10 Reasons Why Companies Get Employee Engagement Wrong!

Denise CooperAchieving Goals, Employee engagementLeave a Comment

What is the single biggest thing that companies get wrong with employee engagement? This was a group posting on LinkedIn. As I read through the comments, I realiolder business man thinkingzed there were about 10 reasons listed why senior leadership and HR that can’t answer this question.

Why does this matter? You might ask, especially given all the other priorities on your “to do” list.

It turns out research is demonstrating there are direct benefits to your net income if you can increase employee engagement scores. The Institute for Corporate Performance (i4cp), and Stanford University’s Center for Leadership Development and Research have produced a significant amount of research demonstrating improvements in market share growth, revenue growth, customer satisfaction and profitability. Since the early 1990’s engagement scores haven’t really changed. Year-in and year-out, about 71% of employees are moderately engaged. In 2012, that translated into a $300 Billion loss in productivity annually in the U. S. To bring that closer to home it means 2 – 4 hours of loss in productivity per employee.

Here are the 10 reasons why companies keep getting employee engagement wrong.

  1. In general, executives ignore the impact employee engagement has on the business. The facts are high-performing organizations are 4.5 times more likely to measure the impact of engagement on revenue growth than low-performance organizations (63% vs. 13%). High performing organizations perform three times better in the market than low performing organizations. There’s a .49 correlation that employee engagement directly contributes to increased market performance.
  2. Executives don’t hold HR professional accountable as performance advisers to the business. HR professionals believe that they spend 25% of their time engaging in strategic activities such as  strategic HR planning, organizational design and strategic change. However, non-HR professionals think that only 10% of HR time is spent on strategic activities. Forget the gap in perception. If we know there’s a correlation between employee engagement and higher performance, why isn’t senior management demanding more on this issue?  See reason #3.
  3. Engagement is not tied to the business and organizational goals. Apparently, CEOs and their boards are not serious about investing in employee engagement. The 2013 CEO Performance Evaluation Survey conducted by Stanford Center for Leadership Development and Research and the Miles Group reported only a 5% weighting for talent development and 2.5% for employee turnover and satisfaction. One of the best employee engagement practices is to include engagement as a part of every manager’s performance review. High-performance organizations are twice as likely as low-performance organizations (40% vs. 19%) to do this.
  4. What is engagement again? Employee engagement measures the mindshare or emotional commitment employees have to achieve the organizations’ goals. Mindshare is a productivity boost that translates into revenue growth.
  5. A focus on collecting data but not doing anything with itThere’s an old saying “if you want to know what’s really important to someone, check their bank account and calendar.” If something is really important to you, then you’ll invest your time and resources on it.

Five other reasons why companies keep getting employee engagement wrong:

6.  Using benchmark or best practices without customizing it for your culture/business.

7.   Lack of investment of time, effort and attention to convince and hire managers who support the employee engagement initiatives.

8.   Creating overly complicated process to collect, monitor and evaluate the results.

9.   Failure to include employees in the process. An important and interesting series of comments were made about having employees solve the issues. Allow them to create a process to increase engagement (hint: engagement is not happiness or satisfaction) among their peers.  High performing companies encourage employee development beyond personal development plans.

10. Failure to use social media/technology to increase collaboration, share knowledge, fuel learning and identify “hot spots”. 

The bottom line is this. Executives and employees at high performing companies have done the work to reap the benefits of higher financial performance.  If you want to see innovation, increase customer satisfaction and higher profits, hold every manager accountable for improving their leadership skills.  Start by including it on their performance reviews and tie their pay to improving engagement scores.
Isn’t it about time?

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