Employee Engagement: what’s missing, and what’s next?

Stuart Mackenzie
Mar 19, 2019 · 7 min read

What’s missing from employee engagement?

Ten years ago, the government sponsored report by David Macleod and Nita Clarke was published, which presented compelling evidence that employee engagement is the key to unlocking high productivity. Recent surveys collected from Gallup have proved that their research is still relevant to today’s workforce — increasing engagement is sound advice for any business which struggles to maintain or improve its position in a tough market.

The message to leaders, managers, and other stakeholders could not be clearer. If you want to improve organisational performance, you need to raise your people’s level of engagement.

Traditional research shows that the three pillars of employee engagement are to ensure that your people feel:

1. Valued

2. Involved

3. Developed

To understand the process of employee engagement, we must start by reminding ourselves of basic human nature. This is where Abraham Maslow started many years ago. It is no coincidence that there is a correlation between the three pillars of feeling valued, involved, and developed, and Maslow’s hierarchy of needs:

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  • The feeling of being valued, both economically and socially, links directly to Maslow’s need for security and esteem
  • The desire to be involved, and have one’s talents utilised and recognised, links to the need to belong
  • The need to be developed and to unlock one’s potential relates to the drive of self-actualisation

None of this is too ground-breaking. It makes sense that in an era when many people feel alienated and disassociated from the world around them, they turn to their organisations to feel a part of a greater whole. Additionally, to learn and to extend oneself is an evolutionary drive. What then is missing?

We believe there is an equally important fourth pillar. It is the need for people to feel:

4. Inspired

Self-actualisation is not in fact the highest need — instead, it is something Maslow called self-transcendence. This is when people feel they make a difference and serve a higher purpose. It occurs when people feel a connection to a bigger idea and are inspired by it. Inspiration in turn gives rise to new levels of enthusiasm and engagement.

Leaders therefore need to know how to create meaning if they want true engagement. For example, employees tend to respond better to organisations that have a reputation for social responsibility or are leaders in their communities.

Your commitment to inspiring people is essential for creating talent engagement. Recognise and act on the knowledge that human beings need to feel they matter, that they make a difference and have a meaningful purpose.

It is the leader’s role to create the circumstances in which people can feel these positives. Only then do people produce outstanding performance, and only then is an individual’s potential unlocked — and with that, the organisation’s potential.

Five leadership secrets revealed

1. Legacy
Invite each direct report to describe the legacy that they would like to leave when they finally leave the company. Engaged people expect to make a difference.
“We all leave footprints in the sand. The question is, will we be a big heal, or a great soul.” — Anonymous

2. Authenticity
Discover today if people see you as authentic by asking people if they know what you stand for and believe in. People feel readier to do their best for someone who is manifestly behaving in an authentic way. Share your humour, your values, and your humanity.
“To be authentic is literally to be your own author, to discover your own native energies and desires and then to find your own way of acting on them.” — Warren Bennis

3. Creativity
Decide to be a creative leader who says “Yes, and” rather than “Yes, but”. This improvisational technique helps you build on other’s suggestions, rather than knocking and finding faults. Encourage your team to suggest improvements and be inventive and imaginative.
“Creativity requires the courage to let go of certainties.” — Erich Fromm

4. Imagination
Be openly curious about one of your team members today and uncover what it will take to engage their talent. By using your natural curiosity, you will stimulate a sense of what is possible. Use your imagination to wonder what could exist beyond how things are now.
“While knowledge tells us all we currently know and understand, imagination is more important and points to all we can discover and create.” — Pablo Picasso

5. Meaning
Interact with each member of your team this week to discover whether they find their work fulfilling and worthwhile — and if they don’t, do something about it. People need to find meaning in their work so they can feel engaged and use their potential.
“Work is a search for daily meaning as well as daily bread.” — Studs Terkel

What’s next for employee engagement?

A s a leader, how do you stop wasting money on crippling turnover costs by mastering the artistry of employee engagement?

