workforce is a standard component of most employee engagement efforts, but the way in which organizations approach the practice can vary.

In fact, during a discussion with our Partners in Improvement, we uncovered a variety of approaches to rewards and recognition programs. Some, like a service award, are very predictable; if you reach an anniversary, you are likely to receive one. Many other recognition programs include an element of surprise when exceptional service is spotted. Some rewards cost the organization little or nothing — such as a thank you note or a special parking place. Others are quite costly, such as a one year lease on a car or a $20,000 ‘President’s Award.’

Similarly, some programs are for teams, and others are for individuals.

Many of the rewards and recognition are after the fact, while some are announced and hyped in advance in order to encourage people to try for them.

But despite the variety of implementations, the objectives were really quite simple. An organization implements a reward and recognition program for one of these three reasons:

  • To increase the recipient’s satisfaction and happiness (and hopefully engagement) with the organization and his or her role within it
  • To motivate continuation of certain types of behaviors and accomplishments
  • To motivate people to work to achieve certain measurable results.

However, regardless of purpose, the amazing variety of program types allowed us to explore the benefits and unexpected drawbacks of each, which will be the subject of our next post.

A ‘must have’ for today’s successful business

must_have

There was a time when engaged employees were a ‘nice to have’ asset, but there were no formal processes for achieving engagement and the prevailing approaches yielded few, if any, measurable results.

Fortunately, as summarized in an article by Engagement Strategies Media, things have changed and engagement is now recognized as a competitive edge.

“With sales growth slowing and competition continuing to grow in many industries, market share goes to those organizations that “wow” not only their customers but all of the people involved with their businesses,” the article said.

“Research consistently confirms that talented “wowed” employees help create “wow” experiences for customers.”

Another fact that has changed the playing field for achieving higher levels of employee engagement is that there are formalized, proven methods for doing so.

One such approach is Engagement Around the Work, which is based on engagement with a purpose. With a clear objective of building and sustaining a high-performing culture in a measurable way, Engagement Around the Work involves specific steps for achieving a culture of engagement that is inextricably linked with team productivity, performance and job satisfaction. It incorporates a clear objective of engaging people around the one thing they all have in common—and the one thing that can bring about increased profitability and a sustainable competitive edge—the work.

You can read our free white paper about this approach here.

managers’ critical impact on productivity, engagement, and retention

managers drive engagement

In a recent presentation, Gallup shared some powerful data on why an organization’s managers are so important.

“Managers are the heart of your organization,” they said. “Managers communicate and uphold the standards of your culture and your brand. They can make or break any change initiative. Nearly every problem and achievement in your organization can be tied back to the quality of your managers.”

During the presentation, Workplace Expert Patrick Mieritz referenced Gallup survey results indicating managers account for 70% of the variance in team engagement!

If you’re wondering why this statistic is so significant, consider their findings on how highly engaged business units and teams impact typical “negative” outcomes:

  • 81% decrease in absenteeism
  • 43% decrease in turnover within low turnover organizations
  • 18% decrease in turnover within high turnover organizations
  • 28% decrease in shrinkage (theft)
  • 64% decrease in safety incidents (accidents)
  • 41% decrease in quality defects

Their research also shows that highly engaged teams have a significant impact on “positive” outcomes as well:

  • 10% increase in customer loyalty
  • 18% increase in sales productivity
  • 14% increase in overall productivity
  • 23% increase in profitability
  • 66% increase in well-being (thriving)
  • 13% increase in organizational citizenship (participation)

Managerial Best Practices
If you’d like to increase the effectiveness of your organization’s managers or your personal managerial effort, a good first step is to identify or confirm the things that are important to your workforce; and beware, employee expectations have shifted since the onset of the pandemic.

As motivation expert Daniel Pink explained, “People really want three things: autonomy, mastery, and purpose.”

Or as famed statistician W. Edwards Deming often said, and a fact that still rings true today, “People are entitled to joy in work.”

So, what’s to be done?

