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Employee engagement appears to be just as important in tough times as it is during good ones.
Despite a global recession that has led to widespread layoffs and restructuring, the link between engagement and key organizational results has remained remarkably consistent regardless of the organization, industry or country, a recent Gallup Inc. study found.
Business or work units that scored in the top half of their organization in terms of engagement were better performers and had nearly twice the likelihood of success based on financial, customer, retention, safety, quality, shrinkage (theft) and absenteeism metrics when compared with those in the bottom half.
The findings were released March 21, 2013, in
Engagement at Work: Its Effect on Performance Continues in Tough Economic Times. Gallup did the research in 2012 by looking at 263 research studies covering 49,928 business units at 192 organizations spanning 34 countries.
James K. Harter, Ph.D., Gallup’s chief scientist for workplace management and the study’s lead author, told
SHRM Online in an e-mail that the research shows that engagement remains an important competitive differentiator.
“What has been most surprising to me, as a researcher, is the consistency of the findings during very different economic times,” Harter wrote in the e-mail. “In good economic times, engagement is the difference between good and great. In bad economic times, engagement is the difference between sinking and holding your own.”
Harter added that engagement also is key to whether employees embrace organizational strategy.
“Having your people behind you can make a big difference in how they interpret the threat of a down economy,” and whether they feel victimized “or can see the future opportunity and feel a part of the solution,” Harter wrote.
Some Key Findings
This was the eighth time the study has been done since 1997. In the current study, Gallup probed engagement’s effect on nine key metrics: absenteeism, turnover, shrinkage or theft, employee safety incidents, patient safety incidents, the number of product defects, customer loyalty/engagement, productivity, and profitability.
Business units scoring in the top quarter on engagement (compared with those in the bottom quarter) had lower turnover and absenteeism, less employee theft, fewer employee and patient safety incidents, and fewer quality defects, as well as higher customer loyalty/engagement, productivity and profitability. Specifically, business units in the top quarter had:
Just Who Is Engaged?
While the study doesn’t address how many employees report they’re engaged in their work or their workplaces, Harter said employee engagement in the U.S. has remained relatively flat despite the downturn and recovery.
Based on ongoing Gallup polling figures from 2012, Harter said about 30 percent of U.S. workers are engaged; 52 percent report that they’re not engaged, and 18 percent say they are actively disengaged.
Bob Kelleher, president and founder of The Employee Engagement Group in Woburn, Mass., and author of
Louder Than Words: Ten Practical Employee Engagement Steps That Drive Results (BLKB Publishing, 2010), said the research supports the experiences he has had with clients and other research he has seen.
“The key takeaway for the HR professional is to take these quantitative metrics to help convince the C-suite that engagement must be a business driver and part of the overall strategic planning process,” Kelleher wrote in an e-mail to
The fact that the study shows a link between engagement and performance despite tough times is not surprising, Kelleher added. The challenge is getting leadership to focus on engagement in tough times.
“Employee engagement is all about those things you
should do,” Kelleher wrote. “Unfortunately, during tough times, firms tend to focus their energies on the things they
Key Beliefs of Engaged Employees
The study identified 12 things that employees said contribute to engagement. All are important, but Harter said three are management basics that organizations often overlook:
Harter added that “great” managers improve employees’ lives while improving performance.
“One thing the 12 engagement elements teach us is that doing what’s good for employees and business doesn’t have to be opposing,” Harter wrote. “Rather than focusing on ‘happiness’ of employees, when managers focus on the right elements, they can improve the organization at the same time they improve the people.”
Steps Organizations Can Take
To help make the most of the link between engagement and results, Harter said HR should:
Pamela Babcock is a freelance writer based in the New York City area.
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