Depending on whom you ask, it’s either the key to unlocking the untapped potential of your workforce, or a fluffy HR issue not worthy of the C-suite agenda.
It’s easy to see why; employee engagement is a can of worms.
This is caused partly by misunderstanding of the term; ambiguity over its meaning, drivers and implications. In an attempt to bring some clarity, I thought I’d attempt to untangle the confusion between engagement and two similar areas: employee satisfaction and culture.
The 3 areas overlap, but they’re not the same. And a satisfied workforce with a vibrant culture doesn’t necessarily equate to high levels of engagement .
Let’s take culture first. This is a subjective area, but I’m going to define culture as the informal code of conduct that shapes employee interactions (work and social). It both guides, and is guided by, behaviour.
It can also influence the extent to which employees go ‘above and beyond’ the basic requirements of their job. Interestingly though, when driven purely by culture this is not necessarily due to any particular commitment to the organisation itself (a hallmark of engagement).
There’s no perfect definition of culture, but Frances Frei and Anne Morriss at Harvard Business Review frame it well:
“Culture guides discretionary behavior and picks up where the employee handbook leaves off.”
Discretionary is right – it’s not written down, you can’t dictate it from above, and it changes over time.
Organisational culture is an amorphous and organic thing, and improving it is complex, complicated, with no off-the-shelf fix.
And while culture is enormously important for a host of reasons, it’s not an accurate reflection of how engaged employees are with what the organisation is trying to achieve.
Similarly, employee satisfaction is a separate thing. This is more indicative of how provisioned people are to do their job, how fairly rewarded, and whether they have opportunities for progression.
This can be managed by providing strong leadership, clear roles and responsibilities, structured training, fair performance management, good recognition, competitive pay and decent development opportunities.
These are the kinds of areas considered in rankings like the Times Top 100 and the Fortune 100, and of course are very important.
A study by the Great Place to Work® Institute showed Fortune 100 companies performed twice as well than the Russell 3000 or the S&P 500. There are also obvious links between employee satisfaction and attraction, retention, churn etc.
But like a strong culture, keeping employees satisfied isn’t the same as winning their hearts and minds.
An employee who enjoys his work, gets on with managers and colleagues, is paid well, and has fun isn’t necessarily engaged; he just has a great job.
Fundamentally, engagement comes from employees understanding what their organisation stands for and is trying to achieve, believing and supporting this, and knowing how they can contribute to it.
It’s helped by:
- A shared organisational purpose
- Clarity over how individual roles contribute to this
- Leaders and colleagues that serve as role models
- Inspired employees who know the organisations history and ambition
- Great stories that demonstrate impact, success and trajectory
Of these, the first is most important. To illustrate the point, consider the average policeman, fireman, nurse, teacher, or soldier.
These professions are underpaid, difficult, shrouded with bureaucracy and politics. They are emotionally taxing and often dangerous. There is little tangible reward for what’s put in. You could class employee satisfaction (according to our definition above) as challenging at best.
Yet many of the people in these professions take enormous intangible, emotional reward from their jobs. They’re disproportionately engaged because they have a clear and shared sense of purpose that they believe in.
Can this translate into the corporate world?
As we see more and more organisations undertaking the introspective exercise of defining their own purpose a persistent question arises – does organisational purpose have to be virtuous, connected to some form of social good? Or is it ok to have a purpose that is solely about profit or shareholder return?
The answer depends on what you are hoping an organisational purpose is going to do for you. If it is purely a sentiment intended to guide strategy and decision-making, then having a clear commercial ambition is a powerful tool.
But it’s unlikely to inspire or resonate with a workforce let alone consumers – two audiences that will largely dictate whether you’re capable of achieving any such ambition in the first place.
Increasingly, organisations are coming to the conclusion that being a sustainable business equipped for long-term success requires making some form of contribution to the world that connects them to society.
Finding the happy balance of shared value - making money while doing good – is becoming the Holy Grail for many businesses, as it enables them to form deeper relationships and much higher levels of engagement with their workforces and consumers while pursuing their commercial ambitions .
Patagonia is an oft-cited example; ‘Build the best product, cause no unnecessary harm, use business to inspire and implement solutions to the environmental crisis.’
Their employees believe in this. So do their consumers. Patagonia reaps the rewards.
This is not to say that a virtuous social purpose is the only way of engaging employees; just that an effective organisational purpose has to have at its heart an idea that is capable of acting as a galvanising force for those who are employed in its pursuit, whether that’s through ethical, emotional, intellectual or financial persuasion.
If that idea can be found, then the benefit is engaged employees committed to the cause who work harder, stay longer, are more motivated, and go ‘above and beyond’ because it’s important to them, not because of cultural expectation.
Engagement isn’t complicated, it’s just hard. It requires a powerful purpose aligned to corporate strategy and ambition, and a coherent plan for making sure everyone within the organisation understands it and knows what their role in it is.
But the first step in making employees believe?
Give them something to believe in.
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