My colleague Michael Beck posted a great piece the other day on why the majority of employers worldwide are doing the engagement thing wrong, addressing it reactively rather than proactively and I couldn’t agree more. Much better to build engagement into the fabric of your organization through appropriate selection and hiring, but it doesn’t stop there.
He pointed out that the latest Gallup poll provided some pretty eye opening statistics, including the fact organizations with high employee engagement saw a 147% advantage in earnings per share over non highly engaged organizations in 2011 and 2012 and the fact that the Department of Labor estimates that disengagement costs the U.S. economy between $450 and $550 billion dollars annually and for me at least that garners some attention.
Add to that recent studies indicating that voluntary turnover was up 45% year to year from and cost per hire is up 15% for the same period and you might think that more organizations would be examining their strategies and taking action. The interesting thing is that we have seen at best incremental improvement over the last five years.
I think there are a number of issues surrounding organizations inability or unwillingness to address this issue. I include the idea we really don’t understand it, we don’t make it a core strategy, the fact that most human resources practitioners are still in the compliance business, and that engagement is a relationship issue rather than a technological process improvement among my big hitters.
I also think many executives and managers are in denial. If you ask executives why employees leave the vast majority (over 80%) will tell you they left for more money. However when you ask employees as a survey of almost 20,000 employees who changed employers did the result was pretty interesting. Only 12% of those employees reported more money as the primary driver.
Instead the top seven reasons employees left were as follows:
- Number 7 - they didn’t trust senior leadership
- Number 6 - they felt they didn’t have appropriate work/life balance
- Number 5 - they felt devalued and unrecognized
- Number 4- they didn’t see a clear career path
- Number 3- they didn’t receive meaningful feedback and coaching
- Number 2- they didn’t feel like they were a good fit with the job or organization
- Number 1- they didn’t feel the job met their understanding or expectations of what they signed on for
Here is a tip, there is not a technology or program yet invented that is going to address those issues.
Here is another tip, Millennial and next Genners put even more value on those issues than Baby Boomers and they represent the future workforce.
I am an optimist. I truly believe that the vast majority of employees show up on day one committed to doing the right work and doing it well. Somewhere in the process it breaks down.
The process of disengagement looks something like this:
* Stage one- enthusiasm and excitement about the new job
* Stage two- they begin to question their decision
* Stage three- they are disillusioned
* Stage four- they consider leaving
* Stage five- they begin exploring options
* Stage six – they receive an offer
* Stage seven- they are forced to decide whether to quit or stay
* Stage eight- they quit and stay
The number of employees who quit and stay has been estimated to be as high as 20% of the employee population and ladies and gentlemen that is a problem.
Employees who quit and stay don’t do so passively. They block opportunities, they poison the well by spreading their discontent, and they utilize enormous resources in terms of managerial time, health care expenditures, sick time, etc.
The American Mental Health Association estimated in 2010 they cost our economy over $200 billion in indirect cost related to absenteeism and lost productivity.
I want to make two points here before moving on-
- This is a huge competitive disadvantage for organizations with low engagement
- This issue is fixable; remember 90% plus employees showed up at work on day one wanting to do the right work.
So how do we fix it?
I read a piece the other day that kind of abhorred me. It talked about whether or not to do a survey of your employees to determine their level of engagement. It recommended that doing a survey represents a social contract to make changes so if you aren’t far enough on the continuum to make that commitment doesn’t do a survey.
I agree in part. Doing a survey without the intent or resources to make changes or respond to the feedback is a pointless exercise. The part that abhors me is that if you are that far up your own ass I think there is a huge wake- up call in your future. I refer to this group as ignorant and proud. The recession which trapped many people in lousy jobs was probably a blessing for them.
So how do we fix this issue?
The first thing you do is to identify the core value proposition of your organization and develop a strategy to clearly communicate it to all of your stakeholders; this includes employees, suppliers, customers, shareholders, and communities where you do business.
The second thing that you do is that you develop hiring and selection processes that ensure that the people you invite to join your organization share the value set of the organization and that the connection between their personal values and your organizational values is transparent.
The third thing that you do is ensure that anyone in a management or leadership role has the competencies and skills to create and reinforce that line of sight.
I like the way Jack Welch describes it -
“…leaders are generally not judged on their personal output. What would be the point of evaluating them like individual contributors? Rather, most leaders are judged on how well they’ve hired, coached, and motivated their people, individually and collectively—all of which shows up in the results.”
The fourth thing that you do is make sure all your other systems reinforce the values as well. By that I mean your hiring and selection, training, compensation, performance management, and your succession planning, and promotional decisions.
The fifth thing you do is to benchmark your progress and recalibrate as needed. Perception is reality, if your employees don’t feel aligned with your core mission and objectives they will not perform at peak.
Realistically all of your employees will not be with you forever and that is a good thing. You need to constantly refresh your talent pool and get new energy and new ideas. The key is that while employees are in your employment they are engaged. In many cases they represent your best resource for attracting the new talent you need.
As a leader or employer you make a cognizant choice as to how you will lead.
It isn’t essential that you embrace an engagement mentality; I just wonder why anyone would knowingly give up the kind of competitive advantages we talked about before.
Engagement is a culture and a continuous journey. It doesn’t belong to a particular department or just to a few people. If you want to reap the rewards you have to do the work…