Employee Engagement: What it Is, and Why it Is Important to Your Workplace

After two decades of rising engagement, things started to change in 2021. Research from Gallup indicates employee engagement across the United States in the second half of the year, and that trend has continued into 2022, with the number of “actively disengaged” employees rising even further.

That’s not to say it is a given that engagement levels will remain low for every business. Many have found ways to keep their employees engaged, even in these trying times.

Some have even found ways to drastically increase engagement, by leveraging some of the benefits of remote work, flexible scheduling, and other new trends that emerged during the pandemic.

If you’re worried about keeping your employees energized or haven’t even really thought about how it can affect your productivity before, you’re not alone. Below, we’ll take a look at:

• What is employee engagement?
• Benefits of employee engagement
• Employee engagement strategies
• How to improve employee engagement
• Challenges you will face along the way

Ready? Let’s dive in.

What is employee engagement?

Have you ever walked by a coworker when they are staring at a wall? Not moving. Just blankly staring into space, wasting time. Maybe they are on their phone, or they could be eating lunch, but they look… disengaged.

On the other hand, there’s that employee so passionate about their work that they stay late to finish a project. They might be working on something outside of their normal job description because they are motivated and believe in the company’s mission. They are engaged.

Employee engagement is the level of enthusiasm and commitment an employee has towards their work and company. When employees are engaged, they go above and beyond what is asked of them because they believe in the organization’s goals.

Conversely, disengaged employees do just enough to get by. They may be putting in the hours, but their heart isn’t in it. This can lead to a decrease in productivity and quality of work. Research has shown that actively disengaged employees cost businesses hundreds of billions of dollars in lost productivity every year.

Benefits of employee engagement

It’s not just direct productivity either. While work output does improve when employees are engaged, there are several other benefits that businesses see as well.

Some of the most important benefits of employee engagement include:

• Increased retention
• Improved customer satisfaction
• Greater profitability
• Reduced absenteeism
• Enhanced creativity and innovation

Each of these benefits is extremely important to the success of any business, but they are especially crucial for small businesses. Let’s take a closer look.

Increased retention

With employee turnover reaching a historically high rate, it’s more important than ever to keep the employees you have. Recruiting, onboarding, training, and developing new employees can be costly and time-consuming.

When you have engaged employees, they are more likely to stick around. One study found that companies with engaged employees had turnover rates as much as 59% lower than those without engagement.

That kind of retention improvement means big savings for your business. The cost of turnover can range from tens of thousands to hundreds of thousands of dollars, depending on the position. For a small business, that kind of money could be make-or-break.

Improved customer satisfaction

When your employees are engaged, they feel like a part of something larger than themselves. They believe in the company’s mission and are committed to achieving its goals. This commitment spills over into their interactions with customers.

Engaged employees provide better customer service because they want to, not because they have to. They are more patient, more helpful, and more likely to go above and beyond to resolve any issue the customer is having.

In turn, this leads to improved customer satisfaction ratings, which can have a direct impact on your bottom line.

Greater profitability

It’s no secret that engaged employees are more productive. They work harder and are more efficient because they believe in what they are doing. This increased productivity leads to greater profitability for businesses. Research has shown that companies with highly engaged employees see up to a 21% increase in profitability.

But it’s not just about working harder. Engaged employees are also more likely to come up with new ideas and innovations that can help your business grow. They see problems as opportunities and are always looking for ways to improve the status quo.

As a result, businesses with engaged employees are more agile and better able to adapt to change.

Reduced absenteeism

Ever had an employee whose attendance was unreliable?

It’s frustrating, and it can have a major impact on your business. absenteeism can lead to project delays, missed deadlines, and a decrease in productivity. Not to mention, it can be contagious. When one employee starts skipping out, others may be tempted to do the same.

Engaged employees are less likely to call in sick or take unplanned days off because they don’t want to let their team down. They understand the importance of being there for their coworkers, and they don’t want to miss out on important work.

Enhanced creativity and innovation

As we referenced above, employees that feel a strong connection to the company will also be more likely to come up with new and innovative ideas. They understand the company’s goals and mission, and they want to help contribute to its success.

This is especially important in today’s business climate where change is happening at a rapid pace. To stay ahead of the competition, businesses need employees who are constantly thinking of new ways to improve things.

Take, for instance, the way many companies have shifted to remote work in recent months. If it weren’t for creative and innovative employees, this transition may not have happened as smoothly (or at all).

Employee engagement strategies

There are many employee engagement ideas that businesses can use to increase the level of enthusiasm and commitment from their team. Some popular strategies include:

1. Providing employees with opportunities for growth and development
2. Encouraging open communication
3. Giving employees a voice in decision-making
4. Creating a positive work environment
5. Recognizing and rewarding employees for their contributions

Each business is different, so it’s important to find the strategies that work best for your company culture.

