Performance and Engagement: No More Smoke and Mirrors

I was talking with the CEO and CMO of a startup software company in the HCM space yesterday. One of the things we talked about was the ready availability of data that link organizational performance with employee engagement. No longer the stuff of smoke and mirrors, the correlation between higher revenue, lower costs and greater customer satisfaction with employee engagement is rock solid. Whether the data come from academic researchers, think tanks, research/analysis firms or other interested parties, we can cite legitimate sources to underpin our ROI calculations. (See previous posts here and here.)

Gallup’s recently released State of the American Workforce is one example of such data. In the “From the CEO” introduction, Chairman and CEO Jim Clifton says:

“Here’s what you need to know:  Gallup research has found that the top 25% of teams – the best managed – versus the bottom 25% in any workplace – the worst managed – have nearly 50% fewer accidents and have 41% fewer quality defects. What’s more, teams in the top 25% versus the bottom 25% incur far less in healthcare costs. So having too few engaged employees means our workplaces are less safe, employees have more quality defects, and disengagement – which results from terrible managers – is driving up the country’s healthcare costs.”

Here’s the corresponding chart from the report:

You may or may not have an opinion about Gallup’s Q12  methodology, but the longitudinal nature of their data — together with their periodic meta-analysis — says to me that their findings have weight. We can take to the bank – and to our CEOs and CFOs – the relationship between higher engagement and stronger organizational performance.

This is the data of sound and persuasive business cases for investing in the well-being of our employees. Take a look at the Gallup findings. You’ll find something that will spark an ah-ha moment. Or maybe two or three.