EMPLOYEE ENGAGEMENT: THE KEY TO IMPROVING

ORGANISATIONAL PERFORMANCE

"I realized early on that if you create a company where employees enjoy coming to work
as much as going home, and where there's a high level of engagement, mutual trust
and respect, no one can beat you."-- Paul Silvis, co-founder of Restek Corporation,
one of the 2007 Winner of Top Small Workplaces Award.

"I've never had control and I never wanted it, if you create an environment where people
truly participate, you don't need control. They know what needs to be done and they do it.
We're not looking for blind obedience. We're looking for people who on their own
initiative want to be doing what they're doing because they consider it to be a worthy
objective.”- Herb Kelleher, founder and Executive Chairman of the Board of Southwest
Airlines, a company known for its profitability, its dedication to people, and a fun and
energized work environment.

“Engaged employees”, the foundations of profitable organizations.

INTRODUCTION

In today’s rapidly changing business scenario, one of the toughest challenges that business
leaders face is sustaining high level of performance over the long term and obtaining superior
business results.

Employee engagement practices in an organization get increased as companies tend to work

with a global workforce. In this changing scenario, the challenge of HR personnel is to
establish the credibility of the organization as well as to ensure that its internal customers
make significant contributions to the organization. Employee Engagement is loosely defined
as the level to which employees are fully involved in their work, committed to their work,
care about their organisation and colleagues and are willing to extend themselves and go the
extra mile for their company to ensure its success.

Employee engagement constitutes the core competence of a successful organization .It is

linked to important organizational issues like retention, productivity and satisfaction.

Engagement can be correctly integrated and woven into an organizations HR policy by

creating an environment that includes challenging aspects of work, supportive team members
and effective training strategies that are consistent with the performance management
techniques. These characteristics can help managers shape the workplace into an employee
friendly outfit. A company must take initiatives to refine and redefine certain human resource
management practices that contribute towards enhancing employee satisfaction and motivate
workers to perform better.

OBJECTIVES OF THE STUDY:

• To understand employee engagement and its importance in modern organizations

• Analyze the factors that drive employee engagement.
• Analyze the strategies that can be used for employee engagement to improve
workforce satisfaction and organizational performance.

STATEMENT OF THE PROBLEM

Despite the negative headlines of employee layoffs and cost cutting due to recessesion,
organizations are still functioning. There is a great uncertainty about the future. Those
organizations that protect their people assets will come out of this stronger. Increasing
pressure on organizations to retain its top-performers who contribute significantly towards
organizations growth has further highlighted the role of employee engagement as a tool for
retention. It is important to maintain employee morale during downturn, a noticeable decline
in morale in the past several months. Effective engagement programs addresses this problem
by maintaining morale and productivity levels

METHODOLOGY

The study is based on secondary data collected through various journals, magazines,
Newspaper and websites providing exhaustive information on employee engagement, its
relevance and integration with effective HR practices of the firm to help align human
activities to the corporate strategy.

LIMITATIONS

•As the data is derived from secondary sources, reliability cannot be assured.
 •Non –Availability of current data

WHAT IS EMPLOYEE ENGAGEMENT

"Employee engagement" is one of the popular concepts in HR these days. Many

organizations have launched new initiatives to improve levels of 'employee engagement'.
Some of them have dedicated HR staff to 'handle' this important dimension.

The Conference Board in the USA in its 2006 publication "Employee Engagement, A
Review of Current Research and Its Implications", describes employee engagement as

“A heightened emotional connection that an employee feels for his or her organization
that influences him or her to exert greater discretionary effort to his or her work.”

Engaged employee consistently demonstrates three general behaviours which improve

organizational performance:

• Say-the employee advocates for the organization to co-workers, and refers potential
employees and customers
• Stay-the employee has an intense desire to be a member of the organization despite
opportunities to work elsewhere
• Strive-the employee exerts extra time, effort and initiative to contribute to the success
of the business ( Baumruk and Gorman 2006)

The CIPD Annual Survey report (2006c) defines engagement in terms of three dimensions
of employee engagement:

• Emotional engagement - being very involved emotionally in one's work;

• Cognitive engagement - focusing very hard whilst at work; and
• Physical engagement - being willing to 'go the extra mile' for your employer.

