Clarity the key to employee engagement

Dec 11 2007 by Nic Paton Print This Article

Managers who can clearly communicate where their company is going and why everyone is doing what they are doing are generally much more successful when it comes to engaging their staff.

Nevertheless, they will still often be completely in the dark about why a valued employee decides to leave.

Two pieces of research by HR consultancy Watson Wyatt have stressed the importance of trust and communication in the management/worker relationship.

First, a poll of 14,000 employees across Europe has suggested that those companies that provide their employees with a clear "line of sight" when it comes to vision and direction tend to have a much more committed, engaged and productive workforce.

Organisations with superior financial performance measured by total shareholder return, market premium and employee productivity will, more often than not, have a more engaged workforce.

The most important driver for ensuring employee engagement was strategic direction, with other key drivers of engagement being employer communication, the attention given to customer focus within the organisation and performance management.

Perhaps surprisingly, pay and other rewards came bottom of the list, found Watson Wyatt.

"Business leaders who articulate the business strategy give employees a clear 'line of sight' to how they can best contribute to the performance of their company," said Andrew Cocks, a senior consultant at Watson Wyatt.

"But the benefit goes beyond this. It helps to build trust in the company and its management and creates a positive environment where all employees have well understood shared goals," he added.

Employees could be segmented into five groups that reflected varying levels of commitment and line of sight, Watson Wyatt said.

Top of the list were "value creators", or those who scored highly for both commitment and line of sight, in total 13 per cent of employees surveyed.

Next were "core contributors", or those displaying medium to high commitment and/or medium to high line of sight, but not high for both.

These were, it was clear, the bulk of the modern workforce, making up more than half (51 per cent) of those polled.

Third were, "aligned sceptics", or those scoring medium to high for line of sight but low on commitment, calculated at 12 per cent.

Fourth were "lost believers", or workers with medium to high commitment but low line of sight, coming in at 12 per cent.

And, finally, there were the "disengaged", or workers who were low on both commitment and line of sight, making up 12 per cent of the sample.

"Segmenting employees in this way is important because considering the differences among segments when companies design employee programmes helps ensure that they retain the right people and get the best return on their investment," said Cocks.

"The key to engaging employees comes from targeting the right employees with the right programmes. Companies that segment employees based on commitment and line of sight can find the right drivers that will retain and motivate their most valuable employees.

"Programmes that increase trust, empowerment and customer focus increase engagement and therefore provide a competitive advantage," he added.

However, a separate poll by Watson Wyatt of 175 companies has also found a continuing and significant mismatch between companies' perceptions of why people change jobs and the reasons employees actually give for doing so.

While a large number of companies across Europe see career development opportunities, their company's reputation and the level of base pay offered as the leading reasons new employees look to join them, employees say something completely different.

For employees the top reasons given are the nature of the work, job security and base pay.

There was also a mismatch when it came to retention, said Watson Wyatt.

Employers focused on career development opportunities, promotion opportunities and base pay as the ways to stop employees quitting.

Employees, by contrast, cited increasing stress levels, uncompetitive base pay and the lack of promotion opportunities as the key catalysts for walking from a job.

"Companies appear to be putting far more emphasis on long-term career planning than employees are themselves," said Carole Hathaway, European head of strategic reward at Watson Wyatt.

"The priorities of many employees are rather more prosaic Ė the nature of the job, pay, stress and commuting," she added.

"This is not to say employers are focused on the wrong things to attract and retain; career development and promotion opportunities are still rated as important by large numbers of employees," she continued.

"But employers need to increase their focus on more immediate needs as well, such as the nature of the work they do now, and the internal and external pressures that affect employees' working experience, like stress and length of commute," she concluded.