The Desirability of Engagement Strategies in the 21st Century - Essay Example

?The Desirability of Engagement Strategies in the 21st Century Introduction An ‘engaged’ workforce is widely believed to be desirable for both employees and the organisation, particularly when it is confronting the need to gain stable competitive advantage and enhance organisational performance. The MacLeod Report (2009) supported this assumption by arguing that engagement strategies are desirable for organisations and employees. The MacLeod Report (2009) confirmed the positive features of engagement by surveying a large number of organisations and companies that adopt employee engagement. They found out that employee engagement has remarkably improved the profitability and performance of these organisations. They also found out from the employees themselves that engagement has made them more enthusiastic and productive at work. A 2006 CIPD report presented by Kingston Business School and Professor Katie Truss discovered that very few employees in the UK were intensely engaged with their work. This finding was substantiated by the study of CLC which reports that there are more disengaged than engaged employees in the UK (MacLeod & Clarke, 2009, p. 15). The same situation was discovered in the public sector. As reported by Towers Perrin, there are more disengaged employees (22 per cent) than engaged workers (12 per cent) in the UK public sector (MacLeod & Clarke, 2009, p. 15). Although these numbers are merely suggestive, they still reflect the low engagement levels in the UK. As a result, the UK government became very interested in employee engagement because of its positive impact on productivity. Thus, the Department for Business (BIS) ordered an investigation in 2007 to study the correlations (Holbeche & Matthews, 2012). As argued by David MacLeod (Holbeche & Matthews, 2012, p. 8): “The job is to shine a light on those doing it well so that more employers understand the benefits of working in that way and really embrace it”. This essay evaluates the argument that engagement strategies are desirable for organisations and employees. Defining Employee Engagement A single concept, but countless definitions and approaches, these at times explain but can complicate ‘engagement’. The entire field of engagement has dominated organisational strategies for the past decades, but until now, there is no single definition to fully characterise it. An accurate definition of ‘engagement’ is needed in order to identify its actual importance to organisations and employees (Torrington, Hall, & Taylor, 2008). However, the best definition depends on the specific circumstances and features of the organisation. MacLeod defines engagement as a process of building ‘mutual respect in the workplace’ (MacLeod & Clarke, 2009, p. 6). He believes that engagement is not only beneficial to the organisation or the employees, but to the nation as a whole. MacLeod views employee engagement as an organisational or corporate strategy intended to make sure that the members of the organisation are committed to its objectives and ideals, driven to contribute to the success of the organisation, and are simultaneously capable of improving their self-respect. The 2012 CIPD Report stated that there are two forms of engagement, namely, emotional and transactional. Emotional engagement takes place when individuals genuinely identify with their organisation and job. It occurs when employees are driven by the desire to perform well at work. On the other hand, transactional engagement refers to a two-way relationship. It appears to be about acknowledging the dynamic involvement of all members of a relationship (e.g. employer and employee). Basically, engagement is characterised as a psychological condition that involves an affective and cognitive aspect, or, feeling and thinking, respectively. Basically, work engagement is a constructive affective and cognitive condition that is stimulated and tends to lead to motivated attitude and behaviour at work (Armstrong, 2006). According to Lucas and colleagues (2007), engagement is a motivation concept that results in a certain distribution of resources. In essence, employee engagement facilitates allocation of individual resources to particular work tasks. Employee Engagement Strategies: How Do Organisations Implement Them? According to the MacLeod Report (2009), different companies and organisations have different ways of engaging their people. They confirmed this assumption through several case studies of public and private sector, service and manufacturing sector, and small and large organisations. For example, Serco, a multinational service firm with hundreds of thousands of employees, implements engagement strategies as the core of its business strategy. It maintains high levels of performance through open and effective communication. It sustains active cooperation between local employees and managers. But its major and most effective engagement strategy is identifying, recognising, and publicising good performance (MacLeod & Clarke, 2009, p. 18). Another example is Broadway, a charity organisation for homeless individuals. It only recruits people who are engaged and committed. In order to do this, the organisation created recruitment procedures that locate these individuals. It grants its employees the freedom to express their opinions, the opportunity to accomplish challenging