Tag Archives: Gallup

Want To Improve Your Business Outcomes?

data-point-tuesday_500

Last week I wrote about the new Gallup report, State of the American Workplace, and discussed some of its broader findings. This week, we’ll dig in a little more specifically.

Two of the chapters, U.S. Workers: Increasingly Confident and Ready to Leave, and The Competitive Advantage of Engaging Employees, should be required reading for all leaders as well as HR folks.

Let’s look at the chapter on U.S. workers having one foot out the door first. According to Gallup, “51% of U.S. employees say they are actively looking for a new job or watching for openings.” Think about that for a minute. A little more than half of your employees have at least one foot out the door.

Optimism about the job market is up for good reason:  hiring is up. Gallup measures job creation and reports its Job Creation Index. In 2012 the Gallup Job Creation Index averaged +18. For the first three quarters of 2016, it averaged +32. So our employees have a deservedly high level of confidence that when they leave, they can find a good replacement job fairly quickly. It’s no wonder that many of our employees have a “grass is greener” outlook.

gallup-employees-are-leaving-2017

And, of course, all of these reasons tie into your HR strategies, policies and plans. Your approach to employee engagement should be tying in to these 5 reasons for employee resignations.

While there are many definitions for employee engagement, this really caught my eye in the report:

“Some leaders and managers believe the ultimate goal of employee engagement is higher levels of worker happiness and satisfaction. Happier workers certainly benefit an organization, but the real goal of employee engagement is improved business outcomes.”

Boom! Let me quote this again:  “…the real goal of employee engagement is improved business outcomes.” Every definition of employee engagement works here – as long as we understand the real outcome for which we’re working.

If employees are happier, they’ll work smarter and harder and quality will go up, improving our business outcomes.

If employees feel respected, they’ll be more committed and stay longer, improving our business outcomes.

If employees’ skills are developed, they’ll make greater contributions, improving our business outcomes.

If employees see a career path forward, they’ll be more committed and stay longer, improving our business outcomes.

If employees feel connected to the organization’s mission, they’ll spend more of their discretionary energy on the job, improving our business outcomes.

You get the point. As you’ll see in the chapter on The Competitive Advantage of Engaging Employees, employee engagement isn’t a nice-to-have any more. In this age of talent shortages and high turnover, employee engagement is a requirement to meet and exceed our business goals.

Gallup has been measuring employee engagement globally for a long time. In the U.S. the figures for the last 16 years are surprising. And not in a good way. They are actually alarming. Take a look:

gallup-engagement-2017-original

What’s alarming about this data is that, essentially, despite a ton of investment in programs, approaches, technology, and training, the employee engagement needle hasn’t moved since 2000. For all intents and purposes, despite our best (?) efforts, the percentage of the workforce that is either Not Engaged or Actively Disengaged hasn’t moved at all over the last 16 years. Somehow, despite our best efforts, we are not convincing our employees that we value them, that we need them, or that we want them. And they’re actively looking. Add in to the equation that there a lots of jobs available – and a lot of them are good jobs – and it’s easy to see why employees feel empowered to check out the green grass across the street or across the country.

Perhaps we aren’t speaking their language. Perhaps we aren’t letting them in as real partners in our drive for success. Perhaps we aren’t asking, or listening, or engaging. But it’s clear from this data – and a great many other sources – that the average organization needs to step up its employee engagement game.

The data are clear. Engaged employees – use definition you like – have lower turnover, lower absenteeism, higher customer metrics, higher productivity, higher sales, higher profitability – as I have been quoted saying, “everything we measure that we want to go up will go up, and everything we measure that we want to go down will down when we create a culture that values its humans.”

Download this report. Download it today and start considering how you can improve your business outcomes by engaging your employees.

1 Comment

Filed under China Gorman, Culture, Data Point Tuesday, Employee Engagement, Employee Productivity, Gallup, Happiness at Work, Talent Management, Workforce Management, Workplace Culture

Maybe Engagement Doesn’t Really Matter

data-point-tuesday_5002

When Gallup released the most recent State of the American Workforce Report the engagement news was not good. Here’s what the report said:

“Currently, 30% of the U.S. workforce is engaged in their work, and the ratio of engaged to actively disengaged employees is roughly 2-to-1, meaning that the vast majority of U.S. workers (70%) are not reaching their full potential — a problem that has significant implications for the economy and the individual performance of American companies.”

