The Engagement Imperative


People Engagement Series

Resource Note # 1

To win in the marketplace, you must first win in the workplace. 1

– Doug Conant

Employee Engagement refers to the strength of the mental and emotional connection that an employee feels toward his or her place of work. In 1990, Professor William Kahn of Boston University proposed the definition of engagement as “the harnessing of organization members’ selves to their work roles.” 

Kahn looked upon personal engagement as the simultaneous employment and expression of a person’s “preferred” self in task behaviors that promote connections to the work and to other people, personal presence, and active full role performances. 2He reported that people employ and express themselves physically, cognitively, and emotionally during role performances when they are “engaged”. 

According to Kahn, the domains of meaningfulness, safety, and availability were important towards understanding the phenomenon of engagement.2Meaningfulness refers to the positive “sense of return on investments of the self in role performance.” Safety is the ability to show one’s self “without fear or negative consequences to one’s self-image, status, or career.” Availability is construed as the “sense of possessing the physical, emotional and psychological resources necessary” for completion of the work. 2

Harter, Schmidt, & Hayes built upon Kahn’s ideas to define employee engagement as the individual’s involvement and satisfaction with his or her work as well as enthusiasm for it. Through the meta-analysis of 7,939 business units across multiple fields, they were the first to study the linkage between employee engagement and business unit outcomes (profit).3

The Engage for Success Taskforce described employee engagement as “a workplace approach which is designed to ensure that employees are committed to their organization’s goals and values, motivated to contribute to organizational success, and are able to enhance their own sense of wellbeing at the same time”. 4

Work engagement is a modified construct that refers to a positive and fulfilling state of being. It is characterized by vigour, dedication, and absorption. Vigour refers to a high level of energy and mental resilience at work. Dedication relates to strong involvement in one’s work that yields the experience of a sense of significance, enthusiasm, inspiration, and pride.  Absorption is characterized by full concentration and happy engrossment in one’s work. 5

Engagement is thus a measure of an employee’s emotional and intellectual commitment to the organization’s success. It occurs when the organization respects the employee, and the employee values the organization in turn. A state of engagement is characterized by the following attributes:

To summarize, employee engagement refers to the degree to which employees feel passionate about their jobs, display commitment, put discretionary effort into their work, and feel a sense of flow while performing their tasks.

The Merits of Employee Engagement

Engagement is characterized by the integration of all the dimensions of the human personality. When deeply engaged, the individual gets fully immersed in a feeling of energized focus, complete involvement, and enjoyment in the process or the activity. The work activity becomes intrinsically joyful and satisfying, and eventually yields an experience of flow. 6

The expression of inherent individual strengths and talents, coupled with their productive utilization in the performance of work tasks, helps the person to accomplish professional objectives and attain personal satisfaction at the same time. The joy and satisfaction derived from accomplishment are revitalizing for the individual. The release of anxiety and the consequent relaxation contributes to the application of undistracted effort into the undertaking. The quality of output is greatly enhanced. 

Owing to these merits, employee engagement has been found to influence a wide range of performance outcomes in business settings. 

The Global Workforce Study conducted by Towers Watson in 2012 reported that companies with high employee engagement levels had an average operating margin that was nearly three times higher than that of companies with low engagement levels. 7 The Hay Group reported that organizations in the top quartile of engagement scores demonstrated revenue growth 2.5 times greater than the organizations in the bottom quartile. 8 

Based on their research in 158 organizations from a wide range of industries, the Kenexa High Performance Institute published evidence that three-year total shareholder returns were positively linked to employee engagement. 9 Another study of 39 organizations by Kenexa indicated that organizations with highly engaged employees achieved seven times greater 5-year total shareholder return than organizations whose employees were relatively less engaged. 10

Alfes et al examined data from over 2,000 employees of a recycling and waste management company. They found that employee engagement was strongly linked to innovative work behavior. 11 When different Business Units at the Royal Bank of Scotland were ranked in 2011 according to their employee engagement scores, a 7 percentage-point difference in customer service scores was found between the top 10% and the bottom 10% of the units. 12

Aon Hewitt found in 2012 that only 28% of employees experienced a high level of job-related stress in high engagement companies versus 39% of employees in low engagement companies. CIPD reported that people who were absorbed in their work were three times more likely to have key positive emotions at work (enthusiasm, optimism, contentment, and calmness) as compared to the negative ones (feeling miserable, worried, depressed or gloomy). 13

