Business Imperative of Employee Engagement
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Business Imperative of Employee Engagement

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Business Imperative of Employee Engagement Business Imperative of Employee Engagement Presentation Transcript

  • Business Imperative of Employee Engagement Organisations that fail to engage their employees fail to realise value.©CHRODA Copyright 2007 www.chroda.net
  • Defining Engagement“The extent to which an employee is committed to their work and their organization, and the extent to which this commitment impacts their performance and intent to stay with the organization.”“A positive attitude held by the employee towards the organisation and its value. An engaged employee is aware of business contexts and works with colleagues to improve performance within the job.”“The extent to which employees identify with, are motivated by, and are willing to expend energy and extra effort for their employer.” 2 ©CHRODA Copyright 2007 www.chroda.net
  • So What is it?• Based on these definitions, engagement is the sum total of the behaviour employees espouse in the organisation which primarily should be characterised by:• Belief in the organisation• Drive to work and make things better• Respect and support for others• Desire to learn new skills 3 ©CHRODA Copyright 2007 www.chroda.net
  • Engagement is Commitment BasedRational Commitment:• Employees believe they will personally benefit - financially, developmentally, or professionally from the team or organization. It makes sense for them to stay with the organization.Emotional Commitment:• Believing in, valuing, or enjoying their day-to-day work, teams, managers or organizations. Because they can make a link between their role and organizational objectives and value system, and they enjoy or find fulfillment in the work 4 ©CHRODA Copyright 2007 www.chroda.net
  • Organizations with highly engaged employees have lower staff turnover, and lower absenteeism. The most dramatic results are seen when engagement is measured in the context of other business measures. In organizations with high levels of engagement operating income improved by 19.2 percent over 12 months, while in organizations with low levels of engagement it declined by 32.7 percent ISR Report 5©CHRODA Copyright 2007 www.chroda.net
  • Rational Commitment Driven By• Remuneration• Incentives• Career growth opportunities• Health benefits• Work environment• Learning and development opportunities• Work-life balanceRational commitment drives intent to stay - RETENTION 6 ©CHRODA Copyright 2007 www.chroda.net
  • Emotional Commitment Driven By• Enjoyment of one’s job• Role clarity• Understanding the link between one’s job and organisational strategy• Belief in organisational values• Respect in direct manager, team and organisationEmotional commitment drives discretionary effort - PERFORMANCE 7 ©CHRODA Copyright 2007 www.chroda.net
  • Tangible Business Benefits• Better performance: engaged employees work smarter. They keep looking for ways to improve performance. This means more sales, lower costs, better quality and innovative products.• Greater stakeholder satisfaction: engaged employees go out of their way to meet stakeholder needs leading to customer retention and reducing the cost to business of acquiring or attracting new customers.• Lower employee turnover and greater ability to attract key talent: engaged employees don’t leave at the rate their disengaged counterparts do, despite offers to work elsewhere or opportunities arising elsewhere. 8 ©CHRODA Copyright 2007 www.chroda.net
  • Drivers of EngagementOne of the strongest drivers is a sense of feeling valued and involved. This has four key components:1. The opportunities employees have to develop themselves through their jobs and career opportunities2. The extent to which the organisation is concerned for employee’s health and wellbeing3. Involvement in decision making, and4. The extent to which employees feel able to voice their ideas, and managers listen to these views and value employee’s contributions 9 ©CHRODA Copyright 2007 www.chroda.net
  • Complimentary Drivers• Senior management’s interest in employees’ well-being• Challenging work• Decision-making authority• Evidence that the company is focused on customers• Career advancement opportunities• The company’s reputation as a good employer• A collaborative work environment where people work well in teams• Resources to get the job done• Input on decision making• A clear vision from senior management about future success. 10 ©CHRODA Copyright 2007 www.chroda.net
  • Dimensions of Engagement Day to Day Work Rational Commitment: The Intent to stay Employee Extent to which employees desire to stay with the Retention Retention believe that managers, teams organisation, based on or organisations have their whether they intend interests in mind. Team to look for a job within a year. Direct Manager Emotional Commitment: The Discretionary Effort: extent to which employees Employee’s willingness to Performance Performance value, enjoy, and believe in go above and beyond the their jobs, managers, teams call of duty. or organisations. Organisation Source: Corporate Leadership Council 11©CHRODA Copyright 2007 www.chroda.net
  • Only Useful Engagement is Directed• If engagement does not lead to increased effort, and or intent to stay, it is not directed.• Engagement drivers are those things that will enhance an employees directed commitment to the organisation.• Simply put, they are an exploration of the conditions under which are employees are either engaged or disengaged and examine what happens under both conditions. 12 ©CHRODA Copyright 2007 www.chroda.net
  • Why is it an issue now?• Greater and more challenging opportunities arise for employees• Greater mobility of the workforce• The war for talent is intensifying• Businesses under more pressure to perform 13 ©CHRODA Copyright 2007 www.chroda.net
  • Role Based Levels of EngagementThere are five work related roles that an employee can assume and these are: – Job Holder Role: employees come to work and do the job that is listed in their job description. – Team member role: employees go “above and beyond” to help members of their team work toward common goals. – Entrepreneur role: employees come up with new ideas and processes and try to get those ideas implemented. – Career role: employees do things to enhance their career in the organisation; they learn, they adapt new skills, and more. – Organisation member role: employees do things that promote and help the company even if it’s not part of their jobs or their team’s duties. 14 ©CHRODA Copyright 2007 www.chroda.net