tasks, independence, and flexibility (MacLeod & Clarke, 2009, p. 20). The VT Group, a major provider of support and defence services in the UK and the US, makes sure that its senior managers competently communicate a precise, unambiguous, and persuasive need for change and motivate employees to express their opinions or give suggestions. It offers regular workshops for employees, regularly educating them about personal development, empowerment, creativity, innovation, and the importance of quality customer service (MacLeod & Clarke, 2009, p. 23). Engagement strategies can also enhance the capacity of organisations and companies to cope with the difficulties of recession through building confidence and trust and harnessing the skills, experiences, and dedication of employees (MacLeod & Clarke, 2009, p. 25). For example, KPMG has vigorously attempted to build a highly engaged workforce. Employees are constantly informed about the real situation, whether good or bad, and this has been successful in weakening the risks of the recession (MacLeod & Clarke, 2009, p. 27). The employees feel engaged with the organisation and their work because the managers respect their opinions and suggestions on how to surpass the problems of recession. Lloyds pharmacy, a group of 1,700 companies, was seriously hit by the recession when the government decided to raise taxes. However, despite this setback, the firm did not allow its engagement strategies to suffer. It still invested in communication and training activities. Thus, in spite of riskier streamlining, the firm witnessed an increase in levels of employee engagement, with more employees expressing motivation, commitment, and satisfaction. The firm was able to prove that “the more engaged the people, the more willing they are to go the extra mile” (MacLeod & Clarke, 2009, p. 27). Barriers to the Success of Engagement Strategies However, employee engagement will only work when it is performed correctly. Sadly, there are numerous organisations that adopt engagement rules and processes as a universal remedy. Within this context, failure or frustration is certain. And the actual potential of engagement to realise preferred outcomes is misplaced. Engagement is never a universal remedy, but it is remarkably beneficial when it is used correctly in any organisation. When an organisation is genuinely and profoundly committed to examining its culture through a variety of engagement measures, it finds out that its current situation arose because of their habitual behaviour towards its members (Torrington et al., 2008). The insights and appreciation of its culture that stem from a thorough engagement examination help the organisation reach the best possible decision and purposely develop the culture it prefers by establishing or preserving the behaviours, rules, or practices that most favourably strengthen the preferred outcome (CIPD, 2011). An engagement examination will provide any organisation the particular aspects it requires for the forms of improvements it desires. Several barriers to the success of engagement strategies are enumerated by the MacLeod Report (2009): lack of awareness, uncertainty about starting, managers and organisational culture, and underestimating engagement. First, as regards lack of awareness, the MacLeod Report (2009) found out that numerous leaders are still uninformed about the idea of employee engagement, and the advantages it may confer to their organisations. This lack of awareness is confirmed by the report of Accenture that most Chief Financial Officers had a quite inadequate knowledge of the profitability of investing in engagement strategies (MacLeod & Clarke, 2009, p. 67). Second, many organisations, although they express interest in adopting engagement strategies, are not sure how to implement or manage engagement. The usual outcome of this uncertainty is the assumption that engagement is a product or wishful thinking. The ACCOR Services Report discovered that most of the leaders they surveyed rank the engagement levels of their employees as more than sufficient; however, sadly, it seems that most of them are really unsure. The report stated that this uncertainty seems to be rooted in the reluctance of leaders to compromise their authority for the sake of mutual relationship with their subordinates (MacLeod & Clarke, 2009, p. 68). The MacLeod Report (2009) revealed that although many organisations seemed to appreciate the value of employee engagement, most of them are not sure how to facilitate the circumstances for engagement to thrive. Third, there are still many organisational practices in the UK that disengage employees and which only work as barriers without the implementation of appropriate engagement strategies. Some of these disengaging practices are enumerated by the Kingston Business School: weak work-life balance; poor respect for senior managers; poor employee identification with the organisation’s goals; poor communication system and dissemination of information and knowledge; incoherent management approach which results in an impression of injustice; and poor quality of decision making (MacLeod & Clarke, 2009, p. 68). Kingston’s study discovered that less than half of the employees find their relationship with their managers satisfactory. Many of the employees surveyed emphasised the inadequate knowledge of managers about people skills (MacLeod & Clarke, 2009, pp. 