Employee Engagement

How employee engagement drives change and boosts revenue

How employee engagement drives change and boosts revenue

Employee engagement is keeping HR leaders up at night. According to a recent study conducted by the Society for Human Resource Management, employee engagement is now the second biggest challenge facing HR organizations today, just trailing employee turnover. A separate Gallup study found that only 13 percent of people feel engaged in their work. Overall engagement levels in the world haven’t improved in years, notes Gallup.

The miserable state of employee engagement raises important questions: how important is it really to engage your workforce in a two-way dialogue? Why do many employees feel disengaged in their work? And, perhaps more importantly, how can business leaders foster a more authentic relationship with their people? We answer these questions in this blog post.

The business impact of employee engagement

A strategic approach to improving employee engagement requires investment in time and resources, but it’s definitely worth the effort. There are three main business benefits to listening to your employees:

1. Retain your people and attract new talent

Employee churn costs businesses a lot of money. When people leave your company, you’ll need to spend the equivalent of six to nine months of their salary to find and train their replacement. Another study, from the Center for American Progress, estimates that the cost of replacing an employee is upwards of 200 percent.

Engaging with your employees helps reduce turnover. In fact, the most engaged employees are 87 percent less likely to leave the company. When your people feel heard and are involved in business decisions, they are less likely to leave for another job. At the very least, your staff can tell you workplace issues that should be fixed.

The most engaged employees are 87 percent less likely to leave the company. 

Collaborating with employees can also help drive recruitment efforts. At Heineken USA, for example, employee engagement has lead to the collaborative writing of a corporate manifesto that clarifies the company’s purpose. That exercise fostered pride among employees, which, the company says, has helped attract new talent.  

2. Drive productivity

When people don’t feel engaged at work, they’re less productive. For instance, disengaged workers have 37 percent higher absenteeism and commit 60 percent more errors. Companies with low engagement scores also suffer from 18 percent less productivity, according to the Harvard Business Review.

The correlation between an engaged workforce and productivity shouldn’t be a surprise, considering that happy employees also tend to be more productive. To foster a positive and productive work culture, it’s critical to engage with your employees so you can identify conflicts and other roadblocks in the workplace.

3. Improve customer experience

Almost 90 percent of companies now expect to compete primarily on the basis of customer experience (CX), according to Gartner. But in an effort to provide a more seamless end-to-end experience, companies often forget to gather feedback from their own employees.

Your employees are a good source of insight into how to improve CX (and why). For one, using the ideas of your employees—especially those on the front lines—can help pinpoint and fix issues in the customer journey. Secondly, engaged employees are more motivated and willing to go above and beyond others in order to satisfy your customers. This may be why research has demonstrated that companies that lead in CX typically have 1.5 times as many engaged employees as CX laggards.

Tips on how to improve employee engagement

Given its impact to the bottom line, engagement requires a deliberate and strategic approach. Keep these tips in mind as you think about the ways in which you engage with your staff.

1. Make it a strategic priority

When it comes to improving employee engagement, the role of the C-Suite can’t be overstated. Sending employee surveys and holding focus groups won’t help you make better business decisions if you’re not committed to using feedback from these activities. And employees are less likely to willingly participate in any engagement activity if they don’t understand what’s in it for them or feel like their feedback matters.

This works on a personal level as well. Engagement at work has a trickle-down effect. As a business leader, you must show that you are invested in your own work.

“Executives who aren’t engaged themselves, can’t expect their employees to be,” says Adam Ochstein, founder and CEO of StratEx, to CIO.com. Business leaders should set the example for the rest of the organization on what it means to be engaged.

2. Engage often

Many companies still rely on annual employee surveys to measure workplace satisfaction. But this old-school approach is problematic. Annual surveys tend to be way too long because they explore a variety of topics in one seating. Also, because they take place so infrequently, traditional employee engagement studies offer little flexibility, allowing only for one opportunity per year to improve the culture.

To have a better understanding of the needs and wants of your employees, engage with them more often. Agricultural machinery manufacturer John Deere, for instance, measures employee morale every two weeks. This approach helps the company embrace continuous improvement and make small, quick adjustments. Because the company has an accurate pulse of its workforce, it can detect issues earlier and correct course immediately.

3. Be responsive

After employees fill out annual surveys, engagement often ends there. They don’t know how their feedback was used and whether their input shaped decisions around the business.

Demonstrate to your employees that their input truly matters. It’s important to keep the conversation going. Delve deeper and ask follow-up questions. Go beyond percentages and scale, and determine why your employees feel a certain way. Ask for feedback on how you can improve things.

Go beyond percentages and scale, and determine why your employees feel a certain way.

Also, show your appreciation for your staff’s feedback. Share what you’re doing with their input, and, more importantly, use their feedback to make visible changes to the business. Demonstrating that their participation has had tangible impact increases employees’ willingness to participate, and you’ll continue to get valuable insight on how to improve the workplace.

To win, start with your own people

In the years ahead, as companies deal with more shortages of skilled workers, issues with employee engagement are expected to magnify even further. To scale engagement, make it a business priority. It shouldn’t be a once-a-year project. For engagement to drive better decision-making, you need to take a more human approach—one that creates a sense of community and builds a culture of authentic, ongoing conversations.



  • Greg Basham

    It’s great to see a firm that really grasps how engagement at all levels of an organization drives results and leads to organizational commitment. It’s even more refreshing when this take is written by a Content Marketing Manager.

    The irony is that sound management practices don’t cost money yet research shows that over 85% of employees actual reasons for leaving are due to management and workplaces that aren’t performance oriented and respectful.

    As a former CEO of a firm that does engagement surveys for organizations primarily in Asia it’s interesting that the article notes the importance of engagement at all levels as you don’t deliver an engaging, performance oriented and rewarding workplace without it.

    We were engaged to create an Appreciation Survey for a consultant to a large Hong Kong and China drugstore chain as they wanted to eventually engage their frontline managers, supervisors and staff in showing customer and other appreciation at the store and warehouse, etc levels.

    Starting at the top of the firm everyone from the Chairman through the CEO and executives and down to the management level were surveyed on these dimensions:
    1. How much appreciation for performance they received including how often from their superior (or board)
    2. How much appreciation did they believe they should be receiving for actual performance.
    3. How much and how often were they extending appreciation for performance.

    The deficit gap for what was wanted for actual performance and actually being received was eye opening for their entire executive team. Unless that is got right, you can’t expect those on the front line to do their part.

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