The Social Contract Part Deaux
I have been following a thread for the last few days on LinkedIn that intertwines two concepts I find very relevant and timely.
The title of the post was Is Engagement Dead? The author argues that as the traditional relationship between employer and employed continues to break down and become more transactional and temporary that concepts like employee engagement have lost both their relevance and their efficacy.
I disagree on both points, but I think it requires a bit more examination.
Employee engagement means many different things to different people. For many you see it described in terms of happiness or morale and by others in terms of tenure.
I define engagement as alignment between the organization and their employees as well as other stakeholders. I think that things like increased satisfaction, reduced regretted turnover, and other factors are positive, but ancillary outcomes of a strategy to create and reinforce that alignment.
Much of the discussion in the thread talks about programs and processes typically led or managed by the human resources organization, and why they fail to achieve their intent. The engagement survey is singled out for particular focus.
I agree that engagement is a culture rather than a program and that surveys are a snapshot rather than a strategy.
I don’t agree that redefining the social contract means that engagement is no longer necessary or important, in fact quite the contrary.
Much of our old social contact was based on an outdated relationship model that in my mind reinforced a form of corporate codependency. If you are loyal to the organization (spelled compliant and obedient) the organization would take care of you.
The advent of international marketplaces, the internet and a variety of other factors has blown that model up. I also believe that creating a mindset and referring to your employees and their combined talents and abilities as human capital contributes to that. It is a transactional not a relationship model.
In my opinion true engagement can only occur between willing and able partners, it is an exchange of value or as Ken Matejka, in his book Why This Horse Won’t Drink describes as where an employee feels psychologically, emotionally, and physically impelled, they willingly give up other choices.
They are not complying, but rather are sharing commitments with the organization based on perceived shared values and desired outcomes. There is no unequal power relationship here.
My own experiences with engagement are grounded in some personal beliefs that I have developed and believe in-
- The most critical elements for the foundation of any relationship, personal or professional are trust and respect.
- Everyone is entitled to respect for their personhood if nothing else.
- Relationships are the most important systemic dimension in every organization.
- People who share your values and are congruent with them will perform at a much higher level than those who are neutral or don’t share them.
Studies also show that when employees join a new organization unless specific actions are taken they go through stages beginning with the potential to be engaged and then diminishing over time. The stages look like this-
- Stage one- enthusiasm and excitement about the new job
- Stage two- they begin to question their decision
- Stage three- they are disillusioned
- Stage four- they consider leaving
- Stage five- they begin exploring options
- Stage six – they receive an offer
- Stage seven- they are forced to decide whether to quit or stay
- Stage eight- they quit and stay
I don’t think most organizations want to live in this space, especially stage eight so I recommend an alternative strategy that I think incorporates both the new social contract and can properly executed create an engaged environment.
The first thing you do is to identify the core value proposition of your organization and develop a strategy to clearly communicate it to all of your stakeholders; this includes employees, suppliers, customers, shareholders, and communities where you do business.
The second thing that you do is that you develop hiring and selection processes that ensure that the people you invite to join your organization share the value set of the organization and that the connection between their personal values and your organizational values is transparent.
The third thing that you do is ensure that anyone in a management or leadership role has the competencies and skills to create and reinforce that line of sight.
The fourth thing that you do is make sure all your other systems reinforce the values as well. By that I mean your hiring and selection, training, compensation, performance management, and your succession planning, and promotional decisions.
The fifth thing you do is to benchmark your progress and recalibrate as needed. Perception is reality, if your employees don’t feel aligned with your core mission and objectives they will not perform at peak.
Realistically all of your employees will not be with you forever and that is a good thing. You need to constantly refresh your talent pool and get new energy and new ideas. The key is that while employees are in your employment they are engaged. In many cases they represent your best resource for attracting the new talent you need.
My colleague Michael Beck posted a great piece on why the majority of employers worldwide are doing the engagement thing wrong, addressing it reactively rather than proactively and I couldn’t agree more. Much better to build engagement into the fabric of your organization through appropriate selection and hiring, but it doesn’t stop there.
He pointed out that the latest Gallup poll provided some pretty eye opening statistics, including the fact organizations with high employee engagement saw a 147% advantage in earnings per share over non highly engaged organizations in 2011 and 2012 and the fact that the Department of Labor estimates that disengagement costs the U.S. economy between $450 and $550 billion dollars annually and for me at least that garners some attention.
Add to that recent studies indicating that voluntary turnover was up 45% year to year from and cost per hire is up 15% for the same period and you might think that more organizations would be examining their strategies and taking action. The interesting thing is that we have seen at best incremental improvement over the last five years.
So in conclusion given the potential upside I am not prepared to declare failure and walk away from the concept or criticality of employee engagement.
Let’s embrace the new social contract and engagement and let’s commit to doing it right!