68-69). Lastly, some leaders do not take engagement seriously. They do not even want to prioritise it. This is obviously a barrier to the success of engagement strategies because engagement has to be deeply embedded into the organisation’s very structure. Thus, the British Association of Communicators in Business stressed the integral role of senior managers and CEOs in making sure that engagement is placed at a higher strategic level (MacLeod & Clarke, 2009, p. 71). Implications of Engagement Strategies for Organisations and Employees Employee engagement has been correlated in different studies to greater innovation and efficiency, lower turnover and number of absences, higher earnings per share, and so on. For example, the study of Corporate Leadership Council (CLC) reported that organisations with a well engaged workforce progress more rapidly than companies with disengaged employees (Cook, 2008, p. 20). Likewise, the study of Towers Watson discovered that companies with high levels of engagement experienced an increase in net profit margin and operating margin. Company studies also emphasise correlations between organisational outcome and engagement. The 2005 ISR research reported that organisations with low engagement levels experienced a decline in operating margin and net profit over a 3-year period (Cook, 2008, p. 20). The Hay Group reported that specialised service companies with high levels of employee engagement were significantly more efficient. Stanford University reports that employee engagement leads to substantial organisational advantages. Gallup studies found out that engaged employees are more likely to remain in the organisation, more efficient, and friendlier to customers (Cook, 2008, pp. 20-21). Therefore, building the circumstances where employees develop a sense of engagement leads to reported gains—strong reputation; advocacy-oriented employees; better employee retention or lower turnover; a stronger sense of commitment to the organisation; better ingenuity and creativity; more productive team performance; a motivated working environment; a stronger sense of alignment with the goals and ideals of the organisation; better individual efficiency; sustainable success; and greater customer loyalty and customer satisfaction. Until now, studies continue to confirm a strong correlation between organisational outcome and employee engagement which surpasses commitment and satisfaction (Holbeche & Matthews, 2012). Hence, employee engagement is presently a widely recognised means towards organisational success. The advantages of cultivating employee engagement in organisations are many-sided. From the point of view of the organisation, the advantages of having an engaged workforce are manifested in a stronger bottom line and better performance. For employees, having a sense of engagement implies experiencing greater job satisfaction. The environment, community, and society may also gain from employee engagement, since an engaged workforce has currently been associated with the emergence of ‘sustainable’ or ‘green’ organisations and corporate social responsibility (CSR) (Sarlak, 2010, p. 98). As regards engagement, what is essential for people is also essential for organisations. An engaged workforce brings financial benefits to organisations, especially with regard to the reduction of costs associated with absences or turnovers, and sustaining employee security and health is now regarded a corporate social responsibility (Cascio & Boudreau, 2010). Employees with a low level of engagement who choose to remain in their organisations are perhaps even costlier than those who decide to leave. As reported by many studies, disengaged employees are more vulnerable to illnesses and feelings of insecurity than engaged workers. Watson Wyatt, an HR consulting company, reported that an engaged workforce has lower number of absences than disengaged employees (Sarlak, 2010, p. 98). Absences are very costly to businesses due to decrease in productivity. Conclusion Employee engagement is not the final objective of an effective organisation. It is a way towards success. In reality, it is an important instrument because when the whole workforce is willingly aligned in favour of the organisation’s goals, as The MacLeod Report (2009) and other studies have shown, that nearly all kinds of human capital costs diminish whilst market productivity rises. Employee engagement is an inimitable competitive advantage. The competitive advantage provided by an engaged workforce, the specific way engaged people carry their commitment and enthusiasm to work, how they deal with or interrelate with their customers, is very difficult to imitate. It can be assessed and harnessed internally. References Armstrong, M. (2006) A Handbook of Human Resource Management Practice. London: Kogan Page Publishers. Cascio, W. & Boudreau, J. (2010) Investing in People: Financial Impact of Human Resource Initiatives. Upper Saddle River, New Jersey: FT Press. CIPD, 2011. Research report ‘Locus of engagement: understanding what employees connect with at work’, [online] Available at: [Accessed 29 January 2013]. CIPD, 2012. Research report ‘Emotional or transactional engagement: does it matter?’ [online] Available at: < http://www02.abb.com/global/gad/gad00540.nsf/0/822c7c40d053c466c1257a0700354cd6/$file/Engagement.pdf> [Accessed 29 January 2013]. Cook, S. 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