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HRA Employee Engagement and Disengagement  11.10.2009
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HRA Employee Engagement and Disengagement 11.10.2009

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  • 1. Scott LeuchterHRA of Greater Oak BrookNovember 10, 2009
  • 2. “Only 1 OUT OF EVERY 5 workers today is giving full discretionary effort on the job, and this “engagement gap” poses serious risks for employers because of the strong connection between employee engagement and company financial performance.”SOURCE: Towers Perrin 2008 Global Workforce Study
  • 3.  Understanding Engagement • The Business Case • Journey to Engagement • Definitions Engaging Your Organization • How to Measuring YOUR Employees’ Engagement • Where is YOUR Organization? • What’s Next?
  • 4. Disengagement’s Financial Impact *Annual cost to U.S. = $292 – 355 billion ** Operating Income  32.7% ** Income Growth Rate  3.8% ** Earnings per Share  11.2% ** Operating Margin  2.01% ** Net Profit Margin  1.38%•Gallop** 2007-2008 Global Workforce Study
  • 5. % Respondents who say they can positively impact: 56% 39% Costs 25% Engaged 20% 59% 42% Enrolled Revenue Growth 23% 17% 60% Disenchanted 41% Innovation 22% 13% 63% Disengaged 46% Profitability 27% 20% 85% 72% Customer Satisfaction 48% 42% 88% 74% Quality 49% 38%SOURCE: Towers Perrin 2008 Global Workforce Study
  • 6. No Plans to leave 7% 15% Not looking, but would 15% consider another offer Actively looking for another job Made plans to leave current job 35% 28% Plan to retire in the next few yearsSOURCE: Towers Perrin 2008 Global Workforce Study
  • 7.  Engagement is a critical leading indicator of potential productivity and retention issues.10% increase in engagement leads to 8% more discretionary effort which leads to 2% improvement in performance.
  • 8. $10,000  $3,400 loss Actively disengaged employees cost organizations $3,400 for every $10,000 in salary. - Gallup, 2002 Smaller organization = Higher engagement levels. In difficult economic times, engagement is more important than ever.
  • 9. In which area(s) is your organization struggling?Cost? Customer Satisfaction?Growth? Quality?Innovation? Retention?Profitability? Employee Performance?How would an organization’s level of engagement impact these areas?
  • 10.  Onlythose companies that win the hearts and minds of their top talent will be able to deliver value over both the short and long-term. – Deloitte, 2008 We are witnessing an era for business around the world in which engaging employees makes the difference between success and failure. -Towers Perrin, 2006
  • 11.  Linkage to Business Outcomes • Employee behavior – customer behavior – financial performance Global Talent Age • Innovation • Agility • Responsiveness to change • Encourage creativity
  • 12. 1980’s 1990’s 2000’sSatisfaction Commitment Engagement• Satisfaction alone • Positive rel. with • Direct relationship is not an adequate turnover/ retention with customer predictor of satisfaction, financial performance • Commitment does performance, not correlate with individual customer satisfaction performance, retention • Positive rel. with company/ • More job-related organization
  • 13.  The extent to which employees enjoy and believe in what they do, feel valued for it and are willing to spend their intellectual effort to make the organization successful. - Human Capital Institute Willingness and ability to contribute to company success; is the extent to which employees go the extra mile and put discretionary effort into their work – contributing more of their energy, creativity and passion on the job. – Towers Perrin
  • 14.  “Occurs when employees are motivated to help the company succeed (commitment) and know what to do to make it successful (line of sight).” – Watson Wyatt “Theextent to which people enjoy and believe in what they do, and feel valued for doing it.” – Development Dimensions International
  • 15.  PersonalEngagement defined as “the harnessing of organization members’ selves to work roles; in engagement, people employ and express themselves physically, cognitively, and emotionally during role performances – Kahn, 1990 Vigor, dedication, and absorption – Schaufeli, Salanova, Gonzalez-Roma, & Bakker, 2002
  • 16.  Passion and commitment – the willingness to invest oneself and expend one’s discretionary effort to help the employer’s success – Erikson, 2005 Psychological trait, situational state, and a behavior – Macey & Schneider, 2008
  • 17.  Meaningfulness • Receiving a return on investment of one’s self • Job enrichment and work role fit is positively linked Safety • Ability to show and employ one’s self without fear of negative consequences • Rewarding co-worker and supportive supervisor is positively linked
  • 18.  Availability • Individual’s belief that they have the resources to engage one’s self at work • Resource availability is positively linked
  • 19.  Job Personal Customer Manager Rewards & Recognition Burke, 2009
  • 20. How do you define engagement? What other factors do you thinkinfluence one’s level of engagement?
  • 21. Engaged Enrolled Disenchanted Disengaged Towers Perrin (2008)
  • 22.  Shocks to the system that impact meaningfulness, safety or availability Breakin the psychological contract Unfolds over time • First thoughts of quitting and actual decision to leave • Decision to leave and actual departure
  • 23.  Behavioral Observation Absenteeism Rapid task saturation Tardiness Slow tempo of activity Withdrawal Poor decision-making Negativity Lack of interest in work Lengthy episodes of Marginally productive distraction
  • 24.  Six Sigma methodology • Effective framework for developing and executing an efficient and effective engagement program • Define • Measure • Analyze • Improve • Control
  • 25.  Define • Problem Statement • Business Case • Purpose and Scope • Intended Improvement • Communication Strategy
  • 26.  Measure • Collect qualitative and quantitative base-line data  Observations  Interviews  Focus Groups  Survey
  • 27.  Analyze • Identify root-causes based on data • Organize and segment by level, locations and appropriate demographics
  • 28.  Improve • Engage stakeholders • Communicate results • Prepare the organization for taking action • Develop, try out and implement action plans and solutions to address gaps • Use data to evaluate both the solution and the action plans to carry them out
  • 29.  Control • Maintain and institutionalize the gains developed via the action plan • Anticipate future improvements and preserve the lessons learned • Conduct periodic “pulse” checks • Form and leverage engagement action teams as change agents
  • 30. On Your Mark  Getting Started • Interview senior leadership • Link to the business strategy • Present the business case • Secure champions•Adapted from Blessing White, 2008
  • 31. Get Set  Consideration • Inform and educate  Just Beginning • Engage managers • Be transparent•Adapted from Blessing White, 2008
  • 32. Go!  Stuck • Focus on specific actions & areas for change  Along the way • Engage leadership across the organization • Leverage prior successes • Revisit your data•Adapted from Blessing White, 2008
  • 33.  Enjoy the journey • Continue to educate and inform • Link results to tangible business performance • Refine and improve•Adapted from Blessing White, 2008
  • 34. Where is your organization in this journey? Getting Started Stuck Consideration Along the Way Just BeginningWhat 3 things will you do to help move it forward?
  • 35.  Engagement leads to organizational success HR is in the best position to impact engagement Time to act is NOW
  • 36. scott.leuchter@sbcglobal.net 773-255-1632