Employee Engagement – The Key for Sustainability Implementation!

Leadership and CSR Conference March 6, 2014

Kevin Wilhelm, CEO

Sustainable Business Consulting

What is employee engagement?

• “I’m making a difference”: Create real meaning, not mission statements

– Motivating jobs

– Good relationships

– A compelling future

• Loyalty is earned, not bought

• Designing motivating jobs – one employee at a time

Accenture 2011, What Executives Really Need to Know about Employee Engagement

• “My company has my back”: Cultivate a culture of trust and respect

– Safe environment

– Dependable colleagues, you can count on them !

• “We’re in this together”: Actively balance effort and recovery

– Energy boosters

– Sane expectations

• Pulling the right levers

What is employee engagement? cont.

Most employees “Not Engaged”

71% of American workers are "not engaged" or "actively disengaged" in their work, meaning less productive.

Gallup (2011) “Majority of American Workers Not Engaged in Their Jobs”

Benefits of engaged workforce

Gallup found that business can secure greater profitability by actively engaging employees.

Comparing top-quartile to bottom quartile engagement % difference.

• 16% in profitability

• 18% in productivity

• 49% in turnover for

low-turnover companies

(those with 40% or lower annualized turnover)

Gallup (2009) “The Relationship Between Engagement at Work and Organizational Outcomes”

• 12% in customer loyalty

• 37% in absenteeism

• 60% in quality (defects)

Additional Benefits

• 2:1 Employees who can make an impact while on the job report greater satisfaction than those who can’t

• Majority of students (65%) expect to make positive social or environmental difference at some point through their work

• Over half of the student population (58%) would take a 15% pay cut to “work for an organization whose values are like my own”

Net Impact 2012, Net Impact Talent Report: What Workers Want in 2012

Sustainability’s importance to Gen Y/Millenials

• 88% of graduate students and young professionals factor an employer’s CSR position into their job decision.

• 86% would consider leaving a job if their employer’s CSR performance no longer held up.

2011 PriceWaterhouseCoopers study, Millenials at Work: Reshaping the workplace

• Almost 50% of respondents between the ages of 18 to 24 would choose a position with a socially responsible company, even if they had to take a pay cut.

2010 Penn Schoen Berland, Corporate Social Responsibility Branding Survey

Barriers that need to be overcome

• Overworked. Too much on plates already and another thing to do

• No perceived senior buy-in

• Boss doesn’t appreciate additional time away from my “job”

• People don’t know what to do. Need training to think differently

• Extra capital required to fund events

• People don’t feel empowered

• Apathy. Loss of momentum for attending events, people stop

reading communications, taking action

• Middle management and department managers don’t see value

Types of Management

1. Hierarchical

2. Egalitarian/ Flat

3. Mixed Model

4. Functional

5. Product

6. Geographic

•Top-down, clear lines of authority

•Dual hierarchy; has multiple lines of authority

with some employees reporting to at least two

managers.

•Few structural layers and intermediaries

•Centered on job function

•By product line: Chevy, GMC, Buick

•North America, Europe, Asia/Pacific

1 Hierarchical

Top-down, clear lines of authority

2 Egalitarian/ Flat

Few structural layers and intermediaries

3

Mixed Model Dual hierarchy; has multiple lines of authority with some employees reporting to at least two managers.

4 Functional

Centered on job function

5 Product

By product line: Chevy, GMC, Buick

6 Geographic North America, Europe, Asia/Pacific

Types of Management

Change Management Methods

Collaborate Oriented

Facilitate group brainstorming sessions

Develop or improve the employee suggestion and feedback system

Develop an online internal collaboration platform

Create Oriented

Use social media and crowd sourcing to generate new ideas faster

Create a training program to cultivate creative thinking

Empowered intrapreneurs

Control Oriented

Understand relevant regulations and associated risk exposure

Analyze or audit existing processes and environmental impacts (e.g., life cycle analysis)

Review existing policies for procedural inefficiencies and opportunities for sustainability

Compete Oriented

Establish goals, objectives, and measures based on company vision and standards

Benchmark performance against initiatives of key competitors

Use competitive means for project idea generation, such as a contest between individuals and teams

Change Adoption Curve

Personality and Learning Styles

Personality Styles • Introverts vs.

Extroverts

• Social (interpersonal)

• Solitary (intrapersonal)

Personality Styles Introverts vs. Extroverts Social (interpersonal) Solitary (intrapersonal)

Learning Styles Auditory Visual Hands on/Physical Logical (reasoning)

Engage The Skeptics/Naysayers

Find Common Ground

When you run into resistance, ask questions differently to find out what is behind their resistance, and try to seek common ground.

Group vs. 1 on 1

Realize that it is actually very rare when you need to have everyone in the room. Most of the time it’s best to have little side meetings offline

Outsider Help If you cannot make any headway, sometimes a solution is to bring in an outside consultant or facilitator.

Engage the Skeptics

Position Typical comment Response

Investor Relations

Maximize shareholder value.

The DJSI has outperformed the S&P 500 for 10 years.

Accounting This is going to cost more

Sustainability initiatives tend to save money both short/long term

Legal Don’t want to disclose You don’t. But you should track, it’s risk mitigation

Operations I know how to do my job !

Yes, but this is how it’ll be different, easier, save $

Sales Market unproven, fad Ability to sell new products to top line.

PR Don’t want to greenwash

Opp to leverage all company efforts

Supply-Chain We’re too small to influence change

Just start the conversation. Create procurement guidelines

HR Can’t afford benefits Look at what you offer, you could switch to options/flex.

Break into groups of 3-4 Come up with a few more examples of Expected Barriers Then possible Strategic Responses for each of them.

Activity:

Ground rules on break outs

Identify the barriers Then ways to overcome them Share stories Feel free to be vulnerable, nobody has 100% done this If you’ve struggled or failed, it’s okay, what did you learn Record ideas, know that you’ll be reporting out. And only have 3 minutes

Your Group Expected Barriers Strategic Response

11 keys for successful sustainability implementation

1. Define Sustainability

2. Make the Business Case

3. Stakeholder Engagement – What’s important to them

4. Baseline - Measure what matters, metrics and KPIs

5. Aligned Vision and Goals

6. Mgmt Support & Resource Commitment (Time, Money, People)

7. Understand your Org & People – How best to “do change”

8. Employee Engagement: Train, empower, intrapreneur

9. Implement: Create policies and procedures

10. Institutionalize: Job descriptions, evaluations, compensation

11. Communicate

Most importantly, HAVE FUN!

What needs to be done

Goals that are clear and integrated throughout the company

Frequent Corporate-Wide Communication so employees know what & why

Resource Commitment (Time, Money, People)

Departmental/business division/facility: Middle management (budget, eval)

- Goals should match impact

Individual: (performance, eval, bonus) Metrics could be: - % of employees trained in sustainability

- % employees evaluated on sustainability

Job Descriptions

Integration with evaluations: Set targets and measure

Make the Business Case

Gamification & competition is necessary