High Employee Engagement  Pays Off in Performance

Here are three major conclusions reached in the recently released Employee Engagement research report from The Conference Board:

1.

8 Drivers of Engagement

The Conference Board's report examining numerous research studies on employee engagement identified 26 factors that influence employee engagement. Following are eight drivers of employee engagement that emerge from all the studies: 1. Trust and integrity. Management tells the truth, communicates well to employees, listens to employees, and follows through with action. 2. Nature of the job. The employee "derives emotional and mental stimulation" from the job. The employee has opportunities in the job for decision-making and autonomy. 3. Line-of-sight between individual performance and company performance. The employee knows how "his/her individual contribution impacts" the company's performance. 4. Career growth opportunities. The employee "feels that there are future opportunities for career growth and promotion within the company..." 5. Pride about the company. The employee derives self-esteem from being associated with the employer. 6. Coworkers and team members. Employees' colleagues have a significant influence on the employees' engagement level. 7. Employee development. The employee "feels that specific efforts are being made by their company or manager to develop the employee's skills." 8. Personal relationship with the manager. The employee "values the relationship that he/she has with his/her direct manager." The report notes one study that "demonstrated that the emotional drivers such as one's relationship with one's manager, and pride in one's work had four times greater impact on discretionary work effort than did the rational drivers, such as pay and benefits."

In some workplaces, as many as 80 or more out of 100 employees commonly are not engaged (emotionally committed, emotionally involved) in their jobs. Eight of the studies in the last four years found employee engagement levels for U.S. employees ranging from a low of 21 percent to a high of 52 percent. For employees in other countries, four studies found employee engagement levels at a low of 12 percent in France and Germany to a high of 70 percent in Canada.

2.

First-line supervisors are the most important key in driving employees' engagement in their work.

The Conference Board report, by John Gibbons, states: "Researchers and writers agree that the role of an employee's direct manager is the key to influencing his/her level of employee engagement." One study reviewed asserted "that the relationship that an individual has with his/her manager is the strongest influencer of his/her engagement," according to Gibbons.

Further, Gibbons in the report cites another study "reporting that employees' views about their relationship with their company were largely the same as their views about their relationship with their immediate manager." And Gibbons found that "a personal (as opposed to professional) relationship with one's direct manager has emerged as one of the key drivers of employee engagement across a handful of studies."

3.

The level of a company's employee engagement is directly connected to the company's financial performance. The higher the employee engagement, the more likely the firm's financial performance is better.

The Conference Board report states, "When employee engagement levels increased, a corresponding increase in financial performance indicators followed." Further, the report states, "...evidence gives credence to the assumption that employee engagement actually causes an increase in a company's overall financial performance."

Engagement: Exactly What is It?

One way to think of employee engagement, according to the report, is to think of the "connection between employees and their companies that involves minds, hearts and hands."

Engagement in work involves three factors: cognitive commitment, emotional attachment, and a connection to the employer. The Conference Board report offers this definition of employee engagement: "...a heightened emotional and intellectual connection that an employee has for his/her job, organization, manager, or co-workers that, in turn, influences him/her to apply additional discretionary effort to his/her work."

So engagement (for purposes of these studies and this report) isn't just doing the job. It's putting an added commitment, attachment, and connection into the job and the results of the job. The report notes that several studies "refer to engagement as the employee's willingness to expend discretionary effort on the job" while other studies focus on the concept that engaged employees are "emotionally and intellectually committed."

What Makes Engagement Important?

Higher levels of employee engagement have several positive impacts on a company. The report states, "There is clear and mounting evidence that employee engagement is strongly correlated to a number of individual, group, and corporate performance outcomes." These outcomes include "recruiting, turnover, individual productivity, customer service, customer loyalty, growth in operating margins, increased profit margins, and even revenue growth rates."

Employee performance improves with higher engagement. One study cited in the report "revealed that highly engaged employees had overall performance scores 20 percentile points higher than those of employees with average levels of engagement." Another study found that employees "who were highly engaged outperformed the disengaged employees by 28 percent and the moderately engaged by 23 percent."

A third study cited in the report "found a significant positive correlation between companies' employee engagement levels and their one-year growth in total revenues compared to the average growth within their Dow Jones sector."

The Role of First-line Managers

The Conference Board report stresses that first-line managers and supervisors are the most important key in driving employees' engagement in their work. In fact, Gibbons in the report lists the first driver of employee engagement as a "manager who is inspirational and enthusiastic."

Other engagement drivers are opportunities to advance in the career with the current employer, the reputation of the organization as a good employer, and salary and benefits.

One study cited in the report encourages employers "to flatten both their managerial and their decision-making hierarchies." That study claims "by adjusting the organizational structures so that each employee has more autonomy, employees and their first-line managers will have richer job responsibilities that include greater decision-making authority."

	Here are more steps, cited by Gibbons, that managers and supervisors can take to improve employee engagement:
	"...simply ask employees how they feel."
	"...build trust and...foster personal relationships with one's employees."
	Use "employee surveys to gather opinions, ideas, and concerns from employees."
	"...gather and act upon employee feedback."
	Keep promises and actually do what you say you intend to do.
	Engage "in open and honest dialogue with employees at all levels."
	Reward "the right people for the right reasons."