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.
Organizational productivity is determined by employees’ efforts and engagement (Musgrove,
ReplyDeleteEllinger, & Ellinger, 2014). Organizations with highly engaged employees experience increased customer satisfaction, profits, and employee productivity (Ahmetoglu, Harding, Akhtar, & Chamorro-Premuzic, 2015; Carter, 2015; CooperThomas et al., 2014; Vandenabeele, 2014).
The employee engagement significantly impacts on financial results of organizations as several studies observe that employee engagement initially results in greater employee performance, which further leads to enhanced organizational performance (Tower Perrin, 2006; Gallup, 2006 as cited in Beauregard and Henry, 2009).
DeleteHi Thilini, I would like to mention here that the Conference Board published article ‘’Employee Engagement” In 2006, stated following key drivers related to employee engagement .Those are;
ReplyDeleteTrust & integrity –Managers need to communicate well and follow their word as said.
Nature of the job – employees’ jobs should be challenging enough to motivate them.
Line of sight between employee performance and company performance – The employee must have a clear understanding of how they contribute to the functioning of the company.
Career growth opportunities – employees should have clear career path and growth.
Pride about the company – Employees should feel respected by joining the organization.
Coworkers / team members – Relationships with colleagues significantly increase the level of employee engagement.
Hi Eranga, high levels of employee engagement with in a company promote retention of talent, foster customer loyalty and improve organizational performance. It is also a key link to customer satisfaction, company reputation and overall stakeholder value (Lockwood, 2007). Seigts et al. (2006) summarized the literature on employee engagement stating that engagement factors deal with connection, career advancement, clarity in communication, conveyance of expectations, congratulations or recognition, contributions, control over own job, collaboration between employees, credibility in leaders, and confidence in the company.
DeleteEmployee engagement today has become synonymous with terms like 'employee experience' and 'employee satisfaction'. Employee engagement appears to be quite similar across organizations, however how it manifests itself and how it is fostered varies. According to (Byrne), engagement cannot be seen, but one can infer from people’s emotions, their talking about their work, and their behaviour on the job whether they are likely engaged.
ReplyDeleteYes Himasha, Business outcomes at a magnitude that is important to many organizations”. However, engagement is an individual-level construct and if it does lead to business results, it must first Impact individual-level outcomes. Therefore, there is reason to expect employee engagement is related to individuals’ attitudes, intentions, and behaviors ( Vasantha & Manjunathan, 2014).
DeleteHi Thilini , I do agree with your statement . Further as per the Gallup survey, out of the entire of organisation, just 15% of employees are engaged. This has resulted the organization function not running as per the management desire, and therefore in this case leadership is a most prominent key driver that can put employees in engage. "Leadership represents a key driver of employee development and employee engagement"(Tomlinson, 2010).
ReplyDeleteHi Bakshi, according to Harvard Business Review Analytics Services (2016), Employee Engagement tops as the 3rd highest factor that’s more likely to bring in success as viewed by business leaders. The research conducted around the subject also demonstrates, a highly engaged workforce, while maximizing the investment in human capital and improving productivity can also significantly reduce cost and directly impacts bottom-line.
DeleteHi Dilini further more work engagement is a positive, fulfilling, impact-motivating state of work-related well-being that can be seen as an antidote to job burnout. Employees who are engaged have high energy and are enthusiastically involved in their work (Bakker, Schaufeli, Leiter, & Taris, 2008).
ReplyDeleteHi Ranga, further research shows that employee engagement has an effect on a company's bottom line and is sturdily linked to business performance (Saks, 2017).
DeleteEmployee engagement is a different and incomparable theory which is a collection of knowledge, emotion and behaviour (Saks, 2006). Cha (2007) defined employee engagement as the employee’s active participation in work and the shape of full physiology, cognition, and emotion that attend the work engagement, including three dimensions of work engagement, organizational identification, and sense of work value.
ReplyDeleteYes Chamila, According to Swaminathan and Rajasekaran (2010), employee engagement occurs when Satisfaction, Motivation and Effectiveness intersect. Employee engagement has been found to be positively related to individual job performance. Studies have found positive relationship between employee engagement and organizational performance outcomes: employee retention, productivity, and profitability. Employee engagement would be a predictor to organizational commitment, organizational citizenship behavior (OCB), and may lead to intention to leave (Bhatnagar & Biswas, 2010).
DeleteAgreed, employee engagement is the extent of an employee's attachment or participation to the company that helps accomplish the objective (Barclays, 2008).
ReplyDeleteHi Malinga , Yes as Baumruk (2004) contends that 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.