The Gallup Organization has shown a strong link between lower engagement scores and higher employee turnover. Its meta-analytic research based on 203 independent samples demonstrated that an increase in employee engagement is associated with reductions in unsafe behaviour, adverse events, accidents, and injuries. An analysis of its Q12 engagement measure found that organizations with engagement in the bottom quartile averaged 62% more accidents than those in the top quartile. 14Their research data also shows that the earnings per share growth rates of those firms with engagement scores in the top quartile were 2.6 times that of enterprises with below-average engagement scores. 14

Further, Gallup also uncovered a positive correlation between the physical health and the engagement levels at work. Employees who were engaged in their jobs were generally found to be in better health than the rest of the employees. 14 In another study during 2013, it found that when employees felt engaged and productive at work, 31% of them rated their lives as ‘thriving’, while 59% considered themselves to be ‘struggling’ and 10% were ‘suffering’. Significantly, engaged employees were over three times as likely to rate their lives as thriving as compared to those who were actively disengaged. 15

This is a small sample of the available evidence that appears to confirm the existence of a synergistic feedback loop between employee engagement and organizational outcomes. Improved engagement has the power and potential to transform the modern workplace. Organizations must sincerely work to engage the employee, because the latter has a choice about the engagement level to offer.

An engaging work environment leads to increased productivity and improved business outcomes. This is because the way in which employers treat the employees has a direct effect upon how the latter treat their customers. And the customers vote with their feet and wallet, depending upon the quality of interaction that they experience.

The (dis) Engagement Crisis

Despite the clarity of the benefits arising from engagement, its deficit in modern organizations remains surprisingly high. Managers and leaders in the digital era are so overwhelmingly pre-occupied with the external environment that their capacity to constructively engage with their own people appears to have shrunk drastically. Employees are expected to offer loyalty to the employer, without a reciprocal commitment from the organization towards the protection of their work and paycheck.

A 2013 Gallup study entitled “The State of the Global Workplace” employed a meta-analysis of 263 research studies covering nearly 1.4 million employees across 140 countries. Overall, it found that actively disengaged employees outnumber their positively engaged colleagues by nearly 2-to-1 at a global level. This implies that work is widely regarded as a source of stress, rather than of fulfillment. 16

The analysis also showed that top-quartile units reported 48% fewer safety incidents and 37% lesser absenteeism as compared to bottom quartile units. This means that countless workplaces across the world are less productive or safe than they could potentially be. 17

When it is reported that two-thirds of the workforce is not fully engaged with the work, it is akin to stating that only a third of an organization’s computers work properly. The rest of them are either unreliable or spend their time infecting their fellow computer systems with viruses. Resource inefficiencies of this magnitude would usually be considered alarming.

Indeed, a disengaged workforce is very costly. In 2012, the Kenexa Institute measured employee engagement in 27 countries (that collectively accounted for 80% of global economic output), and also examined its relationship with GDP growth. They reported that across the world, a 1% increase in employee engagement was linked to a 4.8 % increase in GDP growth. 18

Ignoring the human engagement deficit is clearly no longer an option. Then, why is the issue not being adequately addressed? A part of the answer to this question, or perhaps at least a clue to it, lies in the developments that are taking place in the external socio-economic environment.

The Digital Revolution

Since the dawn of the twenty-first century, the business world has been witnessing a digital revolution. It is characterized by technological breakthroughs in areas such as robotics, artificial intelligence, blockchain, the Internet of Things, autonomous vehicles, 3-D printing, nanotechnology, quantum computing, energy storage, genetics, and biotechnology. 19 

Rapid technological development has had a far-reaching impact upon global economic activity. The instant and widespread availability of information broke down the partitions separating individuals, institutions, and economies. Transportation and communication costs dropped, while global logistics and supply chains became more effective. Products became smaller, faster, cheaper and more resilient.

Technology convergence has led to the blurring of product and service definitions. It also resulted in the decline of many long-established industries. For instance, convergent advances in smartphones, GPS sensors, and networks allowed a Silicon Valley start-up such as Uber to globally become the greatest threat to the taxi industry. Likewise, Airbnb took the hotel and lodging industry by storm. 19

Elon Musk’s company Space X has recently launched broadband satellites that can beam Internet signals to the earth from a low orbit. It eventually plans to encircle the globe with 12,000 such satellites. Others are racing to provide universal Wi-Fi Internet access through balloons, drones, and micro-satellites. 20

Ubiquitous availability of the Internet is likely to bring down the cost of data virtually to zero. This shall make the telecommunication companies irrelevant, in due course of time. Their text and mobile revenues have already been adversely impacted by smartphone applications such as Whatsapp. Digital technologies have led to a similar disruption at varying levels of intensity across the entire business world. 

