Bringing Leadership On Board
Building C-Suite Buy-In on Engagement
Overcoming the challenges faced by corporations in this shifting global economy requires a workforce that's completely engaged in their jobs and fully aligned with the priorities of their organization. Think of it: Employees are increasingly being asked to adapt, learn, readapt and relearn in order to ensure that companies retain a competitive edge; and executives, from the C-suite to front-line managers, need to understand what motivates those employees and drives job satisfaction, pride and commitment.
Many things add up to "engagement," explained Michelle Pokorny, solution vice president, employee engagement and recognition for Maritz Motivation Solutions in Fenton, Mo. "However, if you broadly consider that leadership believing in engagement means a desire to foster and develop employees' emotional connection and commitment to their work, their team, the organization, the customer, the purpose of the brand—then believing or not believing in engagement will heavily influence the environment and culture of an organization."
And the bottom line. Organizations worldwide are scrambling to find effective ways to attract and to not only keep the best talent, but also to elevate their performance, productivity and service levels to new heights. Nothing drives revenue, cost savings or profitability like motivated and engaged employees. Give employees the information, tools and recognition to engage them in your organization's goals, and they will deliver.
Traditional methods to motivate employees have become little more than table stakes—the best and brightest employees want to work for "Employers of Choice" and have open, trusting relationships with their managers, said Michelle M. Smith, vice president, business development for O.C. Tanner in Salt Lake City, Utah.
"While creating this kind of culture may require more commitment from employers," Smith said, "I believe the result is well worth the effort. A study by the Corporate Leadership Council found that increased employee commitment could lead to those employees exerting 57 percent more discretionary effort, which in turn produces a 20 percent improvement in performance. Similar research by Towers Watson shows that companies with employees who trust management enjoy 300 percent more profitability than companies with employees who don't."
Front-line managers also need to know that their role in employee engagement is critical. "One of the dynamics of today's modern-day workplace," said Mike Ryan, senior vice president for Madison Performance Group in New York City, "is that in many cases, they need to call upon employees who don't necessarily report to them to get projects done. We live in a very cross-metric world where you may have a manager who is managing projects that involve disciplines from areas that are not in his or her department."
It's important, Ryan believes, for a manager to understand that the approach they take in not only communicating with employees, but also allowing employees to communicate with them, is critical in establishing a level of comfort synonymous with being engaged—comfort in terms of their employees feeling comfortable that they can give their input, that they can voice their perspective and that they are excited and enthusiastic about giving their discretionary time. Managers on the front line need to understand that everything they do is going to reinforce and sustain a level of engagement.
If the C-Suite Isn't On Board…
Improving engagement when the C-suite isn't on board is definitely challenging, as they often shape the culture, engagement tools and resources available to everyone, Pokorny said. However, C-suite leadership cannot keep other leaders and people in an organization from recognizing one another's contributions, which helps boost engagement.
Many companies are moving away from allowing the hierarchical structure inside an organization to drive what type of engagement is used and how people use it. This opens up possibilities for people throughout the organization to create more engaging work experiences, give people autonomy in their work, and support learning and development through various projects and experiences.
All engagement has its roots in local behavior. But the C-suite definitely sets the tone for the organization, Ryan noted, agreeing with Pokorny. "Top executives help to prioritize what is important," he said. "They put in systems and structures that help engagement, such as recognition systems. You sometimes find pockets of managers so effective that they are establishing employee relationships and doing business in a way that promotes a higher level of engagement. But that is something that is going to be fleeting if senior management is not on board."
A wealth of data from the best research organizations in the world has established that, in the vast majority of cases, people don't leave their companies—they leave their managers. Managers are the key factor in employee retention, yet too many companies still choose to ignore the data and the enormous potential for significantly improving business performance by helping managers become better leaders.
An investment in training managers is one thing that can provide substantial returns. There's simply no excuse not to do this—do it now, and start reaping the rewards immediately.
David Peer, president of Hinda Incentives in Chicago, suggested another practical measure to boost engagement. Create a disciplined routine where all of your employees—or representatives of your employees—take part in a program that coincides with the goals and objectives of the company. Then, give them the responsibility to implement those goals and objectives.
"At the end of the day," Peer said, "employees, as well as their managers, are responsible for creating a business culture, which is really what engagement is. Having a clearly defined business culture that makes people happy, makes them proud and energizes them in pursuit of an objective is your objective. You really need to have a program that has follow-through, but also has grassroots participation in it."
Use Rewards and Incentives to Boost Engagement
It's helpful when top executives control their organization's destiny and also lead by example when it comes to strategic business tools such as incentive or recognition programs. The data is overwhelming that these programs, when well-conceived and well-designed, offer enormous opportunity to drive revenue, capture market share, reduce costs and gain a competitive advantage, but they have very little opportunity for success if they are not fully supported by the company's leaders.
"Having the CEO personally involved will always increase the success and sustainability of an employee engagement initiative," Smith said, "However, it's not necessary to have the CEO function as the primary advocate as long as there are several other senior leaders who can make decisions and will be active champions for recognition."
