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Employee Engagement: Everything You Need to Know

clockRead Time: 20 Minutes

In this article, we explore what employee engagement is, how it has changed over time, the benefits of highly engaged employees, and the steps you can take to increase engagement in your organization.

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  • Intro
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Intro

Employee engagement is more than just a buzzword. Engagement affects just about every important aspect of your organization, including profitability, revenue, client experience, turnover, and much more.

Employees who feel connected to their organization work harder, stay longer, and motivate others to do the same. In fact, employee engagement research shows that organizations improving in profit, revenue, market share, stock value, and employee retention have highly engaged employees.

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1

What is Employee Engagement?

Employee Engagement Definition:

Employee engagement is the strength of the mental and emotional connection employees feel toward their places of work.

What is employee engagement? Employee engagement is the strength of the mental and emotional connection employees feel toward their places of work. Let’s break that down further.

Employee engagement measures how employees feel about their organization. Based on their perception of their workplace, employees are categorized into four main groups:

  1. Highly Engaged: Highly engaged employees hold very favorable opinions of their place of work. They love their job and their organization, and they feel connected. They plan to stay at the organization and put in extra effort to help the organization succeed. These “brand advocates” they speak highly of their company to family and friends. They encourage other employees to meet and exceed goals.
  2. Moderately Engaged: Moderately engaged employees see their organization in a moderately favorable light. They like their company, but see opportunities for improvement. These employees are less likely to ask for more responsibilities and may underperform. There is something about the organization or their job that holds them back from full engagement.
  3. Barely Engaged: Barely engaged employees feel indifferent toward their place of employment. They usually lack motivation for their position and will do only as much to get by—and sometimes less. Barely engaged employees may be researching other jobs and are at high risk for turnover.
  4. Disengaged: Disengaged employees have a negative opinion of their place of work. They are disconnected from the mission, goals, and future of the company. They lack commitment to their position and responsibilities. It's important to understand how to handle disengaged employees so that their negative perceptions don't impact the productivity of employees around them.

Employee Engagement Is Not:

When defining employee engagement, it's important to explore what employee engagement is not. Employee engagement is often incorrectly synonymous with:


employee-engagement-is-not

  1. Employee Happiness: Happiness isn't the same as engagement. It says nothing about how invested employees are in the company, nor how hard they’re working on behalf of the organization’s mission. Happiness is a short-term, rapidly changing measurement. An employee may feel temporary happiness from a raise and then sink back to disengagement. Engagement is a deep, long-term connection to the organization.
  2. Employee Satisfaction: Employee satisfaction can only be measured at surface level. An employee who is satisfied may not be engaged. Generally speaking, satisfied employees will not take steps to go above and beyond. When employees are satisfied, they usually stick around, but they aren't driven to go the extra mile. Engaged employees are productive, while satisfied employees tend to coast by.
  3. Employee Wellness: Employee wellbeing evaluates every area of an employee’s life. We try to understand how well an individual copes with stress or if they're fulfilling their potential. Providing resources to increase wellness can increase engagement. But engagement focu on an employee's connection with their company—not on their own wellbeing.

So, how long has the notion of employee engagement been around? Here’s a timeline showing how it has changed and evolved over time.

2

The Evolution of Employee Engagement

pt-1800s
The Industrial Revolution moves large numbers of people from farms into factories. The concept of management first enters collective thought.
pt-1911
Frederick W. Taylor publishes “The Principles of Scientific Management,” establishing the importance of effective management by linking management to increased employee productivity. The study of management is born.
pt-1924
Elton Mayo and Fritz Roethlisberger’s Hawthorne Studies transform management theory. Instead of focusing on individuals and their innate abilities, Mayo and Roethlisberger focus on social context. The Hawthorne Studies show that employees' surroundings influence how they perform.
pt-1980s

As manufacturing and production jobs are automated or sent overseas, service companies take their place. “Employees are your greatest asset” becomes “employees are your only asset.” The idea of a lifelong employer fades away, pension programs are slashed, and employee retention grows to be a universal challenge.

