Evolving Employee Engagement
Beyond Benefits and Bonuses
With the pandemic largely behind us and the return-to-office in full swing (albeit still a rather divisive topic for many organizations), one of the current challenges for HR leaders is balancing business goals with shifting employee engagement levels. At ChapmanCG, we are fortunate to have insights into the HR landscape as it relates to the transformation of the workplace and the current realities people leaders are facing in this “new normal” post-COVID environment. Through our recent conversations with top HR leaders, the overarching consensus is there is no one-size-fits-all approach or solution, particularly when it comes to employee engagement.
How to maintain an engaged workforce, retain talent, and support employees are topics now requiring a more thoughtful, tailored, and purposeful approach as organizations contend with evolving employee demographics and their associated expectations.
Measuring Engagement: Are Existing Methods Still Relevant?
We doubt the way that engagement has been measured up to now is still fit for purpose and suggest this needs to be redressed. When looking at statistics and data at face value, engagement numbers appear on the surface unremarkable, and even relatively positive. Gallup suggests overall global employee engagement is trending upwards (although not significantly and mostly in best-practice organizations). Despite this initially positive news that employees are technically more engaged, the bad news is they are far more stressed and emotionally disengaged. This sentiment has resonated with HR leaders we have been speaking with in recent months—almost all organizations are seeing a dramatic increase in employees seeking access to mental health resources and stress leave. Many leaders spoke of having to uplevel their Employee Assistance Programs and looking at new ways to partner with their medical providers to look at increasing wellness stipends.
As data analytics become more advanced with the introduction of a more sophisticated technology stack and the advent of AI, more progressive organizations are looking at how to level up their analysis methods using different available data. Employee engagement surveys are just one of many ways to leverage insights and make decisions about what employees want. Pulse surveys offer frequent, smaller opportunities for feedback, capturing the evolving sentiments of employees in real-time. Be mindful that while the completion of the survey is a form of passive engagement, less than 70% participation is also a potential warning sign of apathy and disengagement.
The next step is to make these meaningful and personalized—establish the problem you are trying to solve to ensure you are using data to assess what engagement needs need to be met and where the gaps are. It is important to not only collect feedback but also to make sure you implement and announce the changes so that employees know their voices are being heard.
Evolution of Benefits: From Financial to Well-Being
Compensation and Total Rewards overall have a broader meaning in today’s modern workforce. Gallup talks about the “Tangible vs Intangible”, and we are seeing the tangible evolving from the traditional employee benefits. Salaries, bonuses, and stock options are fine, but in the current economic climate, it is becoming harder for many companies to remain competitive with this offering alone as they look to tighten their belts and reduce costs. We are also seeing increased creativity in well-being benefits that offer more choice to the individual and what they might perceive as important—the element of choice and flexibility which drives engagement.
Experts cite 5 different elements of well-being, which include career, financial, social, physical, and community. From our discussions with HR leaders, some of the more immediate and simple well-being offerings are things like aromatherapy, company-wide volunteer days, and the option to “work from anywhere” for a month. Other innovative benefits that have been enthusiastically embraced by employees include options such as pet insurance, subscriptions to apps (such as Peloton and CALM), fertility support, and equal time-off or sabbaticals for those employees without children.
Understanding the real-life challenges facing employees and their families is critical to offering a competitive and contemporary workplace experience. This goes way beyond the “perks of the job” and becomes a meaningful package of support mechanisms which have a real impact on people’s lives. Whether this is through flexible working conditions, equity in parental leave policies or removing barriers for those facing fertility challenges, seeking tangible ways to contribute to the well-being of employees will inevitably lead to a healthier and more engaged workforce.Christelle Beneteau, CHRO at Ferring Pharmaceuticals
In addition, many organizations are developing more thoughtful internal training and original talent development programs. Other non-financial initiatives useful in driving engagement are the social and community aspects, including learning opportunities and mentorship. Carefully curated content for upskilling and reskilling (learning and development) is proving to be a powerful driver for engagement. This has become increasingly critical with how rapid advances in technology occur simultaneously, such as AI and its impact on transforming business.
ERGs (Employee Resource Groups) are also on the rise. Many companies are more actively encouraging or supporting these employee support groups as they offer individuals space and aid in cultivating a sense of belonging in specific areas of personal interest, commonality, or beliefs that hold value for them (that are not necessarily linked to company mission, vision, or goals). By helping to create these “safe space” sessions that sit separately from other HR or DEI areas, these can be a great way to bring people together where they feel supported. In addition, allowing these and other social groups to meet during company hours fosters a sense of inclusion for those who may have different lifestyle and/or family commitments after hours.
Return to Office: The Art of Communication
Opinions between employers and employees often differ on the return to office. Although organizations have been bringing people back into the workplace for the past 18 months or more, it remains difficult for employers to find a balance that employees feel is fair and equitable. Several Fortune 500 CEOs have openly shared their desire (or requirement) for people to return to the office, arguing that “productivity, collaboration and employee engagement all suffer without the office.” Up to 90% of companies have said they want people back in the office by the end of 2024; however, employee pushback remains strong (with some organizations reporting up to 40% attrition upon reopening their offices after lockdown).
For organizations which have decided that there will be a return to the office, what can they do to enhance employee engagement and improving retention rates?
