To win customers, win your employees first…

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“Loyal employees in a company create loyal customers, who in turn create happy shareholders. The process sounds easy but it is not, and it has defeated some of the bigger organizations of the twentieth century.’

I like that quote, attributed to Richard Branson, and have used it before. Those words sum up very well a key challenge for any manager today. Few would argue that success today in any business is dependent upon having great employees, but achieving that aim remains somewhat of a Holy Grail. Today; the challenge of getting the most from your people is more likely to be framed in terms of ‘employee engagement’ and the goal of course is to have every one of your employees giving their all for you on a daily basis. Clearly, not everyone can be engaged to the same degree but in most businesses there is ample scope to raise employee engagement levels, to some extent at least, and the returns for doing so are not insignificant. Today’s post will help you to consider some practical issues about employee engagement so that you can apply the principles to your own business.

What is engagement and why is it important?

It is vital from the outset to have some clarity as to what we actually mean by employee engagement. Unfortunately, the term is in danger of becoming another of those overused management buzzwords which gets bandied about with as many different definitions available as there are opinions on the subject. In fact, Google the term and prepare to be bamboozled by the variety of views on offer. But strip away all the hype and employee engagement is a relatively straightforward concept. First and foremost, an engaged employee is someone who is satisfied in their job. In other words, they enjoy working for you. But satisfaction, whilst welcome, is never enough because a happy employee doesn’t necessarily mean a highly productive one. An engaged employee, therefore, is not only satisfied but is also very committed to the business (or at least to their boss) and they translate that commitment and satisfaction into higher productivity on a consistent basis. In short, engaged employees deliver more and ultimately that’s why it is such a critical issue.

As employee engagement has gained prominence in recent times so too has the wealth of research circulating on the issue and the findings are quite startling. Here are some snippets of available research.

  • The Gallup organisation conducts a respected employee engagement survey, known as the Q12, which segments employees into three categories: engaged, not engaged and actively disengaged. At this stage they have reviewed more than 25 million responses to the survey and found that:
    • 30% of full-time employees in the U.S. are engaged, whereas 20% are actively disengaged. This means that the bulk of employees are not as engaged as they might be. For me, this is a form of ‘presenteeism’ – people are turning up for work, and doing what is required maybe, but certainly not giving their all.
    • Gallup have also found that businesses in the top 25% in terms of proportion of engaged employees have significantly higher productivity, profitability, and customer ratings with lower turnover and absenteeism and fewer safety incidents than those in the bottom 25%.[1]
  • The Chartered Institute of Personnel and Development (CIPD) in the UK consistently finds that only 35-40% of employees in their surveys can be categorised as being fully engaged.[2]

In working with hundreds of companies over the past twenty years, I have frequently seen this under-engagement problem in practice. Obviously, I am not suggesting that the bulk of employees are unproductive – it’s simply not possible to survive in any job today without delivering to some extent – but the majority of employees I encounter are certainly delivering less than they potentially could. All owners and managers are seeking new external opportunities to grow the business, which is vital; but if you think about it, there is a clear potential within most companies to raise engagement levels and that is an often overlooked opportunity that over time would make a tangible impact on the bottom line.

Before moving on, it is important to highlight the issue of ‘actively-disengaged’ employees. Although always in the minority they do exist and such individuals are not just disengaged but actively acting out that unhappiness. Sometimes they are the in-your-face types but they can also be quite subtle in their approach; in either case they cause untold damage if allowed to. Therefore, as a first step, it is advisable that if you have even one actively disengaged employee you should address that problem as a priority. To do so, you should begin with an attempt to coach them to better performance but ultimately if they don’t improve then it can be necessary to move on to whatever disciplinary procedure you have in place. Tolerating even one actively disengaged employee, amongst other things, will damage the level of engagement of others.

What can you practically do to raise the engagement of those employees who are under-engaged at present? You will not be surprised to learn that there is no magic pill or quick-fix here and the nature and variety of the work on offer always has a role to play. However, research shows that there are a number of common sense factors which directly impinge on engagement levels seen and the following eight questions will help you to consider how they apply at present in your business.

1. How effective is leadership in your business?

In seeking to build employee engagement there is often a temptation to look towards the employees first, but research indicates that the quality of leadership is probably the primary driver of engagement on a day to day basis. People may be employed by organisations but they work with and for managers and can interact with their immediate boss for up to 2,000 hours in any given year. If the quality of that relationship is poor, then an employee will likely be under-engaged. That is not to imply that the manager’s role is to create a happiness camp at work, far from it, but he or she does need to have the range of attributes and skills necessary to bring the best out of others in the modern workplace. It is not a cliché to say that ultimately employees respond to personality, not hierarchy.