pt-1990a
The Academy of Management Journal publishes William A. Kahn’s “Psychological Conditions of Personal Engagement and Disengagement at Work,” considered by many to be the cornerstone of employee engagement. Kahn examines the extent to which people are able to express themselves in their workplace, leading to “attachment.”
pt-1990
The positive psychology movement gains traction. Positive psychology examines the optimal human functioning and “aims to discover and promote the factors that allow individuals, organizations, and communities to thrive.”
pt-1999
New York Times’ bestseller, “First, Break All the Rules” by Marcus Buckingham and Curt Coffman coins the term “employee engagement.” The book summarizes Gallup survey results on employee workplace perceptions. Gallup would go on to refine and develop their Q12 survey, the first widely known employee engagement survey.
Marcus Buckingham and Curt Coffman coined the term “employee engagement” in 1999.
pt-2001
"Job Burnout,” by Christina Maslach, Wilmar B. Schaufeli, and Michael P. Leiter proposes employee engagement as a solution to job burnout. This application to the working world creates more interest in further employee engagement research.
2002
Quantum Workplace develops Best Places to Work, the first national contest to recognize employers of choice. The contest was centered solely on employee feedback, with scientifically validated surveys measuring an organization's overall level of engagement.
pt-2006
The Society for Human Resource Management enters the employee engagement realm by publishing its “Employee Engagement and Commitment” guide. This is the first non-academic organization to establish best practices surrounding employee engagement. SHRM takes engagement from the classroom to the boardroom.
pt-2011
Following one of the largest studies on employee engagement (“Engaging for Success” by David MacLeod and Nita Clarke), the UK institutionalizes the concept of employee engagement by starting the Engage for Success initiative.
pt-2012
Google’s People Innovation team develops a the gDNA study. This century-long study aims to use science and survey results to better understand their work. “We all have our opinions and case studies, but there is precious little scientific certainty around how to build great work environments, cultivate high performing teams, maximize productivity, or enhance happiness.”[1]
3

What are the Benefits of Employee Engagement?

Employee engagement is appealing to HR because of its immediate benefits in retention, recruitment, job satisfaction, and happiness. But the benefits of employee engagement span much further than HR. Some of the most valuable and direct benefits of employee engagement are:

benefits-employee-engagement-increased-productivity
1.
Increased Employee Productivity. Engaged employees are more productive because their job enables them to use their strengths. Why does this matter? If employees work to their strengths, they are set up for immediate success. Enabling employees to do what they do well makes it easier for to meet and exceed goals. A recent study shows that recognition is a top driver of employee engagement. Engaged employees know they will be recognized for their efforts and are more likely to go above and beyond because of this.
 
benefits-employee-engagement-decreased-turnover
2.

Decreased Turnover. Engaged employees turn over less often for three core reasons. First, they know they will be recognized for their contributions. Second, they see opportunities for professional growth and career development within the organization. And third, their organizations are more transparent. When changes happen, they understand why they're happening. These three pillars enable employees to connect to the present and future.

benefits-employee-engagement-increased-innovation
3.

Increased Innovation. Engaged employees foster innovation because they know their opinions matter. They have the resources they need to develop and nurture new ideas. Consistent feedback challenges them to develop new and better ideas, solutions, and products.

Engaged employees are not afraid to fail when attempting new initiatives. That’s because an engaged organization treats failure as an opportunity to grow and learn. Instead of fearing failure, engaged employees feel their job is challenging and interesting. Tracked feedback allows them to see how they have grown over the course of their tenure with the company.

Engaged employees foster innovation because they know that their opinions matter.
benefits-employee-engagement-decreased-workplace-injury
4.

Decreased Absenteeism. Engaged employees enjoy going to work. They know their leaders value employees as their most important resource. Engaged organizations listen to employees and allow them to work in the ways that they work best. They provide resources for employee to work remotely and accommodate flexible work schedules. Employees show up because work aligns with their lifestyles.

benefits-employee-engagement-decreased-workplace-injury
5.

Decreased Workplace Injury. Engaged employees are less likely to get hurt. Their work environment is predictable, stable, and well-managed. Gallup reports that highly engaged, top-quartile work units have 70% fewer safety incidents. Why? Because leaders recognize employees as their most valuable asset. And they actively work to ensure and promote workplace safety.

