Employee engagement and business productivity

Employee engagement and business productivity

• 1.
  What can employee engagementdo for business productivity? Mark Beatson Chief Economist CIPD
• 2.
  Content • Understanding thelink between employee engagement and productivity • The difference engagement can make to employees • The impact on business performance • Understanding why engagement initiatives can fail to deliver
• 3.
  Understanding the link betweenemployee engagement and productivity
• 4.
  What are thechannels? • Release of discretionary effort (hours, effort, attention, imagination) – “going the extra mile” • Alignment of interests allows delegation and decentralisation • Employee insights and knowledge of their customers support innovation • Social exchange • External reputation – how an organisation treats its employees is one of the key influences on how (potential) customers think about it
• 5.
  The importance ofemployees to corporate reputation 20% 36% 37% 39% 41% 52% 55% 57% 60% 64% 67% Blogger Board of Directors Entrepreneur CEO Government official Regular employee A person like you NGO representative Financial or industry analyst Technical expert in industry Academic or outside expert Credibility as a source of information on a company 27% 29% 29% 30% 33% 40% 40% 43% 50% 52% 54% 55% 56% 58% 59% 61% Consistent financial returns Partners with third parties Top global company Admired top leadership Innovator Addresses society's needs Community benefits Protects environment Communicates often Ethical High quality products Acts responsibly in crisis Transparent and open Looks after employees Customers before profits Listens to customers Importance of actions in building trust in a company Source: Edelman Trust Barometer 2014.
• 6.
  The difference engagement canmake to employees
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  Employees who feelinspired and involved are better placed to handle demanding workloads 0 10 20 30 40 50 60 70 80 90 Very true TRUE Somewhat true Not at all true Strongly agree Agree Disagree Strongly disagree % of employees who strongly agree that ‘my job requires that I work very hard’ Always/often come home from work exhausted Work under great deal of tension ‘My job allows me to take part in decisions that affect my work’ ‘This organisation really inspires the very best of me in the way of job performance’ Source: Skills and Employment Survey 2012.
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  Does organisational commitment reducestress? 19% 17% 14% 12% 10% 10% 33% 35% 27% 28% 26% 25% I will often take on more work to relieve my colleagues' workloads I will often work for more hours than contracted to relieve my colleagues' workloads I know very clearly what the core purpose of my organisation is I am highly motivated by my organisations core purpose My organisation gives me the opportunities to learn and grow I am satisfied with content of job role Excessive pressure every day Excessive pressure 1-2 times per week Source: CIPD Employee Outlook survey, spring 2014, employees only.
• 9.
  The impact on businessperformance
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  Engagement is highon employers’ near term priorities 3 9 18 19 22 23 28 28 33 44 50 Other Improving digital literacy Reviewing reward/recognition systems Changing the skills mix of the workforce Predicting future talent requirements Employee retention Recruiting to key vacanices Business restructuring Containing labour costs High levels of employee engagement Improving leadership skills/capabilities Top three workforce priorities in the coming year (% of employers) Source: ‘Growth for everyone’, CBI/Accenture employment trends survey 2014.
• 11.
  What do employersexpect to gain? 8 15 22 42 45 65 80 Improved health and safety Increase innovation Income growth Increase retention Reduced absence/higher well-being Increased client/customer satisfaction Increased productivity/performance Major benefits of higher levels of employee engagement (% of employers) Source: ‘Growth for everyone’, CBI/Accenture employment trends survey 2014.
• 12.
  What’s the evidenceon the impact of employee engagement? • ‘Nailing the evidence’ working group found lots of studies … some more plausible than others • Causality is an issue – does engagement lead to success or success mean businesses can afford engagement? • Meta-analyses suggest causation more likely from job attitudes to performance – but this is something difficult to nail down (if it matters) • Impact often happens through impact on customers and customer satisfaction • Engagement improves quality and innovative behaviour • Engagement reduces turnover and absenteeism
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  Some big claimsare made … -37% -28% -48% -41% 10% 21% 22% Absenteeism Shrinkage Safety incidents Quality (defects) Customer satisfaction Productivity Profitability % difference in performance between top and bottom quartiles of employee engagement Source: Gallup 2012, based on data from about 1.4 million employees in 192 organisations across 49 industries and 34 countries using Q12 measure of employee engagement.
• 14.
  Is employee engagementspreading? 0% 10% 20% 30% 40% 50% 60% 70% 80% Managers treat employees fairly Managers deal with employees honestly Managers can be relied upon to keep their promises INTEGRITY Satisfied with involvement in decisions Managers allow employees to influence decisions Managers good at responding to employee suggestions Managers good at seeking views of employees EMPLOYEE VOICE Satisfied with sense of achievement from work Good management-employee relationship ENGAGING MANAGERS I am proud to tell people who I work for I feel loyal to my organisation I share many of the values of my organisation STRATEGIC NARRATIVE 2011 2004 Source: Workplace Employment Relations Studies 2004 and 2011, surveys of employees, GB, workplaces with 5+ employees. %s are those strongly agreeing/agreeing with the statement.
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  Understanding why engagement initiatives canfail to deliver
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  What are thecommon barriers? • If it’s all one-way • Work-life balance • Development and progression • Lack of job control • Leadership behaviour • Line managers • Lack people skills • Ineffective implementation of organisational HR policies • HR practices • Lack of trust • Lack of effective voice • Mechanisms • Confidence to use them
• 17.
  What undermines organisational commitment? (%of employees highly motivated by core purpose of organisation) 70% 68% 59% 52% 36% 27% “Important information is only shared with a select few” Secretiveness Source: CIPD Employee Outlook survey, spring 2014, employees only. 72% 57% 38% 32% 24% Strongly agree Agree Neither agree nor disgree Disagree Strongly disagree “My working relationship with my supervisor would be described as very effective” Poor managers
• 18.
  Do appraisals helpor hinder engagement? • NHS Staff Survey 2010: overall engagement score = 3.9 for ‘good- quality’* appraisals, 3.5 for ‘poorer quality’ appraisals and no appraisals (West and Dawson, 2012) • *‘good-quality’ = employee felt it useful in understanding how to do job, clear objectives set, employee left appraisal feeling valued by employer. 93% 58% 25% 11% 4% 29% 29% Fairness of performance management process Engagement by perceived fairness of performance management Source: CIPD Employee Outlook survey, spring 2014, employees only.
• 19.
  And can youhave “too much” engagement? • Burnout? • Misallocation of time – forgetting the day job? • Insufficient challenge? • Disappointment – what happens if leaders have feet of clay? • Implications for future jobs – “once bitten, twice shy”? 19
• 20.
  Thank you