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Employee Engagement: The key to retaining top talent

By Gail Finger, Winter 2003

In the Fall 2003 Towers-Perrin Study "Working Today: Understanding What Drives Employee Engagement," the authors outline what is most important to employees, why employee engagement matters, and what you can do to improve employee engagement in your organization. The study involved 40,000 full-time employees and highlights the following crucial points:

  • Employee engagement is defined as an employee’s willingness to put discretionary effort into his/her work in the form of extra time, brainpower and energy.
  • The statistical data shows that engaged employees do out-perform others and are less likely to leave the company.
  • Engaged employees are more willing to focus on customers and the operational performance of your organization, and that makes employee engagement a critical success factor.

The top two factors that improve employee engagement might surprise you:

  • Senior management’s interest in employees’ well being.
  • Challenging work.

Pay and benefits didn't even make the top ten! Pay and benefits help to attract employees, but they don't help to engage employees or make them want to stay.

It is impossible to over-estimate the importance of good leadership and management in an organization. Employees surveyed for the study cited the following qualities/behaviors as positively affecting their motivation and willingness to put that all-important discretionary effort into their work:

  1. Supporting teamwork.
  2. Acting with honesty and integrity.
  3. Encouraging/empowering people to take initiative.
  4. Having valuable experience or expertise.
  5. Encouraging new ideas and new ways of doing things.
  6. Providing clear goals and direction.
  7. Inspiring enthusiasm for work.
  8. Ensuring access to a variety of learning opportunities.
  9. Helping employees understand how they impact the financial performance of the company.
  10. Building teams with diverse skills and backgrounds.

Sadly, half of the 40,000 employees surveyed rated their managers as fair to poor on the qualities listed above. Employees who rate themselves as highly engaged say they have no plans to leave their current company. Those who were only moderately engaged or completely disengaged said they were either seeking another position or would consider another opportunity.

If there is one thing you should do to improve the odds that you have an engaged workforce and low turnover, it’s this:

Be sure your managers and executives have the "people skills" necessary to motivate and engage employees. Management know-how doesn’t come naturally to most. If your managers are people with technical training who have moved up through the ranks to management positions, you should be doubly concerned.

Take a look at the manager leading your most successful group, and the manager leading the least successful group. What’s the difference? It’s very likely that the difference is in their ability to exhibit the 10 qualities of successful managers described earlier.

The good news is these skills can be developed, and it’s not too late. You would do well to consider a management development program for your organization. Your managers will gain confidence, they’ll be able to engage their employees, and productivity and customer service will improve.

Read more in the followiing, related white paper: Executive Development and Succession Planning.

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