Women as Leaders: Good for Worker Engagement and The Performance of Our Organizations!

Some interesting information came over my favorite evening TV news show the other day: it was about the role of women at work, something in which I have been interested ever since I was a young recruit at the Hay Group, an international HR consulting firm which specializes in compensation programs, among other things.  My job as a junior level consultant was to learn the Hay System, a method of evaluating jobs for knowledge and skills needed, and responsibility placed on the person in the job.   Each job then came out with a single score of “Hay points”.  It was interesting because it was capable of separating the job from the person in the job.  The system allowed clients to pay women equally based on what was being paid in their market or locality for a given complexity or “size” of job regardless of male or female incumbents.  As such it enabled our clients to tell their female workers that they were being paid, not on prejudiced pay scales for “womens’ jobs” but on something “gender neutral”.  I got a lot of satisfaction from that.  When I soon moved into Hay’s research business (employee opinion surveys, culture, worker morale etc.) I didn’t forget the lessons learned on the compensation side, and have always been interested in data about women at work.

So on NBC News the other day, this piece came on about how many women are now in the US workplace and what positions they hold, how many go to college and so on. Data was also shown as to how they are being paid, which is always a depressing figure.  The employment and education numbers are far from depressing, however. Sixty percent of women now work outside the home; they occupy more than half the professional and managerial jobs in the US, which is an astounding statistic.  There are now more women in college than men in US, and 40% of women are primary breadwinners in their families.

This was mostly great news for women, but it got better: the part which really caught my eye was about top management jobs and womens’ impact when they occupy them. NBC quoted a study, not a new one but one I had not seen before, that looked at 2000 of the biggest US companies. This was done by David Ross of Columbia Business School and showed that when women were senior managers in a company, it performed better.** Ross was interviewed and he said that is because as leaders women are more democratic, less dictatorial and more collaborative. I would add, also more compassionate. Now the jump to engagement here is an easy one: the traits which Professor Ross mentions are clearly ones which are related to creating a more “engaging environment”, that is one in which workers will choose to engage.

The idea that women are having more and more positive influence on work cultures is gaining ground in both books and the blogosphere. In Enlightened Power: How Women are Transforming the Practice of Leadership, Barbara McMahon states: “In the new form of leadership, it is no longer doctrine that creates a following; it is dialogue. It’s more valuable to be able to engage than to influence. Command and control has shifted to collaboration and empowerment.” As blogger Mitch McCrimmon points out: “Regardless of whether more women make it to the top, organizations are becoming more feminine. There is now more emphasis on relationship skills, emotional intelligence, the ability to nurture talent, listening skills, collaboration and partnership. These skills are essential for success for both male and female executives.” At the same time he points out that mens’ competitive nature is essential and that “In any case, this issue should focus, not on men versus women, but on organizational culture. At that level, a mixture of feminine and masculine traits are required. But there is no doubt that we are in the midst of an unstoppable shift to more feminine cultures”

With women now going to college more than men, and that trend accelerating, they will continue to get more of the top jobs. This study would indicate that this bodes well for US engagement and resulting organizational performance levels. That is good news in an otherwise still quite gloomy post-Crash hangover!

** Note: I am aware that correlation is not cause, and the fact that there may be a third element in this story, which “causes” both women being hired to top jobs and great performance by the organization. I was not able to check if Professor Ross had allowed for this, but he talks as if he has. It is certainly worth further research.

Data source: NBC Nightly News (US), “America in Transition”: March 4th 2011

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Twitter and Facebook as Agents of Revolution in Cairo, Tunis….and Your Workplace?

I was reading a piece by Daniel Henninger in the Wall Street Journal yesterday about the emerging situation in Egypt. After a brief intro he made the jump from Cairo to Silicon Valley, saying that without the invention of the microprocessor’s predecessor (the transistor) Egypt and Tunisia would not have happened. The chip has allowed for Twitter and Facebook, along with so much more, and these programs are the basis of communications for protesters on the streets.

Henninger makes the point that this is the end of what he calls “stability”, where governments can control their people via the control of information. Whereas a few people would gather in the past in Cairo to quietly chat over who had been arrested, now such information is blasted across the ether to everyone around the world. As he says “instability is the new status quo”.

From this, I got to thinking about work and engagement, and the effect of Twitter and Facebook there. If such things as happen in Cairo happen in the workplace, what will be the effect? Revolutions at work? Maybe yes, perhaps not so dramatic, but significant nonetheless. Here are the reasons:

–Social media are a very democratic form of communication. Anyone can get an account and anyone can tweet. Such democracy is very welcome to some companies (Google comes to mind with its constant feedback programs and surveys for workers there)…but in some workplaces it is the last thing they want! I’m not going to say that some companies are run like a police state…but some aren’t so far off either, with high levels of fear as the driver.  An ego-driven CEO will not tolerate democracy in his Kingdom! Heaven forbid that the peasants find a way to use Twitter to revolt! Yet revolt they will, if not on that company’s official intranet or corporate Twitter feed, then in other places over which the CEO and his communications staff have no control. As we see, voices want to be heard and they will be heard. Social media is their outlet.

–Social media are extremely engaging. That’s right, people love them so much they can hardly hold a normal conversation while holding a smart phone…(did someone say addictive? Let’s not go there this time, but you have a point). This engagement is the reason why most companies now reach out to social media users…to tap into this. So if Facebook and Twitter are opening us all up to communicating much more with each other and with the companies with which we do business, can we really go to work and experience something so radically different? Can we go from a heavily engaging experience outside work to something which feels like traveling back through time to the unconnected past? Trust me, as someone who has surveyed many people at work, many people do work under these conditions, even now. So the answer is that these organizations will survive in the dark ages for a while, but the pressure will build, as it built in Cairo and Tunis. This will require more than a shallow effort on the part of these organizations, but a fundamental shift to a level of workplace democracy and communication the likes of which many have never had.

So social media are a disruptive force indeed: not only do they allow for whole societies to try and grab freedom for themselves but they are also methods of engagement for the rest of us at a level which human history has never experienced. Organizations which do not reflect this level of engagement in how they treat their people will be Mubaraks of the working world….and like him, they will be hounded out of the marketplace.

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Employee Engagement’s Big Issues for 2011

It’s a New Year so time to take a fresh look at the state of engagement at work, employee/partner/associate engagement, whatever you might call it. How is this field doing and what are the big issues facing it and its practitioners? What challenges do we face moving forward? Has engagement met its potential in terms of acceptance by the larger organizational community and its leadership?

First of all, 2010 has brought more evidence of the importance of morale and engagement at work as more and more data are added to the extensive set which Cary Cooper and I detailed in our late 2009 book on the subject. No one should now be doubtful that engagement at work is not only a correlate of performance (customer satisfaction, productivity, profitability and even worker health) but more importantly, a driver of this. So this our starting point, the fact that worker engagement is mission critical.

Again this background, there are several issues which this field faces in 2011, and we will look at three of them here:

–Trends in Engagement: Are We Improving? Getting Worse?: depending on whom you talk to there might be good news or bad news. If you talk to Gallup, it would seem that engagement has not gone down during this Great Recession, which would seem incredible until you remember that this means that engagement of employed people has not gone down. Those who still have work perhaps feel so relieved that the downsizing machine has missed them, that that translates into some form of engagement. There are also some very well managed companies which have avoided layoffs by shortening the work week of those who work for them, and they indeed have benefited from stable engagement levels as a result. Some would suggest workers are now engaged only as long as the job market is bad, and they will then fly out of their jobs like out of a cannon, as soon as things turn around. Nonetheless, this is pretty good news and not as depressing as what we hear from others who collect data in this field, namely that both engagement and job satisfaction have suffered badly in the recession. The fact that these data do not agree is something we will cover in more detail next.

–Definition of Engagement: as strange as this may seem, the fact that trend data detailed above differ so much (Gallup has engagement flat while some have a minus 9% shift in the last year) means only one thing, and that is that they are defining engagement differently and this is reflected in their questionnaires used to collect this data. This is troubling for the industry and I have talked about it before, but it is still the case. The field is quite fragmented and each practitioner seems to have different definition of what engagement “is”. Can we imagine what would have happened in the physical sciences if someone said water was H2O and others said, no its HO2…? But in the social sciences we are used to disagreements in definition (witness the arguments about intelligence when it was a very inexact and fairly new concept), although this does not mitigate the problems which this brings to the field of engagement. Somehow and in some way we need an industry standard definition so that all can get on the same playing field and know that we are talking about, measuring and tracking the same thing.

–Professionalism of Practitioners: there has been an explosion in this field and it seems like everyone and his brother is now an employee engagement consultant. This is a bit like when your taxi driver gives you stock tips, and its time to pull back from the stock market. Maybe the field is a bit crowded and buyers of professional services in this area need to remember one of the few phrases I remember from my 5 years of English grammar school Latin: caveat emptor (buyer beware)! I am not saying that there are not great people in this field and I consider it very positive that many wish to help organizations improve in this area. However there is a two-part skill-set which is required to help an organization measure and/or improve worker engagement and morale. First a real professional in this field must have a knowledge of business issues derived from experience and learning in actual business settings, not just academic. Secondly, since engagement is about emotion and human behavior, it is essential to have a background in the social sciences, especially psychology, to really add value. I do not consider a background in communications sufficient, valuable yes but not sufficient for this. There have been too many times where I have seen great communications programs put together for the workforce which had a wonderful message but which in no way represented the way the organization culture really “lived”.

Hopefully 2011 will bring some improvements in these areas which will move engagement forward and into more and more organizations, where it should be. By most accounts the number of organizations which have ongoing and extensive worker engagement efforts is still quite low and I have never seen a number of more than 30% put forward for the US and the UK. The percentages in France, Germany and other European countries are lower even than this. This is pitifully low (given the huge benefits which accrue from it) and anything which can improve it is to be encouraged and welcomed. Part of the issue here is that some of the practitioners whom I have discussed above take a far, far too “touchy-feely” approach to the subject with prospective clients, which puts them off the subject.  As I discuss elsewhere here, morale and engagement are and should be focused on the ability of the organization to achieve its mission, and that is something any CEO can get behind given the overwhelming morale-performance connection to which this blog is dedicated. A second reason for low levels of engagement at work is that engaging workers means coming down off one’s high horse, letting go of ego-based behavior and fears, and some leaders find that hard, if not impossible, to do.  As I have pointed out, ego is probably the greatest destroyer of engagement at work.

So that is where I see this field as we begin 2011, and clearly there is lots to do.  The three areas I have discussed above would be a good start!

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Employee Engagement: Lets Stop Making It So “Touchy-Feely”!

I’ve been reading a lot lately about employee engagement as I get ready to write a new book on the subject. While there is a lot of great material out there, it seems to me there is also a focus on something which is not useful to this field: a tendency to make it a “touchy-feely” subject instead of a solid, data driven business essential. A lot of the reason for this is the fact that many practitioners who now work in this exploding field have backgrounds exclusively in the social sciences such as psychology or sociology, or they are communications specialists. Many have no direct business training and/or experience, and as a result their career paths and knowledge are very different from those in top management at most of our organizations.

The net result of this is a one sided approach to engagement which, while it emphasizes the human elements which are certainly there, neglects the fundamental reasons why anyone in top management would bother to move towards a more engaged workforce.

I’m talking about approaches which refer to engagement requiring “authenticity”, “compassion” and so on. I am as in favor of these things as anyone else, but if I am a tough CEO at the head of a company I need a lot more than this to go ahead with the steps necessary to maximize the engagement of my workforce. In the words of the political slogan from a past US election: “where’s the beef?” The beef is there of course, and its good stuff: worker engagement and its cousin high morale drive performance. Now that is something a CEO can get her teeth into.

Organizations of any kind, from a police force to a hospital or a mining company, exist to achieve a mission. Just as if you wanted to run the London Marathon, you would need to be in shape to do so, and engagement is a big part of the “shape” your organization is in. A great strategy is useless unless your culture is lined up and your workforce ready and willing to make it happen. Engagement is nothing less than mission critical. It’s not a nice, flowery “add on”, its something which one needs to focus on from Monday at 7am all week long, from the C suite to the shop floor to the home offices of the mobile-connected workers. In this hyper-competitive world where competitive advantage can be wiped out by a sudden shift in technology (ask the makers of CDs) and by ultra-low developing-country wages, engagement of one’s workforce provides an edge, something which organizations can leverage as they fight to survive and thrive. There’s nothing “touchy-feely” about this!

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Why Morale and Engagement Are So Important

(first published in this form in humanresourcesiq.com April 1, 2010)

Author’s note: this is an abbreviated and edited version of part of a Chapter in my book, detailed below. 

If there is one word which encapsulates the benefits which accrue from a high morale organization, it is this: performance. This refers to performance at the individual level and that of the organization as a whole. Evidence for morale correlating highly with, and driving, performance is strong and growing.

If you have competition such as most organizations in the private sector (although increasingly public sector organizations have competition), then high morale will increase your competitiveness. If you serve customers, your customers will be more satisfied when served by high morale employees; those customers will also be more likely to return to you. If profits are your goal, you will increase the likelihood of these. If you have a publicly traded stock, even your earnings per share can correlate strongly with your morale level. If you are in the public sector and have a mission, like in the military or law enforcement, you will be much better at fulfilling that mission; indeed many in the military say that without good morale, missions become much more difficult or even impossible to achieve.

At the individual level, the high morale employee will experience less stress than the low morale one and as a result, less absenteeism and sick days; the high morale employee will be more engaged, willing to work harder, be more committed to the organization’s goals than the low morale one, and certainly be a stronger advocate for the organization with others such as customers, family and friends or potential employees.

Combining morale with organizational performance is one of the central focuses of the morale field of study, since consultants in this area are so often faced with the “so what?” question, such as: 

“I like the general idea of high morale and it sounds like a good thing, but what does it really do for me?” 

An alternative and more negative view is often:

“I’m in business to compete and make a profit; this stuff is a waste of time and won’t change a thing.”

Against this background, to counter these still widely held views and demonstrate just how powerful morale is, we will summarize many of the performance and effectiveness benefits of the high morale organization here. Everything you will read on this topic is backed by solid data, in nearly all cases from multiple sources.

• Morale Provides a Competitive Edge in Good Times and Bad

Surviving a crisis (for the organization alone or for the society in general) is far easier when morale is high. The team pulls together and works as one. Sacrifices are shared much more easily. High morale is therefore more than protective armor, although it does play that defensive role: it offers an offensive path through the crisis which those lacking it will not be able to follow.

• High Morale Supports the Implementation of Organizational Strategies

 It’s not your plans that are important; it’s whether you can implement them. A good strategy is a fine thing, but it is useless unless you can make it happen. Making it happen depends to a large degree on your people, and therein lies the power of morale.

• The Morale Process (Measurement-Implementation) Gives Employees a Voice

It sounds like a circular argument, but it is true: simply measuring morale and feeding back the results, when carried out correctly, improves morale. Over and over again, employees have thanked us for being in their organization, collecting their opinions and letting them know how they and their colleagues feel as a group.

• High Morale Helps Organizations Attract and Retain Talented People

Organizations selected by Fortune and the UK equivalent Sunday Times Best Places to Work, trumpet their appearance on such lists in recruitment advertising, not just at the point of sale like at Starbucks, but also in newspaper and online ads. They are eager to let the world know how good it is to work for them. 

• High Morale Makes the Workplace Easier to Manage and Increases Productivity

Stripped of the dramas created by negative morale situations and the challenges of dealing with people who like to perpetuate them (from individuals with no management responsibility to managers themselves), the high morale workplace becomes less fearful, stressful and more “fun”. Management time can be focused on things which make the organization more productive, not just “putting out fires” related to personnel, or replacing the people who have left. 

• High Morale Reduces Workplace Accidents, Reduces Absenteeism, Reduces Workplace Stress, Improves Employee Health and Reduces Sick Days Taken

 Plenty of evidence exists for all of these claims; in fact the evidence is so overwhelming that it is hard to imagine why organizations do not implement practices which would lead to a maximum level of morale, even if only to gain just these advantages; and yet many do not.

• High Morale Organizations In The For-Profit World Have Better Financial Performance Than Low Morale Ones

There is strong evidence from multiple and highly credible sources that morale is positively correlated with higher stock prices, higher earnings per share, and even 5 year survival following an IPO.  

• High Morale Organizations Can Have Higher Customer Satisfaction Than Low Morale Ones

A great deal of research shows the morale-customer satisfaction connection, and demonstrates causal connections between the two. 

• Morale is a Leading Indicator and Allows Organizations to Prevent Potential Negative Situations

 By examining trends based on previous employee survey data you have collected, you can have a sense of how the future will play out if you take no action. This is especially true when a poorly performing manager is having a negative effect on employee morale.

• The Morale Process Is One Of The Most Democratic Activities In Which An Organization Can Participate

There is nothing quite like giving every single person who works in an organization the chance to say exactly what they feel, knowing that top management will look at every piece of data and every written word. 

• High Morale At The Individual Level Is Connected To Job Performance By That Person, And Is As Good A Predictor Of That Performance As Other, Well Tested Measures

Multiple studies now demonstrate that there are few activities one can undertake better than knowing a person’s individual level of morale, in order to predict how they will perform on the job.

Faced with the overwhelming evidence for the power of morale and its effect on organizational performance, some put forward the idea that the relationship is actually reversed, i.e. performance drives morale. While there is a “loop” effect, in that a customer’s positive feedback about a company’s product or service to a sales representative can boost that individual’s morale, for example, the evidence supports a much stronger effect in the other direction, from morale to performance.  

Recent data from Gallup show that the US workforce is only 29% “engaged” at work, and the Conference Board states that US job satisfaction has been falling for two decades. Europe is, if anything, even lower.  With the US and Europe facing ever more intense competitive pressures from high workforce morale countries like India, China and Brazil, they cannot afford to fall behind; it is in their interest to do all that they can to enhance the morale aspect of work life.  If they do this, the morale and engagement of their people will be one of their key competitive edges in an increasingly global marketplace.

 Excerpted from Employee Morale: Driving Performance in Challenging Times by David Bowles and Cary Cooper. Copyright © 2009 by the authors and reprinted by permission of Palgrave Macmillan, a division of Macmillan Publishers Limited. All rights reserved.