When employees aren't concerned for their safety, they become more engaged, more productive, and more likely to stay. Employee move from mindless work to recognizing the importance of their individual contribution. They're held accountable, and rewarded for their contributions. Their opinions are heard, respected, and addressed.

When you invest in employee engagement, you’re investing in more than an HR program. There are tons of employee engagement statistics that prove how engagement initiatives contribute to the health, safety, productivity, and retention of your employees. In other words, the benefits of engaged employees are priceless.

4

Why is Employee Engagement Important?

employee-engagement-higher-profitability
22% higher profitability
stock-price-icon
26% greater stock price growth
unmatched-customer-experience
unmatched customer experience
5X-recommend
5X more likely to recommend
  1. Increased Profitability. When employees are more productive, they're more likely to meet goals and deadlines. Reduced turnover means you spend less money searching for and retaining qualified talent. A safer work environment means you can avoid costly insurance and legal expenses. All these come together to improve your bottom line.
  2. Increased Stock Price. Employee outlook has become more important to predicting the success of stock value. If employees have a positive outlook on the company’s future, the public likely will as well. This can lead to increased stock prices.
  3. Better Customer Service. Engaged employees lead to engaged customers. When employees feel connected to their company, they provide better service. In fact, leading customer service organizations report 60 percent more engaged employees. As true advocates of your brand, engaged employees help your customers and prospects see the value of your products and services. Building a customer success program is easy when employees are willing to proactively identify and execute on opportunities to improve service.
  4. Better Recruitment Success. Recruiting and retaining top talent is a struggle across the board. Nearly 4 in 10 mid-market companies say lack of talent constrains their ability to grow. Engaged employees are like magnets for top talent. In fact, they are five times more likely to recommend a friend or relative to apply for a job at their company.
5

How to Measure Employee Engagement

Before you think about improving employee engagement, you have to know where you stand.

How do you measure engagement? One of the most accurate and efficient ways to find out is with an employee engagement survey.

how-to-measure-employee-engagement


Types of Employee Engagement Surveys

  1. Annual Engagement Surveys: An annual, company-wide survey helps leaders understand engagement at an organizational level. These surveys should include items that are scientifically proven to measure employee engagement. Once leaders decide on the core of the survey, they can also include custom items. Here are a few examples:
    1. Job satisfaction: Are employees happy with their jobs?
    2. Culture: Do employees feel like they fit the mold? 
    3. Management: What do front-line employees think of their leaders? 
    4. Company values: Do your employees feel connected to your mission and core values? 
  2. Lifecycle Surveys: Lifecycle surveys allow you collect feedback from employees from key moments on their journey at your organization. Examples include:
    1. New Hire Survey: What do new employees think of your onboarding process? What was their perception at the 30-, 60-, and 180-day marks? What’s their outlook on the future?
    2. Stay Survey: Why are employees still working at your company? What could drive them to leave? What can be done to prevent it?
    3. Exit Survey: Why did an employee leave your organization? How did the turnover impact remaining employees? What can you do to prevent other employees from leaving?
  3. Pulse Surveys: A pulse survey is designed to help you gather real-time feedback on any topic at any time. This is especially important during times of transition—such as acquisitions and mergers, mission or focus changes, and executive or management changes.

Why is Measuring Employee Engagement So Difficult?

While a survey is a good place to start, there is far more to measuring employee engagement. The purpose of collecting data is to be able to track trends over time and use your results to take action. Here are some reasons why your engagement survey may be yielding unclear or inaccurate results:

  1. You’re not using the right kind of survey. Engagement surveys are not one-size-fits-all. You might be drawn to a simple NPS survey. But chances are, your organization needs a specialized survey to dig deeper into issues and opportunities. Format is also important. If you ask too many questions, your results might not be accurate. Employees might get tired of answering questions and choose a random response. If you ask too few questions, your survey data won't feel actionable.
  2. You’re not tracking results over time. Engagement changes over time. Like your bottom line, you hope to see it grow over time. But you have to record your results the same way you track your business finances. Otherwise, it will be hard to measure and improve engagement. Keep all your results in a central place so you can access and track results in future.
  3. You aren’t sharing the results with the right people. Transparency is important when measuring employee engagement. You need to be sure you are sharing your results with people in your company that can take action. Often, that will be your team leaders. You should also consider sharing the results with the employees who took the survey. This helps them see that their opinions have been heard and are being considered.
  4. You are creating surveys internally. Running your survey internally can lead to skewed or inaccurate data. Employees are less likely to open up when they know the people asking the questions are the same people responsible for their paychecks. Some employees may choose not to take part at all.
6

Why You Should Work with a Partner to Measure Engagement

Some organizations choose to work with a third party to measure engagement. Whether your business is a small startup or an international enterprise, you can benefit from working with a third-party employee engagement software provider to measure engagement.

Why is Working with a Software Provider a Good Idea?

  1. You'll reduce bias. No matter how hard you try to remain unbiased, you won’t be able to evaluate your survey results without bias. Confirmation bias is a huge problem among organizations that conduct their own surveys. Confirmation bias is the tendency to search for, interpret, and remember information based on your own perceptions. Survey software can help you keep the survey analysis as focused and as accurate as possible.
  2. You'll increase trust. It’s imperative that the data you collect from employees is as accurate as possible. Inaccurate survey results can lead to wasted hours and dollars on things that don't increase engagement. But employees are likely to lie or omit information if they know the people handling the data are the same people with the power to fire or promote them. A third-party vendor helps ensure anonymity and confidentiality. Employees will feel safer offering up sensitive feedback.
  3. You'll have access to experts. An engagement survey provider will have experience working with other companies like yours. They'll have insights and advice to help you succeed in your survey efforts and to implement employee engagement best practices. They can help you measure engagement and outline tangible steps to improve your results over time.
  4. You'll have time to focus on action. Whether you’re in HR or management, measuring employee engagement is not—and should not—be your job. Improving employee engagement once you have the results should be your focus.

Looking for employee engagement survey vendors?

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7

What To Do With Employee Engagement Survey Results

Once you have the results of your employee engagement survey, it’s time to develop an employee engagement action plan.

Here’s what to do with your employee survey results:

  1. Communicate your results. Share results of the survey with the company while remaining open and objective.
  2. Talk openly about results in smaller groups. Have a moderator work with teams to open a discussion about the results in a small setting.
  3. Select areas to improve. Have employees select areas that they think should be a priority for improvement. Then, the group should come to a general consensus on what the priority is.
  4. Discuss critical areas and ideas for improvements. Once the group has determined focus areas, spend time exploring the ‘why’ and identify potential solutions.
  5. Make decisions. The group should decide what the best next steps should be to address the priorities.
  6. Implement decisions. If group members are not the best people to implement change, the moderator should inform management of the recommended steps to improvement.
  7. Check in and re-evaluate. Check in on progress after a week, a month, or two months, depending on the scope of changes.
8

Is Measuring Employee Engagement Enough to Improve It?

If you want to improve employee engagement, the first step is measurement. But measuring employee engagement only diagnoses the problem. It’s a bit like stepping on your bathroom scale. Your scale will tell you your current weight, but it won’t help you lose weight.
 
Employee engagement surveys are the same. They help you measure, but they don't help you understand why your score is what it is, or how to improve it.
 
Sending an engagement survey to your employees implies that you plan to do something about the results. If you don't take action, you're communicating you don't care about their feedback.
 
So no. Measuring is not enough to improve employee engagement. You must take meaningful action to do that. Be strategic and intentional with your employee engagement programs.
 