The New Engagement Context

In the face of these upheavals, the way in which the human society conducts itself has undergone significant changes. The context in which employees are to be engaged has witnessed much change too.

Firstly, the largest beneficiaries of technological innovation have been the innovators who provide the intellectual capital and the investors who contribute to the financial capital. The human workers, who commit their life energy to their jobs, are continuing to be displaced by automatic machines.  The demand for highly skilled workers has increased, while the larger mass of those with lesser education and skill are finding it difficult to get paid work. The benefits of economic growth have thus not really percolated down to the working class of people. This has worsened economic and social inequality. 

Second, knowledge has become the principal factor of production in the present age while information is the basis of its economy. Many people now earn their living in an environment of 24×7 connectivity. Employees perform a large part of their work remotely on hand-held, technology-enabled devices. They work together with their colleagues around the world in virtual teams. As a result, the digital revolution is changing the human sense of identity. It is impacting the sense of privacy, notions of ownership, consumption patterns, and the time that people devote to work and leisure. 21

Third, technology is unrelenting in substituting manual work in all sectors of the global economy. Of course, physical work still has its place. There is no doubt that manual labour shall continue to remain important, especially in areas such as agriculture, infrastructure, services and parts of manufacturing. 

However, the trend of organized economic activity across the world is inexorably shifting towards mechanization and automation. This allows the firms to boost their productivity and competitiveness. 

On the flip side, it also leads to progressively fewer opportunities for the human worker to express the creative and artistic elements of his personality. The deleterious effects upon mental health are obvious.

Fourth, business is becoming a unified global field. The boundaries between organizations as well as industries are turning more diffuse. Firms are beginning to actively utilize crowdsourcing, in order to generate innovations and build markets. 

Fifth, disruptive technologies are being evolved at breakneck speed. Novel platforms and business models are emerging rapidly. Centralized institutions are giving way to flexible work teams. Companies locate different parts of the organization wherever it makes most business sense. They learn to transcend the lines of time, culture and geography in order to thrive.

Sixth, consumer tastes are converging across the world – in everything from clothing to cellular phones. Everywhere, time-starved customers also welcome personalized attention. They expect new products to be rapidly developed and precisely customized, in order to meet their unique individual needs.

Seventh, the job market is now highly transparent. Attracting highly skilled workers has become a tremendously competitive activity. In the high-technology industry, two-thirds of all workers believe they could find a better job in less than 60 days if only they took the time to look. The bargaining power of highly skilled employees appears to have increased in the present era. 22

Eighth, over two-thirds of the relatively young millennial workers expect their employers to focus on societal or mission-driven problems.22

Ninth, organizations have also become relatively flatter. This allows the employees a relatively lesser amount of time with their immediate managers. Regular performance feedback, job rotation and the identification of appropriate development opportunities for the people have therefore taken a hit. 23

Finally, individuals are now operating more as free agents as compared to the previous decades. They crave for work that permits them to leave a unique fingerprint on a finished product or outcome. Autonomy, mastery, and sense of purpose are the driving forces of individual work in modern society.23

Creating a new engagement paradigm

Enterprises and corporations have responded to these developments by increasing the use of modern technology in all aspects of their work. That may be useful, but is by no means enough. 

The evolving scenario actually calls for a newer engagement paradigm that can facilitate quicker and keener collaboration, innovation, and adaptation to the environment. 

In the digital era, corporations need to re-configure themselves around shared knowledge and value. Centralized command and control structures must make way for other organizational forms that can facilitate individualized and widely distributed value-creation more effectively.

Engagement and empowerment of employees, accompanied by a focus on learning, is the recipe that would work well in the present epoch. Even in the midst of the global financial crisis, the Indian IT major HCL thrived like never before when its then-CEO Vineet Nayar championed an “employee-first” policy.

Innovators such as the Jaipur Foot, the Aravind Eye Care System, and Narayana Health are striking examples of superior value creation at low cost. They have made it their business to cater to the healthcare needs of every person in society – regardless of creed, class or capacity to pay. 

