Wednesday, June 08, 2005

Employee Engagement Study and Commentary

Regina pointed to Neville Hobson who pointed to a very interesting study by Northwestern University. I’d like to add my 2 cents to their existing commentary.

Fist of all, as Neville points out, this was not some lame and insignificant study. They sent out over 100,000 surveys to employees of target companies, got over 30,000 responses, and then further re-surveyed the non-respondents for bias. I’d like to have seen some more of the quantitative data, but I’m sure they are retaining that for their own consulting uses.

Basic Premise:
Employee Satisfaction = Employee Engagement = Better Financial Outcomes

Mainly I’m interested in the employee engagement and antecedents to that. First off, here’s my definition of employee engagement: the desire of the employee to apply above average effort and dedication to the employer’s work. Based on my read of the numbers, predictors of employee engagement with rankings are: (#4) employee satisfaction, (#1) managerial facilitation, (#3) job design, and (#2) culture (I am aggregating multiple components in the study). Unlike Regina, I was quite surprised that managerial facilitation was the leading indicator, and employee satisfaction was the least of the top 4. I believe that each of these areas are very much interconnected and I’d like to explore that.

What is employee satisfaction? As defined by the survey, employee satisfaction is a function of stress and level of comfort, job satisfaction, and control over quality of service. If we take a look at the 3 of these components, we can mentally derive that culture, communications, and job design are all reconnected here as antecedents of employee satisfaction even while they are direct antecedents of employee engagement. Here’s a majorly convoluted picture of it.

Next, we look at managerial facilitation. Basically this was simplified to managerial supportiveness, communication of established expectations for performance, and effective up and downwards communication. Quite vague, but in short, more communications in a generic sense.

Next on the list was a top priority for me. Job design was the only solid strategic HR activity. All the other cultural, communication, satisfaction aspects are based on somewhat tenuous and less measurable cause and effect. However, the idea that effective and appropriate job design has a direct relationship to the employee’s feeling that they are able to perform, affect, and achieve their job related goals resonated with me. If they can do the above, combined with supportive management, and a culturally sound workplace, then you have engaged employees.

What is especially interesting is that the survey did not find a correlation (by my read neither a positive or negative correlation) between selection, development, performance, or compensation. Certainly other surveys have measured these correlations, and the specific methodologies and language across surveys may have produced some bias. It is also possible that the survey’s definition of satisfaction and engagement precluded these correlations. In fact, the survey notes that managerial facilitation includes expectations for performance, so I’m not sure what to make of it. At any rate, quite an interesting study and you should read it if you have the time.