Cost Related Benefits of Increasing Employee Engagement?

Employee Engagement

Employee engagement is a ‘buzzword’ at the moment in business, often linked to employee happiness and job satisfaction. It’s the ultimate goal that a lot of new businesses strive for – and the term is often talked about in terms of the obvious advantages.  

An engaged workforce is intrinsically linked to a happy workforce, and the benefits of this can include job security, better job performance, better staff loyalty and high staff retention.

Businesses that have an engaged and happy workforce are often the most desirable companies to work for too – which can lead to an increase in job applications and an increased industry profile. 

Of course, a happier team leads to a happier workplace, and a happier workplace often works better, smarter, harder for their employer…

But one thing that isn’t often explored, is how cost related benefits of engagement are a big part of building a successful business too. This side of things is rarely explored, even though research has pointed towards higher profitability and growth for companies focusing on increasing engagement. 

The workforce, and how happy they are, is commonly playing a significant role in many business’ bottom line. So surely it’s worth exploring in more detail?

How do we describe employee engagement?

Employee engagement is a fairly broad term, so how can it be defined? 

According to MIT Sloan School of Management, it is a construct that comprises all the different facets of attitudes and behaviours of employees towards the organisation. The five dimensions of engagement are:

  • Employee identification – this is where culture comes in. How do staff members relate to company values and identify with the brand?
  • Employee satisfaction – satisfied employees are absent less and more committed to their job role
  • Employee performance – valued employees who are trained well will perform well
  • Employee commitment – This develops over time, with committed employees performing better and less likely to leave the company
  • Employee loyalty – loyalty to an organisation results in doing more than expected

These five dimensions affect how your employee acts at work, how they take responsibility at work, how long they work for, their commitment and dedication to the job, and even how they talk about their job in conversation with friends or family. 

The key is value. The concept of value and engagement often go hand in hand, especially in the context of business. 

An engaged team feels valued, and a good boss (or business) values their engaged employees. Making people feel valued, makes people naturally engage more, and the more engaged people are, the more likely they are to feel valued. It’s a circle.

How engagement impacts profitability

If you take a look at those five factors of engagement, it’s actually quite easy to see how the trickle-down effect could improve sales and drive growth. It could take a long time for an employee to tick all five boxes, but even if you master employee identification and employee satisfaction you could see performance related benefits.

Treat your staff like a valued resource and you could see results in a matter of weeks. In a competitive world where there are hundreds of other companies out there selling the same products or services, it’s exceptional customer service and your people who are going to keep customers coming back. Research into global businesses has proven that companies with highly engaged employees experience high levels of growth compared to those with disengaged employees.

In the same ilk, seeing staff as a resource should ensure you treat staff with the value and respect they deserve. A big part of profit is retaining staff, as we all know that hiring new staff takes time, resources and budget. 

Research by Glassdoor recently reported that 53% of employees are confident that if they quit (or lost) their job, they could find a comparable position within six months. 

This statement should highlight one key thing… If you don’t give employees a compelling reason to stay, they’ll find another job that does.

Especially with younger generations (under 40 years old) feeling valued is a major part of their professional happiness. Younger generations want to feel like they’re contributing and giving something to their role, rather than just ‘passing time’ or ‘making money’. Feeling valued and adding valued themselves, is a huge tick on their list.

How can you keep employees engaged?

There are many ways to go about it, here are some quick ideas from us:

Idea 1: Use valuable performance incentives. For performance driven jobs, incentives (and meaningful ones) are a key driver for employee engagement.

Idea 2: Offer benefits that staff actually want. Yes some companies will give you the afternoon off on your birthday, but what about finishing an hour early each Friday instead? Weigh up what employees actually want, versus what sounds cool. If you’re stuck for ideas – ask your staff, they will be more than happy to help!

Idea 3: Have a clear company mission. A lot of employees like to know what they’re part of and what they’re pushing towards. For a lot of employees, they work better and harder when a company mission is clear to them from day one.

Idea 4: Recognise employees of all levels. You’d be surprised how often junior members of staff go unnoticed in larger organisations – when in reality these are the staff that need encouragement and enthusiasm to stay loyal and keep training. Recognising all achievements in the company – no matter how big or small – is a big step to making people feel valued.

Idea 5: Listen to your employees. Listening is a big thing, and when you listen, others will engage with you too. When an employee suggests something, even if it’s not something you can change or alter, be sure to listen and take on board their feedback.

Idea 6: Measure engagement! Engagement isn’t something that you want to mention once and then forget about. Measure your employee’s engagement levels by conducting regular anonymous surveys or even having external companies come in for interviews.

How we can help

In addition to research, here at Hunter Adams we have our own success stories to strengthen the argument for employee engagement. We’ve reduced staff turnover from 60% to zero in a matter of weeks, and help a client save £150,000 on turnover in the first year – this is before any profit increase is accounted for.

As a small company, we should know the direct benefits of focusing on culture and engagement. The Times named us one of the best small companies to work for in 2015, and have experience rapid growth in the first few years of business. If you’d like to discuss how our HR experts can help you tap into the growth available from employee engagement, email team.admin@hunteradams.co.uk.