Let’s look at the facts: data from the report shows that organisations with higher engagement have:

  • 18% higher productivity
  • Twice the annual net profit
  • 59% more creativity and growth
  • 2.5x greater revenue growth
  • 12% higher customer satisfaction
  • 35% more efficiency

There has been compelling new evidence that supports Macleod and Clarke’s claims over the last decade as well. Research collected by US organisations Dynamic Signal and Talent Culture has shown:

  • Increasing employee engagement investments by 10% can increase profits by $2,400 per employee per year
  • Over a three-year period, organisations with highly engaged employees had an average revenue growth of 2.3x greater than companies with average engagement
  • Companies that increase their number of talented managers and double their rate of engaged employees achieve on average 147% higher earnings per share than their competitors
  • Customer retention rates are 18% higher on average when employees are highly engaged
  • Organisations with low employee engagement scores saw 18% lower productivity, 16% lower profitability, 37% lower job growth, and 65% lower share price
  • Companies who implement regular employee feedback have turnover rates that are 14.9% lower than for employees who receive no feedback
  • Only 25% of business leaders have an employee engagement strategy

Making employees feel valued

Unlike pieces of equipment which come with operating manuals so you can get the best performance out of them, human beings don’t come with instructions, as each model is unique. So, the first step is to find out from each individual person what would make them feel valued at work.

Aside from money, what ways do you have of showing people that they are making a difference and that they are valuable to the organisation?

Often the focus of the discussion is around salary, yet we know that money is only part of the equation. Other motivators could include:

  • The opportunity to share and collaborate on ideas
  • Specific acknowledgement of why you think they’ve done a good job
  • Hearing “thank you” or “I appreciate what you’ve done”
  • Public recognition
  • Receiving extra responsibilities
  • Spontaneous shows of appreciation
  • Gifts
  • Team acknowledgement
  • Time off
  • More autonomy
  • Praise which breeds empowerment

When working with one of our clients, they used this list to identify engaged employees:

  • They are excited and enthusiastic about what they are doing
  • They resist distractions, tend to forget about time or place, and often invest discretionary effort
  • They enjoy pondering current challenges, even in their downtime
  • They invite others in — and are emotionally contagious
  • They identify proudly with the activity

Could you imagine all your employees feeling like this? How exciting and productive would this feel?

Survey and assessment

Whilst many organisations are already conducting employee engagement surveys, they are often less rigorous in their assessment of leadership.

A tool that leaders found to be effective in our work with Ocado and Capgemini was our 360° Leadership Profile. This tool was used to contextualise what employees thought of their leadership style, offering practical and useful insights into their strengths and developmental needs. From the feedback, their leadership style can then be adjusted and transformed to have the maximum impact on their engagement.

Five practical steps to improve employee engagement

1. Attention
Take a vital first step in triggering engagement by giving your full and exclusive attention to a person, by seeing who they are, listening to their experiences, and empathising with their cares and concerns.
“The only factor becoming scarce in the world of abundance is human attention.” — Kevin Kelly

2. Belonging
Human beings have a need to belong and connect. You can strengthen your people’s sense of belonging by being more inclusive and seeking to connect individuals together. Find someone in your team today and show them why they are an important part of what you want to achieve.
“Humans live best when each has a place to stand, when each knows where they belong in the scheme of things, and what they may achieve.” — Frank Herbert

3. Emotional Intelligence
The way you express your emotions heavily influences others. Your ability to empathise with, and therefore value another person’s feelings will affect their willingness to engage. Every hour on the hour, ask yourself, “How am I feeling? How are others around me feeling?” This will help you build EI.
“The emotional brain responds to an event more quickly than the thinking brain.” — Daniel Goleman

4. Individuality
To successfully engage talent, treat each person as an individual with their own unique gifts and abilities — they are one of a kind. Make them feel special by tailoring your leadership style to their particular needs.
“Remember always that you not only have the right to be an individual, you have an obligation to be one.” — Eleanor Roosevelt

5. Trust
Less than a third of employees trust their managers. Perhaps that’s because so few managers seem to believe that trust is important. It is in fact critical in promoting engagement. Make an inventory of the promises or agreements you have made recently, and make sure you keep them.
“He who does not trust enough will not be trusted.” — Lao Tzu

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