Because the basic premise is that organizations with highly engaged workforces produce better results than those with less engaged workforces, I was surprised that the press didn’t make more of this data. I wrote about it here, but it was about creating the business case for caring about whether or not employees are or are not engaged. I guess the overall sad state of engagement in the U.S. is a given and not newsworthy anymore.

But I saw some new Galllup survey data that, frankly, raises new questions for me, and makes me wonder if “engagement” is really what we should be measuring. And if “engagement” and stronger financial performance really are causal, as Gallup implies.

The survey question was “If you won $10 million in the lottery, would you continue to work, or would you stop working?” So a rational person might think, “Well, if 30% of the workforce is engaged and 70% of the workforce is not engaged, then probably 70% of the workforce would quit their jobs if they found themselves $10 million richer.” Wouldn’t you think that? I certainly did.

So imagine my surprise to see that the response to this survey question is exactly the opposite of what we would have expected! 68% of polled working adults said they’d keep working and 31% said they would quit. Exactly the opposite!

Gallup win the lottery 1I’m confused. But then I thought I had it figured out when I looked at the next question, which asked those who said they’d continue working if they’d stay in the same job or take a different job. “Aha!” I thought to myself. “The people who said they’d continue to work would surely take another job – a job in an organization that would be more engaging since they’re all not engaged.” But no. Nearly half of those said they’d even stay in the same job!

Gallup win the lottery 2

Now I’m really confused. Maybe it’s financial. Except that the positive trajectory to stay in the same job started way before the recession of 2009. So it may not be financially motivated. In fact, $10 million buys a lot less in 2013 than it did in 2005 – and still the percentage of workers saying they’d stay in the same job has grown substantially.

So what’s the deal? Does engagement even matter? If 67% of the population will continue to work after winning $10 million – and fully half of those will stay in the job they currently have, why do we care about engagement scores? Does engagement really matter?

Enquiring minds want to know!

18 Comments

Filed under China Gorman, Data Point Tuesday, Engagement, Gallup, Winning the Lottery

Performance and Engagement: No More Smoke and Mirrors

data point tuesday_500 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:

Gallup Engagement KPIx

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.

5 Comments

Filed under China Gorman, Data Point Tuesday, Employee Engagement, Engagement, Gallup

Shooting Ourselves in the Foot Isn’t an Effective Engagement Strategy

data point tuesday_500

Recent headlines from Gallup proclaiming that college-educated Americans are less engaged on the job than other cohorts may have spurred some conversation among HR leaders and professionals. Engagement, that elusive component to organizational success, is the holy grail many employers chase. And Gallup, the grand surveyor of people on all topics, has regularly published engagement data that either convinces us that engagement is a fraud or that we have to try harder to win over our workforces.

A recent USA TODAY article, “Higher education = lower joy on job?” quoted Gallup findings as well as findings from this report: “Why Are Recent College Graduates Underemployed?” from the Center for College Affordability and Productivity. The justaposition of these two sources shows an interesting picture.

Here’s Gallup’s data:

Gallup Engagement by Education 2013

So. According to Gallup, the most engaged group of workers are those who have earned a high school diploma or less.  And the least engaged group of workers are those who have earned a college degree. By themselves, the numbers are almost interesting. By themselves, the bigger news is that the numbers show that less than a third of the workforce is engaged, and more than two-thirds of the workforce is either not engaged or actively disengaged. OK. That’s interesting and cause for concern.

But put this Gallup data into the blender with this data from the Center for College Affordability and Productivity and it gets a little more interesting:

College Grads Underemployed 2013

If nearly half of all American workers with college degrees are in jobs that do not require a college degree, might that have something to do with their level of engagement? Are nearly half of our college educated workforce bored on the job?

And if they are, and if we’re concerned about engagement, why are we putting them into jobs for which they are overqualified? Would high school graduates be more engaged and perform better? Would those better performers positively impact the financial performance of their employers?

The Center also asserts that

“past and projected future growth in college enrollments and the number of graduates exceeds the actual or projected growth in high-skilled jobs, explain the development of the underemployment problem and its probable worsening in future years.”

So they believe the engagement problem will grow worse – if there really is a causal relationship between engagement levels and the over-qualification of many of our workers.

