In God we trust. The rest bring data.

Author: Cormac Smith
Date: February 23, 2021

Possibly the most compelling case  for staff engagement you will read this year.

Building real employee engagement is an ongoing challenge. A challenge I’ve been grappling with in large organisations for almost two decades. With staff engagement often seen as the poor relation of corporate communication, trust me, I’ve had to fight many battles.

But, for those who do prioritise staff engagement and make the necessary effort and investment, the rewards are always significant.

So, for the rest of this short article, I am not going to tell you what I think – instead, I will let the most compelling evidence available speak for itself.

LET’S START WITH YOU.

Answer honestly - how do you feel, right now, about your job? Are you invested in your organisation, eager to contribute to its goals, ready to go the extra mile? In short, do you have a sense of engagement with your work?

If you said yes, then you are part of a surprisingly small minority. Now look around (either the office or the zoom call!) – can you say the same for the majority of your colleagues and staff? According to global research by Gallup, only around 1 in 6 employees feel actively engaged by their work. Now get ready for the shocker: for the UK, where I am based – the world’s fifth largest economy, by the way – that figure falls to just 1 in 11!

If we trust those statistics – and coming from one of the world’s most respected polling organisations we should — they are hugely sobering. Put bluntly, the majority of the workforce are either indifferent to, or actively disinterested in, their day-to-day work.

Playing devil’s advocate, these figures raise an intriguing question. From a purely business perspective, how much does staff engagement matter? After all, in spite of this lack of engagement, organisations continue to grow and thrive. Isn’t it enough for employees to simply show up and do what’s asked of them? 

Actually, there’s ample evidence that improving staff engagement not only improves peoples’ working lives, but also makes good business sense. Let’s look at some reasons why.

ENGAGED PEOPLE WORK HARDER – DISCRETIONARY EFFORT

Plenty of research confirms the common-sense notion that people who are happy to be at work are more productive. For example, another survey by Gallup concluded that highly engaged workers are on average 21% more productive than their less engaged peers.

Global management consultancy Bain & Company found an even stronger connection. In their research, engaged employees were 44% more productive than satisfied employees, who in turn were 40% more productive than non-satisfied workers. At the top of the tree were the inspired employees, who were 125% more productive than even their engaged peers.

Engaged employees give more discretionary effort. That is to say they go above and beyond typical job responsibilities. An IBM research report showed that the 25% most engaged workers gave almost twice as much discretionary effort as the those in the bottom 25%. With 95% discretionary effort for the most engaged compared with just 55% for the least engaged. 

ENGAGED PEOPLE STAY LONGER – RETENTION OF THE BEST

As well as increasing productivity, engagement is a key factor in retaining staff.

Staff turnover is a major expense for most companies, with each replacement of an employee costing 50%-60% of their annual salary. And these costs are only set to rise, as job-hopping millennials and Generation Z replace longer-staying baby boomers in the workforce.

So, given that satisfied employees are 52% less likely to be seeking another job, staff engagement has huge financial implications for organisations. The greatest effect on retention is for those millennials and Generation Z, who are less likely to stick around in a job they don’t care about.

ENGAGED PEOPLE WORK SMARTER – HIGHER PERFORMANCE

The same IBM research report referenced above also shows that workers who are more engaged perform at a higher level, with performance scores of 96% for the 25% of staff who were most engaged… compared with a performance score of 73% for the 25% least engaged employees.

Which, in real terms, means engaged employees work harder, work smarter and stay with the organisation longer. Now you see why it’s worth the effort and investment. 

WHAT DOES THIS ALL MEAN?

At the end of 2020, Gallup published the results of the largest ever staff engagement study Gallup 2020 Meta-Analysis (1).pdf involving 2.7 million employees from 276 organisations across 96 countries. In summary, the findings were as follows:

An engaged workforce = a reduction in

  • 81% in absenteeism
  • 18% in turnover for high-turnover organisations*
  • 43% in turnover for low-turnover organisations*
  • 28% in shrinkage (theft)
  • 64% in safety incidents (accidents)
  • 58% in patient safety incidents (mortality and falls)
  • 41% in quality (defects)

An engaged workforce = an increase of:

  • 10% in customer loyalty/engagement
  • 14% in productivity (production records and evaluations)
  • 18% in productivity (sales)

An engaged workforce = positive impact on the bottom line and on our people

  • 23% in profitability
  • 66% in wellbeing (thriving employees)
  • 13% in organisational citizenship (participation)

It’s pretty unequivocal, isn’t it? And there is plenty more evidence of the benefits of engaged staff – here are just three more powerful examples

  • One major study concluded that “organisations enjoy 26% higher revenue per employee when employees are highly engaged.”
  • Likewise, human capital experts Aon Hewitt estimate that companies with highly engaged employees generate 22% higher shareholder returns.
  • And a long-term study reported in Forbes discovered that businesses with a ‘performance enhancing culture’ (of which engagement was an integral part) grew their revenue over four times more than companies without that culture.

SUMMARY

I could go on, but you get the point. The benefits of staff engagement are clear. But improving staff engagement requires investment to build better managerial and leadership capacity and to improve internal communication in organisations.

One thing is certain: at a time of global crisis when we are seeing massive changes to working patterns and unprecedented financial challenges for businesses, having the support of an engaged, committed and loyal workforce has never been more important. As we adapt to the new normal of working life, it could well be the most decisive factor for business success.

Baird’s CMC provides expertise in all aspects of communications, messaging and media management. Specialising in crisis management, we provide training to high profile clients throughout the world. Find out more at our website https://www.bairdscmc.com/ or follow us on LinkedIn and Twitter.

Your Project Team

Raquel Cruz and Cormac Smith bring significant experience in all aspects of strategic communication and public relations. Having worked across our organisation to develop our new product offerings, specifically aimed at the current challenges we all face, they will assemble and lead the strongest teams to address your issues. With our unique global network rest assured you will always be working with the best in the business.

Raquel Cruz

Project Manager

Raquel is a communications and project management specialist. She will be coordinating the introduction of our new services and supporting clients in the management and delivery of their projects.

Since working for Baird’s CMC, Raquel has been involved in communications, research, and project management for clients including Roche, IFPMA, ViiV Healthcare, Angelini Pharma and Gavi, with accountability for everything from conception to successful completion.

  • Speaks fluent Spanish and English
  • Masters’ degree in International Journalism from Cardiff University, UK
  • Background as a public relations consultant in a Spanish communications agency
  • Experienced radio producer and social media specialist

Cormac Smith

Skills Development
Project Director

Cormac is a highly experienced strategic communications specialist. He has been integral to the development of these new services and will be working closely with clients to understand their needs and develop solutions.

In a career spanning three decades Cormac has held a number of senior positions, including Deputy Director of Communications at the UK Cabinet Office, Strategic Communications Advisor to the Foreign Minister of Ukraine, and as Director of Communications for several UK local authorities.

  • Media training and public speaking expert
  • Experienced in crisis communications
  • Specialist in staff engagement and corporate leadership
  • Trusted adviser on reputation management and media relations