- Communication: Internal communication can make or break how a new policy or mandate is received. Leaders insisting on people returning to the office by citing productivity or because “it’s how we worked before” may inadvertently be insinuating a lack of trust, which in turn can erode engagement. Without the proper messaging, employees can be more resistant; after all, most people adapted their lives to work remotely where possible during the pandemic, and many continue to juggle additional responsibilities. Be intentional, transparent, and consistent but fair.
- Lead by example: One CHRO we spoke to shared how her CEO had written to employees to explain his vision of the company when he first started it, linking the in-office collaboration to the company values and the “how and why” employees belong in that story. This resonated well with the employees and resulted in a noticeable uptick of in-office presence.
- Ensuring a positive office experience: Being practical about how often and when people need to be in the office: is it for genuine collaboration, or will people just be sitting on Zoom calls in an empty office as the rest of the team is on a different hybrid schedule? There may need to be exceptions made for different teams or business units. Consider new ways to make the office a place people want to come back to, through creating onsite events, providing catering, or refreshing the office layout.
Using Data to Understand Drivers of Engagement
We know that engagement is so much more than just “showing up” physically or even happiness. Happiness is important but somewhat secondary in the wider context of engagement. Understanding the business strategy and its impact on the future success of the organization helps employees feel emotionally engaged—what gets people up in the morning and keeps them motivated. A clearly defined mission, vision, and values (and alignment with these) helps to achieve sustainable engagement.
A quick Google search can bring up articles suggesting anywhere from five to twenty-five drivers of engagement in the workplace, however, these ultimately boil down to three key aspects: Purpose, Autonomy, and Relationships. Using data to understand what constitutes job satisfaction (purpose), providing the freedom and trust to make decisions and perform (autonomy), and ensuring positive workplace relationships has a powerful impact on team and individual productivity and innovation, which can in turn reduce turnover. The advent of AI and the growth of data analytics are already proving useful in better understanding these drivers of engagement.
Engagement correlates with performance – what empowers or prevents an employee being able to perform. When your engagement vendor reports that the data suggests an engaged culture, make sure you ask the broader question – do leaders know how they achieved this result? If the answer is no, it is important to unpack the data further and look at the context, to know how to either keep doing things well or what needs to be done differently. Make sure you are looking at the right data – for example, it may not be related to diversity or belonging, it could be about specific managers or individual team needs.
To impact engagement, you need to first understand what the data is telling you. Secondly, and perhaps more importantly, you need consensus from the leaders that they believe what the data is telling you is true. Then, you can really understand and focus on the problem you are trying to solve.Adrian Shackelford, Vice President – Talent Management & Engagement at Dow Jones
One example of using unique data metrics came from a VP HR at a global financial institution who suggested examining the different demographics and how each population is responding to the new in-office culture. By analyzing at badge swipes, the HR leaders were able to establish some interesting statistics linking to engagement. They found that those with less than five years of employment with the company were in fact the most likely to be in the office. Between five-seven years of employment, they saw a decline; and then those from seven years or more were back to regular office attendance. They then used their employee engagement survey to better understand the reasons for these trends, comparing these results to productivity output, and assessed what they could do to encourage better in-office attendance and engagement (or in fact, whether there were really any changes needed).
One Size Does Not Fit All: Embracing the Individual
Every employee is different. Just as life sciences companies are driving personalized medicine, HR now has the opportunity to understand sub-segments, and drive engagement and well-being at work on an individual basis. As mentioned earlier, data and AI is starting to allow us to measure and personalize the employee experience to provide a more tailored approach. As such, HR leaders should look to embrace data as much as possible to understand what is important to their workers and personalize the employee experience to individuals.
Leaders should look at how they can provide opportunities for growth. Carefully curated content for upskilling and reskilling is a powerful driver for engagement and increasingly critical with how rapidly advances in technology are occurring. By offering bespoke learning and development opportunities for employees, this fosters a sense of personalized growth. According to McKinsey research, 70% of employees say their purpose is defined by their work, however helping employees find their purpose both inside and outside of work leads to greater engagement and therefore retention. If they feel their best interests are being met and future opportunities for professional development are readily available, they are more likely to stay to make this a reality.
Favoring inclusion and recognition are important factors for enhancing employee well-being. Fostering inclusive cultures in which employees feel appreciated and supported result in improved job satisfaction and general well-being. The make-up of employee populations is changing as the Baby Boomers retire, Gen Z is predicted to constitute 23% of the global workforce by 2024. In the US, Gen Z is also currently estimated to be the most ethnically diverse generation, with more than 50% from non-white backgrounds. Therefore, it makes sense that each generation will have their own requirements on what makes them feel recognized and valued.
Conclusion: More Meaningful Engagement Strategies are Evolving
Trust in an organization and its leaders is the baseline—without this, it is difficult to ever build true engagement. And increased employee engagement and trust in an organization has frequently been shown to drive improved productivity and business success. As HR and technology are intersecting to enhance workplace solutions, it is important to break down the silos between HR, the business and employee expectations to create more cohesive experiences.
Employee engagement is evolving and its future hinges on several different aspects: communication, embracing technology to enhance remote and hybrid work experiences, nurturing a well-being culture that places mental health and the individual at the forefront, and utilizing data to create deliberate and meaningful engagement strategies. It is clear there will never be a “one size fits all” approach to engagement, however those organizations which can adapt to using more holistic yet tailored strategies will likely be ahead of the curve when it comes to both talent retention and achieving business goals.
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