The Evolution of Employee Engagement
It’s no secret that organizations with high levels of engagement consistently outperform the competition. Research shows that engaged employees produce better outcomes, and businesses with a high level of engagement report up to 4x higher levels of success.
According to a recent meta-analysis conducted by Gallup, business or work units that score in the top quartile of their organization for employee engagement nearly double the odds of success, in comparison with those in the bottom quartile. These business units have up to a 41% reduction in absenteeism, a 20% increase in productivity, up to 65% less turnover, 48% fewer safety incidents, and 41% fewer quality incidents. Highly engaged business units also achieve significantly higher customer loyalty ratings and a 20% increase in sales.
But for many companies, employee engagement is an elusive goal. Despite an annual investment of $720M in engagement programs, the majority of workers are still disengaged, resulting in $550B in lost revenue annually.
So what can be done to effectively engage employees for the present and the future? In order to answer that question, let’s take a quick look at how the practice of engagement in the workplace has evolved over the course of the recent decades. Knowing where we’ve come from will help us to get where we need to go.
Uh, yeah. Did you get the memo?
Seasoned veterans of the workplace will undoubtedly remember the motivational posters that used to grace the walls of most offices in the 1990s, espousing broad platitudes about perseverance, teamwork, leadership, attitude, work ethic, and more. The intention behind these posters, beyond serving as affordable office décor, was to inspire workers to achieve higher levels of productivity. Unfortunately, the effect was often one of bitter irony, given the sense of hopelessness that pervaded many of those work environments.
When faced with a “morale” problem, executive management would delegate it to the HR department. HR was then faced with the daunting task of figuring out how to motivate a fundamentally disconnected and disenfranchised workforce. In the absence of a forum for authentic communication, HR turned to a limited selection of tools at their disposal, which could include:
- Posters, bumper stickers, and other items printed with generic sayings about positive thinking
- Simplistic personality typecasting, used primarily for the purposes of manipulating people into feeling appreciated
- Awkward get-togethers, happy hours, and ice-breaking activities that were designed to foster connection
- Performance plans, and rigorous disciplinary action when goals went unmet
One of the most famous depictions of disengagement in the workplace is the 1999 cult classic, OfficeSpace. In one of the film’s most beloved scenes, the main characters, a group of disgruntled IT workers who are laid off in the midst of a corporate downsizing take the company’s malfunctioning printer to the middle of a vacant lot and smash it to smithereens with a baseball bat.
Later in the film, we see a well-meaning HR representative throwing the saddest birthday party on the planet for one of the supporting characters, Milton Waddams, a meek collator who is largely ignored by his co-workers. Unfortunately for Milton, there are more employees at the party than there are slices of cake, and he ends up empty-handed. As it turns out, this relatively minor slight ends up having significant ramifications, since Milton eventually retaliates by burning down the building.
A big part of OfficeSpace’s popularity is that it addresses themes that have become all too familiar to the workforce in general: ongoing frustration with broken systems and processes, disconnection between executive leadership and workers, unfair and pointless protocols, lack of job security, impenetrable bureaucracy, tone-deaf management, and delegation of major decisions impacting employees to outside consultants who knew much less about the business than the people who actually worked there.
Although the film admittedly exaggerated these elements, there was an undercurrent of truth to it. For the characters in this movie, and for many of its fans in real-life, work was a futile exercise of soul-killing monotony that took place on a daily basis within an endless labyrinth of cluttered gray cubicles.
Free Snacks to Recession and Back
As the economy grew in the 2000s, so did the need for skilled workers, causing a more acute need for employee engagement programs. In the tech industry, the dot.com boom gave birth to startup culture, featuring a number of novel employee engagement tactics and perks like Fusbol tables, bean bag chairs, scooters and free snacks. These were offered in order to 1) Make work seem more fun, and 2) Squeeze more productivity out of the workforce by eliminating the need to leave the office for necessities like food and recreation.
The great recession of 2008 changed the game temporarily by forcing businesses of all sizes to eliminate a significant portion of their workforce and consolidate responsibilities amongst those who remained. For the companies that survived, profits went up for a time, but it quickly became clear that desperation wasn’t a sustainable employee engagement strategy for the long run.
In the 2010s, as the economy rebounded, corporations once again faced the challenge of retaining good employees and talent acquisition re-emerged as a significant point of pain. The increased focus on business metrics and analytics fueled interest in what has become one of the most commonly deployed employee engagement tactics to ever hit the enterprise: the annual engagement survey.
Is once a year enough?
Although asking employees for their opinions is a great idea in theory, the annual survey leaves much to be desired in practice. It typically consists of a long list of generic questions presented in a dry format. HR is tasked with chasing people to make sure that they complete it, which can take months when employees view the survey as an unpleasant chore. Once surveys are completed, they result in a massive mountain of data that takes months to compile.
Like many legacy workplace strategies, the process surrounding the annual survey just can’t keep pace with the speed of business. By the time the reports are delivered to upper management, the results may be out of date and no longer relevant. After the investment of extensive time and money, the survey data leads to complicated reports that are overwhelming in scope and often inconclusive in terms of their recommendations. The net effect? A continuation of the status quo, with no impactful change until the next annual survey is administered, starting the cycle all over again.
As explained by Josh Bersin, Principal at Bersin by Deloitte, “The days of the annual engagement survey are slowly coming to an end, to be replaced by a much more holistic, integrated, and real-time approach to measuring and driving high levels of employee commitment and passion…. The change we need to make is to redefine engagement beyond an ‘annual HR measure’ to a continuous, holistic part of an entire business strategy.”
Cultivating engagement from the inside out
As we head toward the 2020s, we are seeing the rise of another major trend in employee engagement – the use of AI for performance measurement. A host of new software platforms and applications have flooded the market offering metrics on every employee, and analytics on the way they spend each moment of each day. Although these tools may be effective in documenting which employees are most productive, it is unlikely that they will make employees more engaged.
Because, as we’ve learned from all the other employee engagement efforts that preceded them, these kinds of tools and tactics simply don’t work when they are applied from the top down. The most effective way to increase employee engagement is to begin with the employees themselves.
Employees are human beings, and as such, they are dynamic and are impacted by a wide range of factors on a daily basis that can’t me measured and compared in a vacuum. This includes their physical and mental health, relationships, living situation, world events, the weather, work environment, role, strategy, team, leadership, and much more.
Employee engagement is a moving target because changes are constantly taking place in the workplace and individual experiences at work change over time. Objectives and goals are shifting, along with the competitive landscape and employee expectations. So, the way we think about employee engagement needs to shift, too, in order to stay relevant in the midst of disruption and change.
In order for employees to truly engage, they need to buy into what they are being asked to do. That requires creating an amazing employee experience from the inside out. A one-size-fits-all approach to engagement cannot possibly work for everyone. Employees need to be able to personalize their roles and contribution, based on their own unique core values.
Fostering trust and transparency encourages accountability and motivation in the workplace. This leads to more engagement and, in turn, higher performance, increased productivity, and better business outcomes.
The problem is that most companies are still tackling the problem from the wrong end. Many focus exclusively on productivity, performance and business outcomes by implementing performance management software to measure the engagement of employees. But that does nothing to encourage engagement at a fundamental level, and may actually result in hindering engagement by contradicting the core values of employees and damaging trust.
An amazing employee experience doesn’t just mean providing perks like free lunches and happy hours. It means creating a foundation of trust in which people feel free to express their ideas and know that their opinions matter. That’s why it’s critical to implement a 2-way communication platform to give people a voice and enable managers to keep their finger on the pulse of the employee experience at all times. Communication is the key to better business outcomes.
One thing we’ve learned from decades of employee engagement programs is that it’s not possible for HR to just “keep everyone happy.” As explained by Gallup:
While positive feelings, such as happiness, are usually byproducts of engagement, they shouldn’t be confused with the primary outcomes. Rather, the primary emphasis should be on elements that engage workers and drive results, such as clarity of expectations, the opportunity to do what they do best, development and opinions counting.
In order for engagement efforts to be successful, they need to involve everyone at the organization, including executive management. The future of employee engagement lies in providing tools that enable employees to keep themselves motivated, based on highly personalized goals and support. And the future of successful management will exist in tools, paired with human connection, that provide employees with a voice and offer insights that enable directed action in bite-sized chunks.
Are you interested in learning more about how your organization can drive better outcomes by cultivating trust, accountability, and motivation? Contact us today to request a demo.