employee engagement research (master list of 32 findings) - kevin kruse

5/28/2015 EmployeeEngagementResearch(MasterListof32Findings)KevinKruse

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EmployeeEngagementResearch(MasterListof32Findings)ByKevinonSeptember18,2012inBestOf,Uncategorized3

Employeeengagementistheemotionalcommitmentanemployeehastotheorganizationanditsgoals,resultingintheuseofdiscretionaryeffort.

AnemployeesdiscretionaryeffortresultsintheEngagementProfitchain.Becausetheycaremore,theyaremoreproductive,givebetterservice,andevenstayintheirjobslonger.Allofthatleadstohappiercustomers,whobuymoreandrefermoreoften,whichdrivessalesandprofitshigher,finallyresultinginanincreaseinstockprice.

Thinkthatjustsoundslikeacademictheory?Thinkagain.Beloware29researchstudiesthatshowacorrelationbetweenengagementand:

ServiceSalesQualitySafetyRetentionSales,ProfitandTotalShareholderReturnsRoleofFrontLineManagers

NOTE:Helpmetomaintainthislist!Pleasecontactmewithanynewresearchyouthinkshouldbeaddedtothislist.

SERVICE

Employeescustomerserviceproductivityscoresandtheiremployeeengagementscoreshadacorrelationof.51.(Source:LinkingPeopleMeasurestoStrategy.TheConferenceBoard)Companieswithhighemployeeengagementscoreshadtwicethecustomerloyalty(repeatpurchases,recommendationstofriends)thancompanieswithaverageemployeeengagementlevels.(Source:AreTheyReallyOntheJob?,Pont)



Inamajordepartmentstorechain,customersscoredhigherincustomerengagementmeasureswhentheywereservicedindepartmentswithemployeeswhohadhighlevelsofemployeeengagement.(Source:GettingEngaged,Bates)Teamsclassifiedashighperformancezoneforengagementhada37%netpromoterscore(NPS)versus10%NPSforteamsoutsideofhighperformancezoneforengagement.(Source:AonHewittEuropeanManagerSurvey2011.AonHewitt)MorrisonManagementSpecialistsincreasedclientsatisfactionby1percentagepointforevery2percentagepointincreaseinemployeeengagement(Source:EngagementLeadstoGrowthatMorrison,TalentManagement)

SALES

FabickCATimprovedpercentofindustrynetsalesby300%(Source:ACaterpillarDealerUnearthsEmployeeEngagement,GallupBusinessJournal)FabickCATimprovedcustomerengagementscoresby8%(Source:ACaterpillarDealerUnearthsEmployeeEngagement,GallupBusinessJournal)

QUALITY

UnnamedFortune100manufacturingcompanyreducedqualityerrorsfrom5,658partspermillionto52partspermillion.(Source:EmployeeEngagement:TheKeyToRealizingCompetitiveAdvantage,DevelopmentDimensionsInternational)

SAFETY

MolsonCoors,itwasfoundthatengagedemployeeswerefivetimeslesslikelythannonengagedemployeestohaveasafetyincidentandseventimeslesslikelytohavealosttimesafetyincident.(Source:Effectivepracticeguidelines:Employeeengagementandcommitment.SHRM)Studyof23,910businessunitscomparedtopquartileandbottomquartileengagementscoresandfoundthatthoseinthebottomquartileaveraged62%moreaccidents.(Source:GallupQ12MetaAnalysis,Gallup)

RETENTION&ABSENTEEISM

MorrisonManagementSpecialistsreducedturnoverby1percentagepointforevery2percentagepointsgainedinemployeeengagement(Source:EngagementLeadstoGrowthatMorrison)UnnamedFortune100manufacturingcompanyreducedturnoverfrom14.5%to4.1%,whileabsenteeismdroppedfrom8%to4.8%.(Source:EmployeeEngagement:TheKeyToRealizingCompetitiveAdvantage,DevelopmentDimensionsInternational)Employeeswithlowerengagementarefourtimesmorelikelytoleavetheirjobsthanthosewhoarehighlyengaged.(Source:Drivingperformanceandretentionthroughemployeeengagement.CorporateLeadershipCouncil)66%ofhighlyengagedemployeesreportedthattheyhadnoplanstoleavetheircompany,whileonly3%ofthemwereactivelylooking,comparedto12%and31%,respectively,fordisengagedemployees.(Source:TowersPerrin2004EuropeanTalentSurvey:ReconnectingwithEmployees:Attracting,Retaining,andEngaging,TowersPerrin)Thereisanegative.43correlationbetweenacompanyslevelofemployeeengagementandtheirvoluntaryturnoverrate.(Source:LinkingPeopleMeasurestoStrategy.TheConferenceBoard)Highlyengagedemployeeswere87percentlesslikelytoleavetheircompaniesthantheirdisengagedcounterparts.(Source:Drivingperformanceandretentionthroughemployee



engagement.CorporateLeadershipCouncil)Studyof23,910businessunitscomparedtopquartileandbottomquartileengagementscoresandfoundthatthoseinthebottomquartileaveraged31%51%moreemployeeturnover.(Source:GallupQ12MetaAnalysis,Gallup)EngagedemployeesintheUKtakeanaverageof2.69sickdaysperyearthedisengagedtake6.19.(Source:EmployeeEngagement:HowtoBuildaHighPerformanceWorkforce.Gallup)Engagedemployeesare87%lesslikelytoleavetheorganizationthanthedisengaged.(Source:Drivingperformanceandretentionthroughemployeeengagement.CorporateLeadershipCouncil)

