Why caring matters: What are the benefits of employee engagement?
Employee engagement is the central topic here at Weekly10. Whether we're talking about the latest employee engagement strategies, how to improve employee engagement or simply what exactly employee engagement is, it's fair to say it is always a focus for us. Yet, we still often get asked what the benefits of employee engagement actually are.
Updated 7th June 2023
We've put together a bit of a primer on the positive outcomes of employee engagement. It should give you some understanding of why it's essential to monitor engagement analytics in your business. For starters, supporting engagement you get invited to a lot of weddings!
But aside from the opportunity to make jokes so terrible they wouldn't even end up in a Christmas cracker, these benefits range from staff loyalty and productivity to employee innovation and advocacy. Investing in engagement can even have knock-on positive effects on employee wellbeing.
First thing's first, before we get into the weeds on this one. It's worth noting that some of these benefits are pretty chicken-and-egg. Sure, high engagement in their roles can make employees more proud of the organisation they work at, for example. But it's also true that taking steps to boost company pride can be a means of increasing employee engagement. And, if you're interested in employee engagement stats, we did a whole compilation of them last year.
Engaging your employees makes them feel valued
One of the major benefits of employee engagement is how it shows your appreciation. A lot of what managers should do to make their employees feel more valued is actually quite similar to what makes a good approach to employee engagement. Employees tend to feel more valued and engaged when they receive:
- Acknowledgement for their contributions and accomplishments.
- Feedback that is consistent, useful and fair.
- The option to work flexibly, which can be seen as a sign of trust.
- Support for their personal development and growth.
Engaged employees are more likely to give discretionary effort
That's right! If you properly engage with your employees, they will literally give you that little bit more when the chips are down.
Engagement and discretionary effort are sometimes conflated for one another. But the truth is that engagement is a very multifaceted concept with a lot of contributing factors. An increase in discretionary effort is just one of the benefits of employee engagement. While the two do overlap, this shouldn't be confused with productivity, which we'll touch on later.
In fact, proper engagement practices are the only effective way to raise discretionary effort. You can't force employees to give it, or it wouldn't be discretionary.
You could think of it as going the extra mile. But it's not a simple matter of working overtime, or competing for a bonus. And that's because those things come with implicit financial incentives.
Discretionary effort is basically the level of focus that someone can only achieve when they actively want to do whatever it is they're doing. Or when they genuinely want to support the organisation they work for out of a sense of pride and enthusiasm.
Advocacy is one of the biggest benefits of employee engagement
Brand advocacy is important for any business. If you treat them right, your employees can be some of your most passionate supporters. Employee advocacy is another one of the benefits of employee engagement, albeit a more indirect one.
One way we see this is in the impact of high employee engagement on customer experience. This highlighted by research from Temkin Group. In their study, businesses with a low level of customer experience had an average employee engagement of 49%. Businesses with "significantly better" levels of customer experience than their competitors averaged 79% for employee engagement.
Then there's out-of-work advocacy to consider. Employee advocates have the potential to widen your customer-base and recruiting pool. They can whole-heartedly recommend the business to friends and family. And not just for its products or services, but also as a potential employer. Prospective clients can even trust employees or "ordinary people" more than they do business leaders.
In the 20th annual Edelman Trust Barometer, 87% of respondents agreed that stakeholders (including employees) are more important to a business's long-term success than its shareholders. And 37% ranked employees as the most important stakeholders. The only group rated more highly were customers, but only by 1%.
In 2019, the Barometer found that CEOs were 'underperforming in their societal leadership and areas of ethics and character.' Going further back to the eventful year of 2016, Barometer respondents rated employees (52%) and people like themselves (63%) as more trustworthy than either CEOs (49%) or boards of directors (44%).
Employees take more pride in their work when they're engaged
Pride is a big contributing factor to the benefits of employee engagement we've already discussed. Firstly, someone who's proud of their work will set higher standards for themselves. And, secondly, they are more likely to instil it in others due to pride in the business as a whole.
There are a few steps businesses can take to improve pride in the workplace:
- Communicate with employees and listen to their concerns.
- Ensure that staff members have managerial support.
- Promote diversity and inclusivity.
- Have an active CSR policy and tie this back to organisational ideals
- Encourage your employees to connect with each other.
How the benefits of employee engagement impact your business
Let's wind things up with a quick rundown of what the benefits of employee engagement can actually do for your business in terms of long-term outcomes:
This is what many business leaders are hoping to gain by focusing on engagement. Ultimately, the difference between this and discretionary effort is that productivity is the end result when considering all factors, including obstacles that don't relate to someone's satisfaction with their role or their pride in the company. But whether it's due to discretionary effort, strong managerial support, or effective communication and feedback, higher engagement significantly boosts performance.
Reduced staff turnover
Reducing turnover and keeping it low are key priorities for any business leader, and employee engagement is absolutely critical. The CIPD turnover and retention factsheet highlights several strategies for improving retention, most of which are key elements of employee engagement.Â The CIPD's guidance emphasises career progression and development opportunities, communicating with employees, allowing flexibility, and paying attention to wellbeing, as well as fair and equitable treatment of all employees.Â It also advises portraying the job as realistically as possible to prospective employees. While this is probably good for engagement, it's also just common sense. After all, employees should have an informed understanding of the difficult or frustrating aspects of a job so they can make an informed decision about whether they can handle the stress.
Another benefit of high employee engagement is that it makes absenteeism less likely. After all, why avoid a job which actively interests you? Not only can low engagement lead to more absenteeism, but it can actually be a vicious cycle. The second Global Retail Absence survey found that over 60% of managers in the UK, USA and Germany believed poor employee engagement significantly increased unplanned employee absences.
A whole team of heads is better than one. Engaged employees stand to be some of your best innovators, which is one of the reasons we put so much emphasis on communication here at Weekly10. Innovation is one of the ways employees can put in discretionary effort, and it also comes about as a result of increased collaboration between members of a highly engaged team.
Those are some of the main benefits of employee engagement for your business. Engagement is at the heart of everything we do here at Weekly10. That's why it's the main focus of our employee check-in system.