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ABM publishes new research on professional business mentoring. Read more here >>>
In this guest blog, ABM Full Member Mark Bates, Executive Business Coach & Mentor of Applebright Coaching, explores how employee engagement can and will unlock great strides in growth within an organisation, team or new business. People-focused business growth is a central theme in this article and shows that through good quality leadership and decision making, such growth is not a concept to be read about in a magazine but rather to be actively worked on in the here and now. Some of the inspiration for this thinking and the theme throughout the blog is from the work of Mauro Porcini who, as chief design officer of PepsiCo, consistently demonstrates that people focus creates success through innovation (Porcini, 2023). This article is part of a four blog series on business growth. Find the other articles here.
People will forget what you said, people will forget what you did, but people will never forget how you made them feel. Maya Angelou
For some time now there has been an accepted understanding that good leaders within business create a strong sense of team and assist in helping their people understand the purpose and values of the business through great engagement. The buy-in created by this engagement has so many business and personal advantages and can be proven through examining a number of leading management reports and surveys and in the case studies of countless high profile exemplars of leading employee engagement. The Gallup research of 2020 is frequently quoted in this article and this evidence matters because of it’s depth. As business leaders, ‘failing fast’ for success is significantly multiplied through the digestion of research that has garnered evidence from multiple sources. This evidence based leadership accelerates and promotes our learning and leads to sharper and focused success decisions. The Gallup work examined the relationship between employee engagement and business success through 456 studies, in 276 organisations, within 54 industries and in 96 countries.
There are many definitions for this and to a certain extent this is understandable based on the nuances of the industry sector, the evolution of a developing business, on its improving engagement or the starting point for the journey ahead. However, it is most definitely best practice for each business to use a core definition for employee engagement as from this basis an initial baseline measure of engagement levels can be taken and improving engagement properly measured and communicated to and celebrated back with all people involved.
In the Gallup reports of 2020 a good definition was fleshed out from significant research examining the employee benefits and business benefits of higher levels of employee engagement. That definition is as follows:-
‘The involvement and enthusiasm of employees in both their work and workplace.‘
Increasingly, this challenge has become ever more significant in the context of achieving success in a competitive economy. Post pandemic the engagement and involvement of employees is not only essential to retain the best people in businesses but also to attract the best new talent. This is even more relevant when considering ‘the Great Resignation’ or through another accepted phenomenon, ‘Quiet Quitting’.
‘Engage for success’ in the UK have measured through surveys that employee engagement fell by 11% during the pandemic and that since that time it has only recovered by 3%. Now is the time to act because people are the energy and the lifeblood of our businesses and unnecessary high turnover is catastrophic to business success and to the cohesion of great teams creating growth in business. Importantly, there is a need for psychological safety in the workplace as an essential element of wellbeing and motivation for our greatest assets, our people. The evidence is strong for staff engagement to be top on our ‘to-do’ list to create high levels of business growth and in so doing to outmatch our business rivals. There is a wealth of evidence demonstrating the positive impact of staff engagement on businesses.
The most significant and definitely the ‘magnificent seven’ of business success outcomes from great employee engagement have not yet been turned into a movie but they should be and they should form the staple diet of any serious leader of business and their people at the planning phase of every year. Business growth is not just good for the business itself and it’s reputation but it supports all of its employees to a successful and stable worklife, it supports business partners and stakeholders, it drives improvements in the products and services offered to clients and customers and importantly, it makes a difference to local communities and to the regional and national economy. What was the common denominator in all of those differences made? Yes, people. This is the benefit of understanding at a business and leadership level what Porcini means by ‘people in love with people’.
Business growth relies upon motivated people who create higher levels of productivity in the business. Multiple studies have found a positive correlation between employee engagement and productivity. For example, a report by the UK Government’s Engage for Success movement found that highly engaged employees are 50% more likely to exceed performance expectations compared to disengaged employees. According to a study by Gallup, highly engaged teams show 21% greater profitability compared to teams with low engagement levels. It is through Gallup that we discover the overall and crucial finding that engaged employees have 17% higher productivity.
This just makes sense that those businesses with more highly engaged employees tend to be more profitable. The Gallup study also estimated that companies in the top quartile of employee engagement outperformed those in the bottom quartile by 21% in profitability. For example, a report by Aon Hewitt also found that companies with high employee engagement had a 4% higher operating margin than their low engagement counterparts. Engaged employees are more committed to achieving business goals and are likely to go the extra mile for customers. As Branson says ‘if you take care of your employees they will take care of the clients’.
