Employee Engagement = ROI

leadership developmentLast week I discussed why employees are more productive with praise vs. punishment. When people “feel” better they perform better. This week I saw an op-ed piece from the NY Times, “Why You Hate Work,” which seemed like a great follow-up to last week’s blog. I think this article has some excellent research about employee engagement which is so important to both the top and bottom lines.

The researchers say only 30% of all employees feel engaged at work. This means that a full 70% of your workforce is NOT engaged during their working hours. Essentially, you are not getting a very good ROI on the wages you are paying for 70% of your workforce.

They identified four core employee needs that impact engagement:

  1. Physical: through opportunities to regularly renew and recharge at work
  2. Emotional: by feeling valued and appreciated for their contributions
  3. Mental: when they have the opportunity to focus in an absorbed way on their most important tasks and define when and where they get work done
  4. Spiritual: by doing more of what they do best and enjoy most and by feeling connected to a higher purpose at work

Not surprisingly, when these needs are met, performance and productivity go way up as does loyalty, job satisfaction, and positive energy while stress goes down. The researchers also found that when one need was met, compared to none, all performance variables went up. It just continued to go up from there as more needs were met.

In most workplaces, addressing all of these would be a profound cultural shift, but as with any investment in business, you need to assess the ROI of doing so. If we agree that 70% of our employees time is spent “disengaged,” then I would suggest that the ROI could be HUGE. Even if you could get that number up to 50% engagement, you would see many positive benefits. And remember that in a workplace, when a positive shift happens, many more will follow because basically humans are wired that way.

So if you can’t spring for free food, flexible work shifts, and have no time or money to spend on consultants to help you figure out best first steps, start small. The article talks about the value of intermittent rests, 10-15 minutes for every 90 minutes worked, and how much more productive everyone is when this is the standard. Just declare that no meeting will go longer than 90 minutes to start and then figure out how to integrate the rest of the changes into your culture and practices.

Just to give you an idea of how valuable this is let’s consider Costco. They put their people first, paying on average 65% more than Walmart, which owns Sam’s Club. Costco’s employees generate twice the sales of Sam’s Club and they have only a 5% turnover of employees who stay at least a year. The reduced recruiting and training costs save Costco several hundred million a year. How is that for a positive ROI?

Think about changing your programs, policies and practices to truly become employee-centric – it’s not nearly as hard as it might seem and the rewards are far above investing in another piece of equipment or consultant.

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Infographic: Avoid Toxic Behavior and Build Self-Worth to Retain Employees

Via AkkenCloud