Business Goals

Related Engagement Statistics

Increased profits

Towers & Watson 11/10– high levels of engagement improved operating income 19%. While low levels of engagement over the same 12 months – declined 33%.

http://employeeengagement.com/2010/11/towers-watson-employee-engagement-statistics/

Gallup – employee engagement scores in the top quartile had 18 percent higher productivity and 16 percent higher profits. http://www.gallup.com/consulting/121535/Employee-Engagement-Overview-Brochure.aspx

I can not confirm the year of this study – but I believe it was 2006.

Gallup ‘06 – Organizations with high levels of employee engagement have 2.6 times the earnings per share (EPS) growth rate compared to organizations with lower engagement in the same industry.

http://gmj.gallup.com/content/24880/Gallup-Study-Engaged-Employees-Inspire-Company.aspx

High engagement companies improved 19.2 percent while low engagement companies declined 32.7 percent in operating income over the study period. Almost 52 percent difference in one-year performance. The data covers financial performance through 2005 (www.isrinsight.com) http://chiefexecutive.net/are-your-employees-engaged (Quoting an ISR study)

13.2 percent improvement in net income growth over a one-year period for companies with high employee engagement, while seeing a 3.8 percent decline in net income over the same period for companies with low engagement. http://chiefexecutive.net/are-your-employees-engaged (Quoting an ISR study)

Companies with high engagement show a 27.8 percent improvement in EPS growth, while companies with low engagement reported an 11.2 percent decline in EPS over the same period.

http://chiefexecutive.net/are-your-employees-engaged (Quoting an ISR study)

A previous ISR study of 41 companies over a period of 36 months from 2002 to 2004 revealed that the high engagement companies realized a 5.75 percent difference in operating margin and a 3.44 percent difference in net profit margin versus the low engagement companies. http://chiefexecutive.net/are-your-employees-engaged

Gaining the Creative edge over competition

Gallup ‘06 – Engaged workers 3 times more creative. 74% of engaged employees strongly agreed that they shared new ideas with customers, contrasted with just 13% of actively disengaged employees – measured by their response to: “At work, we give our customers new ideas” http://gmj.gallup.com/content/24880/Gallup-Study-Engaged-Employees-Inspire-Company.aspx

88% of fully engaged employees believe they can positively impact the quality of their organization’s products and services. 38% of disengaged employees who feel the same way.

http://www.towerswatson.com/services/Employee-Surveys?gclid=CLuyo8C5x6kCFRHGKgodFA35JQ

Gallup ‘06 – Organizations with high levels of employee engagement have 2.6 times the earnings per share (EPS) growth rate compared to organizations with lower engagement in the same industry.

http://gmj.gallup.com/content/24880/Gallup-Study-Engaged-Employees-Inspire-Company.aspx

Increased Employee Productivity

Gallup – employee engagement scores in the top quartile had 18 percent higher productivity and 16 percent higher profits. http://www.gallup.com/consulting/121535/Employee-Engagement-Overview-Brochure.aspx

I can not confirm the year of this study – but I believe it was 2006.

Gallup 2006 – Lower Productivity of disengaged employees costs $328 billion on an average year.

http://gmj.gallup.com/content/24880/Gallup-Study-Engaged-Employees-Inspire-Company.aspx

Towers Watson 3/09 – Highly engaged employees miss 20 percent fewer days of work and are almost 80 percent more likely to be top performers. http://www.watsonwyatt.com/render.asp?catid=1&id=20884

2004 study by the Corporate Executive Board revealed that engaged employees are 20% more productive than typical employees. When applied across the board, the ROI for employee engagement activities is substantially higher than it is for many other investment targets. http://www.gaebler.com/Employee-Engagement-Statistics.htm

Increased retention, and employees that are excited

88% of fully engaged employees believe they can positively impact the quality of their organization’s products and services. 38% of disengaged employees who feel the same way.

http://www.towerswatson.com/services/Employee-Surveys?gclid=CLuyo8C5x6kCFRHGKgodFA35JQ

46% of new hires leave their jobs within the first year.

