Managers may intuitively know having engaged employees is critical to business success, but recent research also supports this assumption. A Gallup study conducted in 2013 found that:
“Work units in the top quartile in employee engagement outperformed bottom-quartile units by 10% on customer ratings, 22% in profitability, and 21% in productivity. Work units in the top quartile also saw significantly lower turnover (25% in high-turnover organizations, 65% in low-turnover organizations), shrinkage (28%), and absenteeism (37%) and fewer safety incidents (48%), patient safety incidents (41%), and quality defects (41%).” “State of the American Workplace,” Gallup, 2017.
This same study shows that in an average company, only about 33% of employees are engaged in their work.
The Daniel Group provides employee engagement research of various types to help companies evaluate and improve. This year, as part of a management transition project, we conducted an employee engagement survey for a commercial construction company. The results of this survey were astounding. Of all the surveys we have conducted over time, this company had the highest level of engagement we have seen.
This high level prompted me to look more closely at the results and think about why these employees are so engaged? The company has many construction sites scattered over a large geographical footprint with superintendents and other staff managing projects, so it is harder to create cohesive teams because of this separation. Nevertheless, they are doing it.
Important Factors in Increasing Employee Engagement
There are some clues in the research and my knowledge of the business that provide answers to this question:
- Employees know what is expected of them and have the tools to carry out their jobs.
- Employees are comfortable expressing their opinions without worrying about retribution.
- It is also an environment that leans toward positive recognition.
- The mission of the company engages employees.
- A high set of values help reinforce the mission, and everyone understands them even though they are not prominently displayed.
- Everyone knows what matters!
Engaged Employees Increase Customer Loyalty
This company is living proof of the research findings. For example:
- In an industry known for not-very-loyal clients, they have developed client relationships that have endured for years. These clients keep returning to have this company build their projects.
- In a highly cyclical industry, the company is consistently profitable. Based on industry benchmarks, this company has a net margin higher than industry benchmarks.
- There is very low employee turnover when it is getting increasingly hard to find talented and trained managers.
- A focus on the future. For example, the company successfully transitioned the senior leadership team 15 years ago, and they are preparing for changes in that team now.
- They have new construction concepts that have created new opportunities for the company to grow and for employees to learn.
This organization is an example of the impact that highly engaged employees can have on business.
Given the shortage of skilled workers facing many companies in North America, creating a culture that is accountable but encouraging is going to become even more important than ever.
Now is the time to begin this effort!