The Real Numbers Around Employee Engagement

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Studies show employee engagement isn’t just “nice to have”, but yields measurable outcomes 

If you’re like most executives you’ve heard plenty of talk about how to get your employees to feel happy and engaged in their work. While it sounds like a nice thing to do, you may be thinking, “Hey, I’m not a mean person or anything, but spending time and effort on things like employee engagement and positive leadership is a luxury my division can’t afford. We’re just racing to make our numbers for the quarter.”

Or perhaps your company already runs an engagement program but you have little faith in its worth. According to a 2012-2013 Global Workforce Study from Towers Watson, only 1 out of 5 business leaders (only 20%) believe that their engagement tactics impact the bottom line.

But in recent years, hard numbers have emerged around employee engagement. It isn’t mainly about happiness for the sake of it; it’s about improving business results. Kim Cameron, a professor of management and organizations in the Ross School of Business at the University of Michigan, and the author of Positive Leadership and Practicing Positive Leadership, notes, “Positive leadership aims not just to create positive emotions in people— to help people feel more optimistic and, dare we say, happy—but to dramatically affect organizational performance for the better.”

Nine Reasons to Care About Employee Engagement

A 2012 Gallup study, among others, revealed a strong link between employee engagement and key organizational outcomes. The comprehensive study looked at nearly 50,000 business or work units and 1.4 million employees in 192 organizations, across 49 industries and 34 countries. Employee engagement turned out to be an important competitive differentiator, even during tough economic times.

Gallup found that business units scoring in the top half of their organization in terms of employee engagement had nearly double the odds of success.  And those in the 99th percentile had four times the success rate.

Companies with high levels of employee engagement had gains in nine areas:

  • 22% higher profitability
  • 21% higher productivity
  • 10% higher customer metrics
  • 41% fewer quality incidents
  • 41% fewer patient safety incidents
  • 48% fewer safety incidents
  • 28% less shrinkage
  • 37% lower absenteeism
  • 25% lower turnover (among high-turnover organizations) and 65% lower turnover (among low-turnover organizations) 

There’s also a risk to your company in having disengaged workers. Disengaged employees cost the US between $450 and $550 million per year in lost productivity, reduced efficiency, negative publicity, and turnover costs (Gallup 2013).

Is Your Daily Work a Job, a Career, or a Calling?

How do you build employee engagement? One approach discussed by Kim Cameron in his course Positive Leadership involves creating positive meaning for your employees.  Drawing on established research in sociology and psychology, Cameron identifies three kinds of meaning that people associate with their work:

“Job” – Motivated by financial or material rewards

“Career” – Motivated by accomplishment, success, prestige, and power

“Calling” – Motivated by the meaning associated with the work itself; tasks are inherently fulfilling and provide a sense of purpose

Companies that achieve positively deviant performance—that are able to move beyond ordinary to extraordinary—have employees with a sense of calling. (It’s important to remember, notes Cameron, that a sense of calling isn’t dependent on the type of work performed, but on the individual’s perspective.)

When leaders learn to highlight the value associated with the organization’s outcomes—which extends beyond the personal benefit of individual employees—they enable meaningfulness and a sense of calling in the workplace.

“Drive Employee Engagement though Positive Leadership”.

Drive results through a positive workplace with

The Happiness + Positive Leadership virtual program.