Employee Engagement: The Key To Realizing Competitive Advantage

EMPLOYEE ENGAGEMENT:
THE KEY TO REALIZING

COMPETITIVE ADVANTAGE
A MONOGRAPH BY
RICHARD S. WELLINS, PH.D.,
SENIOR VICE PRESIDENT OF GLOBAL MARKETING
AND NEW BUSINESS DEVELOPMENT
PAUL BERNTHAL, PH.D.,
MANAGER OF CENTER FOR
APPLIED BEHAVIORAL RESEARCH
MARK PHELPS,
SENIOR CONSULTANT
DEVELOPMENT DIMENSIONS INTERNATIONAL
EMPLOYEE ENGAGEMENT:
THE KEY TO REALIZING
COMPETITIVE ADVANTAGE
INTRODUCTION engagement can be staggering. For example,

Gallup estimates that unengaged workers in
Woody Allen, comedian, screenwriter, and director,
the United Kingdom cost their companies
once said: “Eighty percent of success is showing
$64.8 billion (U.S.) dollars a year.3 And, the
up.” If this was ever true, it certainly isn’t anymore.
United Kingdom is far from the worst. In Japan,
Success today requires a good bit more than
where only 9 percent of the workforce is
good attendance. Yet, multiple studies in different
engaged, lost productivity is estimated to be
countries and across industries show that
$232 billion each year.
employees who are passionate about their jobs
and the organizations in which they work are What makes these numbers especially discourag-
in the minority. DDI’s own research reveals ing is that, supposedly, we have evolved from the
that only 19 percent of employees are highly dark ages of “personnel management.” On one
engaged. The Corporate Executive Board, hand, for the past two decades we have been
looking at levels of engagement across 50,000 trying to realize the benefits of empowerment,
employees around the world, placed only teamwork, recognition, people development,
11 percent in what they dubbed “true believer” performance management, and new leadership
category.1 Towers Perrin’s recent “Talent styles. As one skeptical senior manager commented
Report” is slightly more optimistic, finding just at a recent session where he was receiving
17 percent of the 35,000 employees surveyed feedback on the results of his division’s annual
to be highly engaged.2 climate survey: “It’s not as if we have not been
working on this stuff.” Evidently, there is a big
So, what about the rest? Depending on which
difference between putting in place initiatives
study you read, anywhere from 40 to 70 percent
that have the overall goal of increasing
of employees can be classified as neutral, middle
employee engagement and truly seeing the
of the road, or agnostic. Worse yet, an alarming
payoffs. And, on the other hand, one might
10 to 20 percent of employees are actively
easily attribute low engagement to persistent
“disengaged”—just putting in their time or, worse
downsizing, which leads to an erosion of loyalty
yet, undermining or badmouthing their organiza-
and commitment.
tions and bosses. The economic impact of low
1
© Development Dimensions International, Inc., MMV. All rights reserved.
DEFINING the organization’s financial integrity or from
helping the organization grow by maximizing its
EMPLOYEE investments.
ENGAGEMENT > Value—People want to be recognized and

rewarded for their contributions. Rewards and
DDI defines engagement as “the extent to which recognition come in many forms, including
OTHER DEFINITIONS people enjoy and believe in what they do and feel competitive compensation packages, a healthy
OF ENGAGEMENT: valued for doing it.” work/life balance, and V.I.P. sales trips. But
> “The extent to which
perhaps more important is the heightened sense
employees commit to Let’s take a closer look:
of worth employees feel when their leaders take
something or someone
> Enjoyment—People tend to receive more just a few minutes to let them know that they
in the organization,
pleasure and satisfaction from what they do if are doing a great job and that their contributions
and how long they
stay as a result of they are in jobs or roles that match both their are valued and appreciated.
that commitment.”4 interests and their skills. Look, for example, at
There are many other working definitions of
the high failure rate of sales managers who
> “Loyal employees engagement (see sidebar). All are largely defined in
(versus satisfied were promoted because they were excellent
terms of how a person “feels inside.” However, when
employees) stay salespeople. Some fail because they do not have
we ask people if the level of engagement in their
because they want to. the skills to manage, but we find a greater number
They go above and workplace would be readily apparent to a visitor
stumbling because they discover that they derive
beyond the call of from the outside, their answers are invariably “yes.”
more enjoyment from selling than they do from
duty to further their Job enjoyment, belief in what one is doing, and
coaching others to sell. And it’s not just the
company’s interests.”5 feeling valued all contribute to observable behavior.
functional tasks that add to or detract from
> “Engagement is the You can observe levels of excitement and energy,
enjoyment. Some individuals thrive in a team
state in which individu- you can witness people going the extra length to
environment versus one in which they work
als are emotionally and solve customer issues, and you can see an ethic of
intellectually committed
more independently. Some people like jobs
quality and continuous improvement. Similarly,
to the organization as that require travel, while some prefer not to
workplace behaviors indicative of low engage-
measured by three travel at all. Others like a high-risk/high-reward
primary behaviors:
ment—whining, low energy, passive-aggressive
bonus plan, where others prefer a more stable,
Say, Stay and Strive.”6 behavior, lack of teamwork—can be equally visible.
predictable salary.
> “The extent to which The “right feelings” lead to the “right behaviors,”
> Belief—If people feel they are making meaningful
employees put discre- and these “right behaviors” fuel higher levels of
contributions to their jobs, their organizations,
tionary effort into their business performance.
work in the form of and society as a whole, they tend to be more
brainpower, extra time, engaged. The connection between what people WHY YOU SHOULD CARE
and energy.”7 do every day and the goals and mission of the
The general principles of employee engagement have
organization is crucial to engagement. Walk
been around for decades. In fact,William C. Byham,
into any children’s hospital, and you will find
DDI’s founder and CEO, first published a bestselling
caregivers who passionately believe in their roles
book, Zapp! The Lightning Of Empowerment, in
and the mission of the hospital. You also will
1988. The book, in the form of a fable, struck a
find high disdain for anything that gets in the
chord with many readers by showing the sharp
way of providing quality care. Likewise good
contrast between a high-empowerment organization
trainers believe in what they do and like having
(Zapp) versus one that constantly robs employees
opportunities to see others grow and develop.
of their passion and energy (Sapp).
A CFO might derive satisfaction from safeguarding
2
During the past five years, though, there has been a Since 2003 the picture is once again changing,
surge in the popularity of employee engagement. albeit not as quickly as expected. For example,
Why the sudden interest? Why are some of the the Society for Human Resources Management
companies with which we work—Amedisys, reported that 48 percent of the employees it
Owens Corning, HCA, Grant Thornton, and Progress polled are actively seeking new jobs.10 Alan
Energy—making engagement a key ingredient in Weber, the editor of Fast Company, predicted:
their overall strategy? We believe there are four “The beneath-the-surface issue isn’t jobs, it’s
primary drivers. work. Specifically, it’s the growing recognition
by workers that corporate leaders have so abused
1. People have become the primary source
them during the recession, that when a job-
of competitive advantage. The Brookings
producing recovery really kicks in, companies
Institute (2003) recently examined the primary
will suffer a wave of employee deflation.”
source of market value in today’s organizations
Additionally, the workforce is getting older,
and how it has changed over time. In 1982,
with many of the baby boomers hitting 60 in
62 percent of an organization’s market value
2006 and ready to retire. Over and above the
came from tangible assets and 38 percent from
workforce cost of increased retirements,
intangible assets.8 Tangible assets include things
companies are beginning to take heed of the
like machinery, products, facilities, etc. Intangible
enormous financial costs of turnover (in the
assets, on the other hand, include factors such as
United States the estimate is in the billions) and
brand, intellectual property, and, most important,
increasingly viewing employee engagement as
the quality of the workforce. By 2002, 20 years
an imperative for keeping their key employees—
later, the source of value had almost totally
and attracting new ones—as the war for talent
flipped. Almost 80 percent of market value
heats up once again.
today comes from the intangible with a scant 20
percent coming from tangible assets. As we all 3. Popular appeal. Remember the reengineering
have heard before, products can easily be copied, wave? Even those who used it as more than
a technological edge can prove fleeting, and just a guise for massive layoffs found it painful.
more facilities can be built, but the quality of an Six Sigma implementations are invaluable to
organization’s talent, its passion and commitment, business performance, but most companies are
is nearly impossible to replicate. Engagement is finding them too complex to implement well.
the fuel that drives the value of intangible assets. Engagement is a different matter altogether.
While it still takes patience to implement,
2. Retention and the war for talent. The
engagement gets to the “hard stuff” by focusing
landmark 1998 McKinsey study, The War for
on the “softer stuff.” As one manager said: “It’s
Talent,9 was among the first to talk about the
about appealing to the head and the heart.”
potential for workforce shortages due to the
Engagement is about creating passion, it’s about
aging population. The study’s authors called
focusing on what people do well, and it’s about
upon organizations to take more seriously their
development and recognition. Some have called
efforts to attract and retain talent, to assure that
employee engagement a form of positive psy-
they would be able to survive and thrive in the
chology which, on the whole, is an easy pill for
future. In the late 1990s and early 2000s, the
organizations and their employees to swallow.
slump in the global economy quickly took the
spotlight off of the anticipated talent shortage. 4. Overwhelming impact. The human resources
And some predict that a portion of today’s aging function has been under pressure for decades to
workers will delay their retirements out of prove that it makes a difference. While CEOs
necessity, attenuating the expected talent shortage. may espouse the importance of their work-
3
forces in their annual reports, when times get ance (documented in hundreds of studies, with
tough, HR is among the first to get the budget the evidence mounting every day) provides a
axe. Why? A lack of convincing evidence on way for HR to prove its contribution. It’s a fact:
the value of HR initiatives. HR professionals are The higher the level of engagement, the higher
scrambling, according to a recent Conference the performance of the business. The research
Board report, to prove that their activities and is not inconclusive, not limited to one country
investments are both efficient and positively or industry, and not contained to a few hundred
influential to business strategy.11 The positive people—it’s overwhelming.
relationship between engagement and perform-
4
BUILDING THE only 52 for the high-engagement group.
That’s right—52! In a services organization,
BUSINESS CASE there is a strong relationship between sales

