Whitepaper: TheThreeEssentialComponentsof EmployeeEngagement

ByTracyM.MaylettandJuanM.Riboldi

Copyright 2008, DecisionWise, Inc.

TableofContents:
TheConceptofEngagement.........1 WhatdoWeWantMost? .............2 ThreeScenarios ............................2 DecisionWiseEmployee EngagementModel.......................3 DifferentStrokesfor DifferentFolks..............................3 MeasuringEngagement ................4 EngagementSurveys.....................5 TheImpactofEngagement ...........5 EngagementLeadstoSuccess ......6 AbouttheAuthors ........................7 AboutDecisionWise......................7

TheThreeEssentialComponentsof EmployeeEngagement
UnderstandingtheroleofMotivation,Satisfaction,andEffectivenessin DrivingEngagementandIncreasingOrganizationPerformance
ByTracyM.Maylett,Ed.D &JuanM.Riboldi,MBA/OB Youknowyouwantemployeeswhoaremotivated,satisfied,andengagedoratleast youthinkthatswhatyoureaimingfor.Regardless,youknowyouwantthemtobe productiveandeffective.Youmakeafairattempttomeasurelevelsofemployee satisfaction,butyouremployeesatisfactionsurveydoesnttellyouwhatyoureally wanttoknowhowengagedareyouremployeesinwhattheyaredoing?Dotheydo morethanshowup?Dotheybringtheirhands,minds,andheartstothejob? Organizationsofallsizesareliningupbehindinitiativesaimedatimprovingemployee engagement.Theriseofengagementsurveys,workshops,andpublicationsattesttothe increasedinterestbehindthisconcept.Yetmanagers,HRprofessionals,consultants,and academicsalikeoftenposethesimple,straightforwardquestions:WhatisEmployee Engagementandhowdowemeasureit?

TheConceptofEngagement
Theideaofengagementdidnotsimplyspringfromanoblemanagementeffortto ensureemployeeswerehappy.Itarosefromtheneedforincreasedproductivitythe abilitytogetgreateroutputfromeffort. AscompetitionincreasedfollowingWorldWarII,companiesrealizedthattheycould betterensurelevelsofproductivitybyretainingandgettingthemostfromtheirlabor force.Butonesignificantdifferencecametotheforefrontthatdidnotexistpreviously. Employeesnowhadchoices.Contrarytowhatmuchofthepreviousgeneration experienced,manyemployeescouldnowchoosetoleaveanorganizationformore favorablework.Undertheseconditions,managersbecamemorefocusedonemployees asawaytoincreasethebottomline.Theyneededemployeeswhonotonlybrought theirhandstotheirwork,buttheirmindsandheartsaswell. Astherealvalueofanorganizationshiftedfromtangibleassets(brickandmortar, machines,vehicles,property,tools,etc.)tointellectualassets(knowhow,customer relationships,proprietaryinformation,etc.),whatexistedinpeoplesmindsandhearts wasbecomingmorevaluable.Today,theabilitytolearn,change,andadaptis increasinglybecomingthegreatestsustainablecompetitiveadvantage.Todays workforcefacesdauntingchallengestocutcosts,improvequality,increaseproduction, anddevelopnewproductsandservicesatafasterspeed.Whilesomeorganizations struggleorfail,othersareabletocopewiththeincreasingdemands.Becauseofthese globaltrends,thevalueofhumancapitalisevengreaternowthaneverbefore.Akey factorintappingthiscapitalisengagement.