These organizations are driven by the inclusive and expansive vision of their founders. They do extraordinary social good, even as they score very well on operational parameters. These institutions have thus made world-class health care highly affordable as well as universally accessible.   

Nevertheless, much more remains to be done. During the 20thcentury, mainstream organizational conduct was guided by reductionist beliefs and a materialistic view of human existence.  As a result, the value of human relationships and the sense of community have steadily lost ground in organizational life. The engagement of the employees with their work also continues to be abysmally low. 

Regular surveys indicate that no more than one in seven corporate employees are engaged at work. The number of actively disengaged people is approximately twice that number. 16 The rest of the population works just enough to get by and protect their jobs. 

This results in a colossal waste of value-creation potential. It also yields social disharmony, as the aggrieved employees sometimes vent their dissatisfaction in unwholesome ways. 

Lacking the human spirit, corporate organizations have been occasionally misled into creating ethical catastrophes too. In 2001, rogue executives at Enron and WorldCom destroyed public trust in business institutions. In 2008, the greed of some bankers nearly led to a meltdown of the global financial system. In 2018, Facebook allegedly compromised the private data of over 80 million users. It thereby possibly vitiated the outcome of the 2016 US Presidential elections as well as the Brexit referendum. 24

Such breaches of trust have led to a renewed search for a greater sense of meaning, purpose, and spirit in the lives of corporate citizens. Business enterprises must provide space and challenge for individual employees to achieve, grow and enjoy their work. 

The work environment should be designed to strengthen the bonds of mutual trust. Human dignity must be protected. A web of inclusive and satisfying relationships needs to be created, so that people may once again become excited about working together with others in an “organized” setting.

The Drivers of Engagement

For sustained business success, the urgent need is to create a magnetically engaging organizational environment that facilitates a high level of performance and passion at the same time.

But what is the exact recipe for building greater engagement? Many credible answers are available, but none of these are able to crack the engagement puzzle in a structured and comprehensive manner.

For instance, the Engage to Success Task Force cites four broad engagement enablers that their research has identified as being critical towards employee engagement: 4

  1. A visible leadership that provides a strong strategic narrative, which includes a clearly articulated organizational vision and sense of purpose and also explains how the employees can contribute to its accomplishment 
  2. Line managers who facilitate and empower their colleagues, treat them with appreciation and respect, and also show a sincere commitment to developing and increasing their capabilities.
  3. An effective employee voice across the organization – whereby the ideas, views, and experiences of the people are sought out as well as listened to, and their opinions are made to count.
  4. A belief among the employees that the organization actually lives up to its espoused norms and values, resulting in trust and a sense of integrity.

The Gallup Organization recommends that organizations should select the right employees, develop their strengths, and continually promote their well being, in order to facilitate engagement. The corollary is that employees must also be provided with the space to express themselves and their capabilities.

The consulting firm Deloitte has articulated five major factors that fit together into a system of engagement that helps to create what they call as an “irresistible” organization. 22These are:

 a) Meaningful work, 

b) Hands-on management, 

c) Positive work environment, 

d) Growth opportunities and 

e) Trust in leadership. 

From his seminal research on organizational effectiveness, Elliot Jaques has concluded that a vast majority of employees are keen to get on with their work when provided with even half a chance. Even more, they crave for work that can adequately utilize their talents. However, what is needed is an adequate organizational framework within which they can collaborate and cooperate with one another in a constructive environment that is characterized by mutual trust. 25 

This requires a system of managerial layers, a framework of accountability and authority in lateral relationships, project teams with leaders who are fully accountable, and the establishment of specific functions at given organization levels. It also requires a system of coaching and mentoring, merit recognition, talent pool analysis, and career development. Jaques thus appears to convey that the path to employee engagement lies through the development of the organization.

All these are immensely worthy and valid recommendations that can definitely help to build more engaged organizational contexts. While some of them are complementary to one another, these are overall neither mutually exclusive nor collectively exhaustive in nature.

However, it may be noticed that all of the aforementioned engagement drivers are observed to fall under the rubric of either organizational structure or organizational culture. These two organizational attributes cover all the salient variables that impact a person’s work in an institutional setting. 

Culture and structure are thus very potent tools for building engaged organizations. The chapters of this book explain how a holistic organizational structure and an appreciative culture actually come together to facilitate employee engagement. The quest for building engaged work contexts may be easily fulfilled when these two key organizational features dance together, in a tango.