Some authors discuss the varying degrees of engagement employees can experience. Meere
(2005) describes three levels of engagement:

Engaged: are enthusiastic about their jobs, loyal, motivated, committed and productive.
They have a strong emotional allegiance to their workplace and are driven to succeed.
Not engaged: are not totally psychologically connected to their company. They work hard
and contribute but are less driven to succeed than their engaged counterparts and are more
likely to engage in absentee behaviour and/or leave the company.

Actively disengaged: are emotionally and cognitively divorced from their work. They have
in a sense “checked out” although they are physically there. They are disgruntled, unhappy to
be there and their negativity is palpable, infectious and disruptive for the organisation.

EMPLOYEE ENGAGEMENT AND EMPLOYEE SATISFACTION

Several researchers claim that there is a distinction between job satisfaction, the well-known
construct in management, and engagement since managers can not rely on employee
satisfaction to help retain the best and the brightest, employee engagement becomes a critical
concept. Engagement is about passion and commitment-the willingness to invest oneself and
expand one’s discretionary effort to help the employer succeed, which is beyond simple
satisfaction with the employment arrangement or basic loyalty to the employer Therefore, the
full engagement equation is obtained by aligning maximum job satisfaction and maximum
job contribution. Stephen Young, the executive director of Towers Perrin, also distinguishes
between job satisfaction and engagement contending that only engagement (not satisfaction)
is the strongest predictor of organizational performance (Human Resources, 2007).

GROWING EMPHASIS ON EMPLOYEE ENGAGEMENT IN

ORGANISATIONS

The research evidence overwhelmingly indicates that the difference between engaged and
disengaged employees is not insignificant and that engagement has become the best
competitive advantage companies can leverage to propel their businesses forward. This is
particularly true as economies shift towards knowledge economies and the workforce
increasingly simulates a knowledge workforce vis-à-vis a labour workforce, with the
associated shift in the balance of power. Repeated research has shown that there is a direct
correlation between the level of employee engagement in a company and the company’s
overall financial and operational performance. Specifically, higher levels of engagement are
associated with:-

• Growth in revenue and Profitability

• Customer Satisfaction
 • Employee Satisfaction
• Higher retention levels

According to the Best Employers in Asia 2007 study, conducted by Hewitt Associates and
presented in partnership with The Wall Street Journal Asia, Aditya Birla Group, Satyam
Computer Services and Marriott Hotels India have been ranked as the top three employers in
India.

The study also revealed that employee Engagement in India, has gradually increased since
Hewitt's first Best Employers study was conducted back in 2001. This demonstrates that
organizations are placing a growing emphasis on creating a more challenging environment
for their people.

In India, career opportunities are a key driver of employee Engagement, clearly reflecting
the ambitions and aspirations of a restless and demanding workforce that is keen to ride the
growth wave. As a result, organizations that are able to manage employees' career
aspirations and provide them with opportunities for growth and development will have a
more engaged workforce. The study showed that 76% of employees at Best Employers are
satisfied with their career opportunities, compared with 64% at The Rest.

 A strong competitive advantage over other organizations, Best Employers have

a highly engaged workforce that is prepared to go the extra mile for their
organization and customers.
 Better business results and the ability to grow a sustainable business. This is
because Best Employers take a long-term approach to building a sustainable
workforce and focus on growing committed and loyal employees who have faith
in the leaders of the company.
 Attracting the best talent and recognition in the marketplace for having a
strong employer brand. Best Employers' employees believe their companies are
hiring the right people for the right jobs and deliver on their employment
promises.
 Long-term employee relationships, which leads to fewer employees leaving the
organization. Best Employers also have outstanding leaders in place who not only
inspire employees, but actively make them feel valued in the workplace.
According to The Times of India daily (23 Apr 2008), Indian workers are the most engaged
in Asia. The Work Asia research conducted by Watson Wyatt Worldwide reveals that India
has the highest percentage of highly engaged workers at 78% in Asia as compared to Japan,
which has the lowest employee engagement level at 39%.