performance and employee engagement.
Move the needle on engagement and you move Highly engaged employees achieved an average
the needle on business performance. The proof of 99 percent of their sales goals, while disen-
can be found in dozens of studies across hundreds gaged sales reps averaged 91 percent.
of organizations, involving hundreds of thousands
> Michael Treacy, author of Double-Digit Growth—
of employees.
How Great Companies Achieve It No Matter
Before quickly reviewing some of this data, it might What, worked with Hewitt Associates to
be worthwhile to review how the engagement/ demonstrate the relationship between double-
business-impact relationship is actually measured. digit growth companies and engagement.
Employee engagement is assessed through what is Employee engagement scores were 21 percent
commonly called an “attitude” or “organizational higher in double-digit versus single-digit growth
climate” survey. Typically, employees and their companies. Hewitt showed similar results with
managers complete the survey. Their scores are its Employee Engagement and Best Employer
then aggregated into team, department, and Database of 1,500 companies. In companies
organizational engagement “scores.” These scores where 60 to 70 percent of employees were
are then correlated with various business metrics, engaged, average total shareholder’s return (TSR)
including turnover, productivity, sales, etc. The stood at 24.2 percent. In companies with only
research shows that the higher the employee 49 to 60 percent of their employees engaged,
engagement scores, the better the performance of TSR fell to 9.1 percent. Companies with engage-
the organization. ment below 25 percent suffered negative TSR.12
Lets take a quick “tour” of some of the research > Towers Perrin, looking at over 35,000 employees
conducted by various organizations over the past across dozens of companies, showed a positive
five years. relationship between employee engagement and
> DDI has compiled an engagement database of sales growth, lower cost of goods sold, customer
thousands of employees across 200 organizations. focus, and reduced turnover. For example, highly
Analysis of this database has shown that those engaged employees are almost three times more
employees with higher engagement scores are likely to feel that their company really cares about
more satisfied with their jobs, less likely to leave customers and has the ability to serve them better
their companies, and more capable of achieving than their competitors. Companies with highly
their performance goals. We estimate that in engaged employees beat average revenue growth
an organization of 10,000 employees, moving in their sector by 1 percent while companies
a workforce from low to high engagement can with low engagement were behind their sector’s
have an impact of over $42 million. For example, revenue growth by an average of 2 percent.13
in a Fortune 100 manufacturing company, > The Corporate Executive Board surveyed 50,000
turnover in low-engagement teams averaged employees in 59 organizations worldwide.
14.5 percent, and absenteeism hovered around Employees with lower engagement are four
8 percent. For highly engaged teams, absenteeism times more likely to leave their jobs than those
was only 4.8 percent, and turnover came down who are highly engaged. Even more important,
to 4.1 percent. Quality errors (as measured by moving from low to high engagement can result
external and internal parts per million) stood in a 21 percent increase in performance.14
at 5,658 for the low-engagement group and
5
> The Gallup Organization has done the most work companies was 2.1 percent and net profit margin
on measuring employee engagement, having was a dismal -1.38 percent. Compare this to their
shown relationships between engagement and a high-engagement counterparts, where operating
range of measures, such as turnover, sales growth, margin was up to a positive 3.75 percent and net
customer service, revenue, etc. In a landmark profit margin up 2.06 percent.16
study across multiple companies, it showed that
> Instead of correlating levels of engagement with
business units that reported employee engagement
organizational performance, Melcrum, a U.K.
above the median had a 70 percent higher likeli-
research organization, completed 40 in-depth case
hood of success than those below the median.
histories along with a survey of over 1,000 HR
Success was a composite measure combining
practitioners. More than 50 percent of the survey
customer loyalty, turnover, and financial metrics.15
respondents and case studies report improvement
> ISR has one of the largest databases on employee in customer retention and satisfaction as a result
engagement: 41 companies across 10 geographical of engagement initiatives, and over one-third
markets. Looking over three years of data, report improvements in productivity.17
change in operating margin in low engagement
6
DDI’S BELIEFS 5. Engagement is all about fit. People are more
likely to be engaged if their jobs and the culture
ABOUT EMPLOYEE of the organization match both their abilities
ENGAGEMENT
and skills, and their motivation and values. Most
organizations hire or promote only for the ability
and skill match, ignoring the motivation and
DDI’s approach to building higher levels of engage-
value match.
ment is based on a number of fundamental beliefs,
many of which were formed by our more than 6. No one impacts the state of engagement
three decades of research and experience. more than an employee’s immediate
leader. While this might be a slight exaggeration,
1. Engagement is the primary enabler of suc-
we believe most people do not leave their jobs;
cessful execution of any business strategy.
they leave their bosses. Show us a highly
An engaged workforce is your only true
engaged team, and there’s a strong likelihood
competitive advantage. It is almost impossible to
we can show you a leader who is coaching for
copy and, without it, execution of most corporate
success, setting clear goals, empowering others,
initiatives becomes difficult, if not impossible.
providing open and honest feedback, and making
2. Engagement is not a short-term initiative. the winners feel valued.
Because engagement is simple in concept but
7. Measuring engagement and demonstrating
difficult in execution, it is never achieved or
its business impact is crucial, but it’s only
finished—only improved. It might take years of
a small part of winning the battle. Far too
steady progress to build high levels of employee
many organizations pour hundreds of thousands
engagement, and without the proper care and
of dollars into measuring and remeasuring
feeding, these gains can wither and fall away
engagement, leaving little energy or budget for
surprisingly quickly.
actually improving engagement levels. Keep
3. Engagement must be driven from the top. your engagement measures simple and cost
Engagement is a business imperative, not an HR effective. Instead, spend your resources and
initiative, though HR should be a key player in energy moving the needle in the right direction!
driving higher levels of engagement. Support
8. Engagement means reaching the heart.
from the top also means senior leaders must be
Highly engaged employees give that extra effort
highly engaged themselves. Believe it or not,
because inside they care. And, they care because
only one in four senior leaders—and only one
they feel someone is caring for them. A vice
in six frontline leaders—is highly engaged.
president for customer service at Progress
It’s hard to imagine highly engaged employees
Energy, for example, insists that his managers
without highly engaged leaders.
really get to know the individuals on their teams
4. One of the best ways to have highly as people, not just employees. He wants to
engaged employees is to hire them! Certain know about their aspirations, interests, and
people have a set of characteristics or attributes families. The recognition of the “whole person”
that increase their propensity for engagement sends a powerful message to employees that the
(for example, some employees are more likely organization understands and appreciates that
to have higher levels of engagement than others, they have a life outside work.
regardless of the jobs they choose or assignments
they receive). Companies should pay close atten-
tion to these characteristics in their hiring process.
7
MEASURING can be tabulated and presented in a number of
different ways. Most organizations look at an
ENGAGEMENT overall engagement composite score, which averages