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WhatdoWeWantMost?
Tobettergrasptheconcept,askyourselfthesimplequestion:Whatdowewantmost fromouremployees?Intuitively,weknowitwhenweseeit.Considerthefollowing examples: Asalespersonworkswellpastfiveoclocktosecureadealthathelpsthe companyachieveitsrevenuegoal. Amachineoperatortakesthetimeattheendofhershifttoensurethather counterpartsunderstandchangesintheproductionsystem. Acustomerrepresentativegoesbeyondhisjobdutiestomakesureacomplaint getsresolvedtothecustomerssatisfaction. Amanagertakestimetopersonallycongratulateandrecognizeanewhirefor completinganimportantprojectontime. Overthepastfiveyears,wehaveaskednumerousgroupsofmanagersacrossdifferent organizationsandindustrieswhattheywantmostfromtheiremployees.Theiranswers includestatementslikewewantthemtobeproductiveandtodoagreatjob,we wantthemtofeelrespectedandvalued,orwewantpassionandcommitment,and soon.Theiranswers,asdiverseastheymayinitiallyseem,canbelogicallygroupedin threebroadcategorieswhich,together,defineengagement.Thesecategoriesare Satisfaction,Motivation,andEffectiveness. EngagementoccurswhenSatisfaction,Motivation,andEffectivenessintersect.While eachofthesefactorsisimportantonitsown,itisonlywhenallthreearepresent simultaneouslythattrueengagementoccurs.Theconfusioncomeswhenwebeginto usethesewordsmotivation,satisfaction,effectiveness,andengagement synonymously.Whenweexplorethemfromapracticalperspective,weseethateachis actuallyadistinctanduniqueconcept,andthatallofthreearerequiredcomponentsof engagement.

ThreeScenarios
1. Take,forexample,theassemblylineemployeewhoissatisfiedwithherjob. Herjobmeanssteadyemployment.Shefeelssatisfiedwithherpay(atleastits betterthanmostofthejobsshecouldfinddownthestreet).Shestartsat7:00 inthemorningandgetsoffintimetopickuphersevenyearoldfromschool.It meetsherneeds,butsheisnotengaged.Shewouldnotsaythatshelooks forwardtocomingtoworkeachday,norisshemotivatedbyherwork environmenttoperformatherbest.Itsajob. Hercoworkerenjoyscomingtoworkeachmorningbecauseshehasrecently beengiventheresponsibilitytoensuretheassemblylineisproducingatrecord capacity.Sheismotivatedbythischallenge,andhasbeenabletomeet,and evenexceed,effectivenesstargets.Yethermanagerrarelyrecognizesherfor thiseffectiveness,andherpayisnotreflectiveofhercontribution.Infact,she issodissatisfiedwithherpayandlackofgeneralrecognitionthatshehas recentlyinterviewedforasimilarpositionwithacompetitor. Upstairsinthemainofficeisafriendofbothoftheseemployees.Sheisa programmerthathasrecentlyjoinedthecompanyranks.Lackofmotivationis certainlynotanissue,asshehasbeenexcitedtocometoworkeachdayandto putintopracticetheskillssherecentlylearnedincollege.Shesverysatisfied withherjob.Sheconsidersherselffortunatetohavelandedsuchagoodjob

2.

3.

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straightoutofschool.Yet,everydaysherunsintothesameproblemtheone thatherbosshasbeentellingher(sincethedayshebegan)wouldbetaken careofassoonasthebudgetrequestcamethrough.Hercomputerdoesnot runtheapplicationssheneedsinordertoeffectivelyusehertime.Infact,she estimatesthatasmuchashalfofherdayiswasted.Sheisnoteffective.While eachofthesewomenpossessestwoofourfactors,acriticalthirdismissing whichpreventsherfrombeingengaged. Aseachoneoftheelementsfeedsontheothers,theirlevelofcontributionatworkwill suffer,andcouldeventuallydeterioratetothepointoflosingcommitment.Itisalso possiblethattheycouldevenbecomeactivelydisengaged.Aperceptivemanagerwould noticethesituation,assesswhatiscriticallymissing,andcreatetheconditionsthat wouldhelpengageeachoneofthesewomen.