DeleteEmployee engagement is a vast construct that touches almost all parts of HR management surfaces. Employee engagement is stronger predictor of positive organizational performance clearly showing the two-way relationship between employer and employee (Kompaso and Sridevi, 2010).
ReplyDeleteHi Supun , Adding to your statement, engaged employees are the one of the most significant factors for an organization, the persons who act as the pillars of any organization that brings positive vibes such as productive ethics and accountability (Levinson, 2007). Employee feedback is also very important factor in an organization. Managers should welcome employee feedback for the development and success of any organization. Also employee engagement and organizational performance, the strategic plan of every organization could be demonstrated in the best way (Kazimoto, 2016).
DeleteThe need for a two-way communication is necessary in the process of establishing a good relationship between employee and organization in order to support and develop engagement (Robinson, et al, 2004). Engagement again speaks volumes of the inner commitment of employees towards achieving organizational goals (Allen, 2014). Employee engagement strategies when successful brings about a decrease in employee turnover, better productivity, finer efficiency and win customer centricity/loyalty (Robertson-Smith and Markwick, 2009).
ReplyDeleteExtensive research demonstrates that frequent, open, honest communication between management and employees is crucial to generating trust and high organizational performance. Organizations that receive the “best companies to work for” awards have senior leaders who engage their employees through personal connections and communication. These leaders communicate frequently and personally to employees; speak directly, openly, and honestly to them; are easily accessible to employees; and provide clear direction (Marrelli,2011).
DeleteHi Thilini, Considering your inputs , i will added more for your references. Sridevi(2010), states that , Employee engagement is a vast construct that touches almost all parts of human resource management facets. If every part of human resource is not addressed in appropriate manner ,employees fail to fully engage themselves in their job in the response to such kind of mismanagement. Perrin’s Global Workforce Study (2003) uses the definition “employees’ willingness and ability to help their company succeed, largely by providing discretionary effort on a sustainable basis.” According to the study, engagement is affected by many factors which involve both emotional and rational factors relating to work and the overall work experience.
ReplyDeleteYes Madura , engaged employees support the organization to attain its mission, execute its strategy, and generate significant business results. Employee engagement can be enhanced by different HR practices comprising job design, recruitment, selection, compensation, training, and performance management (Vance, 2006).
DeleteAgreed with your statements. According to Robertson-Smith and Markwick,(2009) Organization can reduce the staff turnover rate, while increasing the employee effectiveness and productivity level by having a proper employee engagement strategies.
ReplyDeleteYes Sohan, employee turnover is at which people leave an organization. It can be disruptive and expensive. (Armstrong, 2014). Organizations invest large sums of money to motivate and train, develop, maintain, and retain their employees within their organization. Therefore, managers at all costs must minimize employee turnover (Kevin et al, 2004).
DeleteEmployee engagement originally results in greater employee performance, which further leads to increase organizational performance (Tower Perrin, 2006). Relationship between employee engagement, customer satisfaction, productivity, profit and employee turnover, which eventually, would lead to increased possibility of business success (Harter et al, 2002).
DeleteThilini,Employee engagement is a relatively new concept (Macey & Schneider, 2008) and the factors that produce engagement may be different from those that produce more traditional employee outcomes such as job satisfaction and organizational commitment (Macey et al., 2009).
ReplyDeleteYes Kelum , 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)
DeleteAdding to that the employee engagement is a key factor which drives organization performance and engaged workforce outperform their competition (Osborn and Hammoud 2017). To be more engaged with the employees the organization must create a better and safe working environment which also will help to improve the motivation of employees. In current pandemic situation the employees are keener on their safety mashers within the organization and they expect a better return of their hard work. The employees are more look forward on Strategic Alignment and Managing Execution while they engaged with the organization and management must implement and identify the best ways to improve the engagement with subordinates (Sun and Bunchapattanasakda 2019).
ReplyDeleteYes Dimuthu, While agreeing on your statement , it is pertinent to mention that to enhance employee engagement in difficult times, organizations should make more efforts toward the employees so that employees feel that their organization is genuinely interested in them (Robertson, 2012). According to Groove Management Blog (Formato, 2014), leadership needs to be more visible in tough times than at any other time.
