Workers who aren’t fully invested in their jobs aren’t just a drag on productivity. They’re bad for the bottom line.
It was six years ago at the start of the Great Recession when the brain trust at engineering consulting organization Edison Welding Institute (EWI) got a wake-up call from employees.
Results of an annual survey of attitudes toward EWI leadership had dipped 30 percent from previous years; employees perceived that the organization’s leaders were hoarding information and not bothering to share it with them.
“That wasn’t good,” says Mark Matson, EWI’s vice president of human resources, “and it just makes everything more difficult. Our people felt that they were being kept in the dark; we just were not communicating with them.”
Matson says there has since been a concerted effort to open up to employees by sharing financial information, answering their sometimes pointed questions more openly and generally building bridges of trust between workers and leadership. The moves are fueled by good business practices and common sense.
“What we sell is expertise, and our employees have a lot of options,” says Matson, adding that EWI competes against the likes of Honda of America Manufacturing Inc. and John Deere for workers. “We can’t afford not to keep them happy. Our people are knowledge workers and they want to know what is going on, and if you don’t tell them what’s going on, they are going to make it up.”
So far, the overture seems to be working. Matson says scores on questions relating to employee attitudes about leadership have topped 90 percent in recent years.
Bad Attitudes, Bad Results
EWI’s experience runs counter to the results of a recent Gallup survey, in which more than two-thirds of the 30 million Americans who work full time reported being either totally disengaged from their jobs and workplaces (20 percent) or “not engaged” (50 percent). While the former group spreads discontent, those fitting the latter description are, as Gallup writes, “just kind of present, not inspired by their managers or their work.”
The third of the workforce that is engaged, Gallup’s survey shows, is more productive and safer, has fewer quality defects and lower absenteeism rates and incurs lower health-care expenses. Those employees also come up with the most innovative ideas, have more entrepreneurial energy and create most of the new customers for their companies.
Disengaged employees are bad for more than morale; they’re bad for business. Gallup says actions by bad managers that enhance disengagement cost U.S. companies $450 billion to $550 billion annually. Rotten supervisors are something most workers understand (who hasn’t encountered one … or two … or three), but there isn’t a single factor solely responsible for creating a disinterested employee. Those within the human resources industry say such an environment is more a witch’s brew concocted from what’s going on within the business, with the employee and with external factors the business has little control over.
“Part of it has to do with the economy; part of it is a lack of feedback; part of it is a lack of development [training]; part of it is technology,” says Ray Noe, a professor at the Ohio State University Fisher College of Business and author of several books on human resource management. “You are seeing more people being replaced by machines, more of them displaced.”
Another part of the problem is a changed industrial landscape, says Janine Moon, owner of Workforce Change, a training and development company based in Columbus. She says the idea of disengaged workers is nothing new, adding that the numbers haven’t moved much over the years. What is different is the global economy and the increased competition it has brought to the way America works and even thinks about work.
“In today’s economy, it takes just not our brains, but our wills to connect with customers,” Moon says. “The important piece, the connections, is important to a company on the outside [with customers]. But if that company isn’t connected on the inside, that translates outside.”
What can companies do to boost morale and engagement? Start with the basics. Moon says the way in which people interact with each other creates the core of every work environment—good or bad. “It’s one of those things where the solution is simple, but not easy, because it comes down to communication and relationships.”
She says within the confines of a business, that includes the relationships between employees and leaders—whether there’s one supervisor for the entire staff or hundreds of workers under the watchful eyes of a layer of managers.
Those internal relationships can be strengthened by having managers and owners include employees in discussions about how the business is run, providing additional training and following through with any plan of action outlined, Moon and Noe say. In other words, give workers a meaningful stake in the game, listen to them and take steps to make them feel good about their work.
“There are a lot of good reasons why you should do this from a productivity viewpoint,” Noe says. “From a strict business sense, you don’t want people to leave the company.”
The Gallup survey validates that comment. When the economy began improving in 2010, public companies with higher engagement levels saw earnings per share grow more robustly than at lower-performing businesses. Furthermore, the former group reported lower absenteeism rates, lower turnover and higher productivity and profitability.
The rebounding economy also has placed the issue of employee engagement in vogue.
Amy Roberson, manager of Robert Half International’s Columbus office, says that in 2011, federal data showed 1 million people were more willing to quit their jobs than they had been previously. The figure doubled by the end of 2012, she says, meaning workers had a plethora of choices. That’s bad news for employers who are looking to keep workers on board.
A recent Robert Half report concluded that employers’ top concerns for the near future are retaining valuable employees and maintaining productivity. “If you are a really good individual and have a good history with your company, you’ve got options,” Roberson says.
Developing an engagement strategy isn’t rocket science, Roberson says. In addition to communicating well with employees, companies should routinely review benefit plans, compensation levels and talk about training and development efforts. “It’s not a hard equation,” she says.
The principle applies to big and small companies alike. Roberson says it can be easier to ensure employees stay engaged at smaller enterprises, where everybody does multiple jobs and works closely with one another.
That holds true for Mike Whalen, president and founder of the digital marketing agency 30 Lines. “I think it’s critical for small businesses because there’s only six of us and we wear a lot of hats,” he says, adding that having just one disengaged employee “can be a cancer.”
Whalen says the company encourages engagement through social functions with staff and even with its office location on East Lynn Street in the heart of downtown Columbus. Still, the issue requires constant monitoring. “It’s one of those things you really have to work on,” he says.
Fisher’s Noe says some of the talk from upper management about engagement is disingenuous and nothing more than lip service. “Everybody wants on the bandwagon,” he says. “When I talk about engagement, they don’t use it. It’s fake participation.”
For Matson and EWI, changing the way leadership interacted with employees wasn’t an easy sell for workers or managers, but the effort has slowly taken root. It reached a point where a manager apologized to employees for his past actions. “It’s taken us three years to start to get grace, if you will, from our employees,” Matson says.
Craig Lovelace is a freelance writer.