responses across all survey items and is often
The Conference Board recently published a report presented at the work unit, department, division,
dealing with the increasing importance of HR and corporate levels. Generally, when we talk
metrics.18 Metrics around engagement have risen about organizations with high or low engagement
to the top of the list as proof of HR’s impact and scores, we usually are referring to their overall
its justification for new expenditures. composite scores.
The popularity of engagement as a metric comes Most organizations also pay attention to the
as no surprise to us. For decades, HR professionals responses to individual items, at the work unit,
have been searching for a formula to demonstrate department, division, or organizational level.
their function’s worth. Engagement measures This allows the organization to zero in on specific
seem to have filled the void. Some of our strengths and weaknesses relative to engagement
clients have even begun to refer to engagement from an organizational perspective down to individ-
measurement as HR’s holy grail. While many of ual work units and leaders. In addition, it is also
the principles of engagement have been around common for organizations to seek comparisons,
for decades, reliably measuring engagement is a at a composite or item level, to internal or external
relatively new phenomenon. norms. For example, a company might want to
Why the sudden measurement craze? We cite see how each division is doing relative to the
three drivers: entire organization. Or it might want to look at
how well the organization is doing relative to a
1. Measuring engagement is relatively simple,
broad-based external norm.
reliable, and, in most cases, takes no more than
10 to 15 minutes per employee. Also, it does We often are asked if there are differences between
not need to be expensive. a cultural or attitude survey and an engagement
survey. The answer is both “yes” and “no.” Unlike
2. As we mentioned before, there is a powerful
well-constructed engagement surveys, most attitude
connection between levels of engagement
surveys have less research behind them in terms of
and business performance. Moving the level
predicting organizational performance. They also
of engagement up means improving the
tend to cover a broader range of factors and items
performance of the company or work team.
than most engagement surveys. For example, DDI’s
3. For the most part, those items that measure E3®, which measures engagement, has 20 survey
engagement are actionable and controllable. items. (See Appendix A for a complete list of E3®
If a senior executive team truly believes in the survey items).
power of engagement, it can do things that will
There is often a high degree of overlap between
make a difference.
items contained in typical cultural or attitude surveys
WHAT DO WE MEAN BY MEASURING and the items in many engagement surveys. If you
ENGAGEMENT? currently are using an employee attitude survey,
Engagement data is generally collected via employee we recommend that you select those items in your
responses to a survey, usually delivered online. survey that match items that research has shown are
Employees indicate the extent to which they agree most predictive of engagement and organizational
or disagree with the items in the survey. Results performance. Then, use those items to develop a
8
separate composite employee engagement index often are administered only once every two to
focusing on this subset of items. If you are missing three years. However, if your organization uses
engagement items that research shows are predic- this method, you need to be sure both surveys
tive of organizational performance, they can be are measuring the same thing. Further insights
added to your current attitude survey. Some of about DDI’s approach to measuring employee
our clients use our E3® engagement survey as a engagement are contained on page 26.
“quick check” between attitude surveys, which
9
ENGAGEMENT: engaging work environment taps into employees’
motivation to try harder and put forth the extra
DDI’S VALUE effort that differentiates organizations from their
PROPOSITION
competitors. Finally, when organizations have
engaged employees, the long-term benefits appear in
the bottom line. Organizations have more satisfied
A popular American radio program featured a story
and loyal customers, increased profits, better-quality
about a software developer who lost his job yet
products or services, and greater growth potential.
continued to come into work to develop a particular
piece of software.19 He snuck in the front door, FIGURE 1: DDI’s Engagement Value Proposition
worked in empty offices, and put in long hours on
a project the company had already cancelled. In ENGAGEMENT DRIVERS
> Right Employees in the Right Jobs
time, he had developed what many considered to
> Exceptional Leadership
be a perfect piece of software. This software was
> Organizational Systems and Strategies
so good that the company eventually installed it on
all the computers it sold and, of course, rehired the
employee. Although unusual, this story illustrates
the power of motivation and a high level of fit with WORK ENVIRONMENT
one’s job. Engaged employees have this type of > Aligned Effort and Strategy
motivation, which drives them to do their very best. > Empowerment
> Teamwork/Collaboration
Figure 1 shows DDI’s engagement value proposi-
> Growth and Development
tion, which includes four sequential components. > Support and Recognition
Top of the model, engagement drivers are the
levers that organizations can use to build a more
engaging work environment. Engagement does not
just materialize. Organizations must hire employees ENGAGED EMPLOYEES
who fit the job requirements, develop leaders > Greater Loyalty
with the right skills, and provide support through > Enhanced Effort
strong systems and strategies. Together, these three

drivers lead to the formation of an engaging work
environment. Once created, the engaging work
environment has a positive impact on employee ORGANIZATIONAL SUCCESS
behaviors and attitudes. In particular, an engaging > Satisfied/Loyal Customers

> Increased Retention
environment builds loyalty in employees by meeting
> Higher Profits and Profitability
their personal and practical needs, thus encouraging
> Revenue Growth
them to stay with the organization. In addition, an
10
ENGAGEMENT DRIVERS > Attachment to the job
Organizations drive engagement by proactively > Agreeableness
leveraging three sources of influence for change:
MOTIVATIONAL FIT: > Emotional stability
SELECTING FOR employees, leaders, and organizational systems
ENGAGEMENT and strategies. These three drivers work in concert > Openness to experience
Many factors within a job
to build an engaging work environment. Although > Achievement orientation
and an organization are
engagement has multiple drivers, the ultimate
satisfying or dissatisfying > Self-efficacy
to people. Consider
ownership of engagement rests within the individual
the number of roles a employee. Organizations hoping to drive engage- These findings show that, in addition to assessing
candidate might assume ment must tap into employees’ passion, commitment, motivational job fit when hiring new employees,
in an organization and and identification with the organization. This is organizations can use cost-effective tests to identify
the tasks and projects accomplished by having the right employees employees who are more likely to be engaged on
associated with each role.
working in the right jobs, which is our first the job.
Add the organization’s
engagement driver. When we say the “right”
values and practices. The second engagement driver is exceptional
Then consider what a employees we mean that individuals have the
leadership. Many of the work environment
candidate prefers in the skills to do the job (“can do”) and that their jobs
factors of our model are directly affected by the
job and work environment. tap into their personal motivators (“will do”).
quality of leadership. Leaders have the influence
The result is a vast Organizations can ensure high job fit by effectively
network of possible and power to serve as catalysts for higher levels
deploying employees’ talents when making
combinations that of engagement, not only in one or two areas, but
selection, placement, and promotion decisions.
makes it anyone’s guess in all aspects of leadership (See text box, Profile
whether the candidate
Research has repeatedly shown that when job fit
of Engaged Leaders). Even more compelling, our
will be happy working is high, an employee performs better and is more
own assessment and testing research shows that:
in the target job and the likely to stay with the organization.
organization. That’s why > More engaged managers have more engaged
In addition to having a motivational match, some
it’s critical to interview for direct reports.
motivational fit. employees are more likely than others to be
inherently engaged in their work. This has > The direct reports of engaged managers are less
DDI’s process has made
implications for driving engagement levels because likely to leave the organization.
people familiar with the
Job Fit Analysis and organizations can benefit from hiring employees > Higher-performing managers have direct reports
Organization Fit Analysis with a greater tendency for engagement before who are more highly engaged.
Questionnaires for identi- they even begin to work.
fing the critical facets for Additional DDI studies show that changes in leader
the job and organization.
DDI has been conducting groundbreaking research behaviors can have a real impact on employee
Critical facets are those on what we call engagement propensity. We have engagement. For example, a study of pre- and post-
that people have many found that some people have a set of personal training engagement scores showed that when
and few or no opportuni- characteristics—regardless of their jobs—that leaders improved their skills through training,
ties to experience. correlate with higher levels of engagement. DDI employees became more engaged in their work.20
Interview questions relate
conducted 10 studies across six client organizations
directly to these critical Engaging leaders understand that their role is
and seven job families correlating a number of our
facets to uncover matches
proprietary test items with employee engagement not to take charge of all the decisions, but to
and discrepancies
survey scores. We found that engagement was be more like cheerleaders. It’s about recognition
between what the job or
organization offers and significantly correlated to these six factors: for a job well done; it’s about giving people the
what the candidate likes room and encouragement to grow. It’s also about
and dislikes. being tough when necessary, holding people
accountable for their performance.
11
PROFILE OF ENGAGED LEADERS
COACH AND DEVELOP FOR RESULTS MANAGE WORK
Effective leaders know that team members are Leaders who do a good job of managing work understand
more engaged when they can “get it right” the first the difference between delegation and dumping. Effective
time. They spend more time coaching for success leaders distribute work appropriately, and they make it
(proactively) than coaching for improvement (reactively) meaningful. They are also effective at making decisions,
for short-term coaching opportunities. For long-term planning and organizing, and following up.
development, leaders need to know how to position
PARTNER WITHIN AND ACROSS TEAMS
high payoff development activities that benefit the
individual, and at the same time, address the team’s People are more engaged in an environment that is
and organization’s goals and needs. collaborative and not adversarial. Effective leaders have
mastered not only the intrateam skills to get people
DRIVE PERFORMANCE engaged, but also the interteam skills.
We’ve all had that experience—one person on the team
INFLUENCE THROUGH PERSONAL POWER
is not doing a fair share, and the leader is not holding the
person accountable. It’s disengaging, right? Engagement Leaders who use influence (or their personal power) versus
is higher when leaders set clear goals and they hold position power are clearly more engaging and have learned
people accountable. how to build sufficient commitment to move good ideas