TheDecisionWiseEmployeeEngagementModel
Asdescribedintheseexamples,peopleareengagedwhenthey Motivation+ aresatisfied,motivated,andeffectiveatwork.Engagement Satisfaction+ occurswhenallthreecomponentsaresimultaneouslypresent. Effectiveness= ENGAGEMENT Employeesareengagedwhentheirjobsattractandholdtheir attention,andtheyaredeeplyinvolvedintheirwork.Butwhatis theimpactofengagementatwork?Significant!Organizationswithgenuinelyengaged employeeshavehigherretention,productivity,customersatisfaction,innovationrates, andquality.Theyalsorequirelesstrainingtime,experiencelessillness,andhavefewer accidents.Simplyput,engagedemployeesdelivermorethantheaverageemployee,and costless. Thevalueofbeingengagedatworkisamutualbenefittotheworker,theemployer, andthecustomer.Totheemployee,engagementmeansamorerewardingjob.Tothe employer,engagementtranslatesintoretentionandproductivity.Thecustomer experiencesemployeeengagementthroughbetterqualityandservice. Eachofusbringsuniquetalentsandskillstoourwork.Whenweuseourstrengthsat work,wetendtobemoresuccessfulatwhatwedo.Whenwechoosetogivetoreally investourselvesintheworkwedowebecomefullyengaged.

DifferentStrokesforDifferentFolks
Theconceptofengagementreliesonacombinationofmanyfactors.Whatmayengage oneemployeemaynotengageanothertothesamedegree.Therearemanyfactorsthat influenceengagementattheindividual,team,andorganizationlevels.Thereisnoone sizefitsallapproach.Forexample,considerwhatmightengageatopsalesperson, versusaregisterednurse.Attheriskofovergeneralizing,wemayventuretosaythat thetypicalsalesrepresentativewillbemorelikelytobeengagedbyaggressive compensationandautonomy,whilethenursemayperceivemorevalueinhavingthe righttoolsandequipment,aswellasbeingtreatedwithdignityandrespect. Realizingthecomplexitybehindtheconcept,isitpossibletoidentifyasetofkeydrivers thatfacilitateengagement?Withthisquestioninmind,weconductedaresearchstudy withworkersrepresentingdifferentjobfunctions,professions,industries,andcultural backgrounds.Wemetwithindividualsandgroupsofworkersandprovidedthemwitha setofcards,eachcarddescribingspecificcomponentsofjobsatisfaction,motivation, andeffectiveness.Thecardsincludedtopicssuchas:CompetitiveCompensation,Co

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WorkerRelationships,andClearGoalsandDirections.Weaskedeachindividualorteam tosortthecardsinorderofimportancetotheirengagementatwork.Thequestionwe posedastheysortedthesecardswassimple:Telluswhatmakesyouwanttodo,and whatmakesyouabletodoyourbestatwork. Theexerciseinstructedthemtospreadthecardsonatable.Atthetopofthetable,they placedthosecardstheyconsideredtobecriticaltotheirmotivationandabilitytodo theirbestatwork.Atthebottom,theysetthecardsthattheyfeltdidnotaffecttheir levelsofengagementtoanysignificantdegree.Inthemiddle,weendedupwithapile ofcardsthat,whileimportant,werenotconsideredcritical. Whatwefoundwasnotsurprising,andhasbeenrepeatedineachsubsequentexercise wehaveconductedacommonsetofcoredimensionsthatdefineengagementforthe majorityofpeoplewithwhomweworked.However,thesefactorswerenotalways giventhesamepriorityintermsofimportance.Inotherwords,engagementmeans differentthingstodifferentpeople.Additionally,withinsimilarprofessions,thereis higherconsistency,astheytendtoidentifysimilarengagementdimensionsasthemost critical.

