What is Employee Engagement?

What is Employee Engagement and Why Does it Matter?

Victoria March 15, 2022
Reading time: 6 minutes
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High employee engagement is when your employees bring their best selves to work and do their best work when they get there.

 

Some consider engagement to be about happy employees. But it’s much more than that.

 

High engagement occurs when employees are channelling that happiness and energy into achieving the goals of the business. This speeds up individual and team performance. Employees align with the values and believe in the vision of the company. The culture is healthy and employees are thriving.

 

Why should you care about employee engagement?

 

Research suggests that organisations with high engagement, outperform organisations with low engagement by 202%

 

With highly engaged teams estimated to sell 20% more than teams with low engagement and enjoying 21% higher profitability, it’s easy to see how it impacts on revenue and business performance. 

 

On the flip side, the cost of low employee engagement can have a significant negative impact on business performance.

 

Consider the cost of under-performance, where an employee is only working at 60% of their potential. Or the cost of replacement if they resign? Add on the cost of extra training for a new starter and a couple of lost clients that they’ve taken with them. It starts to add up.

 

If you’d like to do some maths on the cost of low engagement in your team or business, you can find more information here.

 

How do you achieve high engagement?

 

At Space HR we use a simple model. It helps us to explore what is happening with engagement in an organisation. It shows us where we need to focus to improve.

 

Connection - How connected employees feel to the business. Employees feel informed, heard and bought into the company vision and values.

 

When a company leads with purpose, employees are  78% more likely to want to work for that company. 93% of employees believe companies must lead with purpose and 70% of employees wouldn’t work for a company that lacked purpose.


Employees can be involved with the company's mission by contributing to them. Companies need to work harder to engage their people in the process and think creatively to encourage everyone to find their voice.

 

When an employee feels heard, that person is 4.6 times more likely to perform to the best of their abilities. When your people feel heard, they feel connected, motivated and engaged. 

 

Leadership - How confident employees feel about their leaders and managers. Employees feel inspired by their leaders. Leaders bring out the best in the team. They provide great recognition and create amazing working environments. 

 

Employee turnover is expensive, and people don't quit jobs; they quit managers. Recent DDI research found that as many as 57% of the employees quit because of their boss. The strength of your leadership team makes a huge difference to the culture and success of your teams.

 

Sadly, many organisations aren’t making this investment in leadership. According to a recent survey, a third of employees said they operate in an ‘ethical void’. They rate both their leader’s ethical behaviour and the alignment of their own values with those of the organisation as low.

 

38% of employees don’t feel their manager knows them well enough to understand their full potential. This lack of understanding goes far beyond leadership and management. It's crucial that your managers understand the importance of listening to their team.

 

Fulfilment - How well roles meet employee’s needs, personally & professionally. Rewards match the contribution that's made. Employees enjoy the challenge of their roles and feel proud of the work they do.

 

Research by WorldatWork shows that organisations that do not invest in training and development of their employees lose them to their competition. Employers can differentiate themselves from competitors by investing in their employees' career development. Even a relatively small investment has a positive impact on loyalty.

 

According to ClearCompany, 74 percent of employees say that a lack of professional development is preventing them from reaching their full potential. With only 29 percent of organisations with clear learning and development plans, many employees are set up to feel undervalued and underdeveloped will inevitably result in a disengaged workforce and high turnover rates.

 

Investing in employee development not only allows your talent to feel good about growing their skills, but these learning opportunities can also translate into integral promotions that allow you to retain top talent.

 

The demand for flexibility is at an all-time high. Research indicates that 87% of employees either work flexibly already, or wish they could. A survey by the Centre for the Modern Family, found that 23% of UK workers are willing to take a pay cut to have more flexible working hours.

 

Wellbeing - Employees feel safe, secure and supported emotionally & physically in the workplace. They feel supported by the business & feel able to be their true selves at work.

 

A study by Google found that the highest-performing teams have one thing in common: psychologically safe workplaces. Psychologically safe workplaces promote healthier, more productive and more inclusive workforces. They also provide the environment in which innovation can thrive and people can perform at their best.

 

In the case of ethnic and cultural diversity, research shows that inclusive teams perform up to 30% better in high-diversity environments. When diversity and inclusion exist, employers give themselves a greater chance of gaining access to a larger talent pool. This ensures they can hire employees with the skills, experience, and knowledge needed to build high-performing teams. Employee performance in diverse organisations is 12% higher than in companies with no inclusivity efforts.

 

Environments that encourage diversity & inclusivity practices promote trust and employee engagement among employees. This trust leads to a feeling of psychological safety, which, in turn, leads to respect. Organisations that trust their employees increase their employee engagement by 76%. This has become important as many organisations shift to a remote or hybrid team model. Trust in the workplace allows employees to feel secure, reduces turnover and increases engagement.

 

How can Space HR help?

 

At Space HR, we help organisations understand what is driving, or holding back engagement in their teams. We do this through frequent, bespoke engagement surveys, designed to get to the heart of engagement.

 

We don’t believe in just measuring engagement for a board report. We’re here to explore what’s really going on, so we can help you reduce your risk of employee turnover and drive up performance.

 

But we won’t just throw some tech at you and let you get on with it! We give all our clients a client success partner - an expert who can help you run great surveys and get the most out of each and every one. You’ll get to know our team, just as we’ll get to know yours - to make your engagement activity targeted and impactful.


Find out more at www.spacehr.co.uk

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