through their organization.
INSPIRE LOYALTY AND TRUST
SELECT TALENT
Engaging leaders understand that they need to
proactively build an environment where employees It is best to start with people who have a better chance
are motivated, engaged, and retained. Effective leaders of being engaged and people who not only can do the job,
don’t wait to get the resignation to know that an employee but also want to do the job. Leaders who have the skills
is dissatisfied. and knowledge to select highly engaged employees can

make a great contribution in both the present and the future.
Finally, organizations need strong systems and related to organizational systems in the Alignment
strategies that support and foster engagement. section of Moving the Engagement Needle.
Examples of systems are hiring, promotion,
Together, these systems provide a firm foundation
performance management, recognition,
upon which to accelerate engagement. A shaky or
compensation, training, and career development.
incomplete foundation will make your efforts to
We will provide more specific recommendations
build engagement more difficult, if not impossible.
12
AN ENGAGING WORK ENVIRONMENT organization has a clear focus and direction.
It also enables leaders to pinpoint and address
The second component of our model, an engaging
poor performance. Few things are more
work environment, consists of five key elements:
frustrating to a high-performing team than a
1. Aligning effort with strategy—Engagement leader who refuses to handle the occasional
begins with employees’ clear understanding member who is not measuring up. And many
of what they should be doing on the job. managers don’t have the confidence to address
Each employee needs a solid job description poor performance.
and a clear set of performance expectations.
2. Empowerment—William C. Byham’s 1988 book,
Even more critical is their understanding that
Zapp! The Lightning of Empowerment, was one
their individual goals are connected directly
of the first to examine the nature of employee
to the organization’s goals. Unfortunately, less
empowerment. Empowerment is a feeling of
than half of employees (47 percent) are satisfied
job ownership and commitment brought about
with their organization’s system for managing
through the ability to make decisions, be
their performance. Some organizations do an
responsible, be measured by results, and be
especially good job of creating alignment early
recognized as a thoughtful, contributing human
in an employee’s tenure with the organization.
being rather than a pair of hands doing what
For example, new team members at Toyota are
others say. It implies having the authority to make
given a thorough orientation that clearly defines
decisions, follow through, and get things done.
how their roles and the decisions they make tie
into Toyota’s overall approach and manufacturing Organizations build empowerment by choosing
philosophy. To attain this alignment, leaders need employees who take personal pleasure in the
to help all employees see the bigger picture and work they do and by giving employees the
understand their roles relative to it. They also need ability to make important decisions about their
to show how an individual employee’s actions work. Employees feel empowered when a task
affect other departments and external customers. appears to have a specific goal or purpose that
is of value to the individual. Employees working
Building a strong sense of alignment with strategy
in health care and nonprofit organizations often
requires a good communication system and
point to the rewarding qualities of their work
strong accountability. Employees should be
and the alignment between their personal
kept well informed about the changes that
beliefs and the goals of the organization in
affect their work groups so that they aren’t
spite of lower pay or stressful work tasks. In
confused or surprised when those changes are
other industries, the value of employees’ work
introduced. Additionally, when organizations
may be less apparent, and it is more difficult to
provide a clear sense of direction and keep
develop a sense of purpose or see the impact
employees well informed, employees are able to
of one’s efforts.
make the best use of their time, resources, and
budgets, and, therefore, don’t get off track when Using good measures of motivational fit and
setting priorities or “spin their wheels” when job fit during the employee hiring process can
taking action. ensure that organizations are selecting the kind
of people who find meaning in their work.
Effective performance management is the
Organizations also foster empowerment when
backbone of employee engagement. It drives
employees have the perception that their
accountability, serves as the basis for individual
actions are self-determined rather than directed
development, and shows everyone that the
13
by others. Leaders play a key role in developing A key ingredient in developing and maintaining
a sense of empowerment in their direct reports. high levels of cooperation and teamwork is a
Empowering leaders trust their employees and work environment built on trust. Trust means
give them the opportunity to make decisions employees have confidence that others’ actions
without micromanaging or taking over tasks are consistent with their words, that leadership
when the going gets tough. is concerned about their welfare and interests
apart from what they can do for the organization,
3. Teamwork/Collaboration—“Even the Lone
that the skills they have developed are respected
Ranger had a partner,” is a truism in today’s
and valued, and that each employee uniquely
business environment. Few employees can do
matters in the workplace.23 Many studies have
their work without the support and input of
indicated that trust is a critical success factor in
others. When employees have the support and
organizations and plays a key role in fostering
cooperation of their coworkers, they are able to
high levels of teamwork and collaboration.24
accomplish more and share ideas to come up
with creative solutions. 4. Growth and development—DDI’s 2004
Selection Forecast25 study found that many
In the context of engagement, teamwork and
employees leave their jobs for better growth
collaboration require good relationships both
and development opportunities, often offered
within the work group and across work groups.
by other organizations. Most employees want to
Many organizations have strong teams with
keep their jobs fresh and interesting by learning
members who work well with each other.
new approaches and building new skills.
However, these teams or work groups must also
Organizations can create engagement in their
work effectively with other teams or work
workforce by building a learning culture and
groups in the organization. Many organizations
creating individual development plans for
have “silos” or competing work groups that fail
every employee.
to recognize the need to unite their efforts
toward a common goal. When work groups Promoting employee growth and development
become insulated from other groups, they can requires focused attention in several areas of the
develop an “us vs. them” mentality that ends up organization. First, organizations need to select
hurting the organization in small ways each and employees who have a willingness to learn and
every day, and in big ways in the long run. can adapt their behaviors to a changing work
environment.26 This willingness to grow and
Studies have shown that teamwork and
learn promotes innovation and creativity in the
collaboration within and between groups can
workforce. Second, leaders need to work with
predict an organization’s shareholder value and
employees to understand strengths and develop-
long-term team productivity and effectiveness.21
ment needs, and provide opportunities to leverage
Additionally, the level of support and teamwork
or build skills and knowledge. Most employees
plays an important role in determining whether
want to use their best skills and will feel
employees choose to leave or stay with an
engaged when organizations recognize and
organization in the long term. In spite of the
capitalize on their unique strengths, rather than
importance of teamwork, DDI’s 2003–2004
placing emphasis on fixing weaknesses. Third,
Leadership Forecast showed that, according
organizations also need to provide meaningful
to employees, only 41 percent of leaders have
development plans and opportunities that
strong teambuilding skills.22
include programs such as training, succession
management, special projects and assignments,
14
and mentoring. The key to a successful develop- Each employee has unique skills and perspectives
ment program is to ensure that all employees that add to the organization’s ability to generate
have a plan for development and clear account- and analyze ideas. These ideas, in turn, yield a
abilities for making progress on their plans. The positive benefit for the organization’s bottom
value of investing in a strong and diverse devel- line. The high-involvement movement of the
opment program is clear. For example, studies early 1990s emphasized the importance of
have found that investments in development sharing employee ideas and involving employees
programs are significantly related to financial in decision making. These practices were and
success in the organization.27 continue to be linked to overall company
performance. For example,Watson Wyatt found
5. Support and recognition—Employees
that when employees have input into how work
who feel they are listened to, supported, and
gets done and can share ideas with senior leaders,
recognized for their contributions are likely to
there is a corresponding increase in a company’s
be more engaged. People like to be recognized
market value.29
for their unique contributions. In the Walker
Information study Halfway Out the Door,28 Support and recognition also mean that employees
care and concern for employees emerged as receive regular feedback about how well they
one of the most important factors influencing are doing. DDI’s Selection Forecast study found
employee commitment to their employers. The that only a little more than half (58 percent) of
U.S. Department of Labor confirms that lack of employees feel that they get enough feedback
employee appreciation plays a critical role in about how well they are doing. Employees need
employees’ decisions to leave their organizations. and expect feedback as a way of supporting
their work and recognizing their progress.
Support and recognition can mean several
Ongoing feedback serves as a motivator for
things in the context of creating an engaging
action by creating focus and shaping action.
work environment. In one sense, support
means that employees are appreciated for their Unfortunately, some leaders and employees see
ideas and efforts. Instead of treating employees the opportunity to provide feedback as an open
as pawns, engaging organizations support invitation for criticism, often delivered after the
contributions from employees by listening to work is done. They have a hard time providing
them and responding to their ideas and concerns. feedback that is specific, timely, and balanced.
While leaders should work to address problems,
Although many organizations provide formal
they often forget that employees need encour-
rewards and recognition programs for employee
agement and reinforcement for a job well done.
ideas and contributions, many employees are
Still, many leaders continue to struggle with
hungry for more day-to-day informal recognition.
providing honest and open feedback on per-
Employees who are unaccustomed to recognition
formance. Engagement requires good feedback
for their work often remember a single pat on
skills among employees and between employees
the back from a coworker or boss for weeks or
and leaders. This open flow of information
even months. Support and recognition in an
ensures that employee behaviors stay focused
engaging environment is a daily occurrence
on the right priorities.
that builds employee self-esteem and creates
strong partnerships.
15
ENGAGED EMPLOYEES ORGANIZATIONAL SUCCESS
The right work environment should, of course, The power of employee engagement is that it is
lead to a heightened sense of employee motivation, closely connected to business results. Earlier, we
which, in turn, leads to enhanced or discretionary summarized some of the many studies demonstrating
effort. Enhanced effort is not just putting in the the relationship between engagement and organi-
extra time; it’s also getting things right the first zational outcomes. The results are overwhelming,
time and going out of one’s way for the customer. and it’s clear that employee engagement plays a
The motivational aspect of engagement is well strong role in business success. In particular,
supported by more than four decades of research. engagement can find support in the Service Profit
In his book, The Motivation to Work,30 published Chain33 and the Balanced Scorecard.34 Both of
in 1959, Frederick Herzberg originated some of these conceptual models demonstrate the power
the most lasting and well-researched theories and impact of people practices and human capital
about work motivation. The factors determining on company performance. For employee engage-
satisfaction in Herzberg’s work are surprisingly ment, we classify the primary business outcomes
similar to the elements of employee engagement. into four categories.
According to Herzberg, the true motivators at
When employees work in an environment in
work include achievement, recognition, work itself,
which they can focus their attention on their work
responsibility, advancement, and personal growth.
and have a drive to do their best, organizations
The same things that drive motivation and experience higher levels of productivity and
enhanced effort also increase employee loyalty profitability. Engaged employees look for better
to the organization. Many studies have shown ways to do their work, spend less time on wasted
that employees base their decisions to stay or leave activities, and make effective use of resources.
on factors related to employee engagement. It is In the end, companies deliver better products or
not uncommon for employees to leave high-paying services and have more resources left to invest in
or high-status jobs because they don’t feel fulfilled. further improvements.
DDI’s Leadership Forecast study found that about
Although it is an important consideration, high
one-quarter of leaders have considered dropping
financial compensation is not the only driver of
out of their leadership positions, largely because
increased employee retention. As addressed previ-
they want to pursue other personal or career goals.31
ously, employees decide to stay with organizations
Building an engaging work environment is key to
for other reasons, such as growth and development
making sure that employees find fulfillment in their
opportunities, strong leadership, and meaningful
current jobs. Organizations that lose employees by
work. Turnover costs organizations millions of
failing to create engagement will pay the price.
dollars each year, and engagement has a proven
Past studies have shown that in an organization of
relationship to employee retention.
10,000 employees, the cost of a single percentage
point of turnover can exceed $366,000.32
16
No one likes going into a store where the sales employees have better interactions with customers.
clerks are sullen, absent, or uncooperative. It’s Engaged employees are more likely to improve
easy to see why customers notice engaged other critical factors affecting customer satisfaction,
employees and are more satisfied and willing to such as responsiveness, product quality, thought
purchase again. For example,Tom Labadie, leadership, innovation, etc.
director of training and development at CompUSA
Finally, higher engagement translates into higher and
states,“When you walk into a store with high
faster revenue growth. Engaged employees are
engagement scores, you can sense the positive
more innovative and place more emphasis on meet-
tone. Employees whistle and smile, they approach
ing customer needs. The “what can I do better or
customers, and the store gives off that elusive
differently” attitude of engaged employees versus the
approachable feeling that customers appreciate.”35
“it’s not in my job description” attitude of the unen-
Organizations with engaged employees have more
gaged simply leads to better financial performance.
satisfied customers, but it’s not just because
17
MOVING THE is then monitored including readministration of the
engagement instrument.
ENGAGEMENT Unfortunately, things are rarely this cut and dried.
NEEDLE When leaders follow the process described above,

