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The Truth About Employee Engagement … it Isn’t Working

To human resource and business leaders, the positives from a highly engaged workforce are undeniable. Employee engagement has been linked to higher levels of business performance. Businesses globally view employee engagement as a critical objective and competitive differentiator.

So What Is the Problem?

Employee engagement isn’t working and research shows this. DDI’s research reveals that only 19% of employees are highly engaged. The Corporate Executive Board, examining 50,000 employees worldwide, placed only 11% in the “true believer” category. Towers Perrin’s recent, “Talent Report” found just 17% of the 35,000 employees surveyed to be highly engaged.

More disturbing, 10-20% of employees are actively “disengaged”. Disengaged employees create a staggering cost on any key performance indicator, e.g. poor customer interactions, increased sick days, lower productivity or theft. Gallup estimates that unengaged workers in the United Kingdom cost their companies $64.8 billion a year. In Japan, where only 9% of the workforce is engaged, lost productivity is estimated to be $232 billion yearly. Gallup estimated the cost to the U.S. economy from disengaged employees to be as much as $350 billion a year.

Why Are We Failing to Deliver on Employee Engagement ?

Most companies are applying a one-size-fits-all, generic approach to driving engagement.

As human resource practioners and line managers responsible for workforce engagement, we recognize leadership is critical to increasing engagement. To impact engagement we must provide an environment for employees that demonstrates caring for our employees’ well being and success. Even with the best leadership, employee engagement will not increase if leadership interventions are geared to a fictitious employee who represents the “mean” from all employee responses. Our failure to drive increasing numbers of highly engaged employees is our one-size-fits-all approach to addressing employee engagement.

Without data that takes into account differences in employee attitude and behaviors, leaders miss the opportunity to meaningfully impact engagement. Leaders need specific data about the differences in attitudes and behaviors among their employees to be effective.When leaders are working with employee survey data that outlines action items based on the “mean” of employee responses, leaders are actioning the wrong items.

This generic approach assumes there is one right way to increase employee engagement. All employees – in the same business unit and position – will be motivated by the same factors and will think and act the same.

There is a better and more scientific way to approach engagement by treating your employees like you treat your customers.

Customer segmentation analysis to understand customer differences is well established. Like customers, employees think and perform differently. Generally, four to five segments capture the diversity of employee attitudes and behaviors within most companies. Segments range from most supportive of company leadership and direction (cheerleaders) to least supportive (tuned out).

With segment data, strategic actions to drive engagement can be developed based on your company’s unique segment profiles. Measurable goals can be set to increase engagement ratings within segments, and increase the number of employees among the most positive segments. The profiles also show performance variability, so driving increases in the most positive profiles will also increase business performance. Specific links between segments and company performance metrics can be developed and tracked.

Companies using segment profiles to drive employee engagement have seen outstanding results … improvements in business performance and higher levels of employee engagement.

The positive news – the full potential of highly engaged employees can be realized. There is a better and more scientific way. Just treat your employees like your customers.

Sue Oliver is Founder and President of Katana Partners, a human resources consultancy. Sue was former SVP, HR and Labor for Walmart Stores, US, and CHRO for American Airlines, Inc., www.katanapartners.com.

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