We all know that, at the organizational or senior management level, offering more flexible work arrangements (when possible), reviewing pay scales, and improving on-boarding/team development programs are steps in the right direction.

But, if you’re wondering about actionable ways in which mid- or front-line managers can increase engagement, productivity, and retention levels, you might also consider the following best practices:

  • Set clear expectations. Approximately half of all US employees say they know what is expected from them at work. To improve on this, SHRM suggests managers should emphasize objectives, set expectations early, make goals measurable, and give meaningful feedback (only 26% of US workers say the feedback they receive is helpful). Gallup adds a note to this by suggesting managers give meaningful and frequent feedback, indicating that workers who receive weekly meaningful feedback from their managers are 2.7 times more likely to be engaged in their work.
  • Create a culture of clear accountability. This does not mean taking a “do it or else” stance, but rather a motivational approach that includes open communication, recognition, and awareness.
  • Motivate each employee individually. There is no one-size-fits-all approach that works.
  • Coach and develop people based on their strengths. Gallup says that 66% of employees who strongly agree that their manager focuses on their strengths or positive characteristics are engaged. Focusing on strengths has also proved an effective way to ensure people are placed in the right roles; and providing ongoing development to team members has proved to have a significant impact on increasing engagement levels while reducing turnover.
  • Overcommunicate! Leaders who maintain open and frequent communication, who show an interest in their teams, who share stories of success and vision, and who remind people of the mission tend to foster higher levels of engagement.

how to lower the cost of disengaged workers

cost die

Continuing with the theme of employee engagement, or the lack thereof, people readily agree that disengaged workers are “expensive.”

For example, recent data shared by Gallup indicates that 74% of actively disengaged workers are actively seeking alternative employment. Along those lines, turnover is much higher among disengaged workers, as is absenteeism.

In addition, if the predominant environment within an organization is one of disengagement, productivity and profitability are lower, there is little or no continuous improvement, and pay tends to be higher.

Clearly it is advantageous to engage our employees or, at least, make a concerted effort to address and lower the costs associated with disengagement.

Here are a few suggestions for driving engagement within a business organization and for lowering the costs of disengagement based on input from CI professionals and leaders:

  • Enhanced recruiting and on-boarding – At an Engagement World Conference, leaders from several organizations explained how they had increased employee engagement and retention beginning at the recruiting stage. The first steps involved the inclusion of the organization’s mission and vision into interviewing conversations, and a more conscious effort to identify and hire people with aligned goals. Adding a mentor program to the on-boarding process helped new hires assimilate faster so they became more productive in less time.

    Enabling people to achieve higher levels of productivity and success early-on not only promotes greater engagement levels, but also reduces first-year attrition rates, which are often among the highest. Early churn tends to demoralize the entire workforce as well, so in addition to reducing rehiring and re-training costs, the costs associated with negativity within the existing workforce are also reduced.
  • Flexibility and work/life balance – Employer/employee relationships, expectations, and engagement criteria have evolved significantly over the course of the pandemic. Depending on the type of organization, scheduling and work-from-home options has become a priority in many workplaces.
  • Consistent performance management and communication – People need to find meaning in their work, and understand how their work aligns with organizational objectives. This point was well made by several speakers in an episode of TED Radio Hour, called The Meaning of Work. If managers communicate a shared purpose or sense of direction, and encourage employees to openly share their perspectives and input, then they can increase employee engagement.