http://www.slideshare.net/businessandthegeek/human-resources-employee-engagement-statistics

Gallup poll, companies with large numbers of dissatisfied workers experience greater absenteeism and lower productivity. The amount of turnover these employers experience which was 51% higher than their peers. Effective engagement strategies should target on-the-job satisfaction as a way to reduce turnover and maintain smooth workflows. http://www.gaebler.com/Employee-Engagement-Statistics.htm

Time magazine in 2010 – less than half of American workers (45%) are satisfied with their jobs. This is the lowest percentage since 1987 and is an indication that U.S. employers have a lot of work ahead of them to undo the effects of the economic downturn and deteriorating employee attitudes. http://www.gaebler.com/Employee-Engagement-Statistics.htm

Job security. More than half of U.S. workers feel their jobs are less secure now than they were a year ago. Approximately 70% of workers who feel their jobs are secure report happiness at work, but half of the workers who feel their jobs are in jeopardy are dissatisfied with their jobs. The takeaway from these statistics is that job security and employee satisfaction are connected, even though many workers are only hanging onto their jobs for a paycheck.

http://www.gaebler.com/Employee-Engagement-Statistics.htm

More employees are looking for new opportunities outside their organization than they were in 2008, suggesting that 2011 will be a challenging year for retention (and a hot market for firms looking to attract top talent).

http://www.tlnt.com/2011/04/20/study-only-1-in-3-employees-say-they-are-engaged-in-their-job/

Of those who will be starting or looking for work in 2011, here’s what they say is important in a job:

21% – Job security                                                          5% – Vacation or days off

20% – Health benefits                                                 1% – Company perks

14% – Salary or compensation                              4% – Company culture

11% – Financial or retirement benefit

 http://hollanderleadershipblog.wordpress.com/2011/04/22/employee-engagement-2011/

Autonomy and respect, the researchers note, can act as a buffer on stress — and actually decrease job burnout

http://knowledge.wharton.upenn.edu/article.cfm?articleid=1600

Strong Customer Relations

Gallup ‘06 – 9 out of 10 engaged workers vs. 1 out of 10 disengaged said “At work, I know where to go with an idea to improve customer service”. http://gmj.gallup.com/content/24880/Gallup-Study-Engaged-Employees-Inspire-Company.aspx

PeopleMetrics ’09 – “The three major drivers of customer engagement in restaurant industry 1) a customer feels valued and taken care of, 2) an engaged employee is making the experience take place, and 3) the product meets expectations.

http://www.buzzle.com/articles/boosting-employee-engagement-to-increase-productivity-and-profits-in-a-recession.html

Gallup ‘06 – Engaged workers 3 times more creative. 74% of engaged employees strongly agreed that they shared new ideas with customers, contrasted with just 13% of actively disengaged employees – measured by their response to: “At work, we give our customers new ideas.”

http://gmj.gallup.com/content/24880/Gallup-Study-Engaged-Employees-Inspire-Company.aspx

Employees trust the company direction

Towers Watson ‘09 – 1 of 6 top actions to engagement: employees want to know about organization’s specific plans and progress. Decisive action w/ clearly-articulated rationale. http://www.watsonwyatt.com/render.asp?catid=1&id=20884

Trust in executives can have more than twice the impact on engagement levels than trust in immediate managers does. However, consistent with past studies, employees are more likely to trust their immediate managers than the executives in their organization. http://www.tlnt.com/2011/04/20/study-only-1-in-3-employees-say-they-are-engaged-in-their-job/

When employees don’t feel that the organization respects and values them, they tend to experience higher levels of burnout.

http://knowledge.wharton.upenn.edu/article.cfm?articleid=1600

Why do some have companies high involvement/highly engaged workforces while others do not? O’Toole points to leaders who take a very different view of the value of their employees. In the early 1980s, Harley-Davidson, having been organized on the adversarial model of GM and Ford was facing oblivion when Rich Teerlink stepped in as CEO. He promised his workforce he wouldn’t outsource jobs as long as he got the productivity increases needed to be competitive. Companies such as Goldman Sachs, Deloitte Touche and UPS, he says, have customized development models designed to nurture and encourage talent. When he founded Starbucks Howard Schultz, a self described former working stiff, was more interested in creating the right work environment for employees that he was in the price of coffee.

