Employee engagement and our bottom lines

I was somewhat startled to read the following in a 2009 edition of Priority Manager (www.accountable-workplace.com):

Research conducted among American non-management workers has yielded some interesting facts:

1. Less than one in four workers say that they work at their full potential.

2. One-half say they work only hard enough to hold on to their jobs.

3. Three in four say they can be significantly more effective on the job.

The authors were making a case for increased accountability, but they were also emphasizing the importance of employee engagement in achieving that accountability. “A 2006 study by ISR found a nearly 52% gap in the one-year improvement of financial measures between companies with highly engaged employees and companies with low levels of engagement.” Furthermore, “High engagement companies saw a 19.2 per cent improvement while low engagement companies declined 32.7 per cent in operating income over the same period. The study results, gathered from surveys conducted around the world from 664,000 employees over a 12-month period, measured operating results including operating income, net income and earnings per share (EPS). Net income growth over the one year period was 13.2 percent for highly engaged companies compared to a 3.8% decline for low engagement companies.”

In our organization, the strategy for increasing employee engagement has focused on high performance team (HPT, AKA self-directed work team) processes that have been shown to improve organizational efficiency and effectiveness in fairly dramatic ways:

“Properly implemented, self-directed work teams can substantially increase quality and productivity (30-40% in most cases; over 200% in better implementations).” Nailing Jelly to a Tree, David Chaudron, PhD.

“Motorola’s Cellular Products Division notes a two-to-one improvement in efficiency, space, volume of output per employee, and number of managers per non-manager.” Self-Directed Work Teams, R. Cox

“Self-directed work teams are, on average, 30% to 50% more productive than their conventional counterparts.” Business Week

“AT&T increased the quality of its operator service by 12%; Federal Express cut service errors by 13%; Johnson and Johnson achieved inventory reductions of $6m; Shenandoah Life Insurance cut staffing needs by $200,000 per year, while handling a 33% greater volume of work; one 3 M plant increased production gains by 300%.” Self Directed Work Teams: A Competitive Advantage, Ron Williams

Our HPT efforts have produced similar results—not the least of which is active employee involvement in financial and operational management. (See “From top-down to team-based,” April, 2008 edition of Behavioral Healthcare.) Can a therapist, a case manager, or a clinical support person perform data analysis, understand financial ratios, and come up with innovative strategies? The answer is a definite “Yes.” Our outcomes measures tell the story, but to be quite honest, it’s even more heartening to witness the energy, the engagement, and the previously-undiscovered capabilities of our staff. It’s been like removing a bucket that covered a candle. Or in this case, hundreds of buckets and hundreds of candles.