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NJH presentation given at HR Directors Summit, ICC Birmingham UK, January 2013

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Employee Engagement: What got us here won’t get us there

The new reality for ambitious HR functions

‘Think HR. Think Human

Capital.’ Tour 2013

HR Directors Summit ICC Birmingham UK 2013

Nicholas J Higgins, DrHCMI MSc Fin (LBS) MBA (OBS) MCMI

CEO, VaLUENTiS Ltd & Dean, International School of Human Capital Management (‘ISHCM’)

Video version available through WTG on-demand service.

All rights reserved. No part of this presentation may be reproduced, translated, stored in a retrieval system or transmitted in any form or by any means, electronic, mechanical, photocopying, microfilming recording or otherwise without the express permission of the author.

Please e-mail nicholas.higgins@valuentis.com regarding any matters of reproduction/ organisational distribution.

© 2013

NOTE:

Slides [4 to 52] on auto presentation to music introduction.

Welcome….

2013 sees VaLUENTiS celebrate its tenth year….

7

Some notable achievements…

First British firm to introduce Employee Engagement model (known as the ‘5D’)

First to introduce standard ‘employee engagement surveys’ as opposed to ‘generic’ employee

surveys

First to publish live client HR scorecard linking with employee engagement

First to introduce ‘Qual-Quant’ people management evaluation tool (‘Management Pathfinder’)

First to introduce global value-based HR function (VB-HR™) profiler

First to publish global Human Capital Reporting Standards (GHCRS2006) including the ‘PeopleFlow’, ‘HC Operating’ and ‘HC Productivity’ template statements…

Globally, first to set-up dedicated, practitioner-based Business School on Human Capital

Management and introduce ‘M. Sc. in Human Capital Management’

First School to offer Masters qualification with CMAS® technology (‘non-essay’ based) and for less than £1000

HCMI first to offer membership by association not subscription……

VaLUENTiS continues to support those organisations and HR functions who wish

to push the boundaries on employee engagement and organisation

performance……….

And so let me begin…

A long time ago in a far, far away place we started with the question:

If employee engagement was the answer, what was the question?

And, what constituted employee engagement and how did it impact on

performance?

Which led us to evaluating much empirical research, and, finally to this…

The concept of Employee Engagement: A synthesis of antecedent theories and empirical evidence with human capital

management practice related to organisation performance – 100 years in the making

Source: The antecedents of Employee Engagement, Nicholas J Higgins - VaLUENTiS technical paper 2003

Wider Group

Immediate Team

Organisation Individual

•Group theory

•Trust theory

•Teams theory

•Conflict theory

•Decision-making theory

•Motivation theory

•Goal setting and task theory

•Equity (justice) theory

•Trait theory

•Expectancy theory

•Commitment theory

•Needs theory

•Social cognitive/ self efficacy theory

•Cognitive dissonance

•Wellbeing/Burnout

•Job satisfaction

•Organisation Citizenship Behaviour

•Learning theory

•Behaviourism

•Emotional Intelligence

•Psychological contract

•Leadership theory

•Organisational ‘fit’ theory

•Other I/O psychology contributions

•Organisation performance & measurement*

Human Capital Management practice/systems:

•Training & Development

•Performance management

•Reward & recognition

•Resourcing & selection

•Organisation communication

•Talent management

•Leadership

•Organisation culture

•Employer brand

•Human capital retention

•Organisation design

•Workforce diversity

•High performance work systems

•Fayol - Principles of management

•Taylor - Scientific management

•McGregor Theory X/Y

•Mayo/Hawthorne studies

•Tavistock – Socio-technical systems

•Lewin (MIT) - group dynamics/behaviour

•Munsterberg - Industrial psychology

•Follett - Management relations/integration

•Hertzberg – Two factor theory

•Drucker – Practice of management

•Kahn – Personal engagement

•Likert – Management system/measurement scale

But organisations needed something to use practically…

That led to the 5D construct…

Line of sight

Work environment

Operating culture

Development

Reward (equity)

Performance link

Five domains…

Plus performance

Which used seven core theories as its root structure…

VaLUENTiS 5D Employee Engagement: Core empirical theories that combine to form the root structure of the VaLUENTiS model

Source: The antecedents of Employee Engagement, Nicholas J Higgins - VaLUENTiS technical paper 2003

Wider Group

Immediate Team

Organisation Individual

•Motivation theory

•Goal setting and task theory

•Equity (justice) theory

•Group theory

•Trust theory

•Trait theory

•Fayol - Principles of management

•Taylor - Scientific management

•Expectancy theory

•Commitment theory

•Teams theory

•Conflict theory

•Needs theory

•Organisation performance & measurement*

•Social cognitive/ self efficacy theory

Human Capital Management practice/systems:

