A few weeks ago, friend and fellow blogger Lance Haun wrote an article over at TLNT titled Five Reasons Your CEO Doesn’t Care About Employee Engagement. It’s a really thought provoking piece. Check it out if you get a chance.
I recall having a conversation about the article with a colleague and their reply was if the CEO doesn’t care about employee engagement, then get rid of the CEO. Obviously the implication being that the CEO is a goofball for not understanding employee engagement and should be tossed out of the building.
And while this might be true, I’m not sure it’s the first reply I would come up with.
If employee engagement is important, then you have to show how it directly correlates to the business objectives of the organization. We can’t just say something is important or valuable and expect the world to jump on board. We have to show how it’s valuable and the impact it has on the business.
Frankly in my entire career, I’ve never seen a CEO completely ignore something that was shown to be valuable to company’s business objectives. That doesn’t mean it always becomes the top priority or gets a huge amount of resources thrown at it. But I’ve never seen it deliberately disregarded.
With regard to employee engagement, one firm that has done a tremendous amount of work in this area is Gallup. Several years ago, they introduced the Q12 – a 12-question survey that allows companies to measure employee engagement. They’ve also produced a white paper on their research, outlining the relationship between work engagement and business outcomes. You can download the white paper here.
My point is before you fire the CEO (or another member of the leadership team) for not caring about employee engagement, make sure they understand it and how it impacts the organization. To assume the mere words “employee engagement” are self-explanatory and therefore important and essential is…well, you know what happens when you assume…
Having employees that are engaged with the company is important. It’s our job to show the organization how important engagement is to the bottom-line.
Image courtesy of sushi♥ina0
Paul Hebert says
For those that want to have the conversation with their CEO I’d suggested they visit here: http://www.enterpriseengagement.org/articles/content/2292/the-economics-of-engagement/
This article consolidates a lot of the data on the impact of Employee Engagement into one place. It covers Gallup, Center for Talent Solutions, HCI, and case studies from Sears, Costco and others. There is a an accompanying PDF for download.
Full transparency – I do some social media work for this organization and assist with curriculum development for their certification program. That aside – it’s a good primer on how Engagement drives business results.
Sharlyn Lauby says
Thanks for sharing the resource Paul. I have to check this out!
Catherine Cantieri, Reliance Staffing says
Nice work! I think employee engagement might suffer a loss of credibility for the word “engagement,” which can sound touchy-feely to those prone to disregard such things. But as the whitepaper shows, engagement has a significant impact on such non-touchy-feely things as safety, turnover, absenteeism and, especially, quality. Very good post!
Sharlyn Lauby says
Thanks for the comment Catherine. I agree the term employee engagement is misunderstood. But as you mentioned, hopefully people can get past semantics and see the results.
Great post! I’d be interested in some tried-and-true employee engagement ideas to implement once the CEO is onboard.
John Lake says
“Engagement” = HR speak; “ROI/ROA” = CEO speak
To translate to CEO speak, this might help…
Ask/show how much it costs to replace an employee who voluntarily leaves an organization. Recent studies show it has been around 1.5x to 2x annual salary for entry-level positions and 5x to 10x for higher level and more specialized positions. Don’t forget to include hidden costs such as lost productivity while those still working “pick up the slack” while the position remains empty, lost customer support or contact, etc.. Now you have “initial” investment. For other costs, include OJT, and other professional development items.
If the CEO and his/her direct reports create, monitor, and encourage an environment that people want to belong to, that investment yields a “return.” If the employee leaves one position for another IN the organization, or encourages others to consider joining the company, the return is even greater.
If, however, the employee elects to leave an organization (and it looks right now as if about 50% of the workforce is getting ready to do just that – especially the “hi-po’s”), that investment now becomes an “expense.”
The “hook” question then becomes, “What side of the balance sheet do you want to be on?” That should be a “ponderable” to get the C-Suite thinking about what they are measuring for.
However, it is the approach that senior leadership lives out (not just words, but behaviors) that changes a company’s culture. All the training programs, policies and practices won’t amount to a hill of bean[counter]s until a company’s belief/value system shifts. Until that occurs, expect engagement, motivation, and retention to stay at an all-time low.
working girl says
And if they don’t buy into the numerous studies showing that companies with highly engaged employees outperform companies with passive employees, they may care about capturing human capital measurements in financial reporting: http://www.tlnt.com/2010/11/22/get-ready-that-omg-moment-for-talent-management-leaders-is-coming/
(Just to be devil’s advocate here, there’s enough proof out there about the importance of engagement on the bottom line that the CEO should sort of know about it without HR having to prove it…)
Sharlyn Lauby says
@Zara – Thanks for the comment. It looks like there have been some interesting answers to consider.
@John – I agree that everyone needs to speak the same language, which is typically the language of numbers. That being said, marketing departments talk of customer engagement so I wouldn’t say all engagement is HR speak.
As you point out, if companies talk in terms of numbers then linking engagement outcomes to quantitative results will be key. Thanks for the comment!
@Laura – Thanks for sharing! While morale and turnover are important, productivity is another key business metric to consider in the engagement conversation.
I agree that most CEOs should already have some knowledge of employee engagement. The matter for me is how do you elevate it’s importance (i.e. knowing versus caring).
For an employee engagement strategy, check out this article by TNS Employee Insights: