Employee Engagement: Myths and Pitfalls, Part 1

It seems that everywhere you turn these days in the organizational world people are talking about employee engagement.  It has really become a phenomenon, and I have to say I am a little surprised at this.  I also respect the nature of the market, and part of the market wants engagement right now.  Another part, and its a big one, just wants to know “how our people are doing” and doesn’t really care what consultants call it.  Perhaps the reason for engagement’s rise is that the word is very graphic, it grabs and… er… engages people…..it gets them excited about a subject which before was described with words like morale, satisfaction, empowerment, enthusiasm, etc.  But what happens at this stage in such a phenomenon is that people come out of the woodwork as “engagement experts”.  Everyone seems to be in the business now.  Time was when only those with a background in organizational psychology would work in this area but now I see people with backgrounds in communications and many other disciplines coming into the field.  This is both good and bad:  good in that we have a different perspective from such people;  we need their creative ideas, and engagement surely does have a communications component.  Bad, because some of these people make the most wacky statements about engagement.  I think they do this because they have a limited background in some of the crucial areas which relate to the engagement field, especially measurement.  Lets look at a few of the things which are being said:

–”Engagement is a feeling”:  no its not.  Because it involves human beings it has a feeling component at first, but it doesn’t stop there.  Engagement is also a choice and a behavior.  We choose to engage with our job and our organization based on the conditions we experience there, and what kind of person we are. 

–”Engagement cannot be measured”:  not true.  People who say that engagement is only a feeling also seem to say this.  First of all feelings can be measured, otherwise we would not know which is the happiest country on the planet (it varies, usually the Dutch or the Danes);   or your doctor would never be able to ask “on a scale of 1-5, with 5 being awful, how bad is the pain?”  In any case we do not need to measure feelings to know about engagement.  We can look at the behavioral by-products exhibited by engaged people such as advocacy, with a question like “Would you recommend (company name) as a place to work to friends and others in the community?”

Engagement shouldn’t be measured:  yes it should.  Kris Dunn, who writes very good blogs such as HR Capitalist and Fistful of Talent, had a piece the other day slamming the need for “stinking ” surveys to measure engagement.  There is only one problem, or actually two:   Dunn also works in HR (VP of People is his title) at a company which has…ready for this…77 people.  Well thats easy to say, when all your people can fit into the CEO’s back yard for pizza every week, if he wanted that.   Talk to me when you have 770 or 7700, Kris, and lets see if you still feel the same.  The second point demonstrates a little double talk on his part:  his company is rightly proud of its high position as one of the top Best Places to Work For (R), among US small companies.  This is a huge achievement and is trumpeted on the company’s website and very likely used widely in recruitment.  But wait a second:  the only way they know this and can be ranked on this list is, you guessed it:  a survey.

–”A pig never got fat by being weighed” (translation: we don’t create engagement by measuring it).  Believe it or not this was in the McLeod UK government report on engagement released last year.  Its funny all right, but so totally detached from the real need to measure engagement.  OF COURSE the measurement doesn’t create the “thing” itself.  I have never heard anyone who said it did.  But since the writer of this little ditty likes pigs, lets humor him by giving the following example:  

Imagine this:  you have 20,000 pigs, in 100 countries; you don’t know how fat each one is but your job is to feed them.  Do you: 1) send out the same amount of food to each country, in which case the fat ones get even fatter and the starving ones barely recover?  2)  Do some kind of measurement in each country, so that you know how fat or skinny each pig (or small group of pigs) is?  Then you adjust the food accordingly.  Of course the measurement you do is important.  Pigs, like people, lie about their weight.  Don’t just ask the pigs in front of their peers….you need a confidential process to make sure you are getting accurate results. I think, I hope…..I made a case for employee surveys.   No they don’t create “engagement” but when done well they at least tell you where you are starting from and how far you have come.  Then you can target what you do and adjust it accordingly. 

Show me a way..please.. you can do this on almost any scale beyond the tiniest organization, confidentially, generating quantitative data which can be compared to last year and internally between units, without surveys?  If you have never measured morale or engagement and discovered centers of management excellence previously hidden in your organization which can become role models for others, you have missed out.  Once I carried out a survey for a hospital system and the ER in one hospital scored the worst of any department in that hospital.  The manager blamed the local, admittedly difficult social environment with its history of violence, high volume of injuries, etc., but he didn’t get far with that:  I was armed with the data from a sister hospital where the environment was equally awful and that ER had the highest morale in its hospital.   I suggested the first manager visit the second to find out what works;  this would all have been impossible without measurement and internal benchmarking. 

I plan to write a lot more about this but wanted to start here.  In a new field like this there is a lot of “settling down” which happens as definitions are ironed out between practitioners, in which methodologies are discussed for doing various things.  We are at that phase in employee engagement and I expect it to go on for some time.  Fans and practitoners of engagement should try not to spend too much time on this, their clients (internal and external) such as CEOs and other leaders are pawing the ground expecting them to deliver something well defined, solid and proven to be a performance driver (otherwise what is the point?)  It must improve on what came before.  If they cannot do this, engagement will go the route of other management “fads” with no staying power.

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.

A Troubling Issue in Consultants’ Employee Engagement Trend Data: Why Do They Disagree?

As a follow on to my previous post on trends in US job satisfaction and morale/engagement, I was fascinated to come across the latest data from WatsonWyatt and World at Work (lets call them WatsonWyatt from now on) which indicated that engagement was down over 9% in the most recent period. Here is exactly what they said:

The 2009/2010 U.S. Strategic Rewards Study found that employee engagement levels for all workers at the companies surveyed have dropped by nearly 10 percent since last year

I had argued previously that two apparently conflicting databases (from the Conference Board and Gallup) on job satisfaction and morale/engagement had to do with what was being measured, but this new data compels me to share something else very important with you.

Here are the facts:

Jennifer Robison wrote in the Gallup Management Journal (as reprinted in The Free Library) on January 14^th 2010 that :

Gallup has tracked the engagement levels of the U.S. working population for the past decade. Its most recent employee engagement research shows that 28% of American workers are engaged, 54% are not engaged, and 18% are actively disengaged…..In addition, from July 2008 to March 2009 — during the heart of the recession — Gallup tracked a large sample of employees and found only slight (1%) changes in overall engagement. In July 2008, 31% of employees were engaged, 51% were not engaged, and 17% were actively disengaged. In March 2009, these percentages had changed very minimally: 30% were engaged, 52% were not engaged, and 18% were actively disengaged.

 

(emphasis added)

For several years Gallup has reported that the number of US workers who are “engaged at work”  has hovered between 26% and 30% for the US working population.  Now the WatsonWyatt data tell us that there has been a significant drop since their last survey in 2008.  Gallup data show that engagement is either up 1% or down percent in that time period, depending on which month the measurement was made, but this is nothing like the 9% drop from the WatsonWyatt group.  Unlike my previous post, both these benchmarks purport to be about engagement, both cover the same time period, and both cover the same general population. None of my previous arguments are valid here and so we are faced with something which I consider to be a significant weakness in the the morale/engagement consulting field:  the validity of these external benchmark databases.  This is so important that I covered it in my book, at the risk of infuriating some who work in this field, but I did it because of its importance.  I also had my own data in the book which had never been shared with those who did not commission the original study, a group of large utility companies.  That data showed that external benchmark databases of employee morale can differ significantly from each other, for the same industry, in the same country, on exactly the same question, and for the same time period. I was so troubled by the finding that I literally gave up using such things in my own consulting practice, even though I had spent years building them.  The reason was that I no longer had confidence in them and told my clients exactly why.  I moved entirely to internal benchmarking and built my analysis software around that function.  So my question is: if it is the case, that such differences can be found in benchmarks for a specific industry, how much will they differ when measured across many industries?  This recent data gives us a window into this issue, and an answer to that question:  they differ, and significantly so.

In my previous post I pointed out that methodological differences or errors were unlikely to be the cause of differences between job satisfaction and engagement data;  plenty of reasons for the differences could be found in the factors being measured, not the methodology.  I also said that I had confidence in both Gallup and the Conference Board;   that is true with WatsonWyatt as well. (I do not know enough about World at Work but a cursory look at its website indicates it has been around a long time, is an organization with 30,000 members which certifies professionals in compensation, benefits and work-life skills, etc. and I have absolutely no reason to doubt their competence).  WatsonWyatt is now TowersWatson, an organization of which the Towers part bought the well known survey research house ISR some years back, giving them a huge amount of data and survey research firepower.  I will use “WatsonWyatt” here because the study was first published under that name. All these organizations are therefore large, well run, and entirely competent. 

So lets look at how this happens and draw some conclusions from it.   There are several reasons for the differences between these benchmark databases, in my opinion:

–worker engagement is not like water.  Water is H2O.  Engagement is, well it is a number of things.  Each dictionary would define it differently, as might each consultant.  Who can say that one is right and one is wrong?  I defined it, as best I could, in my book, and compared it to morale.  I repeated some of this in a recent post. Based on the definition you choose, you develop a questionnaire.  The items in the questionnaire measure your engagement elements.  You then refine that questionnaire, as Gallup has done, going down to only 12 questions.  You test and test and test.  WatsonWyatt and its partner in this latest study no doubt has its own specific methodology, its own definition of engagement, its own questionnaire.

–consulting in worker morale and engagement is very fragmented.  There are stand alone research houses like Sirota Survey Research;   there are global giants like Gallup, TowersWaston, Mercer and HayGroup (where I used to work)…and these firms do many things in addition;   there are thousands upon thousands of smaller groups or individuals who work in this field, some of whom have their own benchmark “norms”.  No one firm has a lock on all the companies in one industry, or on all the best performing companies, etc.   If I am Apple and want Dell, HP, Sony, Nokia and a list of other competitors in my benchmark, I cannot find all that in one place.  A “national norm” or benchmark either has to come from firms collaborating with each other and sharing client data (it has happened but I imagine it has some anti-trust issues, and in any case some clients might be wary of sharing their strategically valuable employee opinion data).  It can also be created from sampling techniques of employees from non client organizations.  This latter method creates its own problems:  how do you get non-client employee opinion data?  With great difficulty.

–sampling the national engagement level from 1000 people at work is very tricky.  Look what happens with opinions polls for political elections: they are not always right!   This and other reasons were why I always told clients to poll 100% of the workforce and do everything possible to make sure than 90% + would respond, which they usually did.  That way I knew that the data we had really did represent the whole, and that managers deep in the organization would have enough data with which to work, which they often did not with a sample.

–as a result of the above issues, with the definition of engagement and the resulting questionnaires and with possible sampling, the companies covered by WatsonWyatt and Gallup might have been very different, in different industries than each other and they certainly received a different questionnaire.  All these things affect the data.  Watson Wyatt talks about the data representing “the surveyed companies” but also implies that this represents a national sample.  These might be quite different, its very hard to tell.

Perhaps the clearest thing that a consultant who uses client data for national or industry-specific benchmarks could say to a client about a benchmark would therefore be this:

This benchmark is based on how we define engagement, which might be different from how others define it;  it is based on our proprietary questionnaire, which is based on our definition of engagement;   it is also based on a sample of our client data, and others might have different types of organizations in their databases which will affect their data and cause it to be different than ours.  As a result we cannot guarantee that our engagement benchmark will match any other, even for the same geographic location, the same worker demographics and the same time period.

(one not using client data for its benchmark would have to add even more, about possible sampling errors and response rates).  In any case, don’t hold your breath that we will ever see such a disclosure!

Perhaps clients of all the firms which provide external engagement and morale benchmarks are quite happy with the benchmarks they are given.  Maybe they look only casually at such things, and pay less attention to them than internal benchmarks?  Maybe they just look at a group of top performers as a comparison and find that useful?  Whatever the case I think it behooves us as consultants to make clear that we might not have “THE answer”  as to what an external trend is in worker engagement.  We have ONE answer, our own.  That answer might be as much as nine times (1% change versus 9% change) higher or lower than another’s answer, as we have seen in the two firms’ data shown here.   For me that was not good enough, and so I focused on telling clients how they had shifted internally over time, how groups internally were different from each other,and what their scores were on an absolute basis.   They all found that so valuable that they did not miss the one thing which some believe is a “must have” in this business…the external benchmark.

Tell me what you think….

Job Satisfaction is DOWN but Engagement is FLAT or UP? How can that be?

Recent data from the Conference Board tell us that this Great Recession has slammed job satisfaction.  The numbers speak for themselves and reflect a long downward trend over time:  US satisfaction is at the lowest level in two decades.  From 61.1% satisfaction with the job in 1987 to 45.3% in 2009, the drop really is quite precipitous.  Should we be alarmed?  Maybe we should “wait to worry”, as my accountant once told me 5 minutes before a tax audit (I didn’t have to pay more, he was right).  We first need to look at some other data, then try to make sense of it all.  The other data comes from an equally reliable source as the Conference Board, Gallup, a company in which I have great confidence, and who were gracious enough to share their data with me for my book.  Gallup’s recent data on employee engagement in the US are quite stunning:

They show that engagement has hardly shifted at all during this recession;  if anything it has moved slightly upward.

Can these both be true?  Is there some methodological reason in the research why the data seem to contradict each other?  It is certainly true that the Conference Board and Gallup use a different questionnaire, since Gallup’s is the well-known “Q-12″, or 12 item engagement questionnaire.  As a proprietary measuring instrument, it is probably nothing like the CB questionnaire on satisfaction.   Using sophisticated statistical analysis, Gallup found that it could predict all major elements of engagement with these questions, and no more than 12 were required.  I certainly understand this, in my own consulting firm’s research we could, for certain clients, predict an entire morale survey’s result from one question:  that question was how the employees rated their manager’s ability.   For fans of correlation,  it was slightly more than +0.88, a very significant result.  The power of (local, not top) management to influence the morale of employees was demonstrated quite clearly.  Gallup can therefore easily make a good case for a 12 item engagement questionnaire.  The Conference Board no doubt also has a well-tested and stable instrument with which they measure job satisfaction every year.  In any case, knowing the quality of these two organizations, I doubt that any methodological errors drive the difference between the data.

This means we have to turn to whether “engagement” and “satisfaction” are different, and indeed they are.  Satisfaction, and in this case with the job only, is a very specific element in the overall morale at work, and in my own research I was never able to correlate that specific element very highly with overall morale, unlike the rating of the manager.  It was just one element in a questionnaire which, for us, often ran up to 110 items, and is equally just one element in morale.  Employees seem to compartmentalize feelings of satisfaction or dissatisfaction they have about the job itself, the company, and so on, and these feelings don’t have anything like the influence on their morale as how they are treated by management.

Engagement is something quiet different.  My previous post on this might interest you if you want a bigger discussion of the difference between engagement and morale, but essentially engagement is the behavior that people exhibit when the have relatively high morale.  It’s all about volunteering for tasks,  willingness to “pitch in”, “go the extra mile”, and especially talk up your organization as a place to work or place with which to do business.  So engagement is a broad brush, job satisfaction is a part of that brush.  This means they can differ from each other.  In the Gallup article linked above, the author makes the case that the recession has made managers more likely to try to engage employees, treat them better, etc. because their companies don’t have the money to make financial investments in their workforce.  They go back to the intangibles, the non financial incentives like recognition.  Things they should have been doing all along.  This would explain why, even in a recession, engagement might edge up.  So why would job satisfaction drop?  Because people are being asked to do more with less, they see others being laid off, they are scared of that happening to them…but remember the people in these surveys have jobs, we are looking at the survivors here!   That also counts towards better morale/engagement, its like “hey it’s not all bad, I still have a job, maybe I work harder but I am still here”.  If we add to that the Gallup idea that bosses are trying harder to treat people better in these hard times because that is all they can afford to do, then we can imagine why engagement might be stable in spite of loss of good feeling about the job itself.

As I said earlier, job satisfaction can be quite independent from other feelings of satisfaction:  for example (and I have found this often when surveying workers), people can like their job much more than they like the organization for which  work.  This happens when you have a skill or a profession or something you really like doing, whatever it is, and the job gives you the chance to do that every day.  Or you might not like the actual job but you like the fact that you have a job in the first place.  You can feel all this but at the same time be anything from mad as hell at the company, to simply indifferent, for many reasons.  Your commitment is to the job/profession or whatever it is, not to the organization.  Of course this is less than optimal because you are then much more likely to leave.  Your engagement is only to the job, not to the broad spectrum of things which I have mentioned above, and so you are far from an ideal employee as a result.  Companies need to counter this with all the things which drive good morale, and which are too numerous to list here;  but most of all, good management.

I’ll post more on this as more data become available.  Let me know what you think and what you see happening in your organization; I’m always interested to hear peoples’ experiences.