What Is Employee Engagement And Why Should Organizations Care

WHAT IS EMPLOYEE ENGAGEMENT?

Employee engagement is the extent to which employees feel passion towards their role, are committed to their employer, and put discretionary effort into their work. Not to be confused with employee satisfaction, engagement focuses on how employee happiness translates to productivity and outcomes that influence an organization’s success.

When you can effectively measure employee engagement and influence its drivers, you can increase an organization’s performance and profitability.

THE ORGANIZATIONAL BENEFITS OF ENGAGED EMPLOYEES

In Gallup’s study: State of the American Workplace, they report on the dramatic impact of employee engagement on American organizations. When organizations are able to engage their teams, they can expect improved success metrics on everything from retention and absenteeism, to product quality and inventory shrinkage, to safety, customer satisfaction and profitability. The statistics below have been pulled directly from the study.

Showing up and staying
Engaged employees make it a point to show up to work and do more work — highly engaged business units realize a 41% reduction in absenteeism and a 17% increase in productivity. Engaged workers also are more likely to stay with their employers. In. high-turnover organizations, highly engaged business units achieve 24% lower turnover. In low-turnover organizations, the gains are even more dramatic: Highly engaged business units achieve 59% lower turnover. High-turnover organizations are those with more than 40% annualized turnover, and low-turnover organizations are those with 40% or lower annualized turnover.

Shrinkage and quality
Engaged workers care more about the products and services they deliver to customers and the overall performance of their organization. Highly engaged business units experience a 28% reduction in shrinkage (the dollar amount of unaccounted-for lost merchandise) and a 40% reduction in quality defects.

Safety
Engaged workers are more mindful of their surroundings. They are aware of safety procedures and diligent about keeping their coworkers and customers protected. Highly engaged business units realize a 70% decrease in employee safety incidents and a 58% decrease in patient safety incidents.

Customer outcomes
Employees who are engaged consistently show up to work and have a greater commitment to quality and safety. Understandably, these employees also help their organizations improve customer relationships and obtain impressive organic growth. Highly engaged business units achieve a 10% increase in customer metrics and a 20% increase in sales.

Profit
The previous outcomes collide to bring organizations increased profitability. Engaged employees are more present and productive; they are more attuned to the needs of customers; and they are more observant of processes, standards and systems. When taken together, the behaviors of highly engaged business units result in 21% greater profitability.

MEASURING EMPLOYEE ENGAGEMENT

To get a pulse on engagement, the process must always start by surveying employees. An organization can have as many flashy employee experience programs and initiatives as it wants, but to have healthy engagement it’s the employee perception that matters.

When surveying employees to gauge their level of engagement, employers must focus on the following three areas: advocacy, loyalty, and discretionary effort.

Employee Advocacy
Employee advocacy is the promotion of your company by the people who work there. When employees are engaged, they’re your best cheerleaders – promoting you to potential customers, as well as candidates. Employees rank highest amongst the most trusted members of an organization, making them one of the highest quality sources of referrals. When your employees are cheering you on, organizations can expect endless obvious benefits.

Loyalty to the Organization
When employees are engaged, they plan for a future at their organization. These employees actively pursue opportunity internal to the organization and prove to be the most difficult for to poach. The most engaged employees tend to be more passive candidates who are loyal to their employers, and rarely seek out, or are open to new opportunities at other organizations.

Level of Discretionary Effort
Discretionary effort is the level of effort people could give if they wanted to, that goes above and beyond their job requirements. When employees are engaged, they want to work harder for you and your customers. When employees give discretional effort at work, organizations experience better customer satisfaction, higher productivity and improvements in several other success metrics.

IMPROVING POOR EMPLOYEE ENGAGEMENT

Once you’ve gained a pulse on your employees’ level of engagement, you can begin the necessary work needed to diagnose issues and build plans to repair them. For guidance on how your organization can improve engagement, take a look at some of our other employee engagement blogs below.