they can succeed at installing a process to
Organizations serious about increasing employee
measure employee engagement, but they will
engagement drive it from the top with extensive
almost always fall short of realizing the benefits
input and involvement from HR. At the 30,000-
of increased employee engagement. Installation
foot level, the initiative can seem straightforward:
is introducing a new solution or process into the
Gain support, agree on an employee engagement
organization, whereas realization is when an
survey instrument, ask employees to fill it out,
organization achieves the business outcome
and analyze and distribute the results so that
they originally anticipated. Table 1 describes the
appropriate groups and departments see their
differences between Installation and Realization
results. From the feedback should come a set of
in more detail.
initiatives to improve engagement. The program
TABLE 1: Installation and Realization
Features Installation is the end state Realization is the end state

“Stated” goal Achieve desired business results Achieve desired business results
Critical success factors Inserting solution into the status quo Change process guides installation
Focus of attention Logistics, scheduling, training, Impact, change, and results
budgets, plans
Indicators of success Meeting critical milestones, usage Sustainable changes in workforce
figures, getting things done performance that can ultimately
lead to improved organizational
performance
Quality of outcome Short term and of insufficient value Long term and of substantial value
Management support Weak or inconsistent Strong and sustained
Cost of monitoring High—leader and workforce Low—leader and workforce
and enforcing use commitment is low commitment is high
User motivation Compliance: “I have to do this” Engagement:“I want to do this
because I know it’s important to
the organization”
User resistance Addressed after the fact Preventive measures taken up front
18
Let’s take a look at the main phases of an employee responses. Table 2 provides a number of survey
engagement initiative and the key elements of each. readiness questions that can help determine the depth
and breadth of the communication strategy. In all
PHASE 1—ACTIVITIES PRIOR TO LAUNCH
OF EMPLOYEE ENGAGEMENT SURVEY cases, the communication strategy should include:
Any significant employee engagement initiative > Why the employee engagement initiative is
The single most visible
factor that distinguishes must have strong support and buy-in from senior being conducted—what the ultimate purpose is.
major cultural changes leaders. Not only do senior leaders need to > Who will see the results,and how they will be used.
that succeed from those understand and accept the intellectual business
that fail is competent > How actions to improve engagement will be taken.
case as to why engagement is important, but they
leadership at the top.
also must have an inner belief or passion that > How confidentiality will be handled so that
Corporate Culture employee engagement is crucial to business individual responses will be kept anonymous.
and Performance,
success. And they must be willing to accept their
Kotter and Heskett
roles and responsibilities throughout the process. TABLE 2: Survey Readiness Factors:
Further, it is important to convey to senior leaders
Level of trust—Do most employees trust that a
that increasing engagement across the organization
survey will be confidential when management
is likely to involve some personal behavior change
says it will be?
on their part.
Likelihood of action—Will management
Another activity that cannot be overlooked is
take action based on the results, or will it be
the rollout strategy, which describes how to “business as usual”?
distribute survey results, formulate action plans,
Receptivity to feedback—Have leaders at all
and determine who will see what? Will breakout
levels been receptive to feedback in the past?
reports be available at department or facility levels
only, or will breakout reports cascade down to the Ease of completion—Is the survey being
smallest group or unit possible? We recommend, administered in a way that makes all employees
to maintain confidentiality, that breakout reports feel comfortable participating?
be provided to groups with at least 8 to 10 Success of past surveys—Have past surveys
respondents. The rollout strategy also needs to lived up to expectations in the minds of most
address a number of important aspects including: employees?
> How results will be presented to senior, middle,

