1st September 2008
Employee engagement is the hot topic in the world of work, but how to put it into practice? IPA associate, Jasmine Gartner reports on IPA research that is turning words into action.
Productivity in the UK is low, and companies have started to realise that the solution has been in front of them all along. The solution is to be found in their employees’ untapped potential. And, of course, encouraging people to realise their potential leads to an improvement in employee satisfaction. In other words, increase employee well-being through promoting individual participation, and productivity shoots through the roof – a great deal of research has shown this conclusively.
The big question is: what are the ingredients of well-being? How can we concretely make our employees happy?
The challenge for the IPA’s Employee Engagement Programme has been to work out what organisations know about employee engagement, what they want to achieve, and more importantly, what the concrete steps are that they can take to get there. The result, detailed in this article, has been a new approach to employee engagement that doesn’t focus upon the intangible, but instead upon concepts that can be concretely measured and analysed: creating organisational culture; leadership; and effective communication. These three threads, woven together, will produce community - if done properly. And community, we feel, is at the heart of engagement.
The Backdrop
Logically enough, when organisations started to realise the need for employee engagement, they started the process by collecting data; doing temperature checks. HR metrics were invented. And so a huge amount of information was amassed. More specifically, a huge amount of data was collected that they then didn’t know what to do with. This is where the IPA entered the picture.
Some key facts emerged from examining the literature:
- A 2008 study by the Hay Group found that the world’s best performing companies pay 5% less in wages than average
- The Civil Service showed that disengaged workers cost the UK £44 billion a year in lost productivity
- The Civil Service also found that 70% of engaged employees have a good understanding of how to meet customer needs as opposed to only 17% of disengaged employees
- In 2007, Gallup analysed the link between employee engagement and earnings per share (EPS). Their research showed that public companies ranking in the top quartile of employee engagement had EPS growth of 2.6 times the rate of those that were below average.
- A 2007 IPA survey found that most organisations were aware of a need for employee engagement; less than half knew how to implement it.
- 2006 CIPD poll found that 35% of UK employees are actively engaged with their work
We could summarize this by saying that the one fact that stands out quite clearly is that organisations have a strong awareness of the need for and the uses of employee engagement, but they feel less sure, with some key exceptions, about how to implement it.
What’s to be done?
Following the initial research, IPA brought together some of the leading practitioners in field to examine the troublesome areas and to offer viable solutions from their experience to the challenge of implementing and employee engagement programme. The Steering Group members included representatives from Abbey, BAA, CIMA, Diageo, Egg, Essex County Council, Lafarge Cement UK, Lloyds TSB, RNID, Royal Mail, Scottish Power, T Mobile and Unison.
The Steering Group met in June and in many ways the conversation echoed what the research had showed: without concrete tools for implementation, and without a roadmap for embedding organisational culture, all the information gathered by organisation on engagement was next to useless.
Different Strokes…
We also realised that Employee Engagement needs to be tailored tightly to each individual organisation. This means that the first part of the IPA programme has to be a diagnostic, where we specifically address the needs of the company.
For example, multinational companies, or those where the UK branch is a subsidiary of a foreign corporation, would probably need a component which addresses the cultural differences between the subsidiary and the parent company. Barbara Hobday, of Abbey points out that it would be foolhardy to ignore the issue when designing a toolkit for engagement. Since its acquisition by Santander three years ago, Abbey has been developing its strategy for engagement to support integration so that employees see the value of being part of a bigger and successful global bank. While this may differ from company to company, we can generalize by saying that having a clear and transparent understanding of organisational culture is a priority for the IPA employee engagement programme.
Several steering group members expressed similar concerns about organisational culture, and this, we realised was one area where all companies would probably need help. Hobday, Ian Pitcher of T-Mobile, and Jo Holmes of CIMA, all suggested that another sticking point was how to engage employees who had been on the job for years, and so had reached the top of their pay scale. Another problem area that several people – such as Kenny Irwin of Diageo and Tracey Hammond of the Royal Mail - brought up, was the issue of unions. Are the unions in charge of engagement or is the company? Why do unions seem to put up so much resistance? Caroline Fife, a Regional Officer for Unison, counters that these questions should not be generalized and are perhaps more true of old style ‘table-thumping’ tactics. “Unison,” she says, “is not resistant; we’re about resolution.” In fact, she continues, “a staff rep at one employer recently told me that he felt trade union input was invaluable and the management side said the same.” Because Unison listened to employees, they were able to communicate clearly to management about what the workforce felt would make them satisfied. These are questions of leadership, the second thread for our programme to address.
Another problem that many seemed to find is that managers don’t know how to communicate. As Irwin put it, “it seems blindingly obvious, but there are a lot of managers who are not good at managing people.” Even though it seems obvious that managers (as well as the rest of us) should be able to communicate quite well, this ignores the fact that communication is something we learn, and business communication, therefore is something we must learn. Effective communication, then, is the third thread that needs to run through the IPA employee engagement programme.
What we took away…
Ian Horton of Egg and Ian Pitcher of T-Mobile are having a great deal of success with their programmes, and suggested many excellent tools. Horton, for example, stressed the importance of community and literally involving people by speaking with them, by carrying out surveys every quarter or two months rather than every two years, and also by having staff representatives use effective models of Information and Consultation forums (Egg uses the IPA’s model of option-based consultation).
Pitcher told me about T-Mobile’s ‘clarity index.’ This programme advocates that, on a voluntary basis, once a quarter, the top sixty managers are randomly given four names of employees. They then, unannounced, go to speak with these employees, to see if they understand not only their own job requirements, but their understanding of the company’s proscribed values. It’s not a test that the employees can fail; if they don’t understand, Pitcher explains, it means their line manager is not doing his or her job. This gives the line manager a clear understanding of the weaknesses in his or her approach, and therefore, a clear understanding of how to address those weaknesses. The potential for improvement is built into the system.
Jo Holmes suggested that the IPA put together a database of best practice in terms of engagement, so that people could pick and choose what best applied to their own organisations.
Where next?
Community is at the heart of employee engagement. Emphasis on community is what makes our programme different. While you cannot create community directly, you can achieve it by implementing strong and concrete – in other words, ‘benchmark-able’ – toolkits around organisational culture (shared values and goals), leadership, and effective communication. These toolkits draw on current literature and practices in organisational anthropology; this melding of anthropology and engagement are what gives the IPA programme its unique outlook.
The next step for the IPA Employee Engagement Programme is to put the research into practice. Over the coming months we will be working with partner organisations to trial our approach to engagement. If you are interested in taking part, or would like to find out more, please contact Jasmine Gartner at
jasmine@ipa-involve.com
IPA is grateful to the members of the EE Steering Group, including:
- Barbara Hobday, Abbey
- Ian Critchley, BAA
- Jo Holmes, CIMA
- Kenny Irwin, Diageo
- Ian Horton, Egg
- Emma Sayers, Essex County Council
- John Coyle, Lafarge Cement UK
- David Littlechild, Lloyds TSB
- Sandra Noonan, RNID
- Tracey Hammond, Royal Mail
- Joan Stuart, Scottish Power
- Ian Pitcher, T-Mobile
- Caroline Fife, Unison
