Employee Engagement: For Bottom Line Impact, Don’t Forget this Crucial Component

Employee engagement is a popular topic these days and a whole industry has sprung up around helping managers identify people’s strengths, discover their motivations, and provide the tools and resources people need to succeed.  The goal is to create a high-energy work environment where people want to come to work and be their best.

But do high employee engagement levels translate into better bottom line performance?  Not necessarily.  There is one additional component that has to be in place in order to drive bottom line impact.

Gallup was among the first organizations to discover this when they took a deeper dive into their engagement research.  One of the surprising discoveries they made early on was that work groups with the highest employee engagement scores didn’t always outperform those with average engagement scores.  In taking a closer look, they discovered that in addition to high levels of employee engagement, organizations also needed to create a high level of customer engagement.  It was only when work groups scored high in both of these areas—meeting the needs of both employees and customers—that companies saw the big jump in performance they were looking for. Be sure to read How Employee and Customer Engagement Interact to learn more about this important finding.

What This Means for Leaders

When beginning an employee engagement initiative, remember that the reason for taking care of employees is so they can, in turn, take care of customers. When employee engagement becomes the end and the means, the result might be a happier organization, but not one that necessarily creates the higher levels of customer devotion that drives bottom line profits.

For best results, leaders need to maintain a dual focus on meeting the needs of employees and customers.  It’s a two-step approach that will generate the results organizations are looking for.

PS: Interested in learning more about the relationship between leadership practices, employee work passion, and customer devotion?  Be sure to check out the Blanchard white paper, The Leadership-Profit Chain, which takes a more in-depth look at how strategic and operational leadership behaviors impact bottom-line results.

4 thoughts on “Employee Engagement: For Bottom Line Impact, Don’t Forget this Crucial Component

  1. It’s like the question, “Which came first, the eagle or the egg?” Without customers, there will be no employees. I think it’s a very noble purpose for employees to be motivated by a desire to take care of the customer. A leadership challenge from this angle would be, motivating employees that don’t touch the client directly. People at every level of the organization need to know how their daily output/input will help impact the client in a positive and meaningful way. Otherwise works is a means with no end. Thanks, David

  2. Performance Appraisals Drive Employee Engagement. It’s amazing that such dinosaurs (performance review systems, not the people) are still around. They must be, however, since a book has been published called “Get Rid of Performance Reviews’. Yet despite the outcry against reviews, there’s nothing wrong with them that can’t be fixed by getting managers off of center stage. Top management can fix the basic problems the review system faces.
    Critics argue that performance reviews not only don’t accomplish what they’re supposed to do – that is, improve performance, enhance employee skills and achieve planned outcomes – they have unintended negative consequences. In many cases, unfortunately, that’s true. But it doesn’t have to be that way. What companies need to abolish is not performance review itself, but the idea that it’s a “management tool. Here are some practiced paradigms that must be discarded:
    Performance Review is designed, as the name suggests, in support of managers. If you believe this, your management is one of the roadblocks to exceptional performance. The most useful performance review support work relationships between employees (managers too are employees). Both parties need to address the question of how to best serve the goals and outcomes and align their work efforts.
    Performance review is a management tool. Managers are not necessarily the best qualified to assess their staff’s accomplishments. In fact, they may have a very limited or biased view. A more complete and accurate picture results when employees and managers seek feedback from a variety of customers, team leaders, professional peers, and others inside or from outside the unit.
    Performance reviews include judgments from a “higher authority”. Judgments produce compliant workers – people who are told what to do – not innovative ones. People hate performance reviews because most of them are fault-finding. How much better to ask, “What did we learn from this? What can we each do different the next time?”
    The manager is responsible for obtaining input from the employees. 21st century employees can’t assume a passive role in performance review, providing “tough-minded” self-assessments and valuable insights only on request. They must take the initiative, soliciting feedback from their managers and others. No risk taking to solicit the complete picture and no learning means no improvements.
    Managers should be trained in performance reviews, then prepare their employees for the process. If performance review is to be a productive partnership with employees taking the active role and both parties committed to exchanging knowledge and ideas, managers and employee need to be trained together.

  3. The key here is that when you manage employees, you have to get the relationship right to engage them in the organization as a prerequisite to them then producing relationships that are value-creating with customers.

    This is the very first job for every manager – above all.

    If the manager/organization relationship with employees is not up to scratch, the realtionships that show up with customers will always struggle.

    For a manager to understand what ‘creating a relationship’ with an employee is, think simple things where you show a real interest in them – outside the business need as well as within it – and then you will be well on the way.

    As an afterthought, never assume that everything is OK with your people – it often seems that way, because that’s what they say (hence the significant failing in many of the formalized ’employee satisfaction surveys’, of which Gallup came up with this data), you need to earn your crust and dig deeper till you really are sure that they are engaged.

    Martin Haworth

  4. Most athletes, especially basketball players, at some time or another wonder how they can jump higher. Both rebounding and slam dunking require you to jump high unless you are very tall.

    There are exercises and techniques to strengthen your legs and increase vertical jumping quite a bit. You can add several inches or even feet to your jumping with the right training.

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