Much has been studied about the impact of employee engagement on company performance, and there is general agreement that increased engagement drives results: Gallup, for example, suggests a 20% or better boost to productivity and profitability for companies with high engagement. Such companies, however, may be few and far between: Gallup also reports that only 30% of American workers, and 13% of global workers, are engaged in their jobs.
The typical approach is an annual engagement survey where employees are effectively asked, through various types of questions, to rate their own level of engagement. Assuming honest survey responses, this approach provides good input into the employee attitude side of the equation (for example, how engaged they perceive themselves to be), but, unfortunately it doesn’t do a good job of gathering objective data on just how engaged employees actually are (for example, discretionary effort). While knowing what employees think certainly has value, this data suffers from the same challenges of any other survey-based effort: it becomes dated quickly, there’s availability bias from respondents thinking of only recent events, and potentially gamed results — people telling you what they think you want to hear rather than what they really think.
When this information is paired with traditional attitudinal data such as satisfaction scores, pulse surveys, or annual survey-driven engagement measures, they come together to give an even more accurate picture of what engagement truly means — and where your company is falling short. You can then monitor changes in the data in the form of anonymized dashboard tools, often in real-time, or it can be shared transparently with employees so they have a better context for engagement and how they compare with their colleagues in aggregate.
Through my work at VoloMetrix, I’ve seen first-hand the results that measuring employee engagement can have on firms. One company with an extraordinary talent shortage ran a study with several quarters of anonymized voluntary attrition data in combination with a number of people analytics metrics to see if there was a correlation. The results were staggering. You could literally see a steady week-by-week change in behaviors for employees starting a full 52 weeks in advance of the event, leading right up to the moment they quit. With very high correlations, these employees were spending less time interacting with people outside of their department or region, less time in ad-hoc interactions, and less time being active outside of normal working hours, among other things. What this data makes clear is that the majority of these employees hadn’t decided to quit a year in advance; rather, their engagement levels started dropping… and dropping… and dropping… until they got to the point where they realized it was time to quit. With this information in hand, the company started measuring engagement and providing feedback to managers with plenty of time to make appropriate adjustments to retain their top people.
There are many factors that contribute to employee engagement — ranging from corporate culture to management style to competing priorities outside of work — and the pertinent factors are different for each employee. This complexity is what makes it so challenging to measure and understand engagement in an actionable way. While still in its infancy, people analytics is beginning to give organizations the data and tools to understand what drives engagement, perhaps even better than employees understand themselves. Qualitative data from Gallup’s engagement survey and others like it has been sufficient to prove the case for greater investment. Now, with the ability to directly measure engagement, there is no telling what organizations and employees themselves will learn about what drives them.
HR Basics: Employee Engagement
Why is employee engagement important?
Employee engagement is important because high employee engagement can lead to improved productivity. When employees are engaged, they may care more about the success that the company experiences. Employees who engage in company culture can contribute to more successful projects and influence increases in clientele or higher profits. Depending on the organization and industry you work in, employee engagement can express success in different ways. There are three levels to employee engagement, including:
What is employee engagement?
Employee engagement is when employees are enthusiastic about their work and committed to contributing to the company and helping it grow. Engaged employees are more likely to take part in company events and offer to help with projects to meet deadlines. Engagement is not the same thing as satisfaction, as an employee can experience satisfaction within their role and manage their responsibilities without being fully engaged in their work.
9 metrics for measuring employee engagement
These are some metrics you can use to measure employee engagement:
Number of absences
The number of absences an employee has may show disengagement. When employees frequently miss work and use the same reason many times, it can indicate a lack of engagement in their tasks. When measuring absences, its important not to include absences that an employee may plan by using their PTO or vacation days and only those that are unplanned. Lateness can also show a lack of engagement with their work.
The turnover rate is how often staff members resign and you must find and hire new candidates for roles. When the turnover rate is high within your company or for a certain position, it can be a sign that employees arent engaged in their work. High turnover rates can increase hiring costs and decrease company morale, so its important to measure and improve the turnover rate within your organization.
One metric you can use to measure employee engagement within your organization is the additional effort team members contribute outside of normal work hours. Though it is not ideal to frequently ask team members to take on tasks outside of business hours, they may choose to do so or offer to when teams are under deadline. You can track how often someone offers to complete additional tasks or contributes hours outside of the normal operating day to ensure a project can deliver on time.
Participation is how often an employee attends and takes part in company events. This can include team-building exercises like trivia events or company picnics. You can also consider how often the employee expresses interest in professional conferences and other educational opportunities when measuring participation.
Another metric you can use to measure an employees engagement is their management time. Management time refers to the time that an employee spends with their manager or team leader, either speaking with them, receiving guidance and conducting one-on-ones. A higher amount of management time can indicate an engaged employee because it may mean they prioritize communication and improving their performance.
Professional relationships within the company are another aspect you can consider when measuring an employees engagement. Relationships can include how they interact with their colleagues, team lead and other team members. Improving communication, trust, collaboration and confidence in the workplace can increase professional relationships and improve employee engagement.
Productivity refers to the amount of work an employee can complete within a set amount of time. You can measure an employees productivity by determining how often they deliver work before deadlines. If an employee spends too much time working on activities other than their tasks, their productivity may decrease. If your team members submit work that is easily measurable, such as specific tasks, writing or editing, you can monitor their productivity easily.
Vacation or PTO
How often your employee elects to use their vacation days or paid time off can be another measure of engagement. This measurement differs from absences because when employees take their time off, they are improving their work-life balance, which can allow them to be more engaged at work. If an employee is not using their vacation or PTO, it can indicate a lack of engagement because of poor work-life balance.
Tips for improving employee engagement
These are some tips you can use to improve employee engagement:
What are the levels of employee engagement?
- Actively Engaged. Actively Engaged employees are passionate about what they do in their role and fully committed to the company mission. …
- Not Engaged. …
- Actively Disengaged.
How do you measure engagement level?
- Determine engagement outcomes. …
- Identify what’s important to your employees. …
- Perform a drivers analysis. …
- Develop a continuous listening strategy. …
- Don’t exclusively use pulse surveys. …
- Don’t survey a sample population. …
- Don’t focus only on the quantitative results.
What are employee engagement scores?