Numerous studies have shown the direct relationship between employee engagement and an organization’s performance (ROI, profitability, production, sales, quality, turnover, etc.).Because employee engagement is directly correlated to employee productivity and company performance, it’s especially critical to focus on employee engagement during an economic downturn.
Depending on how economic hardships are managed, we have found that economic bad news can either have a negative affect on employee morale or it can be leveraged to increase engagement.
Factors of Engagement and Tough Times
Research has identified employee engagement as the combination of three factors: satisfaction, effectiveness, and motivation. Economic challenges can impact each of these factors.
Employee Satisfaction: In times of economic uncertainty, many employees report that they no longer feel secure in their jobs as they wait for the “axe to fall.” Additionally, squeezes in salary and benefits can cause levels of satisfaction to drop.
While employers may not be able to predict the future, helping employees understand intended plans, as well as how the plans may impact the employee, will go a long way towards maintaining levels of employee satisfaction. Strong relationships with co-workers and their direct managers are also keys to weathering the storm.
Employee Effectiveness: With current cost-cutting, employees may find themselves with fewer resources and more work. Most of us will be required to do more with less. The 2008 Society for Human Resource Management (SHRM) Job Satisfaction Survey Report indicates that communication during these difficult times is critical. The ability to understand strategic direction and goals allows an employee to align his or her actions with those of the organization, make the best use of these scarce resources, and perform effectively to save the organization.
Employee Motivation: The current economic situation can have both a positive and negative impact on employee motivation. The pessimist will see economic difficulties as de-motivators. However, the optimist will recognize that difficult times can serve to unite the troops in a common effort and goal. There will be opportunities to challenge employees to stretch and grow in their positions. Here it is important to ensure employees are in the right positions and have strong leadership in order to maintain employee motivation.
Maintaining Employee Engagement when Times Get Tough
There are a number of things organizations can do to maintain and increase levels of employee engagement during tough times:
Keep a pulse on levels of employee engagement. Use employee engagement survey results to understand where to focus.
Conduct focus groups. Listen to what employees are saying and act on it.
Communicate. Speak honestly about the challenges being faced, as well as anticipated direction. Without direct communication, employees will fill the void with worst-case scenarios.
Tap into unused resources. As it’s important that available resources be maximized for effective work, it is essential to identify these resources. 360-degree feedback, employee evaluations, one-on-ones, and leadership coaching are often effective sources for understanding where these resources and skills may be lurking.
Develop Front-Line Managers. Employee engagement is “local.” It occurs at the individual and team levels, and is highly influenced by the actions of an employee’s direct manager. However, many front-line managers lack the skills to create an atmosphere where their direct reports can be engaged. Invest the time and resources to develop these skills in your managers.
Clouds have a silver lining, and today’s challenges are no exception. By understanding and focusing on employee engagement, organizations can leverage tough times to build unity, improve efficiencies, and challenge employees.