Engaged employees create better customer experiences, leading to higher customer satisfaction and loyalty. Research by the Institute of Customer Service found that organisations with engaged employees outperformed their competitors in customer satisfaction by 10%. A study by Temkin Group also found that companies with highly engaged employees outperform their competitors in customer satisfaction by 12%. This therefore is not necessarily about heavy investment in products and services coming out of the bottom line of the business through making extravagant offers, it is simply about looking after your best asset as a business, your people – as simple as that – they will do the business for the business from there.
Engaged and empowered employees are less likely to be absent from work and are more likely to stay with your organisation. The UK Employee Engagement Taskforce reported that businesses with high levels of employee engagement experience 41% lower absenteeism and 59% lower turnover rates compared to those with low engagement levels. Engaged employees are more likely to stay with an organisation, reducing turnover costs. Research by Towers Watson found that companies with high levels of employee engagement have a 25% lower turnover rate compared to companies with low engagement levels. The range of 25% to 59% lower turnover is something to aim for through a deliberate leadership driven engagement with your people. This is the best way to promote the values and the purpose of your business, finding that through the loyalty and longevity of your best people you can achieve the greatest and most ambitious business goals.
The ability to create and to innovate inspires and energises both your people and those that their products and services serve. The ability to be fleet of foot and to consider how to ideate, to create and to design differentiates the growing businesses from the failing ones. Engaged employees are more likely to contribute innovative ideas and solutions. A study by the Chartered Institute of Personnel and Development (CIPD) found that businesses with high levels of employee engagement were more innovative and had a greater ability to adapt to change. Engaged employees are more likely to contribute innovative ideas. A study published in the Journal of Applied Psychology found a positive relationship between employee engagement and individual creativity, suggesting that engaged employees are more likely to generate and implement innovative solutions.
‘Innovation is an act of love – or at least it should be. Always. It is a gesture of empathy, respect, generosity, of one human being’s devotion to another’Mauro Porcini
Communicating and empowering your people means that they are likely to take more responsibility for themselves and for others. Their commitment to each other and to the business grows exponentially. Engaged employees are more likely to prioritise safety and wellbeing in the workplace. The UK Health and Safety Executive (HSE) found that organisations with higher levels of employee engagement have significantly lower accident rates and fewer work-related ill-health cases. Engaged employees experience higher levels of wellbeing and job satisfaction. Research by the University of Warwick found that happy employees are 12% more productive, highlighting the importance of employee engagement in overall wellbeing and linking back to safety and productivity. Not only is this what we want for our people, but by keeping people safe they are more able to serve their clients and their customers and to deliver on their promise and their purpose.
Engaged employees can act as brand ambassadors, positively impacting the organisation’s reputation and attracting top talent. Engaged employees are not only dedicated to their own work but also take pride in their organisation. As brand advocates, they are more likely to recommend their workplace to friends, family, and acquaintances. Employee referrals serve as a powerful and cost-effective recruitment tool, as referred candidates tend to align better with the company culture and requirements.
A survey by Glassdoor found that 84% of job seekers consider a company’s reputation as an employer before applying for a job. The power of word of mouth and the levels of research potential employees will do is increasing ever more so. Social media is a source of information that means the employees experience will always be public in some form or other. It is a long held principle that one person who is satisfied tells one person and when dissatisfied tells ten people. It is almost negligent to fail to appreciate the connection between employee engagement and increasing brand reputation and how essential that engagement is in creating the conditions for business growth. This aspect again touches upon why engagement is an important ingredient in being an employer of choice. In Corporate Rebels, the authors, Minnaar and Morree, identify across numerous businesses that engagement and transparency create a powerful cocktail for business growth.
Clients do not come first. Employees come first. If you take care of your employees, they will take care of the clients’ Richard Branson
Getting it right across all of our businesses cannot be a one size fits all approach and understanding the current state of engagement and what perceptions our people have of the way that they are communicated with and are empowered here and now in our businesses is important. That said, in understanding that we learn faster through the experience of others here are some examples that clearly demonstrate what can be done and what we can learn from them. The examples are global but I will begin here by namechecking some UK based businesses that have already built a significant reputation for good employee engagement. These UK based companies are consistently recognised for their commitment to employee engagement.
Admiral Group – This insurance company has consistently been recognised for its employee engagement efforts. It has been named as one of the best companies to work for in the UK by the Sunday Times’ “Best Companies to Work For” list multiple times.
BUPA – This healthcare organisation, has received recognition for its employee engagement initiatives. It has been featured in lists such as “Britain’s Healthiest Workplace” and has received awards for its employee wellbeing programs.