    This type of communication works best when systematized as part of structured, proactive approach to performance management. This methodology includes frequent feedback rather than annual performance appraisals and reviews, ongoing engagement surveys (i.e., e-Net Promoter Score) with real-time feedback loops, and protocols for keeping people aware of how individual work impacts organizational goals and how it aligns with mission and vision.
  • Learning and development – A young, seemingly fast-rising junior executive had been working at a large bank for just over six years. When he was asked about his job and how he felt about it he said, “The job’s OK.” His lack of enthusiasm was evident, and when pressed to say more he added, “Well, I’m not really learning much anymore.” He went on to confirm that he was not truly engaged, and that he did not make much of an extra or discretionary effort, which engaged workers regularly put forward. Only recently has it become clear to forward-thinking business leaders that the path to sustainable employee engagement is to drive productivity, and to do so through ongoing education and empowerment. In support of this perspective, a recent article in Human Resource Executive magazine identified “continuous learning opportunities and personal development” as being two of the four key criteria (scheduling flexibility and social responsibility being the other two) recent graduates value most as they evaluate career options.
  • Recognition and rewards – Recognizing and rewarding employees is not a new concept, but if the goal is to engage workers rather than simply acknowledge milestones (such as length of service), then the approach must be different and must be aligned with what is meaningful to each recipient.

Why employee engagement matters more now

engagement around the work

A recent article shared by Gallup indicated that 36% of the U.S. workforce is engaged in their work. Surprisingly, this statistic is higher than it has been for many years, though the number itself is typically perceived as disappointing. However, Gallup also says that globally, only 20% of employees are engaged at work.

Equally important, their findings indicate the percentage of actively disengaged employees in the U.S., has risen to 15% through June 2021. Actively disengaged employees cost businesses a lot… higher turnover, more safety issues, more absenteeism, and so on; they generally “report miserable work experiences and are generally poorly managed. They also tend to bring-down their coworkers.

Why Now?
The reason workforce engagement has emerged as more important now is that the U.S. Bureau of Labor Statistics says employee turnover or “quit rates” are reaching record highs, and Gallup research has found “substantial differences in intentions to change employers as a function of the quality of the work environment.”

“Among actively disengaged workers in 2021, 74% are either actively looking for new employment or watching for openings. This compares with 55% of not engaged employees and 30% of engaged employees,” the article states.

With this fact in mind, and despite the recent rise in engagement levels, with only 36% of U.S. employees engaged in their work, there is much room for improvement.

The first step in this improvement process is to formalize an employee engagement plan, and to do so in the same fashion as one would implement a continuous process improvement initiative:

  • Get acceptance and buy-in from senior leaders. Little will be accomplished without this; the best results are achieved when leaders understand the benefits of engagement and take action.
  • Create a formalized implementation plan and establish performance measures so that progress can be tracked. Develop realistic, achievable, and measurable goals and objectives.
  • Work with the leaders so that they can model the right behaviors and cascade the concepts throughout the organization.
  • Create and equip project teams to identify and quantify opportunities for improvement.
  • Foster an atmosphere of collaboration, innovation, continuous improvement, and fun. Increases in productivity yield increases in engagement.
  • Make sure people have the knowledge and skills needed to succeed.
  • Implement an appropriate integrated communication plan, reinforcing the concept of improving both the “work and workplace.”
  • Reward and recognize people so that they feel supported in their efforts.
  • Measure results and ROI… and keep your foot on the gas!

Engagement Around the Work

Continuous Process Improvement Squared

Research over the past decade has consistently shown that increasing workforce engagement is a good thing:

  • Gallup: Disengaged workers cost the nation $450 billion to $550 billion per year in lost productivity.
  • Towers Perrin: Companies with engaged employees have 6% higher net profit margins.
  • Kenexa Research: Engaged companies have 5 times higher shareholder returns over 5 years.

Beyond greater productivity and profitability, additional documented positive benefits of engaged workers include lower turnover, better safety, fewer product defects and shrinkage, reduced absenteeism, and better customer satisfaction metrics.

But in spite of the proclaimed benefits of engagement, the efforts made to increase it have too often not paid off in a measurable way. .

We have identified four key reasons why so many have struggled to engage their workforce:

1. Lack of definition.

Taking a “we’ll know it when we see it” approach to employee engagement is like trying to hit a moving (or invisible!) target. The first step to a formalized engagement plan is to identify goals and metrics.

Stephen Wendel from HelloWallet, offers a commonly used definition of engagement: “Engagement means having an emotional attachment to work.”