2. Does the culture within your business support engagement?

Usually when I raise the issue of culture with owners and managers I can immediately see their eyes glaze over. And undoubtedly culture seems like a fairly abstract concern during pressurised times such as these, but like it or not, it remains a vital consideration when talking about engagement. Whilst there is naturally no ‘right’ culture, there are certain environments which build engagement whereas others do the opposite. Managers can play an important role in building a culture which draws employees in rather than pushes them away. One of the common factors seen in businesses where engagement levels are high is the fact that employees as genuinely seen as partners in the business and not simply there to do a job.

3. How effective is your recruitment process in terms of the nature of employees it attracts?

Like any process, you can only work with the raw materials you have. In this case, your efforts to engage employees will be helped or hindered by the type of employees you recruit. Unfortunately, even today, there are some companies  that still don’t pay enough attention to the effectiveness of their recruitment processes. The major flaw I continuously see here is that many employers, particularly in SMEs, remain overly focused on assessing what an individual can do, and spend too little time on exploring who they are. In short, skills can be trained, but addressing attitudinal shortcomings is far more difficult and if you are not consistently attracting employees into the business who have the greatest propensity for engagement then you are in trouble from the start.

4. How well do your employees understand what you are trying to achieve?

I will avoid using terms like vision and mission here because I may push some readers over the edge, but it is an unavoidable fact that you cannot expect your employees to buy-into what you are trying to achieve, if they don’t at a minimum understand what that is. Again the evidence shows that understanding the bigger picture is a vital foundation stone upon which engagement is built.

Clarity is a vital element in engaging employees because any potential lack of understanding across a whole host of work-related issues causes unhappiness which in turn fuels disengagement.

5. How effective is communication in your business?

Linked to the above point is the issue of on-going communication. Nothing destroys engagement levels more than employees feeling, rightly or wrongly, that they are being left out of the loop on matters that affect them. There is a proven correlation between communication and the levels of engagement seen and where communication is regular, open, two-way and more importantly effective, employees tend to be more engaged. Think of past instances in your own career. When you learned after the fact, how did that make you feel? Not good, most likely, and that in turn negatively impacted on how you viewed your boss or the business as a whole.

6. How involved are employees in decision-making?

There is often a fear when I promote the view that employees should be actively involved in decision-making that I am somehow suggesting that the tail should wag the dog. It’s nothing of the sort. There are many aspects of operations such as service quality, cost saving, work processes etc., where your employees possibly know than you do simply because they live on the front line every day. Yet, I frequently see managers making decisions about how things should be done operationally with little or no involvement from the employees on the ground. Again, you don’t need to be an organizational psychologist to understand the damage to engagement caused when employees perceive themselves as being there to ‘do’ but not to ‘think’.

7. How are employees rewarded?

It is obviously important to consider the issue of rewards when talking about employee engagement. First off, pay levels, whilst undoubtedly important, do not drive engagement. The pay component is what could be called a satisfier, in the sense that if an employee feels underpaid then they will be dissatisfied and disengaged, no matter what you do. But even when an employee is reasonably happy with their pay scale, that doesn’t always mean they will be fully engaged. In any case, the two certainties about the pay issue is that employees always want more and there are always limits to what you can afford to offer. If pay was the sole driver of engagement, then we would probably have to give up on the concept. Thankfully, research shows it isn’t.

In short, pay always has to be competitive, but in terms of engagement what matters most is how valued employees feel. This sense of value can, at a basic level, come in the form of praise and recognition for work well done, or it can derive from performance-related monetary rewards which recognise their above the line effort.

8. How well do you monitor and measure performance at present?

This monitoring and measurement of performance are important concerns around the employee engagement issue. To begin with, on a day to day basis, if certain team members are allowed to underperform without consequence this serves as a de-motivating factor for engaged employees as they question why they should bother. Few would disagree that monitoring individual and collective performance is vital but with the shedding of management layers in recent years, I notice that employees are frequently left unsupervised for long periods in some businesses.

The second concern here is how individual performance is measured. For those employees in your business who do shine in comparison to others, and are genuinely committed to the cause, how is that measured and subsequently rewarded at present? Too often, and again this applies particularly in SMEs, performance management is somewhat ad hoc and the top performers don’t really see any tangible benefits for their extra effort which naturally erodes their level of engagement over time.

The points raised here are undoubtedly basic, but don’t make the mistake that they are any less important because of that fact. Engaging employees is not rocket science and at its core is about initially attracting the right people to your business and then doing a variety of the ‘right’ things with them whilst they are with you. Frequently I hear it said, and even in these difficult times, that there is a lack of engaged employees or that “employees just don’t care anymore” as I have heard it put. I disagree with such generalisations. In my experience, the problem has more to do with the fact that there is a shortage of places where engaged employees want to work.

Enjoy your day!

[1] State of the American Workplace – Employee Engagement Insights for U.S. Business Leaders. GALLUP.

[2] CIPD Employee Outlook Surveys

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