New generation of employee engagement required in recession

by 18 May 2009

Australian companies faced with mounting pressure to cut costs in the face of a recession should consider new ways to enhance employee engagement as a more proactive and less disruptive way to improve organisational performance, according to Hay Group.

The old style of employee engagement has passed its use-by date, and it is no longer enough to run employee engagement surveys and report back to organisations about which groups of staff are engaged or disengaged, said Sam Dawson, head of insight, Pacific, Hay Group.

“In today’s tough trading environment, our research with ‘most admired’ companies shows organisations need to enable staff to succeed by putting them in roles that fully leverage their potential and providing them with the workplace supports (such as tools, resources and authority) they need to perform at their best,” he said.

Hay Group research has demonstrated clear links to business performance, with companies with good levels of engagement and enablement seeing revenue growth 4.5 times that of other companies.

“It is always a good strategy to retain the best talent an organisation has, particularly in anticipation of an improvement in economic conditions in the medium-to-longer term,” he said.

“It generally costs an organisation 18 months salary to train up and replace a manager. The smartest companies are looking at ways to support employees to work to the best of their ability and place the best talent in the right jobs. The margin for error is now smaller than ever.”

Organisations that are exclusively focused on increasing employee engagement are missing the point, he said, noting that successful companies are focusing on helping their workforces become more effective.

“They are doing this by looking at engagement in tandem with enabling factors such as work structure, resources and performance management,” he said.

“Today it’s all about supporting employee output to align with overall organisational success.”

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