Employee Engagement: Creating A High Performance Culture and Innovation
Employee engagement has many definitions. In my 20 plus years of running teams and businesses, I like to use the following definition:
People each contributing at their highest and most unique level in the effort to move forward the vision of their organization in which they feel deeply committed to living out daily.
Sounds great, right?! Yet, recent stats on employee engagement tell a troubling story about our workplace culture. According to the most recent Gallup poll, only 33% of American employees are engaged and that number drops to 13% globally.
To add to the current environment, the talent war is on. Organizations that lack in culture, and hence engagement, are losing the battle. Skilled employees have options and they aren’t afraid to use them.
So what’s this all costing your business?
McLean & Company found a disengaged employee costs an organization approximately $3,400 for every $10,000 in annual salary and that disengaged employees cost the American economy up to $350 billion per year due to lost productivity. David MacLeod and Nita Clarke found that companies with low engagement scores earn an operating income 32.7% lower than companies with more engaged employees.
On the flip side, some studies have shown that those with high engagement are 17% more productive, and have seen a 21% increase in sales and in profitability. According to Gallup, strong employee engagement equals the following:
- 37% lower absenteeism
- 25% lower turnover (in high-turnover organizations)
- 65% lower turnover (in low-turnover organizations)
- 28% less shrinkage
- 41% fewer quality incidents (defects)
- 10% higher customer metrics
- 21% higher productivity
- 22% higher profitability
Putting it all together, you are either part of the group losing billions of dollars in lost resources, productivity, and performance or you are part of the few gaining the competitive advantage. Increased commitment and performance leads to bottom line results.
And I would propose that there is a bigger, more widespread challenge that can’t fully be quantified, yet adds greatly to the above challenges. That’s the lack of harnessing your people to their fullest potential. Employees may be “satisfied” and “doing their jobs” but that doesn’t mean they are “enthusiastic” and “bringing their added value game.”
Your employees are producing mediocre work because there isn’t a culture of innovation that pushes them to bring their best. If you want proof of the power of this at work, take a look at some of the most innovative companies out there.
We all know them - Apple, Tesla, SouthWest - to name a few recognizable ones. I would encourage you to go check out some lesser known ones like Anythink Libraries, Infinite Monkey Urban Winery and Gore-Company.
Employee engagement goes far beyond the ping pong table, flexible hours and drinks on Friday. All those things can be fantastic. But, without a culture that allows employees to innovate, those things tend to be seen as a shallow attempt by leadership to be cool. It can have the reverse effect and add to more griping by the coffee maker.
Forced collaboration and fun is never fun.
I’ve asked employees of organizations how they measure their commitment to the organizations. It often comes down to how much room they feel they have to contribute and if they feel their voices are heard. They want to be able to point to something and say, “yeah I contributed to that, we all did.”
And that starts with a culture of innovation on all rungs of the organizational ladder.
Employees rank their commitment as much higher in a culture that gives them a little leeway than those that don’t.
When’s the last time you were able to provide meaningful contribution to your organization?
When were you able to bring an innovative solution to a nagging challenge?
Didn’t it feel good? That’s how employees feel too.
I’ve seen this with many of our clients. Oftentimes we’re asked to lead an Innovation Workshop with a team because results are lackluster, and so are employees. We find that due to a lack of ability to bring their innovative ideas to the table and to make a difference beyond the job description are being squelched. Innovation has become a one time exercise at the 3pm brainstorm, with scented markers and blank easel pads, and not a part of the daily culture. And sure enough, employee engagement shot right up when we flipped the culture on it’s head. As a result, several incredible ideas for solving some big business challenges resulted in competitive advantages in the marketplace.
The reality is that it’s all intertwined - organizational culture, employee engagement, business results, competitive advantage.
Let's go back to the more pervasive problem of not tapping your greatest resource - your people. The most strategic, brilliant, and possible ideas are all right there, inside the minds of your people. The problem is that nobody took the time or had the tools to pull them out. I’m always surprised in our workshops or when teams get access to our IQE Pro Innovation Toolkit that the people in the room have the solution leaders have been looking for. It’s usually within their four walls.
Employee engagement feels like an elusive beast that often drops to its lowest levels before someone takes the time to focus on it. However when you have your eye on creating a culture where people and innovation thrive, high employee engagement comes naturally.