Monday, 12 November 2007

Towers Perrin Global Workforce Study 2007

Towers Perrin’s new report provides some interesting insights into engagement

1. Engagement has a significant impact on business and financial performance.

2. Engagement has a significant impact on retention. 51% of engaged staff have no plans to leave their organisation compared to only 15% of disengaged. (Actually the bigger problem may be that 50% of disengaged employees are not looking for a job and are therefore contributing to the ‘living dead'. Towers suggests these staff “may need to be driven out with a crowbar”.

3. Employees are eager to invest more of themselves to help the company succeed. 63% say they set high standards for themselves and 88% say they enjoy work that will allow them to learn new skills:

“Our study paints a picture of a workforce that is energetic, ambitious and committed to working hard and giving its best. This lays to rest several persistent stereotypes: that employees are loyal only to themselves and their careers and are looking to do the minimum to get by.”

However people will only make this investment if they see the personal ROI:

“While the nature of that ROI differs across countries, cultures and demographic segments, there are common elements in terms of people’s desire to be challenged at work, to grow and learn, to feel pride in working for a socially responsible organisation and to make a real contribution.”

4. Despite these positive indicators, the global workforce is NOT highly engaged. Only 21% of employees are engaged compared to 38% who are either disenchanted or disengaged. In terms of global differences, Mexicans proved to be the most engaged, followed by Brazilians and Indians. US respondents ranked fourth. The last engaged workers were the Japanese, followed by residents of Hong Kong and South Korea.

In summary, there is an “engagement gap – between the discretionary effort companies need and people actually want to invest and companies’ effectiveness in channelling this effort to enhance performance”.

5. Engagement depends more on organisational factors than it does personal characteristics and other factors (geography, industry and employee segment etc):

“Personal values and work experience factors have less of an impact on engagement than what the company does – particularly the extent to which employees believe senior management is sincerely interested in their well-being… Organisations can make a huge difference in engaging their people.”

The key influencers are rewards, learning and development, strategic direction, senior leadership, image and reputation, and innovation.

6. Developing a best fit, high performance culture is important:

“There is no one right model for a high performance culture – there are many, depending on an organisation’s strategic priorities.”

7. Senior leaders have an important role:

“People’s views about the company are also shaped more by what senior leaders say and do than by what the individual’s direct bosses say or do. This too contradicts conventional wisdom.”

This findng / conclusion echoes my own perspective and experience with engagement, and was supported by research conducted by myself and colleagues when I worked for Penna. This showed that for knowledge roles at least, key engagement factors tended to be work life balance, senior leadership, organisational value and then the line manager's role (in that order). However the finding directly contrasts with Gallup’s perspective that the line manager has the most important role in engaging their staff.

One potential reason for these differences may be the way that the various tools define engagement. I’m going to have a longer look at this over the next couple of weeks.

Towers’ findings indicate that senior leaders are not making the most of this opportunity. Only 49% of workers say that senior management’s actions are consistent with their values and just 38% say that senior management are sincerely interested in employee well-being. Only 10% agreed that “senior management treats is as if we’re the most important part of the organisation” (the core concept in HCM). More than half felt “senior management treats us as just another part of the organisation to be managed” (as in Human Resources) or “as if we don’t matter” (Personnel).

To engage their people, leaders need to make the leap to a more inspirational and engaging style of leadership (see graphic):