and frontline leaders (for example, large group As in any good marketing campaign, the communi-
sessions, webinars, department meetings). cation message should be delivered in ways that
will reach all employees. In some organizations,
> How leaders will be trained to interpret results
a letter or e-mail from the CEO is a great way to
and facilitate the action-planning process.
kick off the employee engagement initiative.
> What types of developmental resources will be Regardless of how the employee engagement
available to leaders and staff to facilitate the initiative is promoted, it is important for senior- and
completion of action plans. middle-level leaders to know enough about the
employee engagement initiative to respond to
All employee engagement initiatives require a
employee questions and to be fully supportive
comprehensive communication strategy that
of its goals and objectives.
begins well before the survey is launched. If
employees don’t have enough information, no one
should expect them to provide honest and valuable
19
PHASE 2—SURVEY DEVELOPMENT > Do the levels of engagement indicated by the
AND EXECUTION survey results correlate to important business
Survey Development measures, such as productivity, revenue, turnover,
safety, and other measures of success?
There is no lack of survey instruments in use today
that profess to measure employee engagement. Characteristic #3: Reliable
When you add to this array the mountain of The reliability of an engagement survey is the
employee opinion and employee satisfaction survey ability of the instrument to deliver accurate results
instruments that have been used during the last 30 when administered to random samples of the same
years, just the selection of the right survey instru- population, or (more common in engagement
ment for your organization can be a frustrating and surveys) to the same population over time. There
unsatisfying process. are many ways in which a survey can be unreliable,
To help you cut through the marketing hype that and some surveys are not intended to be reliable
you will encounter in your search for the best over time. Good survey reliability is often a function
instrument, we offer five characteristics of a top- of careful wording, format, content, and administra-
notch employee engagement instrument: tion. Normally, reliability can be established by
showing internal consistency among survey items
Characteristic #1: Short (that is, Chronbach’s alpha) or by showing high
By “short” we mean that the employee engagement correlations between two administrations of the
instrument shouldn’t also be trying to measure same test within a group of individuals.
satisfaction with current benefits, impressions
of a recent program or initiative, or how well a Characteristic #4: Limited Flexibility
new strategic direction has been communicated. Inflexibility. . . a good quality? While flexibility
Survey fatigue can result if the instrument extends might be a positive attribute of many HR initiatives,
beyond 20 or 25 questions. Employees can it can hamper the effectiveness of measuring
become frustrated with the survey process itself, engagement. Nearly every organization wants to
and as they rush through the questions, the quality compare or “benchmark” its engagement results
of their responses suffers. with results from other organizations. The most
accurate benchmarking occurs when the same
Characteristic #2: Valid survey items are used. Unless the survey asks the
Common questions asked about the validity of an same questions, uses the same rating scale, and
engagement survey instrument are: employs the same basic survey approach, there
> Do the survey questions appear to be credible will be little value in comparing an organization’s
aspects of employee engagement, or does the engagement results to those of other organizations.
survey leave respondents wondering how the Also, the better engagement instruments, like E3®,
answers to these questions will prove insightful? are built on a foundation of research. Adding or
changing items haphazardly will reduce the accuracy
> Do the survey items and rating scales actually of the instrument in measuring engagement and
measure what the survey instrument purports to subsequently will affect organizational performance.
measure (that is, employee engagement), or are
the questions just a laundry list of common
employee satisfaction questions?
20
Characteristic #5: Actionable sole goal is to measure employee engagement at
Even if the first four characteristics are satisfied, an a macro level, then you could use some of these
engagement survey can fail miserably if survey same sampling techniques. However, most
item results cannot easily translate into actions to organizations want to “slice and dice” their results
improve the level of employee engagement in the so that even relatively small departments or work
organization. A high-quality engagement instrument units can see how their group responded. This
should lead to clear and understandable solutions— level of refinement requires that all employees
both tactical and strategic—that individual leaders be surveyed. Also, by surveying all employees
and organizations can leverage to drive employee you create broader awareness of and buy-in for
engagement to higher levels. Leaders should the mission of increasing employee engagement.
always be able to answer the following question: This is especially important if the results are to
If a particular item is rated low, is there something serve as a catalyst for significant cultural change.
we can do about it in our organization? In fact, With today’s technologies and widespread access to
an engagement expert should be able to help the Internet, most organizations deliver engagement
the organization map specific solutions to each surveys online to as many employees as possible,
survey item prior to Phase 1 activities so that there in whatever languages are most appropriate. For
are no surprises as results are interpreted and employees without easy access to the Internet,
strategies determined. scannable surveys provide an adequate distribution
In addition, survey results will have diminished platform. Regardless of the distribution method,
value if the key findings are embedded in reams consider logistical issues carefully before the
of detailed analyses. If the leader at each level can’t survey launch, to avoid glitches and minimize
understand the meaning of the results, it is more participant frustration.
than useless—the survey will have soured the PHASE 3—REVIEW OF RESULTS AND
leader against other measurement activities and it ACTION PLANNING
will turn off the survey respondents if they see no
In this phase, most organizations conduct a top-down
results in response to their survey answers.
sharing of engagement results followed by wide-
Appendix B contains a listing of DDI’s engagement spread action planning at a number of leadership
survey items from our validated E3® survey levels. We believe that in addition to this type of
instrument, and the clear mapping of each question activity and involvement, it is a best practice for
to leadership and workforce development solutions. senior leadership to examine the results from a
We will discuss how to leverage these mappings strategic perspective and decide what actions
later in this monograph. could and should occur at the organization level
to create a more engaging environment or culture.
Survey Execution
(See the CompUSA story to learn how their
Once you have selected a top-notch engagement organization rolled out an engagement initiative.)
survey instrument, the next step is to plan the
In this section we will focus on the sharing of
execution of the survey itself. Two important
overall and subgroup/departmental results and
aspects of survey execution are the survey popula-
action planning activities; in Phase 4—Execute/
tion and the method(s) of survey distribution.
Take Action we will provide more insights into
For decades, pollsters have predicted election the responsibilities and actions at the senior
results and identified market trends by surveying leader level.
only a fraction of the entire population. If your
21
COMPUSA ENGAGEMENT STORY
At CompUSA, the goal was to align its HR built a sense of shared accountability in In a year, CompUSA plans to readminister
strategy with the companywide strategy the workforce and was used to build a the engagement measure to track its
to improve business through increased strategic training plan. progress. Everyone at CompUSA, from
customer satisfaction. Director of Training the president and CEO down, is linked to
Managers took feedback from the survey
and Development Tom Labadie knew that the idea of creating a winning culture.
and developed action plans at the individual
long-term retention of team members, Labadie describes how, when you walk
level. The engagement scores were
who gain experience and build stronger into stores with high engagement scores,
examined during performance reviews.
relationships with customers, was you can sense the positive tone.
To avoid a “rank and spank” mentality
essential to customer satisfaction and Employees whistle and smile, they
associated with store performance,
that employee engagement was the approach customers, and the store gives
managers were prompted to talk with their
foundation of retention. CompUSA off that elusive approachable feeling that
supervisors about why their engagement
administered Development Dimensions customers appreciate.
scores were high or low and address
International’s E3 survey nationwide to
®
any outstanding issues. Divisional HR Engagement is linked directly to the

more than 200 stores. The E3® survey
managers met with regional managers company strategy of developing a winning
provided a baseline for engagement
to discuss activities that would further culture and fostering growth.
and gave managers and employees a
engage team members and build a win-
common reference point. The survey
ning culture and created action plans.
Engagement can be tracked and measured over At DDI, we believe organizations are best served
time, and the common reference point, or baseline, when they develop an approach for leaders to
creates accountability for managers and offers a share results and create a meaningful action plan
universally valued measure of progress. Top-down that is consistent and easy to execute without
sharing of results and widespread action planning involving time-consuming training. To accomplish
can be an implementation nightmare: this objective, leaders need clear and detailed
instructions and guidelines. For example, we use
> Begin with a good amount of anxiety about the
a four-step action planning process:
sharing of employee engagement results. Each
leader might wonder: Step 1: EXAMINE Engagement Scores
– Will my business unit or department look > Understand engagement scores before sharing
much better or worse than others? them with others.
– Will my group’s scores be different than I expect? > Consider the impact that you (the leader) have
had in the level of engagement.
– Will I be held accountable for the current or
future level of engagement of my group? > Look at the scores from the perspective of
the staff.
> Add to that the likelihood that there will be
little time or budget for mid-level and frontline Step 2: EXPLAIN/SHARE Results
leaders to receive in-depth training in how to
> Ensure staff has a clear understanding of the
share results, get their groups involved in the
purpose and importance of increasing
process, and formulate viable action plans.
employee engagement.
> End with a lack of clarity about the priority
> Present results so that everyone will understand
of these action plans and the extent to which
what the scores mean.
leaders will be held accountable for completing
their action plans amid other group and > Encourage balanced discussion of strengths and
organizational goals and objectives. opportunities for improvement.
22
Step 3: EXPLORE Possibilities It is also important not to view employee engage-
ment results in a vacuum. No matter how clear a
> Get input on individual action plans that you
picture the results seem to paint, make sure that
are considering.
the conclusions being drawn are consistent with
> Lead brainstorming of actions that the group other sources of organizational information, such as
can undertake. previous employee satisfaction or culture surveys,
> Consider impact and effort of various ways to turnover-related data (for example, exit interviews),
increase engagement. productivity measures, performance appraisal data,
grievances, etc. In addition, make sure the discus-
Step 4: EXCEED—To Go Beyond
sion (at all levels of the organization) includes ask-
> Create meaningful action plans that require the ing why the results are what they are. Ask for
group to “stretch” and grow. examples and personal stories to make the results
even more meaningful and compelling.
> Include short- and long-term action plans.
> Anticipate obstacles or barriers to success. PHASE 4—EXECUTE/TAKE ACTION

