Today employees look beyond just a 9-6 job. They need to be involved, to be shown the importance, and to be engaged in achieving company goal along with the management. A constant move towards growth has always been a common goal for companies. However the factors that they believe will make them succeed, has changed. A report by Harvard Business says that “The top three success factors identified through a study shows high level of customer service, effective communications, and achieving a high level of employee engagement”.
Employee Engagement shows in the top 3 business priorities for companies. So from a NIL position to the third clearly shows that the importance has changed. And so do these numbers –
- Companies with the most effective employee communication have 47% higher shareholder returns over the last five years (Towers Watson)
- Highly engaged employees have less absence days – in average 3,5 days – compared to not engaged employees (Gallup Germany)
- In companies where 60 to 70 percent of employees were engaged, average total shareholder’s return (TSR) stood at 24.2 percent; in companies with only 49 to 60 percent of their employees engaged, TSR fell to 9.1 percent; companies with engagement below 25 percent suffered negative TSR (Hewitt Research Brief)
To understand why employee engagement is important, let’s look at few challenges of an unengaged employee and positives of an engaged employee.
Challenges with an Unengaged Employee
It is important to keep your employees engaged to avoid the below mentioned negatives of an unengaged employee.
- Wasting money with training’s – In absence of a proper employee engagement strategy, organizations end up planning for loads of training’s. Believing that training’s can keep an employee motivated and engaged is common however the fact is that unmotivated employees care a little about training’s and organizations end up spending more money.
- Lower task quality – Your unengaged employees only take care of the hours that they need to spend in office rather the task that needs to be accomplished. Overtime when required is out of question and hence the need to hire more staff increases. The ratio of task: person goes for a toss as the unengaged employee wouldn’t focus and dedicate the quality time, leading to task delay which in turn will affect a bigger goal. The reports would indicate a hiring need.
- Data would show incorrect hiring needs – Out-of-box thinking and the enthusiasm to deliver the best misses in an unmotivated employee, resulting in a low quality work completion. The investment in hiring and training the employee doesn’t give any ROI and to get better quality, you end up hiring again while you are still paying salary and benefits to the previous hire, ending up in additional overhead.
- Incorrect and slow decision making – Moving towards company’s goals is not a priority or focus for an unengaged employee, hence it results in a negative impact on decision making. If your unengaged employee is a manager or at a higher level the worry is more as their slow decision making will not only affect the company’s goal but also the multiple members who report to him.
Positives of an Engaged Employee
- Retention of talent – Deloitte’s Josh Bersin, says hiring a new employee can cost up-to double the amount of retaining an existing employee. We have already understood that employees who are engaged stick with their employers for a longer period. This directly results in cutting down on costs related to hiring, on-boarding, training, culture impact etc. and even the efforts involved.
- Better engagement, better customer service – There is an indirect link between your employee experience and customer experience. Even if all your employees are not customer facing, what they develop as a product or deliver as a service shows the impact of their engagement through quality and customer focus. The engaged employee’s focuses on quality and puts in efforts to ensure the end customer benefits.
- Positivity and willingness to work– Engaged employees are motivated and dedicated which shows in their work and their less absenteeism. You can rely on an employee you know will not take unnecessary leaves. Overall employees who are engaged and happy make the environment creative and positive and can in turn help in making other employees engaged too.
Brand recognition through word-of-mouth instead of advertisements should be the focus and is a more stable way of capturing the market. Ensure you plan focused surveys and ask clear and objective questions to measure engagement and not satisfaction because the main ingredient for a successful company recipe is employee engagement and in turn helps companies to grow and cut down on unnecessary costs.