•Cognitive dissonance

•Wellbeing/Burnout

•Job satisfaction

•Organisation Citizenship Behaviour

•Learning theory

•McGregor Theory X/Y

•Behaviourism

•Training & Development

•Performance management

•Reward & recognition

•Resourcing & selection

•Organisation communication

•Talent management

•Leadership

•Organisation culture

•Employer brand

•Human capital retention

•Organisation design

•Decision-making theory

•Emotional Intelligence

•Workforce diversity

•Mayo/Hawthorne studies

•Tavistock – Socio-technical systems

•Lewin (MIT) - group dynamics/behaviour

•Psychological contract

•Leadership theory

•Organisational ‘fit’ theory

•Other I/O psychology contributions

•High performance work systems

•Munsterberg - Industrial psychology

•Follett - Management relations/integration

•Hertzberg – Two factor theory

•Drucker – Practice of management

•Kahn – Personal engagement

•Likert – Management system/measurement scale

“But all the others have a part to play…”

Over time working with clients, we noticed that organisations needed to focus on six

areas to sustain successful employee engagement…

Known as the ‘Six Pillars’…

EE PLAYBOOK

Grounded understanding of Employee Engagement

Working definition of Employee Engagement

Measurement wisdom

Actioning infrastructure

Dynamic EE-Performance ‘playbook’

DELETE Competent leadership/management

Initial research and observation revealed essentially four types of organisation…

Organisations and employee engagement:

The ‘4-ball’ practice model

Play down

‘We don’t...’

Play act

‘It’s all about PR…’

Play safe

‘At least we audit/ benchmark...’

Play make

‘We do it…’

The four progressive states of employee engagement

embeddedness in organisations

To create…

Little. Limited.

Mostly ephemeral in nature.

Exists in pockets with variation in line management.

Good working knowledge embedded across

organisation.

No definition in use. Most likely borrowed

without any real ownership, or ‘false’ ownership.

Maybe borrowed with internalisation or adapted after some organisational

focus.

Distributed ‘ownership’, whether borrowed, adapted

or created.

Limited to absenteeism metrics, employee surveys

seen as event driven if done.

Probably undertaking surveys but with no valid

construct; response rate/PR main focus.

Will do measurement basics, even to the extent of

engagement index etc. Tick box is main focus.

People management evaluation/measurement

seen as ‘core’ on a par with CRM , finance etc.

Probably in the form of basic training/management

courses.

Probably in the form of basic management courses. Most likely carry out some form of

branded programme.

Will have a number of actioning elements in place but not necessarily joined

up.

Will have necessary ‘toolkit’ to hand with ongoing programmes to suit organisation focus.

Does not exist.

May have something articulated on ‘strategies’.

Most likely collection of irrelevant case studies.

Playbook in the form of ‘manager manual’ or on-line knowledge-share. Still being

developed.

Easy access in different e-/physical formats at

different levels. Signals ‘embedded’ intent.

Will have varied mix of skilled people managers. Existing good performers

more through luck.

Will have varied mix of skilled people managers. Existing good performers

more through luck.

Will have varied mix of skilled people managers but level of competency higher than Play-Act organisations.

Cohort of well-trained people managers exists with

talent pools. Regular evaluation/reinforcement.

‘PLAY DOWN’ ‘PLAY ACT’ ‘PLAY SAFE’ ‘PLAY MAKE’

I Grounded understanding of employee engagement

II

III

IV

V

VI

Working definition of employee engagement

Measurement wisdom

Actioning Infrastructure

EE-Performance Playbook

Competent leadership/ management

The ‘4-ball’ Employee Engagement reality matrix

Pillar

Which leads us to…

A quick exercise…

Choose your organisation (or business unit/division/directorate

etc)…

And decide which box mostly describes your chosen organisation/organisation

unit…

‘PLAY DOWN’ ‘PLAY ACT’ ‘PLAY SAFE’ ‘PLAY MAKE’

The ‘4-ball’ Employee Engagement reality matrix

Pillar

Little. Limited.

Mostly ephemeral in nature.

Exists in pockets with variation in line management.

Good working knowledge embedded across

organisation.

‘PLAY DOWN’ ‘PLAY ACT’ ‘PLAY SAFE’ ‘PLAY MAKE’

I Grounded understanding of employee engagement

The ‘4-ball’ Employee Engagement reality matrix

Pillar

‘PLAY DOWN’ ‘PLAY ACT’ ‘PLAY SAFE’ ‘PLAY MAKE’

II Working definition of employee engagement

The ‘4-ball’ Employee Engagement reality matrix

No definition in use. Most likely borrowed

without any real ownership, or ‘false’ ownership.

Maybe borrowed with internalisation or adapted after some organisational

focus.

Distributed ‘ownership’, whether borrowed, adapted

or created.

‘PLAY DOWN’ ‘PLAY ACT’ ‘PLAY SAFE’ ‘PLAY MAKE’

III Measurement wisdom

The ‘4-ball’ Employee Engagement reality matrix

Limited to absenteeism metrics, employee surveys

seen as event driven if done.

Probably undertaking surveys but with no valid

construct; response rate/PR main focus.

Will do measurement basics, even to the extent of

engagement index etc. Tick box is main focus.

People management evaluation/measurement

seen as ‘core’ on a par with CRM , finance etc.

‘PLAY DOWN’ ‘PLAY ACT’ ‘PLAY SAFE’ ‘PLAY MAKE’

IV Actioning Infrastructure

The ‘4-ball’ Employee Engagement reality matrix

Probably in the form of basic training/management

courses.

Probably in the form of basic management courses. Most likely carry out some form of

branded programme.

Will have a number of actioning elements in place but not necessarily joined

up.