http://chiefexecutive.net/are-your-employees-engaged

Miscellaneous

General Engagement Statistics

Fewer than 1 in 3 employees worldwide (31 percent) are Engaged. Nearly 1 in 5 (17 engaged) are actually Disengaged. Engagement levels vary by region from a high of 37 percent in India to a low of 17 percent in China. In North America, 33 percent are Engaged and 18 percent Disengaged.

 http://www.tlnt.com/2011/04/20/study-only-1-in-3-employees-say-they-are-engaged-in-their-job/

Despite the economic recession, engagement levels around the world remained roughly stable when comparing early 2008 and mid-2010. http://www.tlnt.com/2011/04/20/study-only-1-in-3-employees-say-they-are-engaged-in-their-job/

Consistent with the 2008 findings, there is a strong correlation between engagement levels and age, role/level, and tenure in the organization. Older employees and people in positions of power and authority are most likely to be Engaged. So are long-term employees (7 plus years with an organization). Employees who work in departments closest to strategy decisions and customer relationships tend to be more Engaged as well.

http://www.tlnt.com/2011/04/20/study-only-1-in-3-employees-say-they-are-engaged-in-their-job/

Engaged employees plan to stay for what they give; the Disengaged stay for what they get, suggesting that organizations can benefit from a targeted retention strategy.

http://www.tlnt.com/2011/04/20/study-only-1-in-3-employees-say-they-are-engaged-in-their-job/

Employees worldwide view opportunities to apply their talents, career development, and training as top drivers of job satisfaction. When it comes to contribution, their needs vary considerably, reflecting their circumstances (e.g., region, age, function, engagement level).

 http://www.tlnt.com/2011/04/20/study-only-1-in-3-employees-say-they-are-engaged-in-their-job/

Managers are not necessarily doing the things that matter most. The actions that correlate the most with high engagement are not always the ones that receive the most favorable ratings. And in some regions relationships trump skills, that is, employees’ knowledge of their managers as “people” behind their titles appears to impact engagement levels more than manager actions. http://www.tlnt.com/2011/04/20/study-only-1-in-3-employees-say-they-are-engaged-in-their-job/

Executives appear to struggle with key leadership behaviors correlated to engagement, yet the findings suggest executive behaviors can have a greater potential impact on engagement than manager actions.

http://www.tlnt.com/2011/04/20/study-only-1-in-3-employees-say-they-are-engaged-in-their-job/

Executives aren’t getting the basics of performance right. Creating an environment that supports high performance is the item that received the least favorable response in the entire survey; it also has among the strongest correlations with engagement levels. http://www.tlnt.com/2011/04/20/study-only-1-in-3-employees-say-they-are-engaged-in-their-job/

Engagement surveys without visible follow-up action may actually decrease engagement levels, suggesting that organizations think twice before flipping the switch on measurement without 100 percent commitment for action planning based on the results. http://www.tlnt.com/2011/04/20/study-only-1-in-3-employees-say-they-are-engaged-in-their-job/

Correlation of Engagement to Success

The question remains how direct is the correlation? Are employees more engaged because the companies for which they work are doing better or do they perform better because the employees are committed? RBC Financial Group (formerly Royal Bank of Canada), for example, has been able to link employee commitment with higher levels of customer satisfaction and in some cases more deposits in its branches. By contrast Basi points to the newspaper industry where turmoil and industry consolidation have exacted a toll among employees. “We find in such cases that people might be very proud of the brand in the marketplace, but they might not be engaged any longer because they don’t think that the company is heading in the right direction.” http://chiefexecutive.net/are-your-employees-engaged

The NUMMI Story

The NUMMI Story

http://www.ineak.com/2009/02/the-nummi-story-building-trust-with-employees/

Listen to the story at:

http://www.thisamericanlife.org/radio-archives/episode/403/nummi