Employee Engagement

Employee engagement and your bottom line

employee engagementNumerous studies have highlighted the direct link between employee engagement and the bottom line. They show the value that engaged employees bring to Organisations and illustrate the downside of disengaged employees.

When employees are engaged they are more satisfied, productive, loyal, are innovative and as a result, increase the organisation’s profits.

When employees become disengaged there is an increase in the level of absenteeism, higher turnover rates, the work environment becomes dysfunctional, productivity lowers and a strict work-to-rule ethic prevails...all of this directly affects your bottom line negatively.

With this in mind, it stands to reason that maximising employee engagement should be a strong consideration for any organisation.

Let's take a look at three factors that organisations might consider when developing engaged employees:


1. Investing in people for the long-term:

Although some of your employees may already be engaged, it is a good first step to acknowledge that the majority of them are not, therefore, it is worthwhile to begin thinking of employee engagement as a long-term project.

Consider these facts for a moment:

These are just a few facts highlighting the importance of investing in employee engagement.

There are many ways to invest in your employees such as advocating for work-life balance, allowing flexible working hours, ensuring that the technology and systems are current and providing your employees with growth and learning opportunities.

Investment leads to engagement which results in employees doing the discretionary work that no job description can ever have the foresight of mapping out; ultimately improving organisational productivity, performance and profits.


2. Communication of the organisation’s vision, mission and objectives:

One of the biggest obstacles that organisations face is communicating with their employees effectively.

Communication is necessary as it makes sure that everyone is clear on the business vision and mission. It also ensures that everyone understands their role in achieving it.

What good is an organisation's commitment to improving employee engagement and bottom line figures if its employees are not aligned and do not share a sense of purpose? The importance of communication cannot be understated. When there is context as to why certain initiatives are being carried out by the organisation, it makes it easier for the employees to understand why they are being asked to undertake certain tasks.

In communicating, organisations should always aim to be:

  • Clear and consistent with their message
  • Open, genuine and authentic
  • Passionate and relatable 


3. Measure the gains made through employee engagement:

Investment in employee engagement cannot be a short-term “set it and forget it” exercise but rather a long-term, continuous process.

There are many ways to measure the engagement levels of employees such as surveys, questionnaires and polls.

Measurement can also take place outside of the box by measuring metrics such as customer loyalty, productivity and retention rate.  

Although these may not be direct measures of employee engagement they are all key performance measures to ensure a thriving and successful business.

There is no ceiling for the uptick that a bottom line can experience when an organisation has an engaged workforce.

The above three factors are known as internal service qualities (ISQ). When organisations get these right, they increase their chances of achieving a positive employee engagement.

Let’s take a look into how getting ISQ correct feeds into increased employee engagement and thus an increased bottom line.


Drawing a direct link from Employee Engagement to Increased Bottom Line Results:

The Service-Profit chain is a theory put forward in 1994 which graphically links increased employee satisfaction to an increased bottom line (this was later adapted by Kevin Kruse to replace employee satisfaction with employee engagement).

In it, the authors point out that an organisation can achieve an increased bottom line by following a set of sequential steps.


link between employee engagement and bottom line

(source: https://hbr.org/2008/07/putting-the-service-profit-chain-to-work)

Engaged employees lead to…

                     Improved levels of service, which leads to…

                                    Higher customer satisfaction, which leads to…

                                            Increased sales, which lead to…

                                                    Higher profit levels, which lead to…

                                                             Higher profitability (i.e bottom line).


Key takeaway:

Investing in employee engagement will benefit any organisation.

Employees who are engaged, passionate about their jobs and who believe in the organisation’s vision will be committed and will put forward their best efforts in producing a higher quality and quantity of work thus increasing your bottom line.

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