Will have necessary ‘toolkit’ to hand with ongoing programmes to suit organisation focus.

‘PLAY DOWN’ ‘PLAY ACT’ ‘PLAY SAFE’ ‘PLAY MAKE’

V EE-Performance Playbook

The ‘4-ball’ Employee Engagement reality matrix

Does not exist.

May have something articulated on ‘strategies’.

Most likely collection of irrelevant case studies.

Playbook in the form of ‘manager manual’ or on-line knowledge-share. Still being

developed.

Easy access in different e-/physical formats at

different levels. Signals ‘embedded’ intent.

‘PLAY DOWN’ ‘PLAY ACT’ ‘PLAY SAFE’ ‘PLAY MAKE’

VI Competent leadership/ management

The ‘4-ball’ Employee Engagement reality matrix

Will have varied mix of skilled people managers. Existing good performers

more through luck.

Will have varied mix of skilled people managers. Existing good performers

more through luck.

Will have varied mix of skilled people managers but level of competency higher than Play-Act organisations.

Cohort of well-trained people managers exists with

talent pools. Regular evaluation/reinforcement.

Putting it together…

Little. Limited.

Mostly ephemeral in nature.

Exists in pockets with variation in line management.

Good working knowledge embedded across

organisation.

No definition in use. Most likely borrowed

without any real ownership, or ‘false’ ownership.

Maybe borrowed with internalisation or adapted after some organisational

focus.

Distributed ‘ownership’, whether borrowed, adapted

or created.

Limited to absenteeism metrics, employee surveys

seen as event driven if done.

Probably undertaking surveys but with no valid

construct; response rate/PR main focus.

Will do measurement basics, even to the extent of

engagement index etc. Tick box is main focus.

People management evaluation/measurement

seen as ‘core’ on a par with CRM , finance etc.

Probably in the form of basic training/management

courses.

Probably in the form of basic management courses. Most likely carry out some form of

branded programme.

Will have a number of actioning elements in place but not necessarily joined

up.

Will have necessary ‘toolkit’ to hand with ongoing programmes to suit organisation focus.

Does not exist.

May have something articulated on ‘strategies’.

Most likely collection of irrelevant case studies.

Playbook in the form of ‘manager manual’ or on-line knowledge-share. Still being

developed.

Easy access in different e-/physical formats at

different levels. Signals ‘embedded’ intent.

Will have varied mix of skilled people managers. Existing good performers

more through luck.

Will have varied mix of skilled people managers. Existing good performers

more through luck.

Will have varied mix of skilled people managers but level of competency higher than Play-Act organisations.

Cohort of well-trained people managers exists with

talent pools. Regular evaluation/reinforcement.

‘PLAY DOWN’ ‘PLAY ACT’ ‘PLAY SAFE’ ‘PLAY MAKE’

I Grounded understanding of employee engagement

II

III

IV

V

VI

Working definition of employee engagement

Measurement wisdom

Actioning Infrastructure

EE-Performance Playbook

Competent leadership/ management

The ‘4-ball’ Employee Engagement reality matrix

Pillar

What does your quick assessment tell you…?

And now, a few questions for you…

No pressure!

1. Which decade were employee surveys first introduced as a management

tool…?

2. Which famous experiments took place at Western Electric Co in the 20th

Century…?

3. Which US company is most associated with employee surveys and causal studies linking to performance …?

4. Which author, with an article published in 1990, is attributed as being

the first to use the term ‘employee engagement’…?

5. Employee engagement is…? a) A work-place approach b) A concept c) A strategy d) All of these e) Something else

6. What is the connection between job satisfaction and job performance…?

7. What is ‘acknowledged’ as the single biggest factor in an individual’s

engagement at work…?

8. What’s wrong with Maslow’s pyramid?

9. What are the SEVEN core empirical theories that form the root structure of VaLUENTiS 5D employee engagement

model?

10. Complete this ‘well-known phrase’: “If employee engagement was the

answer, …………………………......?”

How did you do…?

Employee Engagement: What got us here won’t get us there

The new reality for ambitious HR functions

53

Part I

Getting us here…

53

1. Which decade were employee surveys first introduced as a management

tool…?

2. Which famous experiments took place at Western Electric Co in the 20th

Century…?

3. Which US company is most associated with employee surveys and causal studies linking to performance …?

A look back at The original Sears E-C-P Chain… (an early forerunner of ‘employee engagement’ with causal performance link)

Attitude

about the

job

Employee

Behavior

Customer

Impression

Customer

recommendations Service

Helpfulness

The Employee-Customer-Profit chain at Sears By Anthony J. Rucci , Stephen P. Kirn and Richard T. Quinn Harvard Business Review Jan-Feb 1998

Attitude

about the

company

Merchandise

Value

Employee

retention Customer

retention

Return on assets

Operating margin

Revenue growth

5 unit increase in employee

attitude

13 unit increase in customer impression

0.5% increase in revenue growth

A compelling place to work A compelling place to shop A compelling

place to invest

57

Organisation Performance (as defined by organisation/unit scorecard measures and derivative metrics)

Examples of organisation performance areas:

Sales Revenue

Service delivery

Customer satisfaction

Patient care

Procurement

Operational risk

Product development

Organisation support

Safety

Quality

Cost…

59

Sub-optimal performance, i.e. less than achievable

Or

Sub-optimal costs, i.e. higher than necessary

Or

Both

Impaired Employee Engagement: Impact on individual and team productivity/performance

59

4. Which author, with an article published in 1990, is attributed as being

the first to use the term ‘employee engagement’…?