DeleteEmployee’s willingness and ability to help their company succeed, largely by providing discretionary effort on a sustainable basis. Engagement is affected by many factors which involve both emotional and rational factors relating to work and the overall work experience (Global,2003)
ReplyDeleteGubman describes engagement as a heightened emotional connection to a job and organization that goes beyond job-satisfaction. Brief&Weiss (2002). The measurement of engagement with the Gallup measure where the items used to define engagement are all items descriptive of the conditions under which people work. Harter etal. (2002) explicitly referred to their measure (The Gallup Workplace Audit) ‘‘satisfaction-engagement’’ and defined engagement as ‘‘the individual’s involvement and satisfaction with as well as enthusiasm for work’’.
ReplyDelete
ReplyDeleteReward system is one of those strategies which has a direct link with motivation. As it was stated in the definition of a reward, rewards are financial or non-financial things that are used in order to satisfy needs. (Itika, 2011) This need fulfilment leads to a high level of engagement as people are driven to higher performance within an organization. As in the motivation theories, rewards act as motivators which has a powerful effect (Senyucel, 2009)
Mujtaba and Shuaib (2010) discussed that how organizational rewards enhance the good work
Deletehabits and significant boost the performance of each employee. Through reward strategies
management can attract a pool of qualified candidates and maintain a highly motivated workforce in
the organization. Successful companies use the rewards programs to motivate and retain the top
talent and good employee performance which is strategically aligned with the organization’s values
and objectives.
According to Saks (2006), a split to the concept of engagement into two distinct parts: (1) job engagement and (2) organisation engagement, which he puts forward are related but separate constructs. He argues that the relationship between job and organisation engagement vary in numerous ways, resulting in the inference that the psychological states which result in the two aforementioned forms of engagement and their consequences are not the same.
ReplyDeleteYes Dilini, Employee engagement comprises two important facets, that is, job engagement and organization engagement (Saks, 2006). An engaged employee always does care about their effort, work, and performance, and employees want to feel that their work, efforts, and performance could make a difference. Employee engagement is usually understood as an inner state of mind, that is, physically, emotionally, and mentally, that binds together the commitment, satisfaction, and work effort in an employee. Engaged employees support the organization to attain its mission, execute its strategy, and generate significant business results. Employee engagement can be enhanced by different HR practices comprising job design, recruitment, selection, compensation, training, and performance management (Vance, 2006).
ReplyDeleteAccording to ( Erickson, 2005) numerous definitions of engagement can be derived from the practice- and research driven literatures. Additional definitions can be attributed to folk theory: the common intuitive sense that people, and particularly leaders within organizations, have about work motivation. Common to these definitions is the notion that employee engagement is a desirable condition, has an organizational purpose, and connotes involvement, commitment, passion, enthusiasm, focused effort, and energy, so it has both attitudinal and behavioral components. The antecedents of such attitudes and behaviors are located in conditions under which people work, and the consequences are thought to be of value to organizational effectiveness.
ReplyDeleteThe challenge with most of the definitions is that they define the construct in terms of its outcomes more than the construct itself. The definitions also suggest an overlap between engagement and commitment and yet the argument has been posited that engagement exists ‘as a distinct and unique construct that consists of cognitive, emotional, and behavioral components that are associated with role performance’ (Saks 2006: 60).
DeleteEmployee engagement does not have a single definition. Each party; Organizations, Institutes and Scholars have conceptualized engagement in various ways. The concept has developed over a period of 28 years; therefore, it is difficult to find two parties defining it the same way (Smith & Markwick, 2009).
DeleteJohn Storey et al (2009) concludes, if we continue to refer to ‘engagement’ without understanding the potential negative consequences, the core requirements of success, and the processes through which it must be implemented, and if we cannot agree even to a clear definition of what people are supposed to be engaged in doing differently at work (the engaged ‘in what’ question), then engagement may just be one more ‘HR thing’ that is only here for a short time. On a positive note, there is now a wider array of measurement techniques with which to assess trends in engagement and an associated array of approaches to effect some change.Thus, aspiration can more feasibly be translated into action.
ReplyDeleteInternational Survey Research (ISR) defines employee engagement as ‘a process by which an organization increases commitment and continuation of its employees to the achievement of superior results’. The ISR separates commitment into three parts: cognitive commitment, affective commitment and behavioral commitment. In other words, the three dimensions are: think, feel and act (Storey & Welbourne, 2008).
DeleteRecent conferences linking employer branding to employee engagement also indicate the nature of the trend, and the professional associations for HR professionals in the USA and the UK have both paid close attention to the issue (Chartered Institute of Personnel and Development 2006, 2007; SHRM 2008).The Australian Human Resource Institute has engagement as a key component of its ‘Model of Excellence’ which incorporates the latest research results from the HR Competency Model developed by Dave Ulrich and Wayne Brockbank of the University of Michigan.
Delete