The Engaged Organization

An engaged organization is a synergistic social system that comprehensively supports and delivers organizational effectiveness, alongside individual fulfillment. 

The basic pre-requisite for organization effectiveness is a clear articulation the work that is needed for the achievement of strategic goals, combined with the ability to identify capable individuals who possess the ability as well as the willingness to match the work demands. 

On the other hand, individual fulfillment arises when the person’s level of cognitive capability matches the complexity of the assigned work, so as to yield a state of flow. Decision-making comes naturally when the challenges of the role match the capability that the person brings to it.

Matching the role with the goals and the capability appears to be the key to engagement. However, this arrangement sustains over time when the overall cultural milieu respects and constructively engages the person’s inherent nature, her core values, as well as the individual’s basic sense of purpose.

Therefore, the art of the “engaged” organization is to make provision for complex work, to be done by talented people within an appreciative ambience, in positions that appropriately fit the individual capability as well as the institutional needs. Even as its work may be vertically structured into separate departments or functions that achieve particular kinds of outputs by carrying out specified processes, the organization strives for greater horizontal coordination of tasks and activities at the same time.

The concept of the “engaged” organization builds upon two main disciplines:

  1. The modified theory of bureaucracy that was propounded by Elliot Jaques, and
  2. The appreciative approach to organization development that was evolved by David Cooperrider and Suresh Srivastava. 

Jaques proposed that organized work required seven qualitatively distinct levels or strata of abstraction, with progressively increasing time horizons. 26As the required output became more complex, the demands for mental information processing also increased. 

These ideas were later refined into his concept of the Requisite Organization, wherein the complexity of work at each stratum progressed in discontinuous steps as a function of human capability.

Jaques’ colleagues Ralph Rowbottom and David Billis suggested a configuration of seven organizational levels of work too. However, in their view, hierarchical levels emerged from varying degrees of complexity in organizational work rather than from discontinuities in individual mental functioning.27

Brian Dive drew upon these insights to formulate the conception of a healthy organization, which was focused upon the added value of decisions taken at the various strata in the hierarchy of decision-making accountability. Dive defined a decision as a considered act in response to a demand or need to solve a problem, progress a process, or change a state of affairs. 28The Leadership Pipeline framework of Ram Charan and Steve Drotter subsequently articulated how organizations may select, develop and transition their executives from one stratum to the next in the hierarchy of accountability. 29

On the other hand, Appreciative Inquiry developed as a study of what gives life to human systems when they function at their best. It enables human systems to adapt effectively to their environment, and also to innovate for greater success. The following beliefs about collective human existence serve as the foundations of this discipline:

  • Organizations are social systems that are sources of unlimited relational capacity. 
  • The images we hold of the future are socially created. 
  • People have unique gifts, skills and contributions that they aspire to bring to life – individually as well as in concert with one another.
  • Through inquiry and dialogue, people can shift their attention away from problem analysis and work towards the development of productive possibilities for the future.

Arising from these two paradigms, the basic organizational mandate for each of the seven roles in the accountability structure of an engaged organization is clearly defined and comprehensively described. This way, everyone in the organization knows what output, results or contribution they can expect from one another. Accordingly, they can provide the requisite support to their colleagues.

The appreciative process by which each of the respective role charters in an “engaged” organization may be fulfilled is then crafted in exquisite detail. Besides facilitating superior role performance, these process frameworks can facilitate capability building too. All across the organization, role holders then deliver upon the expectations that their colleagues hold from them – humanely as well as effectively.

That is how engaged organizations come into being!

References

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  3. Harter J, Schmidt F, Hayes T. Business-unit-level relationship between employee satisfaction, employee engagement, and business outcomes: A meta-analysis. Journal of Applied Psychology. 2002;87(2):268-279.
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  12. Evidence Case Study: Royal Bank of Scotland [Internet]. 2011 [cited 14 March 2018]. Available from: http://engageforsuccess.org/evidence-case-study-royal-bank-of-scotland
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  18. The World of Retail: A 2011 Work Trends report. How employee engagement can help the registers ring, Kenexa High Performance Institute, 2012
  19. Schwab K. The Fourth Industrial Revolution: what it means, how to respond [Internet]. www.weforum.org. 2016 [cited 24 April 2018]. Available from: https://www.weforum.org/agenda/2016/01/the-fourth-industrial-revolution-what-itmeans-and-how-to-respond
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