MeasuringEngagement
Whyhastheconceptofengagementnowspreadbeyond Nocompany,largeorsmall, theHumanResourcesofficeandintotheboardroom?Our canwinoverthelongrun studiesinvolvingwellover10,000peopleacrossmultiple withoutenergizedemployees organizations,aswellasnumerousexternalstudies, whobelieveinthefirms indicatesignificantcorrelationsbetweenengagementand missionandunderstandhow keyperformanceindicators,suchasretention(turnover), toachieveit.Thatswhyyou customersatisfaction,andfinancialresults(revenue needtotakeameasureof growth).Thesestudiessupportsimilarresearchconcluding employeeengagementat thatengagementisrelevanttooverallperformance. leastonceayearthrough Employeeengagement,therefore,becomesacritical anonymoussurveysinwhich componenttobemeasuredintermsoftheoverallhealth peoplefeelcompletelysafe ofanorganization. tospeaktheirminds. JackWelch,Former Measuringengagementisaprecursortoimproving PresidentandCEOofGE performance.Basedonasounddefinitionofengagement andareliableinstrument,wecanstarttakingnoteof engagementlevelsintheorganization.Wecanthensetgoalsforimprovementand measureprogress. Sohowdowegoaboutmeasuringengagement?Onewayistolookatoutcomes.What aretheendbusinessresults?Dotheyreflecttheworkofemployeeswhoaretruly engaged?Whatdoestheevidencesuggest?Areemployeesactingasiftheyareengaged intheirwork,oractivelydisengaged?Thistypeofanecdotalevidenceishelpful,asitis bothasignofandtheresultofengagementordisengagement. Oneofthemosteffectivewaystoassesslevelsofengagementissimplytoask. Engagementsurveyshavebecomeoneofthemostpopularmethodsofdetermining levelsofengagement.However,manysocalledengagementsurveysdonotmeasureall threeaspectsofengagementmotivation,satisfaction,andeffectiveness.Theystop shortofgettingthewholepicture.

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EngagementSurveys
Itisimportanttolookatallaspectsofengagement.Whenweevaluatelevelsof engagementwithinanorganization,weusetheLeadershipIntelligenceEngagement Surveyasanindicatorformeasuringandimprovingengagement.Thesurveyhasbeen tested,validated,andbenchmarkedacrossvariousindustriesinareasoftheworld.We havefoundthatthesequestionsgenerallyaddressthebasicsofengagement.However, wedontexpectastandardengagementsurveytofitallorganizations,levels,or positions.Questionsmustbecustomizedtofitanorganizationsuniquedriversof engagement. Forexample,whenconductinganemployeeengagementsurveywitharestaurant chain,wedevelopedasetofquestionsspecifictothecorporatestaff(mainlyconsisting ofprofessionalwhitecollarworkers)andanothersurveytailoredtotherestaurant crewswhoareprimarilyparttimeandtemporaryworkers.Aspredicted,thesurvey resultsindicateduniqueneedsforthetwogroups.Atalargeecclesiastical,notforprofit organization,wefoundthatlivinguptotheorganizationsvaluesandlinkingdaily activitiestotheorganizationspurposeandvisionplayalargeroleinengagingthe workers.Conversely,atasuccessfulfastgrowingFinancialServicescompany,achieving resultsandopportunitiesforgrowthweremostcriticaltoengagement.

TheImpactofEngagement
In2008wefinalizedaresearchstudyinwhichwesurveyedover60,000peoplein variousorganizationsandacrossvariousfunctions.Inthisstudy,wefoundthat,overall, 69%ofemployeesindicatedthattheyareengagedatwork(thoserespondingAgreeand StronglyAgreetotheLeadershipIntelligenceEngagementSurvey).Engagementlevels variedgreatlyacrossorganizations,rangingfromalowof41%toahighof96%.This studyalsorevealedthatthehighestscoresgenerallycenteredonprideinthe organization,roleclarity,andqualitywork.Compensationtypicallyshowedupamongst thelowestscores,withareasofpotentialorganizationimprovementoftenbeinginthe categoriesofopportunitiesforgrowth,accountability,andrecognition.