61

Psychological Conditions of Personal Engagement and Disengagement at Work

William A. Kahn

Academy of Management Journal 1990

“Personal Engagement is the simultaneous employment and expression of a person’s ‘preferred self’ in task behaviors that promote connections to work and to others, personal presence (physical, cognitive and emotional), and active, full role performance.”

61

Employee engagement as a sum of constant work ‘forces’ (VaLUENTIS EESoF model) illustrative vectors

interpersonal conflict

incentive misalignment

perceived reward inequity short-staffed

uncaring new boss

poorly communicated reorganisation

enlarged role

planned training

cancelled

Well-received performance appraisal hit personal

targets/ objectives

hit team targets/ objectives

salary increase

enrolled on MD programme

“A further, more up to date interpretation…”

62

5. Employee engagement is…? a) A work-place approach b) A concept c) A strategy d) All of these e) Something else

6. What is the connection between job satisfaction and job performance…?

7. What is ‘acknowledged’ as the single biggest factor in an individual’s

engagement at work…?

Illustrating the management influence using VaLUENTiS 5D Employee Engagement Framework

© VaLUENTiS Ltd 2002-12

Objectives awareness

Behaviour alignment

Role ‘fit’

Performance management

Feedback

Capability

Line-of-Sight

Remuneration equity

Bonus/incentives

Benefits

Role equity

Recognition

Promotional aspects

Reward (equity)

Cultural elements

Team dynamics

Communication

Resources

Local management

Physical environment

Work Environment

Development

Career progression

Competencies

Succession planning

Job/ Role architecture

Training/ Learning

Coaching/ Mentoring

Organisation design Performance/talent

management ‘Corporate’ Leadership

Communication Decision rights Work values

Trust

Organisation operating

culture

A manager has influence in many areas of engagement, some more than others… 66

8. What’s wrong with Maslow’s pyramid?

9. What are the SEVEN core empirical theories that form the root structure of VaLUENTiS 5D employee engagement

model?

VaLUENTiS 5D Employee Engagement: Core empirical theories that combine to form the root structure of the VaLUENTiS model

Source: The antecedents of Employee Engagement, Nicholas J Higgins - VaLUENTiS technical paper 2003

Wider Group

Immediate Team

Organisation Individual

•Motivation theory

•Goal setting and task theory

•Equity (justice) theory

•Group theory

•Trust theory

•Trait theory

•Fayol - Principles of management

•Taylor - Scientific management

•Expectancy theory

•Commitment theory

•Teams theory

•Conflict theory

•Needs theory

•Organisation performance & measurement*

•Social cognitive/ self efficacy theory

Human Capital Management practice/systems:

•Cognitive dissonance

•Wellbeing/Burnout

•Job satisfaction

•Organisation Citizenship Behaviour

•Learning theory

•McGregor Theory X/Y

•Behaviourism

•Training & Development

•Performance management

•Reward & recognition

•Resourcing & selection

•Organisation communication

•Talent management

•Leadership

•Organisation culture

•Employer brand

•Human capital retention

•Organisation design

•Decision-making theory

•Emotional Intelligence

•Workforce diversity

•Mayo/Hawthorne studies

•Tavistock – Socio-technical systems

•Lewin (MIT) - group dynamics/behaviour

•Psychological contract

•Leadership theory

•Organisational ‘fit’ theory

•Other I/O psychology contributions

•High performance work systems

•Munsterberg - Industrial psychology

•Follett - Management relations/integration

•Hertzberg – Two factor theory

•Drucker – Practice of management

•Kahn – Personal engagement

•Likert – Management system/measurement scale

69

“But all the others have a part to play…”

10. Complete this ‘well-known phrase’: “If employee engagement was the

answer, …………………………......?”

71

Absenteeism, turnover, ill-discipline, manager resistance, communication and/or trust issues etc are all, to a great degree, manifestations of poor employee engagement in some form.

“Many case studies and indeed academic comment, however, seem to ignore this fact. Thus, we’re seemingly praising ourselves for putting a fire out – the very one we started as an organisation! What happened to the ‘Why’ in the first instance?

As an industry practitioner question - What’s going on here?”