How to improve employee engagement in your business

Having trouble identifying which strategy will work? Here’s a step-by-step guide to increasing engagement on your team.

1. Define what employee engagement means to your business

The first step is to come up with a definition of what employee engagement looks like in your company. This will help you identify the behaviors and actions you want to encourage.

To do this, ask yourself:

• What does a fully engaged employee look like in our business?
• What are the key performance indicators of an engaged employee?

Once you have a good understanding of what it means for employees to be engaged at your company, you can start working on strategies to increase engagement.

2. Assess where your employees currently stand in terms of engagement

Now that you know what employee engagement looks like in your business, it’s time to take a pulse check and see where your employees currently stand.

There are a few different ways to assess engagement levels on your team.

• Employee engagement surveys: You can send out regular surveys (monthly, quarterly, etc.) to gauge how employees are feeling. Include questions about whether they feel valued, challenged, and supported in their work.
• One-on-one meetings: In addition to or instead of surveys, you can also conduct regular one-on-one meetings with employees. This is a great opportunity to get feedback on how they’re feeling and what’s going well (or not so well) in their work.
• Engagement software: Various engagement software platforms can help you track employee engagement levels over time. Some even provide insights and recommendations on how to improve engagement at your company.

You can only start working to improve something once you have a baseline understanding of where it currently sits.

3. Identify the key drivers of disengagement in your workplace

Once you have a good pulse on where employees stand in terms of engagement, it’s time to start digging into the reasons behind any disengagement you’re seeing.

• Lack of development opportunities: Employees who feel like they’re stuck in the same role without any opportunity to grow can quickly become disengaged.
• Poor communication: A lack of communication (or worse, miscommunication) can lead to employees feeling out of the loop and unimportant.
• Unclear expectations: If employees don’t know what’s expected of them, it’s hard for them to feel engaged in their work.
• Unsatisfying work: Engaged employees are usually passionate about the work they’re doing. If they find their work to be unfulfilling, it’s tough to stay engaged.
• Unsupportive team members: A toxic team member can quickly poison the rest of the team and lead to a decrease in engagement.
• Lack of recognition: Feeling like their efforts go unnoticed can lead employees to feel unappreciated and disengaged.

This is by no means an exhaustive list, but it gives you a sense of some of the most common drivers of disengagement. To find them among your staff, you can use some of the same strategies listed above, including an employee engagement survey or one-on-one meetings.

4. Create a plan to address the areas of concern

Now that you understand where your employees sit and what is causing them to pull back from their work, it’s time to put together a plan of action.

Your goal should be to create a work environment and culture that employees want to be part of. This will require some changes from management, but the long-term benefits will be worth it.

Some things you can do to increase employee engagement are:

• Encourage two-way communication between managers and employees
• Promote transparency in decision making
• Allow for more flexible work hours
• Encourage employees to take breaks during the day
• Implement a system of recognition and rewards for employees
• Improve your onboarding process for new employees
• Encourage employees to pursue their professional development
• Create opportunities for social interaction among employees
• Set up some employee engagement activities that connect them to your company goals

The most important thing you can do is to listen to your employees and address their concerns. By doing this, you will show them that you value their input and are willing to make changes to improve the workplace.

5. Monitor and make changes based on feedback

No plan is worth implementing if you are going to let it stagnate and deteriorate over time. You need to be constantly monitoring your employee engagement levels and making changes based on feedback.

This can be done through regular surveys, focus groups, or even one-on-one conversations with employees. By staying up-to-date on how your employees are feeling, you can make the necessary changes to keep them engaged.

Employee engagement is not a static concept. It will always be changing and evolving as the workplace itself changes. The most important thing you can do is to be aware of these changes and adapt your strategies accordingly.

Common mistakes to avoid

When it comes to employee engagement, there are a few common mistakes that companies make.

• Failing to involve employees in the process: One of the biggest mistakes companies make is failing to involve employees in the engagement process. If you want your employees to be engaged, they need to have a say in what that looks like.
• Not setting clear goals: Another mistake is not setting clear goals for engagement. Without specific goals, it will be difficult to measure success and make improvements.
• Not monitoring progress: As we mentioned before, it’s important to monitor progress and make changes based on feedback. Without this, your engagement efforts are likely to stall.
• Not making it a priority: Finally, many companies fail to make employee engagement a priority. If you want your employees to be engaged, you need to show them that it’s important to you as well.

In 2022, employee well-being is more important than ever. By considering working environments, managers can foster a more positive and productive space. In return, employees feel appreciated in their roles and are more likely to stick around long-term — it’s a win-win!

When looking at the benefits of engagement, it’s clear that this is an essential ingredient for any business wanting to succeed. By taking the time to implement some (or all) of the strategies we’ve discussed, you’ll be on your way to a more engaged workforce in no time.