9

How to Increase Employee Engagement

So, now you’re wondering how to increase employee engagement. There are three critical steps that your organization needs to take. It’s important that organizational leaders:

increase-enagement

  1. Listen. To improve employee engagement, you have to listen. Don’t just read your survey results or feedback reports. Listen to them. What patterns have emerged? Is anything surprising? How can you segment your responses by demographics? When you actively listen to what your employees want, to their feedback, and to the company’s cultural patterns, you are making the first step toward understanding engagement opportunities. Don’t forget that knowing that their opinions matter to leadership is a top driver of employee engagement.
  2. Focus: Once you’ve listened to—and heard—the areas of opportunity and improvement within your organization, focus on problem solving. Prioritize ideas and opinions and decide which can have the largest impact. Determine which areas of improvement are essential to your business growth and strategy in the short- and long-term.
  3. Transform: Once you have your employee engagement improvement playbook laid out, it’s time to roll your shirtsleeves and do the dirty work. Make your insights a reality. Be sure you are communicating your steps and commitment to change to your organization.
Remember that employee engagement is not a one-and-done initiative. Improving engagement should be as routine as pulling financial reports. Determine a cadence that is best for your organization. Request feedback and implement transformation on a monthly or quarterly basis.

Looking for some ideas on how to improve employee engagement?

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10

The Role of Managers in Employee Engagement

Everyone in the organization is important when it comes to driving employee engagement. But there is one role which is foundational to engaged employees: managers.

Managers are key to improving employee engagement because engagement is driven locally, even if it is reported globally. Managers have the most intimate and consistent interaction with employees in an organization. They have the largest ability to impact employee engagement. An employee is not likely to feel connected with an HR representative that is 4,000 miles or ten floors away.

Managers, therefore, have the largest ability to impact employee engagement.

HR can make changes that are generally good for the organization, but managers can build relationships that leverage human individuality and variability. That, in turn, will unleash greater loyalty, engagement, performance, and business success. It is a “win-win-win-win” among employee, manager, business, and consumer.

Conversely, management can also detract from employee engagement. If your management doesn’t have access to the tools they need to foster positive engagement, you could be spinning your wheels—or making things worse. Why? Because managers can make employees love their jobs or dread coming to work. As the accurate cliché states: People don't leave organizations, they leave their managers.

How Can Managers Improve Employee Engagement?

Employees have four core needs when it comes to engagement. And managers are best equipped to meet these needs because they interact with employee regularly and locally.

manager-coaching-professional-development
1.

Coaching and Professional Development. Only 65.6% of employees have been directly coached by a manager or supervisor in the last 12 months. This is an enormous detractor from engagement. Visibility into company growth and professional development opportunities is a top driver of employee engagement. Coaching and professional development opportunities are key to improving engagement.

manager-recognize-performance
2.

Recognize and Acknowledge Performance. Receiving recognition from management and peers is a top-5 driver of employee engagement. 82% of employees say it’s important to receive recognition from their manager. Organizations must provide channels and opportunities for managers to recognize employees.

manager-value-employee-voices
3.

Value Employee Voices, Ideas, and Opinions. Another top driver of employee engagement is knowing that their opinions count in the workplace. Employees don't feel motivated or appreciated when their ideas are dismissed or ignored. Organizations should provide channels for employees to voice their ideas to their managers and peers.

manager-alignment-to-vision
4.
Alignment to Vision, Fit, Goals, and the Future. In order for employees to know where they’re going, it’s important to track their success. Managers should frequently connect with employees about how their role and priorities align with the company’s vision. As employees change and grow, managers should check to make sure the employee is in the best role to showcase the employee’s strengths.

Need some ideas on how your managers can make an immediate positive engagement impact?

Read these 6 surprising engagement ideas for managers.

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Even if you implement some of the best employee engagement ideas, employee engagement activities, and team building activities, improving employee engagement is impossible to do without some degree of support. That’s where employee engagement software comes in. Employee engagement software helps to build and maintain engaging workplace behaviors.

11

Employee Engagement Software

Sure, you can use a free survey tool to ask questions. But a comprehensive employee engagement software doesn't just measure engagement. Effective employee engagement tools help track, communicate, maintain, and report on engagement throughout your organization. Your engagement software must map with the three steps to building employee engagement: Listen, Focus, and Transform.

What are the Essential Components of Employee Engagement Software?

 

1. Asking for Employee Feedback

Asking questions is the core of measuring and improving employee engagement. A comprehensive survey tool will enable you to:

LISTEN

Ramp up your employee listening strategy with right surveys to the right people at the right time. Use three core survey types:

  • Annual engagement surveys: for the 30,000-foot view of everything employee engagement
  • Lifecycle surveys: to measure perceptions across the employee journey
  • Real-time pulse surveys: for quick feedback on any important topic
FOCUS

Features like text analytics and demographic slicing allow you to segment and better understand employees’ feedback.

