Why is employee engagement important and why should you measure it?
Businesses with the highest engagement scores (top 25%) averaged 18% higher productivity than those with the lowest engagement scores (bottom 25%), and increased profitability by 21% (Gallup, 2020).
There are plenty of stats around about the business benefits of having a highly engaged workforce, yet last year’s State of the Nation workforce report showed that only 9% of the UK’s workforce is engaged.
So, what does an engaged employee look like?
Engaged employees share a sense of belonging and care about their job. Taking pride in their work, they are loyal to their employer and are more likely to recommend their organisation as a place to work.
Engaged employees have or receive:
A clear understanding of their role and responsibilities
The tools, training and resources needed to do their job to the best of their ability
Recognition for their contributions and successes
The opportunity to develop professionally or personally
A working environment where they can be their authentic selves
A sense of purpose - this could be contributing to the good of the community or other stakeholders
Richard Branson’s philosophy of happy employees means happy customers, highlights the importance of prioritising your employees- engage with them positively and the rest will come naturally. Creating workplaces where people enjoy coming to work and feel enthusiastic about the work they do will help the business to succeed, but it’s also simply the right thing to do!
The benefits of employee engagement
Human organisations with high levels of engagement, which enable people to be their best, and care for them through the worst, are four times more likely to exceed revenue, profit and satisfaction goals. (Gartner 2022)
Yet financial profit and turnover aren’t the only ways to assess engagement. Other factors such as levels of employee retention, wellbeing and absenteeism, productivity and quality of work are all indicators of this and can be improved through better engagement.
Improved employee retention/ lower turnover
As employee loyalty continues to decline, with an increased need for financial reward, figures show one in five employees look for another job, citing a lack of fulfilment.
In the UK, there’ are around 40,000 medium-sized businesses with between 50 and 249 employees. Top performers aren’t easy to find and for a business of 200 employees with an employee turnover of between 5% (10) and 15% (30), this could mean having to find approximately 20 new employees annually, which brings significant costs in terms of recruitment fees and loss of productivity from vacancies and onboarding time.
Employers can develop loyalty and greater engagement by supporting the broader development of individuals, not just by focusing on role-specific skills. Developing an inclusive culture and a sense of belonging, where colleagues feel like their contributions are meaningful, is also important.
Better wellbeing and reduced colleague absence
“The relationship between wellbeing and engagement is vital because how people experience work influences their lives outside work, and overall wellbeing influences life at work.” Gallup State of the Global Workforce Report 2022.
Engaged employees means fewer accidents and sick days as your employees are in much better shape to feel and perform at their best. Organisations with engagement in the bottom quartile average 64% more accidents than those in the top quartile. (Gallup 2020).
The significance of this was highlighted recently as the sickness absence rate, the percentage of working hours lost because of sickness or injury, rose to 2.6% in 2022 – the highest it’s been since 2004. This is an estimated 185.6 million working days lost because of sickness or injury.
Poor mental health is also estimated to cost the UK in the region of £56 billion each year when you consider increased absences, loss of productivity and increased employee turnover.
From an evaluation perspective, consider adding wellbeing measures to dashboards and focussing on employee wellbeing as a key priority.
Improved productivity and quality of work
Clear expectations are a basic and crucial employee need. An employee’s time is valuable so giving colleagues access to the information they want, when they need it and in a format that they’re used to, can help to improve productivity. They won’t have to spend hours searching for the information they need.
That’s why it’s also important to understand how communication channels and tools are helping colleagues to do their job. Communicators can collaborate with HR teams to establish whether employees have clear tasks and goals set. Do they understand the business’ vision and objectives and has this improved from previous years?
Communication, productivity and culture also have a direct impact on customer experience so tracking customer satisfaction is another area that can be explored.
Strategic communicators can help to measure the Return on Investment (ROI) for engagement as a driver of business success
To deliver effective strategic internal communications, employers must inform, engage and inspire. Successful employee engagement relies on four key enablers:
a strong strategic narrative (reinforced by leaders)
giving colleagues a voice
culture and organisational integrity, based on inclusivity, values and trust
effective leaders who can coach and develop their colleagues and keep them focused on the goals and objectives of the organisation.
But how do you know that communications have been hitting the mark if you can’t measure a direct link between your comms activity and the benefits of engagement outlined above?
ROI for strategic engagement is important to define impact and value and in a post-pandemic world and amid a cost-of-living crisis, measuring this has never been more important, with businesses watching the bottom line and increasingly needing to recruit and retain the best talent.
When determining ROI – it’s important to start by asking: what does success look like to you?
Building trust is crucial to improving engagement and ensuring messages are landing well, so how, as internal communicators, can we prove that we’ve been successful?
Consider the following questions and think about how you’re engaging with employees and whether this is meeting their needs. After all, you can’t engage anyone without communicating with them first:
What’s the business metric you’re trying to improve? Could it be innovation, customer service, employee turnover etc.?
Has behaviour changed as a result of better communication?
Do colleagues have enough opportunities to have their say?
Are employees getting the information they need to feel informed?
Have trust levels in managers and leaders improved?
Is there an increase in the score for how well and often information is provided?
Are employees increasingly understanding the business’ plans for the future?
Also look at whether the data aligns with anecdotal feedback about communications and track this from year-to-year.
Conclusion
Capturing quantitative data will help you measure how effective your communications are and whether they’re having an impact on the organisation, but it’s vital to make sure you’re combining this with the human element as well, looking at links between the two.
Let’s be honest, it’s a lot easier to get budgets passed in the boardroom for activity that relates to the customer rather than employees, so be clear on how communication with and engagement of employees can have a positive impact on the customer experience and business performance, and highlight the need to give colleagues the attention they deserve.
At the end of the day, if you don’t look after your employees, you won’t have any customers!