*image source: agile-trail.com
Employee Engagement and Performance Outcomes
There is extensive research that shows beyond doubt the correlation (dare I even say, causality?) between employee engagement and performance. A Gallup meta-analysis using 263 research studies across 192 organizations in 49 industries and 34 countries confirmed the connection between engagement and 9 performance outcomes:
- customer ratings
- safety incidents
- patient safety incidents
The meta-analysis found the following interesting correlations:
- Those employees scoring in the top half of employee engagement nearly doubled their odds of success compared with those in the bottom half.
- Those at the 99th percentile had 4 times the success rate as those at the 1st percentile
- Work units in the top quartile in employee engagement outperformed bottom-quartile units by 10% on customer ratings, 22% in profitability and 21% in productivity
- Work units in the top quartile also saw significantly lower turnover (25% in high turnover organizations, 65% in low-turonover organizations), theft (28%) and absenteeism (37%) and fewer safety incidents (48%), patient safety incidents (41%), and quality defects (41%)
- Companies with engaged workforces have higher earnings per share (EPS)
- Companies with an average of 9.3 engaged employees for every actively disengaged employee in 2010-2011 experienced 147% higher EPS compared with their competition.
- Companies with an average of 2.6 engaged employees for every actively disengaged employee, in contrast, experienced 2% lower EPS compared with their competition during the same time period.
Thus it is clear that employee engagement can have a hugely beneficial impact on performance and overall productivity at work. But how does one capture and measure employee engagement?
Subjective Well-Being (SWB)
SWB refers to how people evaluate their lives. A person is said to have high SWB if he or she is (a) satisfied with his or her life; and (b) experiences frequent positive emotions such as joy and happiness, and infrequent negative emotions such as sadness and anger.
How can experiences of positive emotions be further defined? Russell‟s (1980, 2003) circumplex model proposes that affective states arise from two fundamental neurophysiological systems, one related to a pleasure–displeasure continuum and the other to arousal, activation, or alertness.Each emotion can be understood as a linear combination of these two dimensions as varying degrees of both pleasure and activation.For instance, the degree of activation while experiencing positive (pleasurable) emotions varies considerably. Feeling calm and content implies a lower level of activation compared to feeling happy, engaged, excited or enthusiastic. Similarly, unpleasant emotions may range from “feeling bored or depressed” to “feeling upset, anxious or tense”. The circumplex model emphasizes that emotions are not discrete and isolated entities but instead are interrelated based on the two neurophysiological systems of pleasure and activation [Source: http://www.pop-lab.com/beheer/userupload/papers/27.pdf].
Happiness as a measure of positive SBW
It is thus clear that positive SWB has a significant impact on engagement which in turn, as we have seen, has a positive impact on performance outcomes. Hence, it becomes important for organizations to not just help employees to attain a positive SBW but also to help monitor and measure it. As the old adage goes, “you can’t change what you don’t measure”. So how does one go about measuring Happiness?
Akinori Sakata propounded the use of the niko-niko calendar as a means to “make visible” the feelings of employees. Niko-Niko in Japanese means “smiley”. The idea is to ensure visibility of an employee’s feelings and emotions so that organizations can take proactive decisions. This is carried out by physically pasting on sticking emoticons onto a board having the names of people for a given function or division on a day to day basis.
While this is a great idea, it is still limiting from an organizational perspective since leaders of large organizations would want to take a look at organization-wide trends in the “Happiness Index” of their employees.
n!Gage provides organizations with near real-time feedback on how employees are feeling through a simple, pop-up based feedback mechanism. It also provides the organization with a means to derive insights from the pulse data. These insights can answer questions such as:
- Which functions or divisions are most stressed?
- Are there times of the day where employees are less engaged?
- What is the long run “Happiness” average for a function or division?
- Which functions or divisions are doing consistently better?
More importantly, n!Gage can help identify the impact of specific events on the mood of the organization through intervention analysis. Events can be as simple as a CEO town hall or could be any number of different policy rollouts. Identifying whether such events have had a significant (in the statistical sense) impact on the Happiness Index of people can be a powerful way for organizations to keep track of which interventions work and which ones don’t!
Check out n!Gage at https://www.nfactorialanalytics.com/home/offerings