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Managing Employees

Four Strategies To Boost Employee Engagement That Can Improve Your Bottom Line

Four Strategies To Boost Employee Engagement That Can Improve Your Bottom Line
Image credit: Shutterstock
Guest Writer
Chief Commerical Officer, Lifecare International
8 min read

You're reading Entrepreneur Middle East, an international franchise of Entrepreneur Media.

Do you look forward to going to work? Okay, but how about your employees? It’s a question worth asking because the degree to which employees are engaged with their job has a direct effect on their productivity, loyalty and inclination to absenteeism, which in turn affect company profitability.

The connection between employee engagement and profitability is long-established and not at all surprising but recent research has revealed the extent to which it applies. And for any company executive with an interest in getting the most out of their workforce, it places an emphasis on the need to boost employee engagement which simply cannot be ignored. So, what defines an engaged worker?

Put simply, engagement is a measure of your employees’ conscientiousness and emotional connection to your organization: engaged employees care about their work and how it supports your business objectives and mission. According to the State of the American Workplace report from Gallup, engaged employees are in the minority. In the US they number just 33%. Globally the figures are even more startling- just 13% of employees are actively engaged.

The remainder fall into two categories: ‘disengaged’ employees, who actively act out their unhappiness at work and create a negative effect on the rest of the workforce; and the ‘unengaged’ who, although not overtly hostile or disruptive, nevertheless sleepwalk through their day with a lack of passion or motivation. This group fulfils the minimum requirements of the job without going the extra mile to improve customer service or increase sales or profits, and has little or no desire to exert any discretionary effort.

A major opportunity lies in converting those employees into engaged workers and thus bolstering performance, retention and long-term growth– but where do you start? Here we look at four interconnected strategies, which can help business owners make a positive impact on their bottom line.

1. Reassess leadership: Gallup’s research in the US shows that the actions of managers and leaders account for up to 70% variance in employee engagement scores. Business owners are increasingly beginning to focus on what managers are doing to create, or indeed destroy, employee engagement. Why is that important? Engagement is driven principally by leadership so business owners need greater insight into developing managers who can in turn drive engagement levels and raise the performance of the business.

Individuals with talent in their specific field don’t necessarily make good leaders. According to another Gallup report, State of the American Manager, the practice of promoting individuals with no talent for management into leadership positions means that over 50% of managers are not engaged. Worse still, 14% are actively disengaged. As a result, Gallup estimates that these managers cost the US economy almost USD 400bn annually. And the impact of disengaged managers leading your disengaged workforce can be expensive for your business: the same research estimates that actively disengaged employees cost the US over US$ 600 billion each year in lost productivity.

As the State of the American Workplace report goes on to note, however, organizations that choose managers based on talent rather than reward or tenure have a much greater chance of choosing high performers. "Naturally talented managers know how to develop and engage their employees," the report states. "They create enthusiastic and energized teams that focus on moving their company forward and doing right by their customers."

So, what impact can an energized team have on your business? Getting it right means that you’ll suffer far less employee turnover– actively disengaged workers are almost twice as likely as engaged employees to seek new jobs. Whilst a staggering 73% of disengaged employees are looking around for new opportunities, that figure drops to only 37% among engaged workers. 

2. Engage in regular and rich communication: The importance of good communication between owner and employee is also crucial when it comes to employee engagement. According to the State of the American Workplace report, "leading frequent, meaningful conversations is both art and science, and when done well, it motivates employees to perform at higher levels."

These findings reveal that when a manager regularly checks in with their employees to review progress, team members are more likely to believe they get paid fairly, more likely to stay with the company and more than twice as likely to recommend the company to others as a great place to work. Of course, none of this can happen if employees feel that a business owner or manager doesn’t care about them. Indeed, disengaged workers are more likely to steal from their company, negatively influence their co-workers, miss workdays and drive customers away.

Investment in your people is key. In short, employees give more of themselves –that all-important discretionary effort –if they feel their manager or employer is invested in them as people. Consequently, they are much more likely to be converted into engaged employees. It follows, therefore, that the true value of that rich communication lies not simply in a discussion about projects, roles and responsibilities, but extends beyond that into what happens in their personal lives outside work.

How can this impact your business? While only three in 10 employees state that they receive regular progress reports and feedback, the research suggests that by improving that ratio to six in 10, your company could see a 26% drop in absenteeism and an 11% jump in profits.

3. Enhance your learning & development (L&D): Creating developed self-managers by giving them a say in building their own futures through L&D can ultimately develop employees who are internally committed and engaged. And that’s no bad thing, as it can often be the difference between an employee who’s committed to your company mission and values and one who simply pays them lip service.

A report from the Institute for Employment Studies, entitled The Drivers of Employee Engagement, suggests that enabling your workforce by focusing on L&D gives employees a sense that their organization takes a long-term view of their value and will deliver fair access to development opportunities. After all, it’s one thing to get employees excited about your company mission, but if they’re not developing, it can cause frustration and hinder performance, meaning their engagement may be short-lived. Indeed, as the State of the American Workplace report suggests, employees are rarely enthusiastic or excited about their job when they have to perform the same tasks day in, day out without the chance of learning something new.

What effect could enhanced L&D have on your workforce? While only four in 10 employees say that they have had opportunities to learn and grow in the last year, Gallup suggests that improving that ratio to eight in 10 could allow your business to realise a 44% drop in absenteeism and a 16% jump in productivity.

The research reveals that businesses scoring in the top half for employee engagement almost double their odds of success compared to businesses in the bottom half, while those at the 99th percentile have four times the success rate of those at the first percentile.

4. Set clear goals for performance management: It may seem obvious, but giving employees a clear understanding of their role in the business needs to extend beyond a written job description when they join, and links back to the importance of rich communication between owner and employee. According to Gallup, ‘clear expectations are the most basic and fundamental employee need’.

Without good performance management, it’s easy for employees to become disengaged because they lack a clear understanding of exactly what’s expected of them and struggle to appreciate their own role within the bigger picture of an organisation. As things stand, fewer than half of all employees surveyed (43%) strongly agree they have a clear job description, and even fewer (41%) strongly agree that their job description aligns with the work they are asked to do.

But when leaders excel in performance management, employees are more engaged than those with managers with poor performance management skills. Six in 10 employees state that they know what’s expected of them at work, but if that ratio could be increased to eight in 10, your business could achieve a 14% reduction in staff turnover and a 7% increase in productivity.

Start with leadership
There is no magic bullet when it comes to employee engagement, but a renewed focus on the suitability and quality of leadership can help reinvigorate your emotional and financial investment in your employees. In short, whether we’re talking about UAE entrepreneurs or business owners worldwide, everything flows from good management. Promote on the basis of talent rather than tenure and you will begin to reap the rewards of the points mentioned above – with higher productivity and profits, reduced turnover and lower absenteeism.

Related: Educators Have A Key Role In Nurturing An Entrepreneurial Spirit Among The Youth

Opinions expressed by Entrepreneur contributors are their own.

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