The engagement level of the Indian worker is 20% more than his Chinese counterpart. This
means that Indian employees are better at understanding the organization’s business goals,
the steps required to achieve those goals and how their contributions drive goals,
the study highlights that companies with higher employee engagement levels can expect to
improve their subsequent financial performance.

These findings are powerful demonstrations of how employee engagement has emerged as an
important initiative by organizations to strengthen workplaces and build organizational
performance. The challenge for managers and leaders is to try to create the workplace
conditions which foster employee engagement s as well as nurture a highly committed
workforce who contribute effectively towards the goals of the organization.

KEY DRIVERS OF EMPLOYEE ENGAGEMENT

Engaging workforce is of great significance to organisations today as it indicates the degree

to which an employee is emotionally bonded to his organization and passionate about his
work. Building an engaged and loyal workforce today will help whether the challenges of
tomorrow. The Blessing White Employee Engagement Survey 2008 have listed some key
drivers of employee engagement:

• Career Development Opportunities and Training

• More Challenging Work
• Greater Clarity about one’s work and career goals
• Greater Clarity about what the organization expects from the employee
• Improved Cooperation among co-workers
• More say in how work gets done
• Better relation with superiors

STRATEGIES TO DEVELOP EMPLOYEE ENGAGEMENT

1. Employee engagement starts on day one: Effective recruitment and orientation programs
are the first building blocks to be laid on the first day of the new employee.

Unique induction programs contribute toward engagement of employees.

Some innitatives include Marriot International has an exclusive induction program called
“VOYAGE” for all new recruits, NIIT begins with SEED (School for employee education
and development) New Delhi.

2. Employee engagement requires commitment from leadership:

The company viewed youth as a source of innovative ideas and as such encouraged the
young employees in the company to come out with innovative ideas and also strengthen the
leadership bench strength at the company.

N.R. Narayana Murthy (Narayana Murthy), Founder, Non-executive Chairman and Chief
Mentor, Infosys, said, "It is important that you give challenging engagements to deserving
people, whether they are young or new in the organization. Youth and empowerment are the
keys to scalability and longevity."

Unless the people at the top believe in it, own it, pass it down to managers and employees,
and enhance their leadership, employee engagement will never be more than just a “corporate
fad” or “another HR thing”. .

3. Give satisfactory opportunities for development and advancement

Domino’s Pizza India has reduced its attrition rates to 3.5 per cent by incentivising its
employees with the promise of further education. The firm bears 50 per cent of the cost of
pursuing further degrees and has also tied up with IMT Ghaziabad to offer the courses.

4. Companies should develop a performance management system which holds managers

and employees accountable for the level of engagement they have shown. Conducting regular
survey of employee engagement level helps make out factors that make employees engaged.
5. Give employees’ appropriate training

Help employees update themselves increasing their knowledge and skills through giving
appropriate trainings., Wipro has started a new initiative called People Ambassador’s
Programme(PAP) to help its human resource department drive greater employee engagement
and give staff a sense of belonging. The PAP initiative will see fresh non-engineering
graduates trained in human resources over the next three years. The initiative will help
expand the reach of the HR team by building a greater engagement with employees. The
chosen candidates will now undergo a work-integrated collaborative ‘Executive Diploma in
Human Resources Management’ 18-month programme from Symbiosis Institute of Business
Management (SIBM). Participants will attend training by SIBM faculty at Wipro campus two
days in a fortnight, while the remainder of the training is on the job. The programme would
be followed by an HR project for 12 months.

7. Managers should work out both financial and non-financial benefits for employees
who show more engagement in their jobs. There should be a clear link between performance
and incentives given to the employees.

8. Focus on top-performing employees

This reduces the turnover of high-performing employees and as a result leads to top business
performance.

CONCLUSION

Employers should pay more attention to creating an engaged workforce. This is a business
issue. The employment relationship requires regular attention and maintenance but, if not
carefully managed, HR business partnering can lead to neglect of the ‘employee advocacy’
role with damaging effects on engagement. Adopting an effective engagement strategy can
4

provide an opportunity for HR practitioners to acquire new skills and work alongside
professionals in other parts of the business, including those responsible for marketing and
corporate social responsibility. The development of a robust employee proposition or
employer ‘brand’ can also support a positive psychological contract between employer and
employees.

