Developing high employee engagement makes good business sense

Watson Wyatt’s 2002 study found that "high commitment firms" (ones with dedicated employees) outperformed "low commitment firms" . . . by 200%!

Companies are fast finding out that boosting worker engagement boosts overall financial performance. The Gallup Organization has shown that involved and committed workers produce more, make more money for the company and are more committed to the quality and growth of the organization. Happy employees are more likely to stay and they create loyal customers. Engaged employees are the backbone of good working environments where people are industrious, ethical and accountable.

Watson Wyatt’s 2002 study found that "high commitment firms" (ones with dedicated employees) outperformed "low commitment firms" . . . by 200%! And that’s not all the research shows. Four major studies by Gallup, Learning and Development Round Table, The Conference Board, and The Corporate Leadership Council form a cross-validation for the link between employee development and high engagement. Together, they create a compelling business case for investing in the development of people.

The culture of companies who believe in and practice employee development - like Hewlett Packard, Whole Foods, and Genentech - is one where employees have a high degree of control over their work lives. There’s a collaborative leadership style, which engages employees to participate in all aspects of the business – ideas, products, and services. Everybody is a stakeholder. Engaged behavior is reinforced by the company’s reward system and manifested in the employees’ job design. A job design that promotes employee engagement guarantees that workers will be challenged and stimulated, given authority, autonomy, access to information and resources, as well as growth and development opportunities.

Engaged employees are 87% likely to stay in their jobs. Interestingly enough, in regards to employee retention, the decision to leave a company is equally linked to emotional reasons and physical reasons like pay and benefits.

To sustain core values with high employee engagement, environmental supports must be set up within the company so that everything reinforces the corporation’s cultural DNA. And for best results, it’s essential that collaboration also be at work outside the company with everyone in the supply chain. In departments where engaged employees sell to engaged customers, customer loyalty, repeat purchases and recommendations to friends is double that of companies with average employee engagement.

Curt Coffman and Gabriel Gonzalez-Molina stated the case for employee engagement beautifully in their 2002 book, Follow this Path.

"Great organizations achieve sustainable growth and profits because they do what other organizations don't: they maximize the innate, individual talents of their employees to connect with customers. They know that tapping the resources of humans is the only remaining area where significant improvements can--and do--lead to an unlimited source of competitive advantages."

In Part III of this series, we’ll look at ways to support employee engagement in your organization.