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The Cost of Employee Disengagement
Can’t Wait
By Mark Shearon
The recession—hopefully—is almost behind us, and now is the time to focus on rebuilding employee engagement. With a happier, more fulfilled workforce, companies can emerge from the recession stronger than their competitors and drive lasting bottom-line growth.
The last 18 months have been tough for almost every company: the recession has resulted in restructurings, layoffs, mergers, and belt-tightening. In these circumstances, it’s no surprise many employees are feeling overworked, uncommitted, and unsettled. The recession, however, is waning, and managers need to act now to boost employee engagement—because companies that focus on reengaging employees today will emerge with more market share after growth returns. Those who do not will be slower out of the blocks and left behind.
Market research has proven time and time again that engaged employees result in more successful and more profitable companies. According to Towers Perrin-ISR, companies with highly engaged workforces have an average of 19% higher net income and a 3.75% higher operating margin. Engaged employees are also ten times more likely to stay at a job, according to Gallup. That means that even when a more fluid job market returns post-recession, companies with engaged employees will enjoy significantly lower employee turnover and higher productivity.
Getting Started with ReEngagement
The reality is, the majority of employees today are not engaged: that is, they are either unhappy in their jobs or just coasting along with no real commitment to their company’s success. A recent Gallup study found just one-third of employees are engaged in their work. The recessionary environment has only worsened many employees’ attitudes about their jobs; as co-workers are laid-off and more responsibility is piled on existing employees at the same time, wages have been frozen or cut. For many companies, these drastic measures are necessary for survival, but that doesn’t make the situation any easier on employees.
Smart companies realize that now is the perfect time to focus on rebuilding employee engagement. If leaders can effectively communicate to their employees just how valuable and intrinsic to the success of the company they are, these employees will not only stay with the company even after growth returns but engage more deeply in their work than ever before.
So how do you get started with an employee reengagement plan? This five-step program will help you build employee engagement from the “inside out”—creating positive employees inside the company who in turn represent your company positively to outside customers, dramatically boosting sales and increasing brand credibility.
A Five-Step Program
As a leader in your company, before you begin your employee engagement program, ask yourself some tough questions: Has a difficult year damaged the relationship between your businesses, your leaders, and your employees? If so, will the damaged relationships impact not only your company’s ability to survive, but also its ability to make the best of the recovery? And if it will—what can you do about it? What messages and values do you want to convey to your employees, and how willing are you to hear open-ended feedback from your employees in a candid environment?
Being honest with yourself about how disengaged many of your employees are is the first step to fixing any issues.
Step one: Figure out what you want to say. Get leaders together to brainstorm the key concepts you want to communicate, then translate these messages into concepts employees can buy into on a personal level. Craft simple stories everyone can understand using examples of real employees who have made a positive impact on company growth, and honestly state goals and challenges, as well as the specific initiatives (newsletters, a new intranet, one-to-one meetings for some teams, team-building events, etc.) that will be part of the overall program. Strive to “speak employee.” Instead of talking about “driving shareholder value,” use language like “contributing, making a difference, and being part of a team.” Tell them exactly what you need them to do.
Step two: Pick your target employees. While it would be great if all employees were fully committed on all initiatives, this is not realistic for large organizations. Choose which employees are key to the success of your company in the short term, and focus the major part of your re-engagement program on those work teams. You can segment teams by hierarchy, geography, business unit, department, or product line. For example, if your company is set to launch a new product, it may be most important to get the sales team fully engaged through in-person meetings and hands-on activities, while providing only a simple email communication to back-office employees.
Step three: Take an “elevator” approach to engagement. Once you’ve identified your key employee reengagement targets, segment the rest into different groups depending on the level of engagement you want to build with them. You can picture these levels of engagement like an elevator, starting with awareness, then proceeding to understanding, support, involvement, and, finally, commitment. Administrative employees may only need a simple “understanding” of engagement principals, while your leadership teams should ride the elevator to the top to get to full “commitment.”
Step four: Use the right communication tools. Each stage of the engagement elevator has appropriate communications tools associated with it. For example, use passive communication tools like email, newsletters, broadcast voicemail, or magazines to get across broad “awareness” of your reengagement plan to the entire company. It might be as simple as sending out an email message from your CEO expressing appreciation for a job well done during challenging times, or inviting all employees to log into a new employee intranet. As you move up the elevator, use the right communications tool for each target group: proceeding from all-employee broadcasts to one-on-one meetings with senior managers, to individual rewards and recognition programs for key employees.
Step five: Measure the effectiveness of your program. After your reengagement plan has been in action for several weeks or months, measure it to find out whether it’s working to achieve your desired goals. Use quantitative methods—such as turnover rate, responses to employee satisfaction surveys, recommend-a-friend hiring programs, and so forth—to get a broad overview of whether the program is meeting targets. But remember to also gather qualitative feedback. Ask your key employees directly what they think about their jobs, their level
of engagement, and the future of the company, and allow them to give feedback in a confidential manner so they are more open to sharing their true opinions. Hearing this type of feedback may take a thick skin, but it’s crucial to finding out exactly how to improve engagement going forward.
Engagement in Action
When two major financial services companies merged last year, they launched a major employee engagement initiative. They wanted to help employees around the world understand the benefits of the merger, ease concerns over job losses and changes, and challenge the new unified team to build a single, stronger company in the shortest time possible.
At the center of the initiative was a global road show of “town hall” style meetings that invited the maximum number of people to interact with top managers face-to-face. Employees were invited to ask questions either in person or via a confidential form; no questions were off limits. The program was also supported by a wide-reaching online and print communication program. A pre-tour campaign built expectations using everything from posters and banners, to intranets and blogs. Local leaders invited employees to submit questions and ideas before the road show was in town. Employees who couldn’t be present at the town hall meetings were invited to view them via the Web, and an intranet site allowed employees to pose questions to executives on an ongoing basis, watch presentations, and get more information about the merger.
Quantitative and qualitative feedback gathered throughout the program was incredibly positive. One year after the merger, during a significant downturn in the financial services sector, both revenue and operating profit had significantly increased from the same period a year earlier.
Mark Shearon is executive vice president of TBA Global (www.tbaglobal.com), an engagement marketing agency that connects brands and people through a unique combination of education, events, entertainment, and experiences. TBA Global helps many of the world’s top brands build deeper employee engagement and maximum brand recognition through a proprietary methodology that links strategy with action. For more information: mashearon@tbaglobal.com