  • Role Based Levels of Engagement• Based on these role descriptions, it is clear that employees are in highly engaged state when they are doing non-job roles.• most employees have a sense of responsibility, and even if their employers treat them unfairly, they still show up to work and do the job.• having employees show up at work simply doing their jobs gets an employer nowhere in terms of long term competitiveness.• If all your employees simply show up and only do their jobs, then you are not building organisational strength and long-term competitiveness through people.• It’s the synergy that comes from people working together and gathering creative ideas that leads to long-term organisation sustainability. That synergy and “above and beyond” behaviour is evidence of employee engagement. 15 ©CHRODA Copyright 2007 www.chroda.net
  • Sources of Influence• Organisations drive engagement by proactively leveraging three sources of influence for change: 1. Right employees 2. Exceptional leaders 3. Organisational systems and strategies.• These three drivers work in concert to build an engaging work environment.• Although engagement has multiple drivers, the ultimate ownership rests within the employee.• Organisations hoping to drive engagement must tap into employee’s passion, commitment, and identification with the organisation. 16 ©CHRODA Copyright 2007 www.chroda.net
  • 1. Right Employees in the Right Job• Skills to do the job (can do) and that their jobs tap into their personal motivators (will do).• Effectively deploy talents• When job fit is high, an employee performs better and is more likely to stay with the organisation.• Engagement propensity• In ten studies across six organisations and seven job families (using a number of propensity test items) it was found that engagement was significantly correlated to these six factors: – Attachment to the job – Agreeableness – Emotional stability – Openness to experience – Achievement orientation – Self efficacy• These findings show that in addition to assessing motivational job fit when hiring new employees, organisations can use appropriate and validated tests to identify employees who are more likely to be engaged on the job. 17 ©CHRODA Copyright 2007 www.chroda.net
  • 2. Exceptional Leadership• Employee engagement is directly affected by the quality of leadership.• Leaders have the influence and power to serve as catalysts for higher levels of engagement, not only in one or two areas, but in all aspects of leadership.• Our research shows that: – More engaged managers have more engaged direct reports – The direct reports of engaged managers are less likely to leave the organisation – Higher performing managers have direct reports who are more highly engaged• Engaged leaders understand that their role is not to take charge of all the decisions, but to be more encouraging.• It’s about recognition for a job well done– holding people accountable for their performance. 18 ©CHRODA Copyright 2007 www.chroda.net
  • PROFILE OF ENGAGED LEADERSCOACH AND DEVELOP FOR RESULTS MANAGE WORKEffective leaders know that team members are more engaged when they can Leaders who do a good job of managing work understand the difference“get it right” the first time. They spend more time coaching for success between delegation and dumping. Effective leaders distribute work(proactively) than coaching for improvement (reactively). For long term appropriately, and they make it meaningful. They are also effective at makingdevelopment, leaders need to know how to position high payoff decisions, planning and organising, and following up.development activities that benefit the individual, and at the same time,address the team’s and organisation’s goals and needs. PARTNER WITHIN AND ACROSS TEAMS People are more engaged in an environment that is collaborative and notDRIVE PERFORMANCE adversarial. Effective leaders have mastered not only the intra-team skills toWe’ve all had that experience - one person on the team not pulling their get people engaged, but also the inter-team skills.weight and the leader is not holding the person accountable. It’s disengagingright? Engagement is higher when leaders set clear goals and they hold peopleaccountable. INFLUENCE THROUGH PERSONAL POWER Leaders who influence versus those who ‘flex their muscles’ are clearly more engaging and have learned how to build sufficient commitment to move goodINSPIRE LOYALTY AND TRUST ideas through their organisation.Engaging leaders understand that they need to proactively build anenvironment where employees are motivated, engaged, and retained.Effective leaders don’t wait to get the resignation to know that an employee .is dissatisfied.SELECT TALENT It is best to start with people who have a better change of being engagedand people who not only can do the job, but also want to do the job.Leaders who have the skills and knowledge to select highly engagedemployees can make a great contribution in both the present and the future 19©CHRODA Copyright 2007 www.chroda.net
  • 3. Organisational Systems and Processes• It almost has to go without saying organisations need strong systems and strategies that support and foster engagement.• Examples of these systems are: – Screening at hiring – promotion, – performance management, – recognition, – compensation, – training and career development.• Aligned, these systems provide a firm foundation upon which to accelerate engagement.• A shaky or incomplete foundation will make your efforts to build engagement more difficult, if not impossible. 20 ©CHRODA Copyright 2007 www.chroda.net
  • Value Proposition ENGAGEMENT DRIVERS •Right employees in the right jobs •Exceptional leadership •Organisational systems and strategies INPUT WORK ENVIRONMENT •Aligned effort and strategy •Empowerment •Teamwork/collaboration •Growth and development •Support and recognition ENGAGED EMPLOYEES •Intend to stay longer •Enhanced effort ORGANISATIONAL SUCCESS OUTPUT •Satisfied / loyal customers •Increased retention •Higher output, productivity and/or profits •Revenue/ value growth 21©CHRODA Copyright 2007 www.chroda.net
  • Introspection• Am an engaged HR leader?• How engaged is my workforce?• Is engagement something important for my organisation 22 ©CHRODA Copyright 2007 www.chroda.net
  • Conclusion• Engagement is the extent to which an employee is committed to their job, and the extent to which this commitment drives their performance and intent to stay with the organisation.• Engagement does not just materialise, organisations must hire employees who fit the job, develop leaders and provide support through strong systems and strategies.• Further more, organisations must invest in understanding, measuring and developing solutions to engagement challenges. 23 ©CHRODA Copyright 2007 www.chroda.net