Don’t Be Fooled

fooledNew research shows engagement is up—but so is interest in leaving. Four strategies to combat attrition.

By Don MacPherson

With employee engagement at levels not seen since before the recession, it’s surprising that the number of employees who are looking for new jobs at different organizations continues to rise. This finding is a result of Modern Survey’s U.S. Workforce Employee Engagement Study, which surveyed 2,000 full-time, U.S. employees to understand the latest picture of employee engagement. It is clear, however, that employers won’t be able to rest on their laurels. Organizations need to outline strategies to address this dynamic situation as engaged employees are considering greener pastures.

Modern Survey’s employee engagement index is composed of questions based on the following factors:

  • Employees’ intent to stay with an employer over time;
  • Whether employees are inspired to give extra effort;
  • Whether employees are willing to refer the organization as a great place to work;
  • Employees’ level of pride in the organization; and
  • Individual sense of future at the organization. According to the Fall 2014 engagement index results, the state of employee engagement is increasing. The study found that 44 percent of employees are engaged — the highest level since the study began in 2007.

There are a couple of explanations for these changes.

• As unemployment continues to drop, disengaged employees realize they have options elsewhere. Opportunities open up, and disengaged employees are finding new jobs where they are more engaged.

• An influx of new employees brings enthusiasm into the workforce. Turning enthusiasm into engagement is not easy, but it is easier than engaging a worker who has been disengaged for some time.

The situation is a bit like musical chairs. People who were disengaged for a long time have left and are now in a honeymoon phase with their new organization. People who stayed with their organizations through difficult times are feeling more confident about their organizations’ futures and getting more career development opportunities. Confidence in an organization’s future and career development are both strong drivers of engagement.

While employee engagement is up, more people are also looking for new jobs outside their organization. In fact, 28 percent of employees are currently looking to leave their organization. That is up from 25 percent last year and 23 percent in 2012. Retaining employees, not employee engagement, will be the biggest threat to many organizations’ people strategies.

What should organizations do?

This scenario can be confusing for employers — on the one hand, engagement is up. On the other hand, if employees are looking, that may mean increased turnover and training costs, plus a hit to engagement if the employees who leave were engaged. If those employees that are looking to leave are leaders or managers, the toll is even greater.

The challenge for organizations in the coming months will be to maintain high levels of engagement in order to retain employees. It is a very odd environment. Normally when there is high engagement, there is high retention, but that is not the case right now.

Focusing on what the organization needs to do to make engagement possiblepaticularly building a culture of trust and putting a spotlight on the organization’s values —is a good start.

Building a Culture of Trust

In order to make engagement possible, you need trustworthy leaders. Modern Survey’s research indicates that 95 percent of fully engaged employees say they trust their direct manager and senior leaders. Trust is a gateway to engagement. An organization can put all sorts of programs in place, but if people do not trust their leaders, full engagement will be very difficult to obtain.

Leaders need to follow through on their commitments. They should also be open with their communications regardless of whether the organization is flourishing or floundering. Poor communication from leaders causes employees to create their own stories, which are generally worse than reality.

Organizational Values

Like trust, organizational values are a critical piece to obtaining full engagement. They need to be communicated—or look out. According to Modern Survey’s U.S. Workforce Employee Engagement Study, of the respondents who say they work for an organization without values that are known and understood, only 1 in 260 are fully engaged.

Great organizations talk about their values often. They share their values when they are interviewing job candidates, reference them as part of the performance appraisal process, and praise employees who honor them.

Growth and Development

Once the gateway elements like trust and values are in place, it is time for leaders to drive engagement. The second strongest driver is career development.

Employees are thirsting for ways to grow at work. Providing opportunities for development can boost both engagement and retention. This may include cross- training, personalized career tracks, leadership roles on team projects, or the opportunity to work on an innovative project.

While many people think of promotions when they think about growth and development, that is not necessarily what employees want. Many employees will be motivated simply by expanding the current capabilities required to do their current jobs. Leaders should have conversations with their direct reports about what development means to them at the individual level and how they would like to grow. Leaders may be surprised by what they hear and employees will be happy to offer input.

Confidence in the Future of the Organization

Overall, employees are more optimistic about their organizations. This is critical because belief in senior leadership and confidence in the future of the organization have consistently been the strongest driver of engagement over the last four years.

In Fall 2011, just 55 percent of U.S. workers had confidence in their organization’s future. Now, that number is 67 percent. However, some organizations are still struggling. If CEOs and other executives at these types of organizations expect to retain their employees, especially their top performers, they need to develop a clear road map for how they will steer the organization to better days. Failure to create this road map and communicate it effectively will be disastrous. Top talent will be picked away relentlessly as competition for high performers increases.

The increased percentage of engaged employees may imply that employers can celebrate and relax. But this is not the case. Keeping the momentum going and retaining engaged employees at all levels in the organization will be important issues in the months ahead.

Ensuring that the organization is doing its part by creating a trustworthy environment and articulating values will provide the necessary framework for engagement to thrive. Once that framework is in place, leaders should focus on driving engagement by providing employees with growth opportunities and communicating a road map for where the organization is headed and how it will get there. While there are other drivers of engagement like recognition and personal accomplishment, giving employees a clear sense of their place in the organization and giving them the career development opportunities they want are significantly more important to engagement and motivation.

Organizations need to be measuring employee engagement, and act on the results during the good times and the bad. Few organizations ever reach extraordinary engagement status accidentally, and there is no better way to assess the health of your organization than by asking employees their opinions.

Don MacPherson is president and co-founder of Modern Survey. 

Posted December 15, 2014 in Talent Retention

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