REVENUE,PROFITandSHAREHOLDERRETURNS

Incompanieswhere60to70percentofemployeeswereengaged,averagetotalshareholdersreturn(TSR)stoodat24.2percentincompanieswithonly49to60percentoftheiremployeesengaged,TSRfellto9.1percentcompanieswithengagementbelow25percentsufferednegativeTSR.(Source:Employeeengagementatdoubledigitgrowthcompanies,HewittResearchBrief)Companieswithhighlyengagedemployeesbeataveragerevenuegrowthintheirsectorby1percentwhilecompanieswithlowengagementwerebehindtheirsectorsrevenuegrowthbyanaverageof2percent.(Source:WorkingToday:Understandingwhatdrivesemployeeengagement.The2003TowersPerrinTalentReport)Operatingmarginwas2.1%inlowengagementcompaniesversus3.75%inhighengagementcompaniesnetprofitmarginwas1.38%inlowengagementcompaniesversus2.06%inhighengagementcompanies.(Source:Engagedemployeesdrivethebottomline.ISRReport)A5%increaseintotalemployeeengagementcorrelatestoa.7%increaseinoperatingmargin.(Source:TowersPerrin2004EuropeanTalentSurvey:ReconnectingwithEmployees:Attracting,Retaining,andEngaging,TowersPerrin)Searsmeasuredthata5pointimprovementinemployeeattitudesdrovea1.3pointimprovementincustomersatisfaction,whichinturndrovea0.5%improvementinrevenue.(Source:TheEmployeeCustomerProfitChainatSears,HarvardBusinessReview)Studyof23,910businessunitscomparedtopquartileandbottomquartileengagementscoresandfoundthatthoseinthetopquartileaveraged12%higherprofitability.(Source:GallupQ12MetaAnalysis,Gallup)Studyof89companiescomparedtopquartileandbottomquartileengagementscoresandfoundthatthoseinthetopquartilehad2.6timeshigherearningspershare(EPS)thanthatofthebelowaveragescores.(Source:Investors,TakeNote:EngagementBoostsEarnings,Gallup)Companieswithhighlevelsofemployeeengagementimproved19.2percentinoperatingincomewhilecompanieswithlowlevelsofemployeeengagementdeclined32.7percentoverthestudyperiod.(Source:TheISREmployeeEngagementReport.TowersPerrinISR)StandardCharteredBankreportedthatin2007theyfoundthatbrancheswithastatisticallysignificantincreaseinlevelsofemployeeengagement(0.2ormoreonascaleoffive)hada16percenthigherprofitmargingrowththanbrancheswithdecreasedlevelsofemployeeengagement.(Source:Engagingforsuccess:Enhancingperformancethroughemployeeengagement,UKGovernmentStudy)Astudyof64organizationsrevealedthatorganizationswithhighlyengagedemployeesachievetwicetheannualnetincomeoforganizationswhoseemployeeslagbehindonengagement.(Source:TheImpactofEmployeeEngagement.Kenexa)Astudyconductedacross39organizationsindicatesthatorganizationswithhighlyengagedemployeesachieveseventimesgreater5yeartotalshareholderreturn(TSR)thanorganizationswhoseemployeesarelessengaged.(Source:TheImpactofEmployeeEngagement.Kenexa)



RoleofFrontLineManagers

Incompanieswhoadministeredanemployeeengagementsurvey,27%ofmanagersneverreviewedtheresultsatall,and52%reviewedtheresultsbuttooknoaction.(Source:AonHewittEuropeanManagerSurvey2011.AonHewitt)

CausationStudyLinkageBetweenEngagementandOutcomes

Landmarklongitudinalstudy,using755retailbankemployeesandbusinessunitmetricsforafouryearperiod,showedengagementhadmoreimpactonbusinessresultsthanviceversa.(Source:Newinsightsintoanolddebate:Investigatingthetemporalsequenceofcommitmentandperformanceatthebusinessunitlevel)

KevinKruseisaNYTimesbestsellingauthorandkeynotespeaker.Getmoresuccessandtipsfromhisnewsletteratkevinkruse.comandcheckoutkeynotevideoclips.Hisnewbook,EmployeeEngagement2.0,teachesmanagershowtoturnapatheticgroupsintoemotionallycommittedteams.

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