Mark Royal, Senior Principal, Korn Ferry Hay Group
In today’s highly competitive environment in which organizations must optimize every resource—especially talent—employee engagement is a powerful tool for driving performance. Employees who are highly engaged and well positioned for success are better able to deliver more, and organizations that are known for high employee engagement become magnets for attracting and retaining valuable talent.
As CEOs and their senior leadership teams contemplate how to elevate employee engagement, it’s important that this concept not be confused with employee satisfaction. Engagement is not about making employees “happier,” per se. Rather, employee engagement seeks to improve performance and increase productivity by creating conditions that foster commitment to organizations and a willingness to go the extra mile. Engagement has the greatest impact on business outcomes, however, when work environments also enable employees. Otherwise, employees may be engaged by the goals and enthusiastic about making a difference, but will become frustrated because they are held back by jobs that do not suit them or work environments that impede them.
Organizations with a high level of employee engagement operate like a high-performance engine, with every piston firing. Korn Ferry Hay Group’s partnership with Fortune magazine to identify the World’s Most Admired Companies highlights the factors that contribute to making these organizations both highly regarded and highly successful. As recent findings show, 94% of executives in the World’s Most Admired Companies say their efforts to engage employees are a significant source of competitive advantage and have reduced employee turnover, while 84% said they have strengthened customer relationships.
Employee engagement can help organizations more successfully navigate through change. Engaged employees are better able to cope with new and unanticipated situations, especially when leaders cannot be there to guide them to the answer. In these scenarios, leaders have to count on agile and engaged employees to determine the right answer.
If organizations want employees to be engaged and deliver more, they have to reciprocate. One way is with compensation that is fair and recognizes employee contribution; but rewards are not monetary alone. Increasingly, employees are seeking development opportunities that will prepare them for future challenges and further their careers.
While it is up to senior leaders to create a compelling story about the organization—its vision, objectives, and commitment to employees—delivering on those promises comes down to managers at all levels. The employee-manager relationship is where employee engagement stands or falls. Therefore, CEOs must ensure that the organization’s messages are carried out consistently by all leaders and managers. Inconsistency between what is said at the top and what is experienced among employees undermines confidence.
Another important component of culture that impacts employee engagement is corporate social responsibility (CSR). As Korn Ferry Hay Group research has shown, developing a culture that provides employees with meaning and purpose is critical to talent recruitment and retention.
CSR has evolved from many organizations focusing initially on reducing harm to the environment to a more expansive view, with commitment to making a positive contribution in the world through the core business and charitable activities that are aligned with their purpose.
For some organizations, defining purpose is fairly straightforward. Consider pharmaceutical companies that can draw a direct line from their business to a social benefit of improving people’s health. For example, Johnson & Johnson highlights healthcare initiatives as part of its “citizenship and sustainability.” Pepsico, as a global food and beverage company, has numerous initiatives such as nutrition, water supply, sustainable practices in packaging, and sustainable agriculture.
With social responsibility comes a need for greater transparency; people inside and outside the organization want to see that the organization is living up to the values it professes. Inconsistency can stir up “noise” quickly, especially in social media channels.
Consistency in CSR also enhances employee engagement. As research has shown, a primary driver of job satisfaction is working for a company whose culture is aligned with personal values. But there is more that organizations and their senior leaders can do: Progressive organizations use CSR goals to help develop leaders with purpose and enhance a mission-driven culture. CSR can also foster talent development by encouraging individuals to become involved in the communities in which the organization operates, such as serving on a community organization’s board. Such activities are not about just doing the right thing; they also provide opportunities to develop leadership competencies.
Employee engagement is a way of looking at everything an organization does, from community involvement to developing leaders. Its holistic nature also means that organizations should not rely on annual employee engagement surveys alone for feedback. Evidence of employee engagement can be found everywhere, from pulse surveys and polls conducted periodically to comments on internal and external social media. Employee engagement then becomes a dialogue between senior leaders and the organization’s most valued asset—its people, whose alignment with objectives, priorities, and goals are key to successfully executing strategy.
About the Author
Mark Royal is a Senior Principal within Korn Ferry Hay Group’s employee research division. In this role, he helps clients attract and retain talent, foster innovation, manage change more effectively, and enhance customer satisfaction and business performance. Mark works closely with clients in all aspects of employee engagement initiatives. He also plays a leading role in directing Hay Group’s annual partnership with Fortune magazine to identify the World’s Most Admired Companies and uncover the business practices that make these companies both highly regarded and highly successful. Mark’s client consulting work focuses on helping organizations structure work environments both to increase employee engagement and to translate high levels of employee motivation into improved results. He is co-author of the book, The Enemy of Engagement: Put an End to Workplace Frustration – and Get the Most from Your Employees (AMACOM, 2011). Mark holds Ph.D. and MA degrees in sociology from Stanford University and a BA in sociology from Yale University.