Engaged employees are more likely to act as organizational advocates than disengaged
employees and can play a powerful role in promoting their organization as an employer of
choice HR professionals need to recognize that engagement is a strategic issue that cannot
simply be left to manage itself. Organizations should review their communications and
particularly their arrangements for listening to employee opinions in designing challenging
jobs and managing effective teams.

As organizations globalize and become more dependent on technology in a virtual working

environment , there is a greater need to connect and engage with employees to provide them
with an organizational identity .Especially in the Indian culture this becomes more relevant
given the community feelings which organizations provide in our society .Employee
Engagement plays a greater role in the current era were every contribution by the employees
counts. Employee Engagement programs throw light into the success of the company in
engaging its employees in productive activities.

REFERENCES

BlessingWhite (2008) The Employee Engagement Equation in India. Presented by

BlessingWhite and HR Anexi. Retrieved from www.blessingwhite.com

Gallup Management Journal survey on Employee Engagement Using the Gallup Q 12-item
employee survey

Employee Engagement and Talent Management –watsonwyatt.com

Employee Engagement the key to realizing competitive advantage – DDI(DEVELOPMENT

DIMENSIONS INTERNATIONAL)

MBA REVIEW –The Icfai University Press

HRM REVIEW - The Icfai University Press

Times of India

Make a Kid’s Day

Commonwealth Bank staff raised an amazing $70,000 with their annual Make a Kid’s Day
fundraiser in October. This year the Commonwealth Bank dollar matched the funds raised.
Staff decorated bank branches, held morning teas, competitions and slave auctions, dressed
as Clown Doctors and generally went wacky to help Make a Kid’s Day.
The Commonwealth Staff Community Fund has supported the Clown Doctors as their
principal charity since 1998.
caption: Commonwealth Bank staff around Australia raised funds to Make a Kid’s Day. Dr
Ready visited the Queen Street branch in Brisbane. The staff dressed up and held a morning
tea and other activities.

Commonwealth Bank staff around Australia raised funds to Make a Kid’s Day.
Dr Ready visited the Queen Street branch in Brisbane. The staff dressed up and held a
morning tea and other activities.

Project Giggles

Project Giggles created lots of fun in the workplace

and raised $65 000, matched by Cadbury
Schweppes. Staff at various Cadbury Schweppes
sites challenged each other to raise as much money
as possible. The project soon took on a life of its
own as staff came up with fun and creative ways to
raise funds.

Innovative raffle prizes included winning a day off work, on site parking and product
hampers or even a colleague to do the household chores such as car washing and carpet
cleaning. Fun events included employee busking, karaoke, "Cadbury Idol"
talent competitions and golf days. Swearing, being late for meetings, or wearing jeans on
Fridays warranted a donation to the cause.

Apple bobbing competitions, coin throwing competitions, manager dunking competitions,

factory tours, sausage sizzles and appearances by sporting stars and children's characters,
Freddo and Caramello Koala were highlights of Open Days for employees and their families
at major sites. One site even formed its own band.
Staff created their own Clown Doctor name and persona, and had their colleagues laughing
with their comic routines as a requirement for their entry to the ‘Clown Doctor for the Day’
Competition.

The 12 week Project Giggles exceeded expectations.It identified a strong community spirit
and gave many people the opportunity to showcase talents and skills, often stepping out of
their comfort zones in the process. Most of all, they had lots of fun and made a big difference
to children in hospital

People Engagement There have been solid people

engagement improvements driven from the Which new Bank program.
This result is supported by enhanced employee satisfaction readings, key
culture change measures, a continuing safety improvement focus and the
implementation of enhanced leadership, performance management and
talent management frameworks.
This progress is reflective of the Bank’s commitment to its people. The
evolutionary strategy builds on the success of the Which new Bank program
and includes a strategic priority relating to Trust and Team spirit. Through
strengthening leadership, developing and valuing our people and working
collaboratively business performance will be lifted and growth will
continue.