Observation 101

71

72

Part II

Getting us there…

72

Back to the ‘Six Pillars’…

EE PLAYBOOK

1. Grounded understanding of Employee Engagement

2. Working definition of Employee Engagement

3. Measurement wisdom

4. Actioning infrastructure

5. Dynamic EE-Performance ‘playbook’

DELETE 6. Competent leadership/management

73

What got us here/Getting us there…1

Grounded understanding of Employee Engagement

• Insufficient appreciation of existing empirical research

• Evidence Based Management still not widespread

• Thinking ‘too simple’ (instead follow Einstein’s dictum)

74

The concept of Employee Engagement: A synthesis of antecedent theories and empirical evidence with human capital

management practice related to organisation performance – 100 years in the making

Source: The antecedents of Employee Engagement, Nicholas J Higgins - VaLUENTiS technical paper 2003

Wider Group

Immediate Team

Organisation Individual

•Group theory

•Trust theory

•Teams theory

•Conflict theory

•Decision-making theory

•Motivation theory

•Goal setting and task theory

•Equity (justice) theory

•Trait theory

•Expectancy theory

•Commitment theory

•Needs theory

•Social cognitive/ self efficacy theory

•Cognitive dissonance

•Wellbeing/Burnout

•Job satisfaction

•Organisation Citizenship Behaviour

•Learning theory

•Behaviourism

•Emotional Intelligence

•Psychological contract

•Leadership theory

•Organisational ‘fit’ theory

•Other I/O psychology contributions

•Organisation performance & measurement*

Human Capital Management practice/systems:

•Training & Development

•Performance management

•Reward & recognition

•Resourcing & selection

•Organisation communication

•Talent management

•Leadership

•Organisation culture

•Employer brand

•Human capital retention

•Organisation design

•Workforce diversity

•High performance work systems

•Fayol - Principles of management

•Taylor - Scientific management

•McGregor Theory X/Y

•Mayo/Hawthorne studies

•Tavistock – Socio-technical systems

•Lewin (MIT) - group dynamics/behaviour

•Munsterberg - Industrial psychology

•Follett - Management relations/integration

•Hertzberg – Two factor theory

•Drucker – Practice of management

•Kahn – Personal engagement

•Likert – Management system/measurement scale

75

HR as…

Evidenced Based

Management (EBM)

Practitioner

Objective: Proficient knowledge embedded across HR function

to enable good working knowledge to be embedded across

organisation.

What got us here/Getting us there…2

Working definition of Employee Engagement

• Many definitions omit productivity or performance • Definitions vague – difficult to translate to frontline • Too few involved in the ‘understanding process’

77

78

“Employee engagement is an ‘outcome-based’ concept*. It is the term used to describe the degree to which employees can be ascribed as ‘aligned’ and ‘committed’ to an organisation such that they are at their most productive.”

VaLUENTiS/ISHCM

2005

Employee Engagement Definition One that provides the basis of a measurable construct

(and simplified from the overall EE complexity):

*Consistent with Kahn’s original paper; employee engagement as a concept but with a more performance-oriented and dimensional construct. 78

‘P12 modes of productivity’

More likely to embrace set

values

More likely to produce higher grade/quality of

work (less errors)

More likely to be flexible to

organisation needs (if equitable)

Less likely to suffer stress

(but more likely to suffer burn-out)

More likely to achieve goals set

More likely to ‘own’ their development

More inclined to input into ideas/

innovation

More likely to give discretionary effort above contractual

obligations

Less likely to move employer

Less inclined to take days off

More inclined to share knowledge

Applied across all job roles in the context of the role specificity and environment which impact on individual and

collective performance

79

“Only one box in nine reflects the constant ‘high bar’ challenge for organisations in optimising engagement across the workforce on a daily basis”

Staff engagement: The challenge for organisations (The A-C Matrix)

© VaLUENTiS Ltd 2002-12

Likely to have performance,

attitudinal and/or

behavioural issues

More likely to have

performance/ capability issues

Knows what to do/achieve

but unlikely to achieve it

More likely to have objective

and/or ‘potential’

issues

Job gets done

Could do more

High probability of wasted

effort/ frustration

Less than optimally

productive - Could do

more ‘well’

Fully productive

Individual’s degree of Alignment

Degree of Commitment

Affective Continuance

Incongruent

Fully congruent

‘Doing the right things the right way for the

right reasons’

‘Doing the wrong things/ wrong way/

wrong reasons’

‘Having to stay’ ‘Wanting to stay’ ‘Feeling of ought to stay’

80

Staff engagement: The challenge for organisations (The A-C Matrix)

© VaLUENTiS Ltd 2002-12

Likely to have performance,

attitudinal and/or

behavioural issues

More likely to have

performance/ capability issues

Knows what to do/achieve

but unlikely to achieve it

More likely to have objective

and/or ‘potential’

issues

Job gets done

Could do more

High probability of wasted

effort/ frustration

Less than optimally

productive - Could do

more ‘well’

Fully productive 15%

10%

10%

5% 15%

25% 10%

5% 5%

“Typical organisational

split”

Individual’s degree of Alignment

Degree of Commitment

Affective Continuance

Incongruent

Fully congruent

‘Doing the right things the right way for the

right reasons’

‘Doing the wrong things/ wrong way/

wrong reasons’

‘Having to stay’ ‘Wanting to stay’ ‘Feeling of ought to stay’

81

HR as…

Knowledge Facilitator

Objective: HR function facilitates ‘organisation learning’ and

enables distributed ‘ownership’ of working definition of employee

engagement for frontline use.