Faced with the choice An employee engagement initiative is simply an
We incorporate these steps into an Engagement
between changing exercise in futility if there isn’t a true commitment
one’s mind and proving Action Planner that serves as each leader’s
to taking positive action to improve employee
that there is no need to inspiration guide, action planning process map,
engagement. Changing organizational culture,
do so, almost everyone and documentation guide for the entire action
gets busy on the proof. addressing a major HR system deficiency, or raising
planning process.
the bar on leadership behavior doesn’t happen
John Kenneth Galbraith
Action planning should be tightly linked to the overnight, and it doesn’t happen by focusing on
development resources that each organization only one factor of engagement.
offers. By this we mean that for every survey item
Executing your engagement strategy is likely to
being measured in the engagement survey, leaders
be more difficult than the employee engagement
should have resources available to support them
initiative’s first three phases combined because
and their staffs. Resources can be classroom or
it requires that employees at all levels of the
web-based training courses, electronic performance
organization change their behavior. To help you
support tools, mentors, executive coaches, self-
develop a high-engagement work environment and
directed learning activities, and other developmental
realize bottom-line results, we present a number of
experiences. If leaders do not have access to
suggestions organized around the five components
development options for each survey item, the
of realization: communication, accountability,
survey results could create more frustration than
skills, alignment, and measurement.36
improvement. One client had some sage advice
for all organizations about lining up resources to Communication
support leaders’ action plans: “If you open the
> Generate more interest in the engagement
door, you’d better be willing to walk through it.”
process by shining a spotlight on it. As action
One more activity associated with the action plans are made and groups begin to take employee
planning process is the collection and tracking engagement seriously, provide encouragement
of action plans to report progress and assure and support through internal communications.
compliance. Each organization will develop its For example, you can use your company
own approach to ensure execution of action plans. newsletter to talk about engagement and its
To this end, we offer a number of suggestions and progress throughout the organization.
strategies in the next section.
23
> Collect and publish engagement success stories Skills
as they happen. > Project leaders and senior-level champions need
> Use engagement success stories to demonstrate to become articulate advocates of the value of
examples of out-of-the-box thinking or any other employee engagement. They can become strong
desirable attribute that the organization wishes advocates by becoming knowledgeable on the
to increase and promote. topic of employee engagement and its relation-
ship to business performance.
> Keep senior leaders updated regarding the
employee engagement initiative and its impact > Do not underestimate the value of providing
so that they don’t lose sight of the importance leaders with the skills and proper motivation
of the initiative. they need to conduct high-energy, enthusiastic
action planning sessions with their staffs.
> Schedule and conduct manager and employee
informational sessions (in person or via video/ > Make sure leaders at all levels have the change
webcast) of engagement programs. management skills they need to do things
differently. Changing levels of engagement often
Accountability mean significant cultural changes that will need
> Ensure that there is a single owner for your to be managed by leaders at all levels.
employee engagement initiative. While
Alignment
engagement is everyone’s responsibility, driving
the process is a senior-level responsibility. > Conduct sessions with senior management to
make sure they continue to be aligned with and
> Challenge senior leaders to take a personal
fully support the changes needed to achieve a
interest in increasing employee engagement.
high-engagement environment.
The senior leadership team first needs to work
together to set cascading organizational goals > Create a high-level working group, including senior
and objectives to increase engagement on an HR and operational leaders, to review each major
enterprise level. Second, they should create area of human resource management and to
action plans with both their direct reports and support a high-engagement environment. Major
their entire business unit or group. areas include selection and recruiting, leadership
and workforce development, rewards and recog-
> Ensure that accountability (what needs to be
nition, compensation and incentives, perform-
done, by whom, by when) for engagement
ance management, and succession management.
actions is clear.
The group should develop a realignment strategy
> Incorporate expectations for increasing to recommend to senior leaders. The following
engagement into the performance management examples list some possible actions:
system. The clearer you can be in advance
Selection and Recruiting:
regarding team and individual accountability,
the stronger results. – Consider the match between a prospective
employee’s motivations and values and those
> Provide ongoing progress reports to senior
offered by the job or organization when
management, so that they calibrate programs
making selection and promotion decisions.
against goals and close any gaps.
– Test for engagement propensity (see page 11).
– Make decisions about promotions to leader-

ship positions based, in part, on the ability of
the candidate to build highly engaged teams.
24
Leadership and Workforce Development: Rewards and Recognition:
– Use your engagement survey score to target – Help leaders understand the difference between
leadership areas (and leaders) most in need reward (some type of financial or nonfinancial
of development. The engagement survey can compensation) and recognition (public or
often act as a leadership training needs analysis. private appreciation for a job well done).
Appendix B shows how our E3® items relate
– Increase the frequency of recognition and
directly to specific training courses.
feedback. They are powerful motivators of
– Remember that an emphasis on training and engagement and often cost nothing.
development is, in itself, a strong determinant
– Set up special awards for leaders or teams
of engagement.
that embody engagement.
Performance Management:
Measurement
– Involve all employees in setting goals (the
> Create lead indicators (or measures) throughout
whats) and targeting competencies (the hows)
the employee engagement initiative to ensure
in relation to departmental and company
that the actions being taken are achieving the
priorities and the organization’s value system.
results desired. This might seem redundant, but
– Hold people accountable for performance: it’s critical to the success of the initiative. Lead
reward the winners and act on those that measures in Phase 4 include successful comple-
don’t meet expectations. tion of short-term action items, compilation of
initial success stories, and positive “buzz” around
the changes that are happening because of the
employee engagement initiative.
> Monitor engagement once or twice a year.
> Connect/Correlate engagement scores to critical

outcome measures (for example, turnover, sales,
customer service) and report findings.
25
CONCLUSION accountability systems that provide direction,
support, and objective assessments—all work
We began this monograph with a Woody Allen
together to provide a foundation and environment
quote. With all due respect to Woody—engaged
in which engagement can flourish.
employees do a lot more than just “show up.”
They fuel higher levels of business performance, Ultimately, engagement lies in the heart of the
enable the successful execution of business strategies, employee. Measuring motivational and job fit
and improve performance. Time and time again, during the hiring process ensures that you select
studies have shown that moving the needle on people who can and want to find meaning in their
engagement moves the needle on performance. work. Some people have personal characteristics
that correlate with higher levels of engagement,
But engagement is not a simple matter. If you are
and those characteristics can be screened for
considering just jumping on the bandwagon, forget
during the hiring process. Once you’ve hired the
it. And nothing is more dangerous than measuring
right people, engagement can be either fueled or
engagement without making the commitment to
hampered by the work environment and quality
act on the feedback.
of leadership.
Engagement has to be a leadership-driven initiative
Building an engaged workforce is a long-term,
from the most senior level all the way to the front
ongoing initiative. Because it requires a coordinated,
line. No one affects an employee’s engagement as
consistent effort from leaders, organizational systems,
much as his or her immediate leader. Engaged
and individuals, it must be aligned and linked with
leaders coach proactively for success, inspire loyalty
the most important organizational business drivers,
and trust, and build an environment in which
or it will get pushed aside by the daily press of
employees are motivated and engaged.
work, and languish.
To foster an environment of engagement, organiza-
In the end, the rewards are many. A fully engaged
tions need strong systems and strategies that
workforce is a loyal workforce—expect turnover
promote and support engagement. Hiring and
to drop. In addition, an engaged workforce will
selection systems that measure motivation and
give the extra effort your organization needs to
the propensity for engagement, leadership training
remain competitive.
in certain skills (coaching, influencing others,
managing change), performance management and
DDI’S E3® EMPLOYEE ENGAGEMENT SURVEY
DDI offers a comprehensive yet cost-effective approach to measuring and increasing employee engagement. Our E3SM employee
engagement survey instrument as described in this monograph is the centerpiece of the measurement phase of our interventions.
It is delivered online and in paper-based formats in many languages to meet the needs of today’s international organizations.
When it comes to increasing employee engagement, DDI’s consultative and skill building support is unmatched in its depth,
breadth, quality, and consistency. Additionally, we tailor employee engagement initiatives by incorporating and leveraging each
client’s internal resources to the greatest extent possible.
To learn more about our engagement services, please call us at (800) 933-4463 or email at info@ddiworld.com.
26
APPENDIX A > In this organization, different work groups
E3® SURVEY ITEMS

reach out to help and support each other.
ORGANIZED BY
> People in my work group quickly resolve
conflicts when they arise.
KEY ENGAGEMENT > People trust each other in my work group.
ELEMENTS Development Plans

