By Charlie Lang, Executive Coach & Trainer
Corporate Culture & Leadership Expert @ Progress-U Limited

As an executive coach, I get to see many different companies. Some are large multi-nationals, others are midsized companies and sometimes smaller enterprises. Over the years, I have developed a “fine nose” for the various cultures of the companies I work with. In many cases, I can already get a sense of a company’s culture the moment I walk into their office. And in most cases my initial sense is confirmed by the executives I’m coaching.
 
In the past couple of years I started to pay special attention to the engagement level of the people working in these offices. How would I know if the engagement level is high or rather low? And why does it matter? And ultimately, what has leadership got to do with it?
 
In the course of this article I will share with you not only my observations in working with many senior executives and management teams but also results from recent research on this topic. I will endeavor to provide you with a complete view on this topic and useful strategies and tools to assist you in what you most probably need right now: a top performing team or organization that successfully navigates through the challenges leaders are continuously confronted with.
 
Let’s first define the term ‘highly engaged employee’. I like the definition brought forward by Hewitt Associates as part of their Best Employers Research1. They summarized it with three ‘S’. Highly engaged employees

• say good things about their team and/or company. Their communication towards people inside and outside the company about the company is positive;

• stay longer with the organization because they can identify themselves with the organization and feel committed to it;

• strive to work at their best possible level, strive to learn what’s necessary to deliver excellence and are willing to go the extra mile.

It is rather obvious that highly engaged employees have a positive impact on the top and bottom line of your P&L. More than that, they actually help increase shareholder value as the brand image of your company gains in value.
 
Ever since I have been involved in the people management business, I have been wondering: Why are some employees highly engaged and others not – often even in the same team with the same manager in the same company we notice considerable differences. Why does it seem that some managers are more able to build a highly engaged team than others? Why do I notice such differences even within the same company?
 
I started the quest for a deeper understanding of employee engagement in 2004. In 2005, I published my first book “The Groupness Factor”2 which is about one specific and highly influential aspect of employee engagement.
 
The longer I studied this topic, I noticed more and more determining factors for employee engagement and the whole topic became almost overwhelming to me. For those who know me, they know that I hate models that are too complex because they usually are not very practical and rarely lead to the desired outcome.
 
So I realized that I needed to find a way how to integrate these complex ideas into something easier to grasp. And as it often happens when you search for something, it will somehow show up if you are sufficiently patient and persistent. And it did!
 
In mid-2007, through some coincidences, I came across a study on engagement conducted in 2004 by the CLC (Corporate Leadership Council)3. A similar study was repeated in 2008 and the following graph4 (adapted from this study) summarizes one of the key findings:

Note: ‘Discretionary effort’ could be translated to ‘going the extra mile’ or ‘doing more than what is necessary’ and is therefore a strong indicator of high engagement.
 
That’s exactly what I was looking for – a deeper understanding of what actually makes people highly engaged. It took me a while to fully grasp the meanings of these commitment types and how we could help organizations to apply them in a highly effective and efficient way.
 
I noticed that many efforts by line managers and HR are focused on rational commitment types (column on the right). For example, incentive systems tend to increase the rational commitment to the manager (“I’ll work harder and be more loyal to my boss because then she will more likely give me a higher bonus.”). From the above research we see that this has a comparatively low impact on high engagement.
 
The rational commitment types mean that people are committed because of some expected benefit. The emotional commitment types mean that people are committed because they simply love the job, the company, the team, the boss.
 
