The Mixed Bag...
$5 for a bag of apples – sounds like a good deal. So you pay your money and take your apples. You reach into the bag. The first apple is perfect – it tastes like a summer’s day and brings back happy memories of childhood. The second apple is OK – there’s nothing wrong with it, but it will inspire no poetry. The third apple is shriveled – edible, but you’d rather not eat it. The fourth apple is rotten – your nose wrinkles in disgust. If you leave it in the bag, it will rot the other apples. You wonder what the rest of the apples are like, so you empty the bag. Final tally: 2 perfect apples, 2 OK apples, 4 shriveled apples, and 2 rotten apples. You feel like you’ve been had.
The thing is, I’m not talking about apples here.
This represents the level of engagement in the workforce- ranging from fully engaged, engaged, partially disengaged to fully disengaged. More than half of the workforce is unengaged, with as much as 20% at an inexcusable performance level. This is truly astonishing! Payroll is usually the single largest cost item, but you are not getting value for money from the majority of your workers. And around one-fifth could actively be slowing you down.
Now I know what you’re thinking – this is the average, it’s not my firm or my employees. But the other remarkable thing that engagement studies1 show is how consistent this engagement profile is across countries, industries, jobs, and firms. The standard deviation is around “one apple”. This means that even in the better firms, around half of the workforce is underperforming.
The Power of Employee Engagement
But even this relatively small difference in engagement results in vastly different financial performance. In one study2 across 90 000 employees, the firms with the most engaged employees had a 19% year on year increase in operating income. Whilst the firms with the lowest levels of engagement had a decline of 32%.
What does this mean to you? Well you certainly wouldn’t think it’s acceptable to carry on buying apples like that. You’d quickly remove the rotten apples before they affect the rest of the bag. You’d deal with the shriveled apples by saving what you can. And you’d want to get more of the perfect apples. Why should this be different for your staff? Or is this just because- let’s face it no one really likes working- most people would rather be doing something else?
To answer that question, I will share with you what science says on employee motivation. I will cover what role monetary incentives play. I’m also going to cover what factors affect staff satisfaction and which of these are under the manager’s control. I will cover what are the five things that every manager must do but are not on their Job Description. I'm going to tell you what makes an Effective Manager. And I’m going to explore what science says about staff engagement and how you can convert this into practical actions. But these are all posts for another day. To make sure you don't miss any of these be sure to sign up for the free email series Boss Camp.
I believe that this problem is quite possibly your largest opportunity. We’ve already seen that small changes in engagement have massive increases in financial performance. And this isn’t just about the financial impact. This is also about having a better working environment for your staff, for your managers, and for you.
For now we have something for you to think about. What do you think is the level of engagement of your co-workers? What about the organization as a whole? And what about the people who work for you? Do you recognize any of the symptoms of disengagement in your company?
How do you measure employee engagement?
Employee engagement can seem to be an intangible concept that cannot be measured directly. Wikipedia defines it as follows: “An "engaged employee" is one who is fully involved in, and enthusiastic about their work, and thus will act in a way that furthers their organization's interests.”
More tangible symptoms of low employee engagement include: performance issues (avoiding accountability, low work volume & quality), attendance issues (absenteeism, punctuality, long breaks), high staff turnover, and generally low financial performance.
Staff turnover – The Silent Killer
If unengaged workers are the infectious disease of the organization, then high staff turnover is the silent killer. An average staff turnover of around 20% costs you about 10% of your payroll in direct costs alone (recruitment, training, payroll cover, learning curve). Many managers that are good at getting results are often not good at keeping staff. The characteristic of a truly talented manager is a manager who is good at getting results while keeping staff.
I hope you find these free insights and actionable tips helpful and inspiring. The best way to learn these skills is by doing one of the training modules and if you would like to learn more I would encourage you to take a course. This is how I support the creation of this content. Please see the side bar for course links or go to the training page to find out more.
1. Towers and Perrin Global Workforce survey
2. Towers Perrin study of 90,000 employees in 18 countries, 2007-2008
As a manager you can get upset when your employees do something wrong, you can get annoyed that they don’t do what you ask. In short you can be the chocolate teapot boss. Or you can learn how to be a boss, like a boss at WWW.BOSS.CAMP. The program includes topics such as:
- How to motivate employees,
- What are bad employee motivators,
- What you must do as a manager but isn't on your job description,
- How leaders get power.