Leadership in Action

Editors: John Mohr and Rich Clampitt

Research performed by the Corporate Leadership Council (Consulting Research Firm) has provided some very timely information on the topic of Employee Engagement. The Corporate Leadership Council performed a study on Driving Performance and Retention Through Employee Engagement. This study surveyed over 50,000 employees at 59 organizations across the globe. Here are some key findings: Engaged employees outperform their disengaged peers by up to 20 percent. Correctly chosen engagement strategies can reduce an organizations voluntary termination rate by nearly 10 points. However, engagement is not a panacea for driving business outcomes. Instead, employee engagement is best thought of as the third leg of the stool it can drive performance and retention, but it cannot replace the recruitment of high-caliber talent or supporting that talent with needed resources, information, and experience. Despite conventional wisdom, engagement is not a characteristic of group membership. Generation X, for example is no more (or less) engaged than any other generation. The council has found that demographics alone cannot predict an employees level of engagement. The key factor in explaining variation in employee engagement is the company that the employee works for! Organizations can differ by a factor of 10 in the percentage of their workforce that is highly engaged. The most powerful drivers of engagement are an understanding of the connection between an employees on-the-job performance and broader organizational strategy and success. Instilling a belief in the jobs importance to the organization during the onboarding process must be a critical focus. None of the top 50 drivers of employee engagement are related to compensation.

The Corporate Leadership Council recommends the following four strategies to positively impact employee engagement: 1. Focus, Relentlessly, on the Business: Target and resolve areas of disengagement that pose the greatest risk to the organization. 2. Engage Key Contibutors: Expand the organizations definition of value creators and seek to engage key contributors. 3. Target Barriers to Engagement: Before attempting to engage employees, understand all the barriers to engagement, many of which are not captured by conventional metrics. 4. Build a High-Engagement Culture: Focus on the following 3 Cs: Connection Build an inviolable connection between the employees work and the organizations success. Contribution Turn employees into partners personalize the organization for employees and offer them significant and meaningful opportunities for participation. Credibility Build and ensure ongoing organizational credibility clarify expected behaviors for different roles, enforce alignment of desired behaviors and action, and strengthen the perception of leaderships trustworthiness through behavioral support.

Summary: The economic benefit of engagement its impact on retention and discretionary effort is substantial: Research has shown that moving from non-commitment to strong commitment decreases the probability of leaving the company by 87 percent. Moving from strong non-commitment to strong commitment increases discretionary effort by 57%. In the Corporate Leadership Councils research, they found that 13% of employees were highly uncommitted and only 11% were highly committed. This leaves a huge population (76%) that is up for grabs. The challenge for each of us, as leaders, in Celestica is to move that neutral group over to the committed side!