The same study, conducted globally (47% of respondents outside the US) in 2008, had a special focus on engagement during an economic downturn. Let me summarize a few key findings:

• The number of highly disengaged employees rose from 8% (first half 2007) to 19% (second half 2008)

• The percentage of highly disengaged employees seeking a new job has decreased (!) at the same time from 46% to 35%

• High Potentials (HIPO’s) in the average show a 21% higher discretionary effort than average employees

• 25% of all HIPO’s plan to leave their employer over the next 12 months

• Only 18% of all respondents (total over 160,000 respondents) agree to the statement “Organizations have the Best Interest of their Employees in Mind”

• The percentage of highly engaged senior managers (VP’s and above) dropped from about 1 out of 3 to about 1 out of 10 between second half 2006 and second half 2008

Interestingly, when high engagement is most necessary – during an economic downturn – actual engagement levels seem to be dropping, even at senior management level.
 
So what to do?
 
Here are a few areas you might want to consider to address:
 
1.   Emotional Commitment to the Job
 
In our experience, to make people highly committed to their job, selecting the right people for the right positions is key. People who ‘can’ and ‘want’ to do a certain job are most likely emotionally committed to it.
 
We tend to be quite good in figuring out whether or not a candidate can do a job (eligibility) but we seem to be far less successful in predicting if the candidate is likely to ‘want’ to do the job (suitability). To assure high suitability, you might need to include an effective personality profiling system into your recruitment process.
 
Besides optimizing recruitment, it is important to continually assess if our people are a good fit (eligibility + suitability) with their current jobs. To know this, you may use similar tools as for recruiting people.
 
If you find that certain people might not be a good fit, you have the following choices:

• Develop their capabilities through targeted training

• Work on their mindset through internal or external coaching which may make it more likely for them to love their job

• Move them to a more suitable role or ultimately ease them out. This is often a good solution for both parties in such case.

2.   Emotional Commitment to the Organization & Team
 
We found that very similar approaches can be used either for single teams or for a whole organization. In both cases we talk about ‘groups’ and the dynamics seem to be quite similar.
 
For example, each team that works together for a certain period of time will develop its own culture. An organization, no matter how small or big forms a group as well and as such will develop its own culture.
 
In order to drive high emotional commitment to the organization or team, it is necessary to enhance ‘groupness’, or a sense of belonging to the team / organization.
 
Based on my research, there are three key factors that drive groupness:

1. Giving Direction (vision, mission, strategy, goals)

2. Differentiation (e.g. from competitors)

3. Image or Identity (influenced by corporate values, culture and external / internal brand)

Besides defining these areas, it’s crucial to clearly communicate them to your team members – not only once but continually as people have a tendency to forget.
 
4.   Emotional Commitment to the Manager
 
As the Industrial Age has given way to the Information Age, the old directive leadership style is less and less acceptable for smart high performers.
 
High potential employees today want to take more ownership, enjoy more flexibility and be able to engage their creativity. Moreover, they want to work for a manager they can trust.
 
As a result, managers at all levels need to learn to adopt a coaching style leadership approach. In my experience, very few managers know how to do that naturally, so specific coach training for managers will help to increase the emotional commitment of their direct reports.
 
Conclusion
 
Employee engagement is clearly related to top line and bottom line results. Emotional commitment factors have a considerably higher impact on engagement than rational commitment factors. These emotional commitment factors can be enhanced by improving your selection and development processes, using effective communication to enhance groupness, and training managers to use a coaching-style leadership approach.
 
Notes

1. For more info on Hewitt Associates’ Best Employer Research, visit  http://was7.hewitt.com/bestemployers/anz/pages/index.htm

2. The Groupness Factor, Hong Kong, 2005 by Progress-U Ltd, available on http://www.amazon.com/Groupness-Factor-Corporate-First-Class-Leadership/dp/1411683714

3. For more info on the Corporate Leadership Council, visit https://www.clc.executiveboard.com/

4. Graph by Progress-U, adapted from “Improving Employee Performance  in the Economic Downturn”, 2008, Corporate Leadership Council
    
    
   About Charlie Lang
   Charlie Lang is Founder of Progress-U Ltd.  He was president of the Hong Kong International Coaching Community (2007-2009) and is author of “The Groupness Factor”. He currently writes his second book on Corporate Coaching Culture.