Smith referred to an "O.C. Tanner Global Recognition Study," conducted by Towers Watson, which found that over a three-year period, companies with engaged employees grew by 19 percent. Over that same period, organizations without engaged employees experienced a decline of 30 percent. The 49 percent growth variance is something no CEO or CFO can afford to ignore.
While incentive programs are a very positive experience for employees, it's the employer who gains the most from them in the increased revenues and cost-savings they can generate, "and I like to remind CFOs in particular that finding these opportunities is their job as the steward of the company's financial security," Smith said.
Praise from immediate managers and leadership attention can also be more powerful motivators than cash bonuses, raises or stock options. While economic uncertainty and increasing workloads have made workers apprehensive, employees still find reassurance a powerful motivator that also helps them feel more connected to the organization and its success. The best way to integrate traditional reward and recognition programs into a company's engagement efforts is to do more of them, Smith suggested. "I think the single biggest factor standing in the way of higher engagement scores across the board," Smith noted, "is the lack of awareness by senior executives that recognition and incentive programs are a highly successful tool they should be utilizing on an ongoing basis to address business issues."
A CEO wouldn't consider putting forth a budget that didn't include advertising, legal counsel, financial services support, etc., yet recognition and incentive programs are still largely viewed as a discretionary spend, only appropriate when times are good and easily cut when the economy softens.
Making the Case
When confronting skeptical executives, it is important to make both rational and emotional arguments that are grounded in science, research and experience. Introducing solid data and statistics that effectively outline the importance and impact of effective engagement strategies will help the C-suite better understand the need for engagement.
Also, Pokorny said, "helping the C-suite understand that employees want more than extrinsic rewards or paychecks is key. People want to bond and connect with others. They want to express, learn, create and grow, knowing that their work has meaning, purpose and impact. They will go the extra mile for and defend people and organizations they trust and make them feel important and valued."
Employees are more productive when they are engaged.
The ROI case to convince C-suite executives of the value of incentive and recognition programs is all about the enormous difference these programs can make in bottom-line and overall corporate success. The world's most admired companies attract candidates—and customers—because they are renowned for treating both well. Feeling appreciated and being recognized for one's work continually ranks at the top of why people remain loyal to their employer, and those engaged employees afford their employers tremendous advantages in the marketplace.
"Research has demonstrated that incentive programs that are supported by top leadership are significantly more successful in achieving their stated goals than programs where management isn't fully engaged," Smith said. "I always advise that when a company decides to make the investment in an incentive or recognition program, leaders should protect that investment by actively engaging in the program as well."
Another factor that Smith has found helpful in convincing leaders of the value of engagement is that most investments in incentive programs pay for themselves from the increased revenues and/or cost savings they generate. The numerous benefits of more engaged and skilled workers continue long after the program ends.
More and more leaders around the world are starting to understand what a powerful business tool motivation can be—for their employees, their customers, and the longevity and strength of their brands. Research has been very influential in this transition since there is so much data linking employee and customer engagement to brand loyalty—and the financial benefits it creates—that leaders can't ignore it.
CEOs may have been earlier adopters of this strategy than many of their marketing leaders. "It's been challenging to get the message to CEOs," Smith continued, "but once they hear it, they quickly understand the enormous power and potential of the strategy."
The recession crystallized the importance of retaining brand loyalty, and CEOs appreciate the efficiency and effectiveness of building their business and their brand by building engagement levels in their workforce—they are often grateful for an integrated strategic approach that transcends organizational silos.
What most troubles Smith and other experts is that this is a business problem easily solved—and to the benefit of everyone involved. Executives can't control many things in business, but improving employee engagement—and the related inherent benefits to our organizations—is something they can do something about, so it's inexcusable to allow and accept a disengaged workforce. Not taking good care of employees creates a vicious cycle of business problems that have far greater consequences than investing some effort and a few dollars in aligning employees' motivations with corporate goals.
As people are increasingly being recognized as the means with which companies can gain competitive edge, people are also identified as the method to achieving those results. As more and more leaders make the shift to this strategic view of incentives, and the powerful dynamics of rewarding those individuals who can directly contribute to the success of the organization increasing numbers of executives will see the wisdom of giving their full and unconditional support to incentive programs. Engaging your employees—and your customers, vendors and channel partners—isn't just what you should be doing when times are good.
It makes sense to utilize this effective strategic business tool at all times to optimize your business processes and the results from those efforts. Smart leaders have enthusiastically embraced this practice and many are continuing to engage their staff and other stakeholders to gain the advantages that a hyper-competitive marketplace requires. "Progressive leaders entered this downturn with a workforce fired up and committed to leveraging the available resources to turn things around as quickly as possible," Smith said. "Not only are their efforts doing just that, but they're also perfectly positioned to leap forward in a redefined, healthier economy—unlike their competitors who may be just starting to think about engaging their staff at that time and finding themselves falling further behind the curve."