Introduction
“Employee engagement is an investment we make for the privilege of staying in business.”
- Ian Hutchinson
Employees, “the backbone of any organization” is a vital deciding factor in achieving business success. The 1960’s, the era of Civil Right Movement, organizations focused on employee satisfaction as a standalone requirement of employees rather than promoting the relationship employees have with the organization, and with time, attention had drifted apart from employee satisfaction to commitment (Chandel 2018). Without any doubt, a company aiming to be successful in today’s market essentially need to retain and attract dedicated and competent workforce. Employee engagement is one key driver in achieving aforesaid task. Engaged employees have a sense of energetic and effective connection with their work activities and see themselves as able to deal well with the demands of their job (Schaufeli & Bakker, 2004)
Definitions of Employee Engagement
Employee
Engagement has been conceptualized in many different ways. There is no single
agreed definition and research has shown that however, engagement is defined it
is a multi-faceted construct (Kahn, 1990). There are different definitions of
employee engagement among different scholars, organizations and different
countries. Following table illustrates various definitions provided by
researchers. (Table 1)
Table 1. Definitions of Employee Engagement
(Source: Sun Li, 2019.)
Kahn
(1990), the first to point out on employee engagement has comprehended it as
the way in which people can “use varying degrees of themselves – physically,
cognitively and emotionally in work role performance”. In essence, it can be put into words as how
employees are emotionally committed to their organization which would eventually
contribute to achieve organization’s success. Engaged employees are said to be dedicated,
productive, enthusiastic, accountable and at the same time result focused
(Allen 2014). Further, the Aon Hewitt’s employee engagement model (2012) has
drawn attention to the three behavioral traits of an engaged employee, and is
as follows,
Figure 1.0: Employee Engagement Model
(Source: Aon Hewitt, 2015.)
As per Robinson et al. (2004) an engaged employee put forth a positive mindset towards the organization and its value. Further, such employees are fully aware of the business context and alongside with colleagues contribute to improve performance for the betterment of the organization. A survey done by Gallup, Inc. (Harter 2020), has revealed only 15% of the employees are engaged, whereas 85% of the employees are not engaged rather disengaged. Therefore, an organization should take actions to foster engagement while building a fruitful two-way relationship between the employer and employee and identifying and nurturing the other factors which drives employee engagement.
Figure 2.0: How Employee Engagement Influences Business Outcome
The framework illustrated in Figure 02, indicates how employee engagement is being facilitated to achieve organization’s outcomes, subsequently organization’s success. Harvard Business Review Analytics Services (2016), has considered Employee engagement as the 3rd highest contributor in achieving success. Further as per Perrin (2007), organization with highest level of employee engagement result in increase of operating income by 19 percent and earnings per share (EPS) by 28 percent year on year basis.
After the financial crisis 2008, for
companies with engaged workforce, EPS has been a strong differentiator as companies
with engaged employee base had seemed to be recovering from the drop in EPS at
an increasing rate when compared with the peers, which further evident the
correlation between employee engagement and organization’s success (Sorenson
2013).
Undoubtedly,
due to significance of the evolving concept of employee engagement to
organization’s benefit, it has become a key challenge to many organizations operating
in varying industries and banking sector is not an exception in this regard. For
any bank all stakeholders are important for the long term survival, however
among them, customers are considered to be the key to sustain! To provide
better quality service to customer and to achieve competitive advantage over
peer banks, any bank should be at the top in terms of employee engagement.
Every organization wants to gain competitive advantage and employee engagement
is the best tool for achieving it. In fact,
employee engagement is considered to be the most powerful factor to
measure a company’s
vigor and orientation towards
superior performance. Banks being a service provider, differentiating factor in
going towards achieving competitive edge is clearly the employees of the bank
as they are in the forefront in dealing with customers, thus clearly having engaged
employees is one key goal of banks (Dale Carnegie & Associates, Inc 2013)
and needless to say, it is the biggest human capital challenge.
In
a nutshell, employee engagement, a multi-faceted concept, which is relevant to
any organization, irrespective of the scale, size and industry in which the
company operates in. With no questions, the prominence of employee engagement
would be eventually manifested through the organization’s outcome and is a
definite core contributor of organizational success!
References
Aon, H., 2012, ‘Trends in Global Employee
Engagement’, pp. 5-10.
Chandel,
P., 2018, ‘The Evolution of Employee Engagement: A Unique Construct’, International
Journal of Human Resource Management and Research (IJHRMR), vol 8, issue 6,
pp. 199-216.
Dale Carnegie & Associates, Inc., 2013,
‘Employee Engagement in Banking Sector’, p. 2.
Harvard Business Review Analytics Services, 2016, ‘Impact
of Employee Engagement on Performance’.
Harter,
J., 2020, ‘Dismal Employee Engagement Is a Sign of Global Mismanagement’, viewed 22 October 2020,
<https://www.gallup.com/workplace/231668/dismal-employee-engagement-sign-global-mismanagement.aspx>.
Kahn, W. A., 1990, ‘Psychological conditions
of personal engagement and disengagement at work’, Academy of Management
Journal, Vol 33(4), pp. 692–724.
Perin, T., 2007, ‘Largest Ever Study of
Global Workforce finds Senior Management Holds Trigger to Unleash Talent
Potential’.
Robinson, D., Perryman, S., & Hayday, S.,
2004. ‘The Drivers of Employee Engagement Report’, Institute for Employment
Studies, UK.
Smith,
GR & Markwick, C. (2009) ‘Employee Engagement: A review of current
thinking’, Report 469, Institute for Employment Studies, viewed 03 November
2020,
<https://www.employment-studies.co.uk/system/files/resources/files/469.pdf>
Sorenson, S., 2013, ‘How Employee Engagement
Drives Growth?’, viewed 22 October 2020
https://www.gallup.com/workplace/236927/employee-engagement-drives-growth.aspx
Sun Li, 2019, ‘Employee Engagement: A Literature Review’, International Journal of Human Resource Studies ISSN 2162-30582019, Vol. 9, No.1, pp. 66-68.