This allows you to quickly identify the issues that matter most to your employees, saving time and resources.

TRANSFORM

Armed with quantitative and qualitative data, you can take action confidently. Address concerns based on data, not bias.

2. Recognizing Employee Success and Effort

Recognition from management and peers is paramount to building employee engagement. Giving and receiving recognition shouldn’t be a hassle—nor limited to a monthly or quarterly meeting. Look for a software with intuitive and live feedback features.

LISTEN

An intuitive recognition tool allows management to read and listen to what peers are saying about your employees. Learn about events or milestones that may have otherwise gone unnoticed, and gain understanding into what your employees value.

FOCUS

By gathering recognition into a single, trending system, you can analyze and understand what your employees do best.

TRANSFORM

Transform your company culture into a participative group that values and rewards accomplishments and behaviors unique to your company’s culture.

3. Goal Setting and Tracking

How do you align individuals, teams, and your entire organization to a single set of company goals? It takes more than an email memo. A real-time goal setting and tracking software gives you immediate, real-time access into how individuals and teams are trending toward goals.

LISTEN

Listen to your employees’ goals and view their progress toward them in real time. When employees meet goals, set another for improved innovation and growth. Don’t limit goal reviews to a quarterly cadence.

FOCUS

With your metrics tracked in a central location, you can view where your employees are succeeding and provide recognition. You can also narrow in on where employees are struggling using metrics that mean the most to your organization.

TRANSFORM

Transform your organization from a basic ‘performance rating’ to an organization that has true visibility into the success and opportunities of individuals, teams, and the organization as a whole.

4. Giving and Receiving Feedback

Feedback is just as valuable as recognition when building employee engagement. Find a system that allows employees and managers to give feedback in a way that improves individuals and the organization as a whole.

LISTEN

Attributed or anonymous feedback allows peers to give continuous feedback. But it’s not just limited to employees. Feedback can be requested from outside partners, direct reports, and customers. Get feedback from anyone about anything, from anywhere.

FOCUS

Feedback can be corralled into a single feed, which makes it easy to identify trends and focus on areas of improvement. 

Two-way instant messaging allows your employees to better understand their feedback and the steps they need to take to improve.

TRANSFORM

From meaningless and sometimes harmful feedback loops to a continuous, incremental improvement model.

Funnel your feedback into a larger employee model to track goals and recognition moving forward.

5. Mapping and Tracking 1-on-1s

One-on-one meetings are critical in helping managers connect with employees mentally and emotionally. One-on-ones ensure employees can express their ideas, feedback, or concerns in an individualized setting.

LISTEN

Listen to your employees' concerns, challenges, and successes. Discuss growth and development. Be sure you have the ability to record notes, goals, and follow-up.

FOCUS

Easily see a record of past conversations in a feed that integrates with recognition, feedback, and goals so you have a complete picture.

TRANSFORM

Transform your one-on-ones from unproductive, routine check-ins to an open, two-way continuous conversation over the course of your employees' tenure.

What else should your engagement software have?

  1. Ideas and Alerts: No one is born knowing how to be a good manager. Automated alerts and accessible educational content help your managers increase engagement while respecting their busy schedules.
  2. Analytics: You shouldn’t have to have a degree in statistics or I/O Psychology to measure, analyze, and increase engagement. Analytics allow you to understand and act in confidence, making it easy to get to know your organization.
12

Final Thoughts

Employee engagement is more than just a survey. If you truly value your employees as your most valuable asset, you have to take action. Engaged employees aren’t just more productive—they can can lead to a better bottom line. To remain competitive in the digital age—and recruit and retain the best talent—you should have a plan to measure and drive employee engagement.

Employee engagement isn’t possible without empowered managers. Managers are the best resource you have in improving engagement. Providing your managers with the tools they need to measure, report on, and improve engagement is easy with a comprehensive and user-friendly employee engagement software.

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