What got us here/Getting us there…3

Measurement wisdom • Poor survey design, measurement and analysis • ‘Laissez-faire’ process, over-focus on response rate • Over-focus on line item benchmarking

83

Survey instrument design & measurement expertise

HC

M s

ub

ject

mat

ter

exp

ert

ise

Myopic

Result: misleading or erroneous

interpretation

20/20 Foresight

Result: organisation has sufficient in-depth, robust

knowledge to act upon

Unfocused

Limited insight due to limitations of HCM knowledge

Blind

Result: end up with ‘garbage in-garbage out’ syndrome

HIGH

LOW HIGH

© ISHCM 2006

The employee survey expertise model

“Still too many in the red box…” 84

Line of Sight

Work Environment

Reward & Recognition

Learning & Development

Operating culture

Awareness of objectives/goals

Individual’s behaviour aligned

Individual ‘fit’ with assigned roles

Performance management effectiveness

People receiving timely feedback/acted on

Know capabilities for promotion

SMART targeting/goals

Values alignment

Local management/leadership role model

Intra-team relations/cohesiveness

Have resources to carry out job

Team effectiveness/trust

Physical environment/facilities

Work-life balance

Sense of accomplishment

Team diversity

Reward equity intra-organisation

Reward equity extra-organisation

Benefits package component balanced

Performance-reward link

Recognition for contribution

Promotion for contribution/performance

Incentives encourage correct behaviour

Incentives encourage achievement

Individuals possess requisite competencies

Utilisation of individual skills

Pro-active training/ learning

Opportunities for personal development

Structured coaching/mentoring

Job/role architecture

Career progression paths

Succession planning

Inter-team relations/cohesiveness

Organisation decision rights

Performance/talent management

‘Corporate’ leadership

Pride with organisation

Effective decision-making

Work values

Organisational trust & openness

3

3

2

2

3

8

2

4

‘5D’ Employee Engagement case study diagnostic sheet © 2004-12

OVERALL

OVERALL

OVERALL

OVERALL

OVERALL

8

10

5

22

12

27

6

25

12

15

9

19

22

20

24

21

15

11

12

7

14

6

11

9

35

31

44

29

25

25

33

21

27

30

28

21

24

14

24

20

1

3

4

4

1

5

5

6

12

18

13

15

7

22

17

17

11

23

33

23

12

32

18

17

24

13

7

9

19

10

5

19

25

28

32

31

37

22

33

20

28

15

21

18

24

9

22

21

3

6

5

3

8

6

3

7

6

17

19

20

22

13

17

21

21

24

26

29

25

20

21

29

5

7

7

12

8

15

7

6

42

29

25

22

25

32

33

24

23

17

18

14

12

14

19

13

3

2

5

3

5

4

9

5

17

24

15

21

21

12

21

16

21

32

25

26

31

21

29

18

6

9

7

10

8

15

10

16

31

20

29

20

21

29

24

28

22

13

19

20

14

19

7

17

8

10

9

5

3

4

3

6

22

16

15

26

11

26

14

21

26

19

23

26

17

29

25

30

15

18

10

14

14

13

11

14

18

24

28

21

31

17

29

20

11

13

15

8

24

11

18

9

This is an example where front-line client projects meet management learning. VaLUENTiS has customised Harvard/ECCH case studies by adding employee engagement profiles along with human capital data and analytics to create a far more enriched and practical learning experience for managers/practitioners. It’s also unique and cheap to deliver (and also effectively on-demand).

Employee Engagement triangulation “Squaring the circle…”

New (re)hire data

Performance appraisal data

Case data

Other internal survey/assessment data

Exit data

Organisation event log data

Critical incident data

Social media data

Customer/client/patient/citizen data

Employee/management survey data

86

HR as…

Smart Operator

Objective: HR function collectively possesses (or has access to)

measurement nous in people management evaluation.

What got us here/Getting us there…4

Actioning infrastructure • Tendency to focus on one-off isolated actions • Still treated as ‘imposed task’ not as part of culture • Over-focus on PR/Branding

88

Actioning Employee Engagement Infrastructure

(Purpose: ‘to embed’)

Supportive top leadership and ‘signalling’…

‘Interactive’ people management evaluation process map

Multi-survey mapping and

planning overlay

EE related development/

learning programmes & workshops

People Manager evaluation/

appraisal (regular

‘practice runs’)

Defined ‘how to’ strategies around engagement elements

‘Live’ Employee Engagement adapted QFD (‘House of Quality’)

Dedicated internal focus team or nominated ‘on-point’

person

Nominated People Manager Engagement line

champions

Organisation event logs Links into wider

organisation intelligence analytics

Wider communications/

branding

“Spinning plates cogs…” 89

Employee Engagement - Actioning Infrastructure

4

3

1

2

“Thus…” 90

HR as…

‘Perpetual’ Programme

Director

Objective: HR possesses the necessary ‘executive toolkit’ to

hand, in driving/creating ongoing engagement programmes ‘to

embed’ that complement organisation focus.

What got us here/Getting us there…5

EE PLAYBOOK Dynamic EE-Performance ‘playbook’

• No EE playbook • Little knowledge capture • Signalling opportunities missed

92

Mo

del

s St

rate

gies

Im

ple

men

tati

on

Le

arn

ing

Contents

1. Engagement strategies

2. Engagement operating ‘system’ models and analytics templates

3. Question-statement selection and construct design

4. Measurement index construction, maintenance and reporting

5. Engagement Driver Factor (EDF) analysis

6. Engagement ‘forcefield’ analysis

7. EE project management methodology and flowcharts

8. Engagement ‘issue work-through’ tools

9. Management learning programme design and evaluative criteria

10. Engagement Transformation Programme (ETP) methodology

11. Core applied theory summary capsules

12. Human Capital Management framework

EE playbook 4

EE playbook example content

93

“Have you got one…?”

