Wednesday, February 11

Looking For Leadership: Engage Employees

As the economic downturn continues, employee engagement remains the critical component for companies to weather the worst and remain on track. It is not enough to simply demand more from top performers or expect employees to hang on with with the hope that job security seems safer than facing unemployment. Leaders need to energize the base.

Watson Wyatt, a global consulting firm, recently released a report that shows highly engaged employees are twice as likely to become top performers. They also miss 20 percent fewer days of work. And, three-quarters of them exceed or far exceed performance review expectations.

The benefits for highly engaged employees benefit the organization as a whole. Organizations with clear leadership and internal communication enjoy 26 percent higher employee productivity, have lower turnover risk, and have earned 13 percent greater total returns to shareholders over the last five years. They are also more supportive of organizational change initiatives, willing to get behind near-term plans even when they ask for sacrifice.

There are two catches. Executives need to be leaders more than managers. And, each organization requires its own plan.

“There is no ‘one-size-fits-all’ approach to employee engagement," said Ilene Gochman, global practice leader for organization effectiveness at Watson Wyatt. "Segmenting the workforce and tailoring communication, performance management programs and other resources to specific employee groups is the most effective way to engage workers.”

• Capitalize on “engageable moments.” In the best of times, companies can most easily energize new employees. Currently, most companies do not. Even after six months, employees tend to be less motivated to do their best every day. Instead, especially at organizations with hiring freezes, challenging economic times can become the catalyst, assuming management hasn't settled into complacency.

• Demonstrate strong leadership and clear direction. As we recently mentioned, employees want to know about their organization’s specific plans and progress. "What plan" matters less than the fact there is a plan.

• Manage organizational change with effective communication. Especially in an economic crisis, employees are anxious to learn the rationale behind decisions. Authentic communication from senior management will give employees a sense of purpose.

• Emphasize customer focus. Employees are already aware that job security is strengthened by satisfied customers. The two challenges most leaders face is if employees are too focused on internal rumors (will there be more layoffs) or if employers are not providing employees enough support to satisfy customers.

• Invest in the core. One of the most interesting aspects of the study was the emphasis placed on energizing the base. Highly engaged employees that are already top performers can be limited by their less engaged co-workers. Companies need to establish engagement with more than 60 percent of the workforce before productivity shifts.

From our own research, the majority of organizations have settled into a "holding" pattern, attempting to wait out the economic crisis. This presents a tangible opportunity for companies that energized to turn the economic situation into a clear advantage. As simple as it might sound, the decision can be articulated in a few lines from Robert Frost.

"Two roads diverged in a wood, and I —
I took the one less traveled by,
And that has made all the difference."

The only question that remains is which road will your organization take? Without question, the choice will make all the difference. Our company, fortunately, has already decided to take the one less traveled by. And, we recently were engaged by an organization to help them do the same. What about your organization? Wait and hold or engage and grow?

Related reading:

City of Collinsville: We work to bring the employees into the decision making.

Edleman: One in four employees will consider switching jobs when the economy picks up.

The Employee Factor: Employee engagement levels erode over time.

Compensation Force: Recession-driven sense of shared destiny - are we missing an opportunity?


Unknown on 2/11/09, 2:13 PM said...

I am not religious, but this post deserves an AMEN!

Rich on 2/12/09, 9:00 AM said...

Thank you Hadley.

Leadership is a unique skill set. While I am confident all people can be guided toward it, I am not always certain that all people can learn it.



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