What do we make of this? Well, I do think it’s common sense to believe that people who are significantly over-educated for the jobs they hold could well be bored and unengaged. But I also think that in this economy, many are grateful to have any job, over-educated or not. What that means for engagement is unclear to me. Except that Gallup, being the last word in survey data, shows a clear line between education levels and engagement.

shoe with bullet holeWhile this might be above my pay grade, I’m willing to make a leap here and suggest that hiring overqualified workers might not be the best strategy for boosting engagement. If we truly believe that engaged workers have a demonstrably positive impact on an organization’s financial performance – and that’s been the HR mantra for a number of years – then we are probably shooting ourselves in the foot by requiring college degrees for jobs that truly don’t need them.

I’ve written this before: the over-inflation of job requirements in job descriptions isn’t putting the unemployed in this country back to work. And now we know it isn’t helping organizational performance. Hmmm…

I’ll bet we can agree on this:  shooting ourselves in the foot isn’t an effective engagement strategy.

5 Comments

Filed under Center for College Affordability and Productivity, China Gorman, Data Point Tuesday, Education Deficit, Engagement, Gallup, Job Descriptions

What Comes First: Employees or Customers?

As a business leader, I’ve always believed that one of the most important aspects of my job is to create and lead a culture that motivates employees to come to work every day and do their very best work.  I’ve always known that in order to acquire, delight and retain customers my organizations (at the local, regional, national and global levels) needed to acquire, engage and retain the best talent.  I’ve always known that the link between customer and employee satisfaction is strong.

Over the last few months I’ve been able to take the time to read some great books, articles and research reports; to meet with thought leaders and executives; and to attend conferences and courses focused on these aspects of organization and leadership success.  Now I’ve got more than a “gut” instinct that the focus on creating a culture that puts customers first by recruiting, developing and retaining the right employees brings dividends that are more than repeat customers and happy employees.  Now I’ve got real data.

Where did I get the data?  I’ve read research reports from BlessingWhite, Gallup, SHRM, the U.S. Department of Labor and others.  I’ve read books by Chip Conley, Mark Sanborn, Geoff Colvin, Leigh Branham and Mark Hirschfeld, Tony Hsieh, Jim Collins, Dave Logan, John King and Halee Fischer-Wright and Jonathan Haidt among others.  I’ve had conversations with Tony Hsieh, Dave UlrichDoug and Kimberly Rath, Cathy Missildine-Martin, Paul Hebert, Joe Gerstandt, Jason Lauritsen, Chris Hoyt, Lars-Henrik Friis-Molin, John Sumser, William Tincup and many others.  Basically, I’ve been a sponge.

And the outcome?  Well now I see clearly that while having happy, committed employees is critical for organizational success, having the right happy, committed employees makes the difference between good customer service and exceptional customer service;  the difference between good organization performance and exceptional organization performance — by any measure you wish to use. 

The right happy employees are determined by what will exceed the customers’ expectations.  And that’s about culture and values. 

To create a culture that retains happy employees feels good on many levels.  What leader doesn’t want to walk around and see smiling faces on their employees?  But to create a culture that retains employees happy to make your customers ecstatic is the secret sauce of organization success. 

The reason for an organization’s existence is not to create a “happy” environment for employees.  The reason for an organization’s existence is to create value for its stakeholders by serving its customers.  You win in business by serving your customers better than anyone else.  And it’s clear to me now that the key to serving your customers better than anyone else lies squarely in creating a culture that attracts and retains the right employees.  I’m not sure many leaders see the difference here, but it seems huge to me.

In the hard work of creating a motivating culture almost every organization starts with their employees:  what makes them happy, what will engage them, what will motivate them to commit over the long haul.  I’ve come to believe that the hard work of creating a motivating culture needs to start at a different place:  conversations with customers and potential customers.  What is important to them in their interactions with your employees?  What values will motivate their engagement, their commitment over the long haul?  Once you have that input you can begin to translate it into organizational values, characteristics, behaviors and skills that become the basis for your culture work – and, ultimately, your talent acquisition, engagement, development and retention strategies.

It’s clear to me that both culture and organization success has to start with the customer.  Only then will you know what kind of talent acquisition, engagement and retention strategies will lead to the type of organizational success that will value your organization among the strongest financial performers and land you on the lists of best companies to work for. 

In other words, when creating and leading your organization’s culture look first to your customers and second  to your employees. 

Most do it the other way around.

15 Comments

Filed under Uncategorized