“Would you like one…?”

HR as…

‘EE Playbook’ Guardian

Objective: HR function creates, maintains and evolves the ‘EE

playbook’ on behalf of the organisation to enable frontline

dissemination (whilst also signalling serious intent/reinforcement).

What got us here/Getting us there…6

DELETE

Competent leadership/management • Too few managers with understanding of EE • Little focus on managers own ‘engagement’ • Still too much tolerance of poor or average

leadership/management 95

‘Line Management’ engagement score by percentile

910

860

813

790

760

Management client cadre sample 2010-11 Sample size: 1400 managers representing 20,000 employees

Score range 200-1000 Source: VaLUENTiS Engagement database

“Often overlooked:

Impaired manager engagement…

And its impact…”

96

‘Line Management’ engagement scores ‘bell curve’

Management client cadre sample 2010-11 Sample size: 1400 managers

(employee population: 20,000) Score range 200-1000

Source: VaLUENTiS Engagement database

14.5% below one standard deviation

738 1000 200

“Same data as previous slide – different graphic format…

Looking outside ‘norms’ that’s one in seven line managers posing serious concern…”

13.9% above one standard deviation

“And so…” 97

HR as…

People Management

‘Enforcer’

Objective: HR function as ‘enabler/enforcer’ to ensure cohort of

well-trained/engaged people managers exists within organisation.

EE Pillars and HR Masks…[recap]

EE PLAYBOOK

Grounded understanding of Employee Engagement

Working definition of Employee Engagement

Measurement wisdom

Actioning infrastructure

Dynamic EE-Performance ‘playbook’

DELETE Competent leadership/management

EBM Practitioner

Knowledge Facilitator

Smart Operator

‘Perpetual’ Programme Director

‘EE Playbook’ Guardian

Management ‘Enforcer’

99

100

HR functions have to embrace the fact that the de facto ‘reason for being’ is to be instrumental in optimising employee engagement within their organisation.

What got us here/Getting us there…7

“It’s no good talking about recruitment or talent management or any other HR processes for that matter if employee engagement is not embedded as core…

…Impaired engagement means individual effort and talent is just wasted. So therefore, what is the point of it not being de facto?”

100

Little. Limited.

Mostly ephemeral in nature.

Exists in pockets with variation in line management.

Good working knowledge embedded across

organisation.

No definition in use. Most likely borrowed

without any real ownership, or ‘false’ ownership.

Maybe borrowed with internalisation or adapted after some organisational

focus.

Distributed ‘ownership’, whether borrowed, adapted

or created.

Limited to absenteeism metrics, employee surveys

seen as event driven if done.

Probably undertaking surveys but with no valid

construct; response rate/PR main focus.

Will do measurement basics, even to the extent of

engagement index etc. Tick box is main focus.

People management evaluation/measurement

seen as ‘core’ on a par with CRM , finance etc.

Probably in the form of basic training/management

courses.

Probably in the form of basic management courses. Most likely carry out some form of

branded programme.

Will have a number of actioning elements in place but not necessarily joined

up.

Will have necessary ‘toolkit’ to hand with ongoing programmes to suit organisation focus.

Does not exist.

May have something articulated on ‘strategies’.

Most likely collection of irrelevant case studies.

Playbook in the form of ‘manager manual’ or on-line knowledge-share. Still being

developed.

Easy access in different e-/physical formats at

different levels. Signals ‘embedded’ intent.

Will have varied mix of skilled people managers. Existing good performers

more through luck.

Will have varied mix of skilled people managers. Existing good performers

more through luck.

Will have varied mix of skilled people managers but level of competency higher than Play-Act organisations.

Cohort of well-trained people managers exists with

talent pools. Regular evaluation/reinforcement.

‘PLAY DOWN’ ‘PLAY ACT’ ‘PLAY SAFE’ ‘PLAY MAKE’

I Grounded understanding of employee engagement

II

III

IV

V

VI

Working definition of employee engagement

Measurement wisdom

Actioning Infrastructure

EE-Performance Playbook

Competent leadership/ management

The ‘4-ball’ Employee Engagement reality matrix

Pillar

Where is your organisation currently…? 101

The ‘Play-Maker’ programme approach to Employee Engagement:

The first 100 days

VaLUENTiS has developed the ‘six-pillar programme’ to help organisations to get on/stay on the ‘Play-Maker’ approach. We call it the ‘100 day EE bootcamp’ for organisations. Want to try?

103

The Conference Board: CEO Top Ten Challenges 2013

2013 rank CHALLENGES 2013 2012 rank

N = 729 N = 776

1 Human capital 2

2 Operational excellence na1

3 Innovation 1

4 Customer relationships 7

5 Global political/economic risk 3

6 Government regulation 4

7 Global expansion 5

8 Corporate brand and reputation 9

9 Sustainability 8

10 Trust in business na2

Source: The Conference Board CEO Challenge 2013 (www.ceochallenge.org)

1Operational excellence replaced Cost optimisation; 2Trust in business replaced Investor relations

“Just in”

103

Little. Limited.