With this definition, employees emotionally care about their work and their company. He further describes employee engagement as a mental state — it’s something in our heads and hearts that represents the attachment we feel to our work. The definition also includes an element of discretionary effort. “Engaged workers don’t work just for a paycheck or just for the next promotion, but work on behalf of the organization’s goals.”

However, as good as these definitions sound, they are not quite specific enough… instead, it would be better to use Wendel’s definitions as guides and add specific objectives based on your organization’s situation. These metrics might include “lower turnover by 25%” or “reduce absenteeism by half.”

2. Confusing Engagement with Happiness

As it turns out, a happy workforce is not necessarily and engaged workforce, as people can be satisfied or happy at work without being engaged. As Wendel further states, “Happiness is a current emotional state that is often related to many factors that have nothing to do with employment — the weather, family life, personality, etc.”

Without understanding the distinction between happy and engaged employees, organizations have taken a variety of paths to try to increase engagement. Some have focused on things such as dress-down Fridays (pre-pandemic), putting in vending machines with healthier snacks, or creating a work place with state of the art work-out facilities and a great latte bar. Those things might be nice — they might make for physically healthier and maybe even happier employees. But, there is plenty of evidence that these things do not increase engagement.

3. Misunderstanding the Link Between Engagement and Productivity

There is considerable research about what truly motivates people. Hands down, intrinsic motivation trumps extrinsic motivation! People are motivated primarily by an intrinsic desire to do a good job, to be recognized for it, and to be considered a valuable asset to their organization; in Deming’s words, “To have joy in work.”

Deming was very clear about how to make sure that employees have “joy” in work — by enabling them with the training, tools, and resources they need to do a good job; to listen to their ideas for improvement and to continuously improve the work of everyone.

In other words, many organizations focus only on engagement as the strategy, but productivity yields engagement — not the other way around!

“Employee happiness and morale is NOT the critical path to employee productivity. but productivity and employee achievement are the critical path to high morale and a happy work environment. Morale and employee happiness aren’t the means to the end; they are the end itself.” —Morale and Motivation Myth…No Strings Attached

By increasing employees’ productivity, you get increased engagement, and that engagement, in turn, increases productivity, and the other positive and measurable results that come from increased engagement.

4. Seeking a Quick Fix

Engagement efforts often fail because we wishfully think and hope that a few superficial suggestions and tips for increasing engagement will actually result in substantive change It’s a classic case of one of Deming’s truisms: “I didn’t say it would be easy. I just said it would work.”

There is no magic bullet for engagement. It requires fundamental culture change and that requires commitment and
the required resources. This is a culture change in which engagement is the byproduct of having everyone involved in the continuous improvement of everything!

It’s an approach we call Engagement Around the Work, as it’s all about achieving goals through people!

We call it CPI2 his method has two parts:

1) CPI – Continuous Process improvement — improving all that we do through improving all our work processes

2) CPI – Continuous People Involvement — providing the tools, resources and environment for people to be critically involved in all aspects of improvement.

The Ripple Effect of Disengagement

Our previous post focused on ways of reducing the costs associated with disengaged workers. While the most obvious course of action might simply be to increase the percentage of engaged workers, doing so is no easy feat! It’s also important to recognize the specific ways in which disengaged workers impact an organization’s bottom line or, stated another way, to identify and quantify the waste!

During meetings with our Partners in Improvement, these costs were discussed in detail. The Partners concluded that disengaged employees create a negative and expensive ripple effect throughout an organization, and drive-up costs in numerous ways:

Higher turnover: Disengaged employees leave their employers as soon as they see a better opportunity. The turnover increases the costs of recruiting, on-boarding, and training, (1.5-2x annual salary as explained in a recent post), and significantly more for higher-level executives based on a Center for American Progress study. Every new hire brings a risk of a bad fit, and every employee leaving an organization takes with him or her some organizational knowledge that might have been helpful to that organization in future decisions.