Jaguar Land Rover – This automotive business has been praised for its employee engagement efforts. It has received awards for its training and development programs, as well as its commitment to employee wellbeing also, it will not be lost on us that our ‘people’ and looking after them through appropriately scaled wellbeing programmes is vital, particularly post pandemic.
John Lewis Partnership – As a well-known employee-owned business, John Lewis Partnership often ranks highly in employee engagement surveys. It is famous for its partnership model, which allows employees to have a say in the company’s decisions and share in its profits. This again echoes not just the importance of engagement but also of empowerment.
Unilever – As a multinational consumer goods company, this business has been recognised for its focus on employee engagement. It has received awards for its diversity and inclusion initiatives and its commitment to sustainability, which resonates with so many employees and enables the other side of the job interview to be effective (the ‘do I like this company?’ test!).
On the international business scene here are two fabulous case studies that demonstrate exactly what is possible in employee engagement programs for our people. They are also so clearly a part of the business brand, how the business treats and engages with its people is used as a part of not just ensuring that the best people stay and join those businesses, but also of selling the goods and services to their customers.
Zappos has developed its reputation for creating a unique and employee-centric culture. Here are some ways their employee engagement is next level:
To the hungry readers you will have spotted that in the first blog of this series that Patagonia again featured because they have created a unique company purpose and they are able to deliver that with the support and engagement of their people and they also make this a very clear part of their business USP with their customers. This sort of thinking again delineates the person centred business from the one that may be overly focused on products and profits alone. This approach across the business as a whole also inspires innovative and creative thinking as the engagement occurs from leadership to teams, from teams to each other and from the business to innovative collaborators and to the communities that enjoy the products and services that Patagonia provide.
The Patagonia DNA for engagement extends across a range of differing and key factors , the headlines of which are:
So far we have examined the business case for why an employee engagement plan will take the business and company to the next level and also looked at some best practice examples of such work. This final part of the article considers some of the tools and techniques to either accelerate existing engagement programs or to embark on completely new and inspiring journeys to engage people in the business in such a way as to create the foundation for business growth and innovation that will very quickly outperform those rival businesses that fail to see the value of people.
This is something very consistent in the top engagement performers and has the ability to operate a transparent information cycle to all employees and this can include very simple tools such as explaining the business balance sheet with information that supports all employees to a better understanding of, and to share actively in, the real challenges of the business. Sometimes transparency on items such as budgets is carried through by the business leadership but it can go very wrong if the communication is issued too technically and without a glossary of terms and an explanation given.
This principle holds true to total transparency on key business processes such as client development, new production lines, product development, product diversification, quality standards and change management. Similarly, the findings of any employee consultations and the actions being taken with their results must also be transparently fed back to all employees.
An idea to consider here that will support the level of engagement from the transparency strategy is to develop a transparency driven newsletter in the best format for your teams that regularly includes all of the above items and makes the messages more personalised and relevant using relatable styling, words and images This prevents the confetti of information that could also have a negative impact of doing the right thing but turning off your staff through information overload.
This panel can be a combination of the real experiences of customers both internally and externally. There is irrefutable evidence that this helps employees to widen their thinking about how they supply products and services and puts them in direct contact with those that matter the most. The benefit of this is that the shaping of products and services and the feeling of engagement in the challenges of the business are also encouraged. This also prevents a situation whereby the business leadership are distrusted for conveying a customer’s true feedback due to their own agenda. Direct contact from the ‘horse’s mouth’ is legitimate, its is authentic and it is impactive! This panel can be formed to meet directly with employees and can include problem solving approaches to what works really well, what products and services are valued the most and also conversely, what would customers really appreciate that might make a difference for them as the most significant people in any business alongside employees.
The significance here links back to the processes of advertising and recruiting into roles within the business which immediately makes clear the core skills and attributes that are essential to the roles of the business that deliver the products and services that clients and customers enjoy. It is particularly important that the business is true and consistent to its employees and keeps the contract made with each worker.
To get a deeper approach and understanding for this engagement opportunity then business owners, company directors can consider how the teams themselves are a direct part of the development and finetuning of their role descriptions. This enables the teams to feel that they are shaping their workplace and able to include direct expertise into the role profile. There is some evidence that the workers themselves will set a high bar for what should be expected of them and this can myth bust what might take place if leaders define these role descriptions in isolation and impose them on their teams.
This process can be frequently repeated to keep the role definitions clear and accurate and will also support the accountability and engagement of leaders and deliverers all together. The process of direct involvement is very marketable in onboarding of new staff and also can be used as a part of what makes the business attractive employment, in so doing, selling the business to the best potential new employees and s