Mostly ephemeral in nature.

Exists in pockets with variation in line management.

Good working knowledge embedded across

organisation.

No definition in use. Most likely borrowed

without any real ownership, or ‘false’ ownership.

Maybe borrowed with internalisation or adapted after some organisational

focus.

Distributed ‘ownership’, whether borrowed, adapted

or created.

Limited to absenteeism metrics, employee surveys

seen as event driven if done.

Probably undertaking surveys but with no valid

construct; response rate/PR main focus.

Will do measurement basics, even to the extent of

engagement index etc. Tick box is main focus.

People management evaluation/measurement

seen as ‘core’ on a par with CRM , finance etc.

Probably in the form of basic training/management

courses.

Probably in the form of basic management courses. Most likely carry out some form of

branded programme.

Will have a number of actioning elements in place but not necessarily joined

up.

Will have necessary ‘toolkit’ to hand with ongoing programmes to suit organisation focus.

Does not exist.

May have something articulated on ‘strategies’.

Most likely collection of irrelevant case studies.

Playbook in the form of ‘manager manual’ or on-line knowledge-share. Still being

developed.

Easy access in different e-/physical formats at

different levels. Signals ‘embedded’ intent.

Will have varied mix of skilled people managers. Existing good performers

more through luck.

Will have varied mix of skilled people managers. Existing good performers

more through luck.

Will have varied mix of skilled people managers but level of competency higher than Play-Act organisations.

Cohort of well-trained people managers exists with

talent pools. Regular evaluation/reinforcement.

NEGATIVE NEGATIVE NEUTRAL POSITIVE

‘PLAY DOWN’ ‘PLAY ACT’ ‘PLAY SAFE’ ‘PLAY MAKE’

Overall value to organisation performance/competitive advantage

I Grounded understanding of employee engagement

II

III

IV

V

VI

Working definition of employee engagement

Measurement wisdom

Actioning Infrastructure

EE-Performance Playbook

Competent leadership/ management

Getting us there the ‘Play Maker’ way…

Pillar

New (re)hire data

Performance appraisal data

Employee/management survey data

Case data

Other internal survey/assessment data

Exit data

Organisation event log data

Critical incident data

Social media data

Customer/client/patient/citizen data

“Finally, remember the performance link - Employee Engagement triangulation converts from...”

105

New (re)hire data

Performance appraisal data

Employee/management survey data

Case data

Other internal survey/ assessment data

Exit data

Organisation event log data

Critical incident data

Social media data

Customer/client/ patient/citizen data

“To this - The Engagement-Performance Matrix”

Performance area

‘Hawthorne’ for the 21st

Century organisation”

“There is much that

organisations can do for

themselves”

106

‘Your mission should you choose to accept

it…’ ‘Think HR. Think Human

Capital.’ Tour 2013

THANK YOU.

108

Employee Engagement: What got us here, won’t get us there The new reality for ambitious HR functions

Presenter: Nicholas J Higgins

CEO, VaLUENTiS &

Dean, International School of Human Capital Management (‘ISHCM’)

‘Think HR. Think Human Capital.’

Tour 2013

VaLUENTiS-ISHCM Productions 2013 ……

Nicholas J Higgins nicholas.higgins@valuentis.com VaLUENTiS Ltd, 2nd Floor, Berkeley Square House, Berkeley Square, London W1J 6BD HO: +44 (0)207 887 6108 M: +44 (0)7811 404713 www.valuentis.com www.ISHCM.com www.NicholasJHiggins.com www.HCglobal.blogspot.com

THE EE

PLAYBOOK

Line of sight

Work environment

Operating culture

Development

Reward (equity)

Performance link

What we bring…

Employee Engagement Solutions Evidenced based definition,

understanding and application

Measurement wisdom and expertise

On-line tools and analytics

Survey design expertise

Project management

expertise

Actioning strategies and

tactics

Frontline blended learning

‘License to manage’ programmes

Senior management feedback sessions

Global reach

‘Ten years of innovation…’

VaLUENTiS Ltd, 2nd Floor, Berkeley Square House, Berkeley Square, London W1J 6BD HO: +44 (0)207 887 6108/21 www.valuentis.com www.ISHCM.com

Management

Pathfinder®

Think Human Capital.

Professional Services www.valuentis.com

Smart. Smarter. Smartest...

‘PEOPLE SCIENCE®’

Organisation Intelligence

to improve organisation performance

• Human Capital Management Evaluation • Employee Engagement • Talent Management • Workforce Productivity & Performance • Predictive Analytics • HC Forensics & Risk • HR Function ROI Analysis • Organisation Measurement • Management Education • Organisation Strategy

SOLUTIONS

‘The leading human capital management specialists’

Think HR. Think Human Capital.™

Only one place to learn Human Capital Management. Being human is unique. Attaining an M Sc in HCM is even more so.

2nd Floor, Berkeley Square House, Berkeley Square, London W1J 6BD Tel: +44 (0)207 887 6121 Fax: +44 (0)207 887 6100 enquiries@ISHCM.com www.ISHCM.com

…+

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