Friday, April 11, 2014

Beyond Compensation: Countering the ‘Checked-out’ Worker

Engaged Employees, Human Capital, Invested Workforce, Holy Grail? That’s what you’d believe if you read the headlines. Finding and keeping employees actively engaged and connected to your business vision is becoming harder to find than the proverbial needle in the haystack.

Types of Workers
Gallup’s State of the Global Workplace Report identifies three employee types. 
  1. Engaged – These employees work with passion and feel a profound connection to their company. They drive innovation and move the organization forward. Some define it as those workers that are psychologically invested in the business and apply discretionary effort in their daily tasks.
  2.  Non-Engaged – These employees are essentially ‘checked-out.’ They’re sleepwalking through their workday, putting time – but not energy or passion – into their work.
  3.  Actively Disengaged – These employees aren’t just unhappy at work; they’re busy acting out their unhappiness. Every day, these workers undermine what their engaged coworkers accomplish.
While the global report revealed that only 13% of the world's workforce is in category 1 above, this number gets higher when we look at the U.S., where 30% are actively engaged in the workplace. However, the remaining 70% indicates there is still work to be done.

Today’s working environment
According to a recent report from our friends at Cornerstone On Demand, titled Reimagine Work, today’s work place is more Multi. It’s multi-generational, multi-geographical, and multi-cultural. Much has been made about the substantial number of boomers that will retire in the next 5 – 7 years. This absence will only increase the diversity.

Technology advancements are another driver of change. The constant connectedness we have through social media and personal devices results in more work/life blurring rather than balancing.

What’s a Business to Do?
With the changing face of the American workforce, some of the things that employees desire in the workplace may surprise you. While it would be wrong to not consider adequate compensation, it’s certainly not the sole motivator for employee buy-in, nor is it necessarily the #1 factor in determining job satisfaction. 
  • Team Play and Collaboration – This is one of the top traits employees love about their co-workers. Cornerstone's survey indicate that employees desire a more dynamic workplace, which is more social and fun, particularly because of the aforementioned work/life blurring.
  • Peer to Peer Recognition - is also valued. MTV’s ‘No Collar Workers’ report provides some insight indicating that 92% of Millennials or Gen Y, in the job market think their company is lucky to have them as employees, but they expect feedback and recognition.
  • Deep Desire to Generate New Ideas and Contribute to the Organization - Before the above stat sours you on Millennials understand this, one-third would prefer recognition or a promotion over higher pay. Perhaps a little recognition and feedback from managers and peers would go a long way in keeping them engaged.
  • Constant Learning - In fact, 89% think it’s important to be constantly learning at their job, which gives career ladders and professional development a pivotal role in an employee’s personal job satisfaction ranking. Only 1 in 4 employees surveyed had established career goals with their manager or employer.
Opportunity for Successfully Engaging Your Workforce
The biggest opportunity for businesses is to engage the non-engaged employees. Companies with high employee engagement tend to be significantly more profitable, have higher productivity, with fewer safety incidents and lower turnover. 
  • Lower Turnover – Engaged employees are more satisfied with the job, in tune with the company mission and vision and far less likely to leave the company. If you were to estimate the average cost to recruit and train one employee as 2.5% of the anticipated salary, the cost of losing just one employee would be significant. This doesn’t begin to identify the cost of business strain from carrying actively disengaged employees.
  •  Increased Profitability/Productivity – These two concepts are intrinsically linked. Engaged employees are happier, more invested in the business, and more importantly, actively looking for a better way to get things done. They are incredibly efficiency focused. Organizations with an average of 9.3 engaged employees for every actively disengaged employee experienced 147% higher earnings per share compared with their competition.
  •  Lower Absenteeism and fewer safety incidents – Satisfied employees, invested in and recognized for, improvement efforts and contributing new ideas, are more inclined to come to work. If processes are running smoothly and efficiently, there is less opportunity for accidents and violations to occur. According to OSHA, workplace injuries and illnesses have a major impact on an employer’s bottom line. It has been estimated that employers pay almost 1 Billion per week for direct workers’ compensation costs alone. 
Next Steps
Before you can act, you have to analyze and understand your current situation. An employee survey is a great way to take the pulse of your organization. From there, you can form an action plan to implement.

Still not convinced? Don’t take my word for it. Instead, come and join us on May 1st for a breakfast briefing and panel discussion as your peers share the benefits they experiences from successfully engaging their workforce. Click here for more information or to hold your spot at the table.

Since 1991, MMTC has assisted Michigan’s small and medium-sized businesses compete and grow. Through personalized services fitted to meet the needs of clients, we develop more effective business leaders, drive product and process innovation, promote company-wide operational excellence and foster creative strategies for business growth and greater profitability. Find us at

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