Top 7 Software Strategies for Boosting Employee Engagement
By Micah Fairchild
Seven Solutions for Increasing Employee Engagement
While our aim here at HRLab.com is to provide the best, most unbiased advice when it comes to HR software selection, implementation, and optimization, we have a confession to make…we are 100% unashamedly, unabashedly for technology. We're the folks whose hearts start to race at the mere mention of "mobile learning" and "applicant tracking". Not just because it's cool (we're not even sure if it actually is cool) or it's the direction that so many organizations are going; but because of the direct and measurable impact that technology has on human resources—and especially on employee engagement. And let's face it, employee engagement is the holy grail for human resources departments and organizations the world over. To that end, in this special report, we've collected what we think are the top 7 strategies that organizations can use to enhance engagement through technology. But first, let's answer some frequently asked questions to make sure everyone is on the same page.
What Do We Mean by Employee Engagement?
Countless theories, representations, and definitions have been espoused over the years about what employee engagement actually is. Rather than get into redefining this term to suit our needs here, we think it best to simply settle in on those aspects of engagement that are the most significant and agreed upon:
Engagement is about attitude – employees that are fully engaged truly want to be a part of, and are committed to, their organization;
Engagement is about effort – employees that are fully engaged show initiative, put forth intense effort, and contribute to the organizational bottom-line;
Engagement is about willingness – employees that are fully engaged willingly act as organizational advocates and actively promote the organization to current and potential customers and employees; and
Engagement can be influenced by a host of factors
Adding to this list is the fact that employee engagement is incredibly important; affecting everything from turnover rates to overall business performance. In fact, a recent study conducted by Gallup, the leading research company for engagement studies, found that organizations that don't invest in employee engagement have only a 17% chance of financially performing above industry averages.
What's the Organizational Impact of Engagement?
Aside from the financial statistic just cited, numerous research initiatives have shown that staff engagement is integral to the organizational "bottom-line", and more companies are becoming interested in how improving employee engagement can affect them. Indeed, the Confederation for British Industry (CBI) recently found that employee engagement is "the biggest challenge facing employers"—highlighting that nearly 75% of all organizations have engagement as a top priority. This is due in large part to the ratio of engaged: non-engaged: and dis-engaged employees—which in a recent Gallup study was 24%: 51%: 25% respectively.
Given that engaged employees out-pace and out-perform their colleagues by as much as 20% and are 87% less likely to voluntarily turnover than their non-engaged or dis-engaged counterparts (according to the Corporate Leadership Council), organizations are starting early with on-boarding and other practices as a way to preemptively net as many engaged staff as possible. Unfortunately, it would appear as though efforts aren't nearly as strident for existing employees. Given the research statistics, it would seem like far too many organizations are still not understanding the flip-side of the engagement coin—dis-engagement.
Employees that are dis-engaged are not just unhappy at work; they're passionate about how much they don't like their work. If you take the points we made earlier about what engagement is, but put a negative instead of a positive factor on them, you get closer to the true nature and danger of a disengaged employee. For example:
Attitude – employees that are dis-engaged have bad attitudes and let those bad attitudes be known;
Effort – employees that are dis-engaged can put forth intense effort to undermine other employees and hinder organizational progress; and
Willingness – employees that are dis-engaged willingly act as organizational detractors and actively discredit the organization to current and potential customers and employees
If those descriptors weren't bad enough, Gallup researchers (through a study of 40K+ employees) determined that those dis-engaged employees (which keep in mind only make up 25% of your workforce) are costing U.S. businesses alone over $345B annually. Couple these stats with the fact that dis-engaged employees are actively trying to influence the non-engaged, neutral employees (51% of your workforce), and the imminence of the threat should become evident.
All of this information adds up to an undeniable conclusion, employee engagement is tantamount to business success and organizations should be doing everything within their power to both engage employees from the onset and maintain or re-engage those that are already here. We happen to think that HR software technology is an incredible conduit for that engagement and as such, have outlined 7 strategies that you can use to boost what you have. Enjoy, engage, and prosper!
