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What Is Employee Engagement?

What is employee engagement?

It’s important to define what it isn’t as well as what it is. Employee engagement is not a survey score, not a satisfaction level nor a happiness meter – all things that can be numerically measured, which is what makes them so attractive. Instead, employee engagement is typically described as the amount of discretionary effort an employee is willing to give an employer. You might also call it commitment – which is naturally more of an emotional state than a rational one. 

It’s that emotional commitment that drives the decisions employees make, and ultimately, your business outcomes.

While most leaders understand and agree that employee engagement is desirable, not many have a strategic approach to maximising it. Many studies on the topic report the number of disengaged employees range from 50-87%. If even half of your workforce is disengaged, you have an opportunity to become more productive, profitable, safer and innovative with greater market presence. This is not to mention the reduction in costs due to decreasing employee turnover, absenteeism, recruitment, shrinkage, defects and customer attrition. There is certainly a business case for increasing employee engagement.

Organisations with highly engaged workforces enjoy a competitive advantage in their markets: high employee retention, attracting top talent, employee loyalty and referrals. Staff are empowered to use their strengths, be recognised for their progress and rewarded for their achievements. So how do you create an engaged workforce? It comes back to commitment – what emotions are at play that drive people to decide what to do, whether that be giving more effort, meeting the minimum requirements or opting to disengage.

Recognition is a key ingredient in creating emotional commitment. Results show that:

  • Recognition raises sustained employee engagement by 10-25%
  • Recognition decreases employee turnover by 23-31%
  • Over half of an individual’s engagement is driven by the amount or recognition received
  • Increases in recognition also drive higher engagement scores, performance commitment scores and intent to stay scores

In fact, recognition accounts for 56% of the variance in an employee's engagement level. Four in five Australians (85%) report that they could be more productive, and they identified the main obstacles as staff engagement, wellbeing, motivation, reward and recognition1. Recognition and engagement go hand-in-hand. Why not take advantage of a recognition program to realise the benefits of increased employee engagement?

BIW uses the science of behavioural economics to design motivating programs to emotionally engage your staff, drive long-term focus, promote goal-setting and align their activities with your business objectives. For more information please visit our research section for case studies, blogs and white papers.

1 Productivity gains stall - Australia has $305 billion in unrealised productivity.

Why recognition matters – an employee’s point of view

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