Whatdotheseresultstellus?Forstarters,weseethatmostorganizationshavenot tappedintotheiremployeepotential.Withonly69%ofemployeesindicatingthatthey areengagedintheirwork,thiswouldleaveover30%whoarenot.Previousstudies, conductedbothbyDecisionWiseandbyotherresearchorganizations,showevenhigher levelsofdisengagement.Consequently,theoveralleffectivenessoftheseorganizations suffers. Inordertofurtherstudytheimpactofengagementontheseorganizations,weanalyzed variousperformanceindicatorsfortheseorganizationsandcomparedthemtothelevels

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ofengagementintheseorganizations.Wefoundthatengagedorganizations experiencedsomesignificantadvantages: ReducedTurnover(24%) HigherBusinessScorecard(overallperformancemetrics)ratings(+7%) HigherCustomerSatisfactionratings(+2%) HigherRevenueGrowth(+10%) Withimprovementssuchasthese,itslittlewonderthattheconceptofengagementhas drawntheattentionoforganizationstoday.

EngagementLeadstoSuccess
Employeeengagementcanbesimplydefinedasavoluntarydedicationand commitmenttodoingourverybestwork.Engagementgoesbeyondtraditional measuresofemployeesatisfactiontoincludeconceptsofmotivationandeffectiveness. Differentpeopleareengagedbydifferentthings,sotheactualdimensionsof engagementmayvaryforagivengroupororganization.Engagementismuchmorethan ensuringouremployeesaremotivated,andisnolongerjustHRjargon.Itisnowasreal astheresultsofthelatestcompanyProfit&LossStatement.Intodaysorganization,the differencebetweenengagedemployeesanddisengagedemployeesmayverywellmean thedifferencebetweensuccessandfailure.

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AbouttheAuthors
TracyMaylett DecisionWisePresidentandCEO Tracy'sbusiness,coaching,andconsultingbackgroundextendsovera periodof20yearsandacross5continents.Withexperiencein technology,retail,government,education,andmanufacturing environments,Dr.Mayletthasworkedwithexecutiveandleadership teamsinover20countries. TracyjoinedasPresidentofDecisionWise,comingfromapositionasVicePresidentof OrganizationEffectivenessatModusMediaInternationalinBoston.Priorrolesincluded humanresources,traininganddevelopment,andprocessmanagement.Hehasalso taughtintheDepartmentofOrganizationLeadershipandStrategyattheMarriott SchoolofManagementatBYU.TracyhasaDoctorateinOrganizationChangefrom PepperdineUniversity,anM.B.A.fromBrighamYoungUniversityandaB.A.inEducation fromUtahStateUniversity.HeiscertifiedasaSeniorProfessionalofHumanResources (SPHR),andistheauthorofnumerousprofessionalandacademicpublicationsrelating tofeedback,coaching,leadership,humanresources,andchange. JuanRiboldi DecisionWiseConsultantandEmployeeEngagementExpert Forovertwentyyears,Juanhasconsultedwithvariouscorporations andleadersacrosstheglobeinchangemanagement,organization development,andleadershipcoaching. JuanisthefounderofDecisionWiseandtheauthorofanumberofpublicationsand programsintheareasofemployeeengagement,feedback,leadership,and organizationaleffectiveness.HeholdsgraduatedegreesinOrganizationBehaviorand BusinessManagementfromtheMarriottSchoolofManagementatBrighamYoung University,wherehealsotaughtintheDepartmentofOrganizationLeadershipand Strategy.

AboutDecisionWise
DecisionWise,Inc.isamanagementconsultingfirmspecializinginleadershipand organizationdevelopmentusingassessments,feedback,coaching,andtraining.Our LeadershipIntelligenceprocessleadstomoreeffectiveworkingrelationships,higher levelsofemployeeengagement,andincreasedbusinessperformance.Weprovideour consultingandsurveyservicestoorganizationsthroughouttheworld,includingmany Fortune500companies,governmentorganizations,andnonprofits.Ourmissionis simpleandstraightforward:"Tohelppeopleworkmoreeffectivelybyturningfeedback intoresults.DecisionWisewasfoundedin1996,isprivatelyowned,andbasedalong theWasatchMountainsinProvo,Utah. FormoreinformationaboutDecisionWise,visitwww.decwise.com.

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