1) Compensation Management Software
Though we're likely to get plenty of flack about adding a compensation element to an engagement strategy list, the fact of the matter is that compensation brings a great deal of influence to the engagement argument. While critics will undoubtedly argue that employees will not expend extra energy because of total compensation, it has been shown that in certain contexts, financial incentives do have a big part to play. For example, manufacturing environments have been shown to operate well under the auspices of a Pay-for-Performance (P4P) model. Likewise, Sales positions function quite effectively through incentive-based commissions.
The key for compensation management when it comes to employee engagement is to recognize that the rational engagement of compensation cannot substitute for the emotional engagement of managerial respect, teamwork, belonging and the like. Further, if not used correctly, compensation can turn motivation into expectation. Be that as it may, Compensation Management software can serve as the conduit for achieving these rational engagement gains by:
Providing the means by which pay-for-performance (P4P) is planned, measures and delivered;
Providing the structure by which incentive plans are created; and
Providing the efficiency needed to effectively deliver incentives when and where needed
While it may be true that compensation isn't the driving force for engagement overall, it is also true that engagement strategies largely depend and fluctuate based on the industry and the individual. As organizations look to leverage whatever elements they can for employee engagement, compensation should not be left out of the discussion. Any by proxy, nor should Compensation Management Software.
2) Labor Management Systems
With more and more companies adding work/life balance to their list of acceptable Employer Value Proposition (EVP) tenants, it's clear that few things are as lauded for attraction, retention, and engagement in the war for talent. Unfortunately, many organizations don't understand that one of the keys to work/life balance lies in software solutions that are largely seen as transactional—Labor Management Systems (LMS). While scheduling capabilities inherent in these applications do allow schedule optimization for productivity or customer service purposes, they can also be used to optimize schedules for employees—especially those that are paid by the hour. Specifically, LMS software provides a method for these workers to select shift preferences and couples that with worker availability. These items can then be automatically fed into a scheduler application for the manager's approval and manipulation.
Aside from the fact that employee preferences are taken into consideration, by providing these workers flexibility, managers are better able to predict scheduling issues (e.g. greater adherence to schedule preferences = fewer absences), increase workforce capacity utilization, and mitigate unnecessary customer service failure (according to a recent Aberdeen study). While this may seem to be a solution that is too easy to have much impact, consider this:
Job growth for hourly workers is on the rise;
The U.S. Bureau of Labor Statistics puts low-wage worker turnover 3.5 times higher than that of salaried employees; and
The average turnover cost (using the most conservative models) for an hourly worker is 1 month's wages.
Hence, even if the amount of hourly workers at a given organization is low, the financial impact of not implementing schedule optimization is sizeable. Labor Management Systems have the ability to deliver a solution that handles this optimization—from both human and financial standpoints.
3) Alumni Networks
A growing trend, highlighted by involvement from major players like Microsoft, Ernst & Young, and Waste Management, Inc., is the use of web-based networks to link up, engage, and stay connected with former workers or "Alumni". Running the gamut in terms of size, scope, ownership, and structure, alumni networks are all about leveraging social media to maintain relationships and increase brand strength—only in this case that brand strength is aimed at prior employees.
Involving everything from news to events to activities to recruitment efforts, alumni networks are geared towards closing the "goodwill" gap between employers and ex-employees through LinkedIn groups, Facebook company pages, and Twitter feeds (just to name a few of the social media options). In turn, these social networks pay dividends in terms of loyalty long after the employee has left, and allows for contact to be retained, opportunities to be marketed, and relationships to be maintained with individuals that are known commodities.
The use of these networks is giving organizations the tools to take full advantage of employee engagement--keeping former workers apprised of the company and primed for re-entry into the organization if necessary. While the benefits to recruitment, branding, and engagement are self-evident however, estimates put the use of formal alumni networks pitifully low—hovering at just over 10%.
4) Employee Self-Service
Nobody likes to have to go through the HR or Payroll department to gain access to their own information, which is why the advent of Employee Self-Service (ESS) software has been so widely heralded. Aside from the inherent efficiencies of providing direct access to information though, ESS is also a strong driver for employee engagement. Specifically, by giving employees access to their own information, two very important facets of engagement are being communicated: 1) employees are being told that they can be trusted and 2) employees are being empowered with a level of convenience that is usually reserved for customers.
