Workplace Recognition and Incentive Programs

Engagement Linked to Financial Performance

Posted on August 3, 2010 by Carl Bonura in Uncategorized

Senior leaders should take the lead on employee engagement – for the sake of the organization. Hewitt Associates in a recently released 2010 study shows a clear link between highly engaged workforces and highly performing companies. “Organizations with high levels of engagement (where 65 percent or more of employees are engaged) outperformed the total stock market index even in volatile economic conditions…companies with low engagement (where less than 40 percent of employees are engaged) had a total shareholder return that was 44 percent lower than the average.” If that does not illustrate the connection clearly, please read the entire article for more info: Hewitt Analysis

Hewitt’s research shows that 46 percent of organizations experienced a decline in engagement levels in the quarter ending June 2010, while just 30 percent saw an improvement. Obviously, there is a growing gap that will be problematic as the economy recovers. Employers are struggling with financial issues and employees are stressed beyond limits. Many are thinking about leaving when the opportunity arises. This will lead to shortages in talent for many companies. It is the prudent thing to put systems in place that will mitigate these issues and support financial performance.

There are some critical steps to improving engagement levels and boost morale. Companies must think well into the future and be proactive now to see successes 2 to 3 or 5 years out. Some steps you can take now are:

· Communicate a clear vision for the organization now and into the future
· Engage leadership to be visible and to walk the talk to lessen employee anxiety
· Create systems that will energize employees and managers alike…provide feedback on how well the company is doing and the impact employees are having
· Actively involve all stakeholders in the process. A sense of ownership for the future will create an environment that helps retain top talent
· Use all the tools available to your organization to increase morale. One program or approach may not be enough
· Adjust your strategies as needed to keep the edge

Understand what drives positive employee behavior and make sure your employees know that you appreciate all the sacrifices they have made on behalf of the company. Acknowledge people’s contributions and reward people for their effort. Recognition can have an immense effect on a person. These actions help to create a workplace where people feel secure and valued.

Remind people of what the organization, the department and the team are trying to achieve and where they fit into this. Create a line of sight from individuals’ roles to the future achievements of the organization and highlight the benefits for the public in meeting these goals. Make the effort to know what values your people hold and align these with what the organization is trying to achieve and how the organization is planning to do this. This can create a sense of purpose and pride in what people are doing.

This is about people, connecting with people, valuing people, supporting people and developing people. Employee engagement is related to many positive outcomes; financial performance, productivity, employee well-being, and job satisfaction, just to name a few, and leaders cannot let this be undervalued in the current climate.