Lower productivity: Disengaged employees don’t go the extra mile; they do not make an extra effort when faced with a challenge, and don’t put forth the same discretionary effort that an engaged person will make. A 2013 article from the Harvard Business Review concluded that organizations that cultivate high employee engagement yield a 22% increase in productivity over the norm.

Lower profitability: Similarly, McBassi & Company has compiled data which shows that the Engaged Company Stock Index (comprised of 43 companies with high engagement scores), outperformed the S&P 500 by 21.4 percentage points since it’s inception in 2012.

Little or no process improvement: Improvement requires engagement — a willingness to design and conduct experiments, a willingness to take risks to try something new and potentially better. Often times, disengaged employees focus on their personal agendas and see little upside in trying something new to forward the organization’s goals. The associated cost of lost opportunities is difficult to calculate; but it is significant and probably far greater than the direct replacement costs outlined above.

Higher pay: When we say about someone, “They are only in it for the money,” we are observing disengagement. While money is important to nearly everyone, if that is the only motivation, there is no genuine engagement. As the behavioral economist, Dan Ariely, said, “Money is the most expensive way to motivate someone.” Organizations that are unable to create an environment that intrinsically engages their employees must pay them more to keep and motivate them.

Reducing the Cost of Disengaged Workers

Our previous post focused on the cost associated with disengaged workers and the often-unrecognized lost opportunities associated with turnover.

Fortunately, there are proactive steps that can be taken to avoid these costs and the collateral damage to team morale and brand that is a regular side-effect.

Based on research and data shared by the Enterprise Engagement Alliance (EEA) and The Chartered Institute of Personnel and Development, the following five steps can drive employee engagement, and reduce the number of disengaged workers and the associated costs:

  1. Enhanced recruiting and on-boarding — At a recent Engagement World Conference leaders from several organizations explained how they had increased employee engagement and retention beginning at the recruiting stage. The first steps involved the inclusion of the organization’s mission and vision into interviewing conversations, and a more conscious effort to identify and hire people with aligned goals. Adding a mentor program to the on-boarding process helped new hires assimilate faster so they became more productive in less time. Enabling people to achieve higher levels of productivity and success early-on promotes greater engagement levels, and reduces first-year attrition rates. Early churn tends to demoralize everyone, so in addition to reducing re-hiring and re-training costs, the costs associated with negativity within the existing workforce are also reduced.
  2. Consistent performance management and communication — People need to have meaning in their work, and understand how their work aligns with organizational objectives. This point was well made by several speakers in an episode of TED Radio Hour, called The Meaning of Work. If managers communicate a shared purpose or sense of direction, and encourage employees to openly share their perspectives and input, then they can increase employee engagement.
  3. Learning and development — a past post shared the fact that, for the first time in two decades, the percentage of engaged workers in the US rose in 2019. The increase was due to positive changes in how organizations were developing people. In addition, a recent article in Human Resource Executive magazine identified “continuous learning opportunities and personal development” as being two of the four key criteria (scheduling flexibility and social responsibility being the other two) recent graduates value most as they evaluate career options.
  4. Recognition and rewards — Recognizing and rewarding employees is not a new concept, but if the goal is to engage people rather than simply acknowledge milestones (such as length of service), then the approach must be aligned with what is meaningful to each recipient. An EEA article outlines an effective approach, which begins by stepping-back from the traditional monetary rewards.

    “To receive a deeper level of benefit that can come from sincere recognition, look beyond monetary rewards and get to the human connection – reward employees in ways that connect with them
    emotionally and psychologically,” the article suggests.
  5. Flexibility and work/life balance — Employer/employee relationships, expectations, and engagement criteria have evolved significantly over the past decade. In the Human Resource Executive article referenced above, data from a PwC survey of 44,000 workers who had become less-engaged indicated that “71% said their jobs interfered with their personal lives, and 70% said they wanted to be able to work from home.” The current pandemic, which has necessitated higher-levels of working from home, will no doubt add to the number of people wishing to do so more often.