Of course, in order for employee engagement to be fully realized, trust must be a part of the employer-employee relationship. However, providing access to personal information has proven to be one of the largest benefits of Employee Self-Service applications due to the streamlining of regularly-used processes; the elimination of unnecessary administrative hurdles; and the employee-system interaction at the exact point-of-need. While the convenience and accuracy that ESS systems provide should be enough to warrant wide-spread adoption, a 2010 Deloitte study found that only 52% of companies had implemented such systems. Hopefully, by viewing this administration automation in the light of employee engagement, further growth will happen in this all-too-easy-to-deploy sector.
5) Learning Management Systems
One of the more salient aspects of engagement is the near-universal need for growth—whether it's in a professional or personal sense. As it pertains to the workplace, this is due to the fact that when employees build knowledge, skills, and abilities, managers in turn allow for more autonomy. In turn, this increase in responsibility builds confidence, self-efficacy, and engagement. As such, allowing opportunities for development is one of the fastest ways to engage employees. In fact, a relatively recent BlessingWhite study found that nearly 60% of all employees "want more opportunities to grow" in order for them to stay engaged. This means that targeted development plans need to be put into place; knowledge/skills/abilities (KSAs) inventories need to be updated; and effectively managed development programs should be deployed.
The most effective of these development programs have a Learning Management System (LMS) at the core—driving performance and engagement by:
Consolidating all records, licensing, and certification requirements;
Delivering just-in-time learning;
Making automated recommendations for career learning opportunities;
Implementing multiple learning mediums; and
Connecting organizational imperatives with learning initiatives
Further engagement is driven from learning management systems by matching up programs, employees, and skills for future deployment; thereby ensuring that the organization has the right workers and the employee is developed for many years to come.
6) Performance Management Systems
Accountability is widely-regarded as the greatest benefit of any performance management system. Whether it be for doling out performance pay, or for setting the stage for action due to performance failure, performance management is the process that makes it all happen. Unfortunately it's utility as a process is far less than its capability to drive employee engagement. Indeed, far too few organizations understand the link between employee engagement and performance—and as such these organizations wind up driving outdated systems that do little to actually affect an employee's performance positively.
Modern, effective Performance Management Systems understand that organizational performance and employee engagement are inextricably linked. These systems foster an environment that supports the notion that an engaged employee puts forth more effort; willingly goes above and beyond the specific parameters of his or her job; and actively contributes to the organizations bottom-line. While a great deal of this environment is created by the organization itself, the technology of performance management systems provides an automated solution that facilitates consistent and relevant feedback—simultaneously driving performance, aligning goals, and increasing engagement.
7) Manager Self-Service Software
Few experts would argue that the single-biggest influence on employee engagement is the immediate supervisor. So much has been made of this connection that the adage, "people don't leave jobs, they leave bosses" was even coined from it. Indeed, studies from Development Dimensions International (DDI) even go so far as to say that managers are responsible for the creation of a "highly engaged workforce". However, the responsibility to engage and the ability to engage can be vastly different, especially if the manager doesn't have the right tools. Of the tools that are important to creating this workforce, one of the most integral is Manager Self-Service (MSS) software.
MSS can have many forms, but even at its most basic, this software tool provides managers with access to information that could take weeks to receive otherwise. And as mentioned in the other strategies of Compensation Management, Labor Management, Learning Management, and Performance Management, the timely access to this information can mean the difference between: providing an incentive to an employee at the time it's needed; empowering an employee to take part in a growth opportunity when seen; or even encouraging an employee to list out schedule preferences. Manager Self-Service allows these engagement strategies to take place by integrating with the other previously-mentioned strategies. In turn, additional engagement connections can be made between the manager and employee, increasing efforts and driving productivity even higher.
There is an undeniable link between employee engagement and organizational performance. Regardless of how you choose to frame it (be it commitment, satisfaction, etc.), engagement plays a significant role in the company's financial performance, and as such should be monitored and improved whenever possible. Likewise, technology plays a significant role in achieving this engagement. By integrating the software capabilities that the above technology systems have with individual/company goals and objectives a more comprehensive approach to engagement can be undertaken—positively impacting employees' lives and organizations' bottom-lines.
Employee engagement is incredibly important; affecting everything from turnover rates to overall business performance. In fact, a recent study conducted by Gallup, found that organizations that don't invest in employee engagement have only a 17% chance of financially performing above industry averages."