> My job provides me with chances to grow
ENGAGEMENT CORE ITEMS and develop.
Align Efforts with Strategy > In my work group, people try to pick up new
skills and knowledge.
> Overall, I have a good understanding of what
I am supposed to be doing in my job. > In my work group, people are assigned tasks that
allow them to use their best skills.
> I am kept well informed about changes in
the organization that affect my work group. Support and Recognition
> My work group makes efficient use of its > In my work group, my ideas and opinions
resources, time, and budget. are appreciated.
> In my work group, meetings are focused > I get sufficient feedback about how well I
and efficient. am doing.
> In my work group, people are held accountable > People in my work group understand and
for low performance. respect the things that make me unique.
Empowerment SATISFACTION AND LOYALTY

> I can make meaningful decisions about how Supplemental Survey Items
I do my job. > I am satisfied with my job.
> I find personal meaning and fulfillment in > I would recommend employment at my
my work. organization to my friends or family.
Teamwork and Collaboration > I feel a sense of loyalty to this company.
> People in my work group cooperate with
each other to get the job done.
27
APPENDIX B: DDI Leadership and Workforce Development Resources Mapped to E3® Questions
OPALTM PEOPLE
ONLINE LEADER
E3 QUESTIONS LEADERSHIP COURSES WORKFORCE COURSES SUPPORT IMPERATIVES
Q1 In my work group my ideas IM Essentials Interaction Skills for Success COACH &
YES
and opinions are appreciated. DEVELOP
Q2 People trust each other in Building an Environment of Trust Building Trust
my work group. YES INSPIRE
Q3 My job provides me with chances Achieving Your Leadership Potential Taking Charge of Your Development
to grow and develop. Developing Others Investing in Your Learning YES COACH &
Supporting Leadership Development DEVELOP
Q4 In my work group people are Delegating for Results Fast Start for Teams
assigned tasks that allow them to Boosting Business Results MANAGE WORK
use their best skills. Setting Performance Expectations YES & DRIVE
Reviewing Performance Progress PERFORMANCE
Launching a Successful Team
Q5 My work group makes efficient use Rapid Decision Making Fast Start for Teams
of its resources time and budget. Launching a Successful Team Making Sense of Business MANAGE
YES
Making Effective Decisions WORK
Taking Action to Solve Problems
Q6 I get sufficient feedback about how Coaching For Success Feedback Fundamentals DRIVE
well I am doing. Reviewing Performance Progress YES
PERFORMANCE
Q7 In my work group people are held Coaching For Improvement Improving Personal Productivity
accountable for low performance. Managing Performance Problems YES COACH &
Reviewing Performance Progress DEVELOPMENT
Q8 Overall I have a good understanding Setting Performance Expectations Communicating and Listening
DRIVE
of what I am supposed to be doing in YES PERFORMANCE
my job.
Q9 People in my work group quickly Resolving Conflict Working Through Conflict
YES INFLUENCE
resolve conflicts when they arise.
Q10 I am kept well informed about Leading Change Adapting to Change
changes in the organization that YES INSPIRE
affect my work group.
Q11 In this organization different work Influential Leadership Partnerships for Improvement
groups reach out to help and support Building Winning Partnerships YES PARTNER
each other.
Q12 People in my work group understand Valuing Differences Valuing Differences
and respect the things that make me Adaptive Leadership YES INSPIRE
unique.
Q13 In my work group meetings are Making Meetings Work Contributing to Meeting Success
focused and efficient. Reaching Agreement Reaching Agreement YES PARTNER
Q14 People in my work group cooperate Leading High-Performance Teams Working as a Team
with each other to get the job done. Optimizing Team Performance YES PARTNER
Supporting Others
Q15 I find personal meaning and Motivating Others Personal Empowerment: YES INSPIRE
fulfillment in my work. The Empowering Leader Taking Initiative
Q16 I can make meaningful decisions Rapid Decision Making Improving Personal Productivity
about how I do my job. The Empowering Leader Impacting Your Work Processes MANAGE
Personal Empowerment: YES
WORK
Taking Initiative
Q17 In my work group people try to pick up Achieving Your Leadership Potential Investing in Your Learning
new skills and knowledge. Developing Others Taking Charge of Your Development YES COACH &
Thunderbolt Thinking®: Building an Thunderbolt Thinking®: Innovation DEVELOPMENT
Innovative Workplace Fundamentals
Q18 I am satisfied with my job. Motivating Others Personal Empowerment: Taking Initiative
Retaining Talent: Creating the Environment Taking Charge of Your Development
The Empowering Leader YES INSPIRE
Developing Others
Achieving Your Leadership Potential
Q19 I would recommend employment at Motivating Others N/A
YES INSPIRE
my organization to my friends or family. Retaining Talent: Creating the Environment
Q20 I feel a sense of loyalty to Motivating Others Building Trust
this company. Retaining Talent: Creating the Environment YES INSPIRE
Building and Environment of Trust
All DDI Leadership and Workforce courses are available in classroom format; for most courses, a comparable web-based training course is also available. Please contact a
DDI representative to learn more about our full complement of assessment, selection, and development offerings for individual contributors, up to and including senior leaders.
28
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and retention through employee engagement. 32
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29
ABOUT THE benchmarking research, implement evaluation and
validation research designs, and provide ongoing
AUTHORS measurement consulting. In the area of engage-

ment, Dr. Bernthal was the primary developer of
Richard S. Wellins, Ph.D., is a senior vice DDI’s E3® employee engagement survey and has
president at DDI. Dr.Wellins is responsible for delivered engagement surveys to a wide range of
leading DDI’s research programs, launching new organizations around the world.
solutions, building strategic alliances, and executing
Mark Phelps is a senior consultant and leader of
marketing strategies. During his tenure at DDI,
DDI’s employee engagement practice. Mr. Phelps
Dr.Wellins has authored five books on leadership
manages client engagements, consulting process
and teams. Most recently, he served as DDI’s
development, and product development. Joining
overall project leader in the development of a
DDI in 2000, Mr. Phelps has more than 20 years of
new competency model for workplace learning
consulting experience, holding leadership positions
professionals, sponsored by the American Society
in delivery of human resource solutions, customer
for Training and Development. Currently, he is
service culture change, research and development,
involved in consulting engagements with Leed’s,
project management, and sales and marketing.
Texas Children’s Hospital, and Grant Thornton.
Recent employee engagement clients include
Paul Bernthal, Ph.D., manager of DDI’s Center Brinks, the State of Michigan’s Department of
for Applied Behavioral Research (CABER). He Human Services, IHS, Lear Corporation, and
works with internal and external clients to conduct Johnson County Government (Kansas).
30
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MEXICO CITY Dimensions International has worked with some
52.55.1253.9000
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TORONTO
416.601.5500 achieve superior business results by building
Other major offices in engaged, high-performing workforces.
Atlanta, Chicago, Dallas,
Detroit, Los Angeles,
We excel in two major areas. Designing and
Monterrey, Montreal,
New York, St. Louis, implementing selection systems that enable
San Francisco, Santiago,
and São Paulo you to hire better people faster. And identifying
and developing exceptional leadership talent
EUROPE/AFRICA
crucial to creating a workforce that drives
DÜSSELDORF
49.2159.91680 sustained success.
LONDON What sets DDI apart is realization. We focus on

44.1.753.616.000
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Other major offices in The outcome? You bring the best people
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EMPLOYEE ENGAGEMENT:

THE KEY TO REALIZING

INTRODUCTION engagement can be staggering. For example,

ENGAGEMENT > Value—People want to be recognized and

BUSINESS CASE there is a strong relationship between sales

ABOUT EMPLOYEE of the organization match both their abilities

ENGAGEMENT overall engagement composite score, which averages

DDI’S VALUE effort that differentiates organizations from their

strong systems and strategies. Together, these three

behaviors and attitudes. In particular, an engaging > Satisfied/Loyal Customers

COACH AND DEVELOP FOR RESULTS MANAGE WORK

people accountable. how to build sufficient commitment to move good ideas

is dissatisfied. and knowledge to select highly engaged employees can

ENGAGEMENT Unfortunately, things are rarely this cut and dried.

NEEDLE When leaders follow the process described above,

TABLE 1: Installation and Realization

Features Installation is the end state Realization is the end state

> How results will be presented to senior, middle,

any outstanding issues. Divisional HR Engagement is linked directly to the

> Anticipate obstacles or barriers to success. PHASE 4—EXECUTE/TAKE ACTION

– Make decisions about promotions to leader-

> Monitor engagement once or twice a year.

> Connect/Correlate engagement scores to critical

DDI’S E3® EMPLOYEE ENGAGEMENT SURVEY

E3® SURVEY ITEMS

KEY ENGAGEMENT > People trust each other in my work group.

ELEMENTS Development Plans

Empowerment SATISFACTION AND LOYALTY

Forecast: A benchmarking study. Pittsburgh, PA:

AUTHORS measurement consulting. In the area of engage-

LONDON What sets DDI apart is realization. We focus on

Other major offices in

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