Employers Engage on Engagement

Organizations continue to develop strategies related to employee engagement, which is the all-important qualifier of discretionary effort widely thought of as the linchpin of organizational success.

Though recognition and work-life balance programs are among the leading methods to promote engagement, both techniques were among the least-valued factors by HR managers when measuring engagement, according to a 2014 Employee Engagement survey by Human Capital Media Advisory Group, the research arm of Talent Management.

The survey, released earlier this year, included 134 human resources practitioners from companies of varying sizes and industries.

Recognition, work-life balance and wellness programs are the top three methods used to promote engagement — formally defined as the extent to which employees are motivated to contribute through discretionary effort. Nearly 61 percent of respondents in this year’s survey said they use recognition as a primary employee engagement tool (Figure 1), followed by work-life balance (54.6 percent) and wellness (50 percent). HR practitioners also reported using stretch assignments and incentive programs to drive engagement, though to a lesser extent.

“Our wellness program has been extremely successful,” wrote one respondent in the comments section of this year’s survey. “Currently, we are sponsoring a weight-loss challenge for our employees.”

Another respondent said: “We use open book management. Employees are educated on how a company makes money, overhead costs and are exposed to the costs of doing business. They get a share of the gains and there are little minigames to help solve problems that prevent efficient running of the company (extra hours on a job or shop time that is not needed).”

But when it came to the values and behaviors companies say they evaluate in measuring engagement, overall job satisfaction (64.1 percent), excitement about one’s work (60.9 percent) and opportunity to grow and improve skills (60.9 percent) top the list, according to the survey, roughly in line with last year’s results.

Meantime, work-life balance (37.5 percent), satisfaction with recognition programs (25 percent) and workplace safety (22.7 percent) were among the least evaluated factors when measuring engagement.

More Money, More Problems?
Money and other compensation-based motivators continue to be among the least-used methods to boost engagement. Benefits (28.5 percent), compensation (23.1 percent) and charity matching programs (20.8 percent) were among the bottom three programs used to boost engagement, according to the survey.

Additionally, 85.1 percent of survey respondents were aligned in defining employee engagement as “the extent to which employees are motivated to contribute to organizational success and are willing to apply discretionary effort to accomplish tasks important to the achievement of organizational goals.” This is a slight uptick from HCM Advisory Group’s 2013 Employee Engagement survey, when 83.6 percent of survey respondents agreed with that definition.

About 19.5 percent of respondents in this year’s survey said their organization does not evaluate employee engagement, similar to prior year results.

Employee retention is the most-used metric to gauge the effectiveness of employee engagement efforts, according to the survey (Figure 2). Roughly 80 percent of respondents said retention is the primary measurement used to determine engagement effectiveness, followed by individual performance (72 percent) and team performance (63 percent).

The least-used metrics companies report in measuring engagement effectiveness are customer loyalty (30 percent), sustainable revenue growth (23 percent) and increased market share (19 percent).

Moreover, in terms of how engagement is reported by demographics, 57 percent of survey respondents said they report engagement by department and division; 30 percent report by high performers; 24.3 percent report by generation or age; 23.3 percent report by gender; and 9.7 percent report by race or ethnicity. About 35 percent do not report engagement by any demographic.

Comments included in the measurement section of the survey reveal that engagement is most often measured through companywide surveys administered at least once a year. Other companies administer engagement surveys every other year.

Most respondents in the survey said they measure engagement’s influence on factors such as performance, retention and absenteeism yearly (Figure 3). Engagement’s influence on things like team performance and productivity are also measured annually, according to the survey.

On the other hand, things tied more directly to a firm’s financial results — service quality, profit, revenue and market share — are measured against engagement influence on more of a quarterly basis, according to the survey (Figure 4). A much smaller percentage of HR practitioners reported measuring these things in relation to employee engagement on a weekly basis.