Employee Engagement: A Critical Path to Success
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Wednesday, August 29, 2012
We all know that employee engagement is critical to business success. Engaged employees help you maintain an advantage over your competitors and grow your business. The challenge is how to excite your workers and continually maintain their engagement.
Join us as we define the key drivers of employee engagement and prescribe a formula for success. Learn from case studies the factors that motivate engagement and how performance-based metrics can help you track your progress. Develop a roadmap for effective measurements, metrics and processes to enhance your organization’s commitment to engagement.
This webinar is for....
- Executives who are concerned about the performance of their organizations
- Managers responsible for their organization’s Internal Brand
- Communications specialists who are involved in internal corporate communications with their employees
- HR executives and managers responsible for their employer’s brand
CEO and Founder of Inward Strategic Consulting
For over twenty years, Steinmetz has been on the forefront of internal branding and communications, helping organizations, from Fortune 500 to start-ups, forge effective internal branding and communications initiatives.
Webinar Transcript: Employee Engagement: A Critical Path to Success
Thank you very much and good afternoon everyone. I'm Jeff Quinn. I'm the vice-president of research here at Monster, and I'd like to thank you for joining us today in this exclusive webinar hosted by Monster Intelligence. Today's webinar is titled, "Employee Engagement: A Critical Path to Success." In this event, we are joined by Allan Steinmetz who has provided an informative and interactive webinar on employee engagement and why it is critical for the success of your business. Before we get started, I'd like to mention a few housekeeping items. The copy of today's presentations in the recording will be posted on hiring.monster.com within a few business days. Please click on the Resources tab and go to the HR Event section to retrieve those materials. All participants will receive an email as well with a direct link to today's materials in the event.
Monster Intelligence provides insight to help HR professionals improve recruiting success, accelerate worker performance, and retain top talent. We analyze and collect data from over 4 million unique job searches performed on Monster each day, and we invite you to visit hiring.monster.com to read some of our other in-depth reports and analyses under the Resources tab. There will be time, as mentioned previously, after the presentation for some questions, and our meeting manager will help to facilitate that Q&A. Please feel free to type your questions into the available space during the event, and we will try to include those in the Q&A as well. Additionally, if you're getting your audio through the phone, you will be placed on mute until the Q&A session begins.
I would now like to welcome today's first speaker, Allan Steinmetz. Allan has built an internal and external branding, change management, communications, team alignment, and marketing research consulting firm like no other. He has over 30 years of experience in marketing strategy, branding, change management, advertising, and communications. During that time, he has worked for Ford Motor Company, the U.S. Postal Service, Ericsson, Pitney Bowes, Campbell Soup, as well as Wal-mart, in addition to several high-tech companies, start-ups, and professional services firms. Before establishing the firm, he was a senior vice-president and corporate director of marketing for Arthur D. Little.
Recently, Allan was selected as one of the top 25 consultants by Consulting Magazine. Allan was a member of the U.S. Postal Service Marketing Advisory Board and formerly a board member of Bertuccis Brick Oven Pizza. He is a frequent speaker on topics such as the advertising industry, need for internal branding, and change communications. He has been a feature speaker at many nationally recognized conferences. At this point, I'd like to thank Allan, once again, for sharing all of his information and knowledge with everyone today. At this time I'd like to turn it over to Allan for the webinar that he's about to present.
Thank you, Jeff. That was a terrific introduction, and I'm humbled by all those words, to be honest with you. It's an absolute delight to be here today, and to present some ideas about employee engagements. We were reflecting just a few moments ago in our preview discussions about how suddenly, in the last two years or so, it seems like employee engagement has become a very important topic in industry today. On reflection, I think the reason that is happening is that most companies have done all they have been able to do in regards to making investments and technology, recruitment, service programs, and training programs. But the one area where research is now showing its greatest effect is on the customer experience.
The more an organization has a positive customer experience with their customers, the more revenue and loyalty and retention they have over the long term relationship. It has been found, by and large, that the reason that customers have better customer experience is because of employee engagement. So that's the topic that we're going to share with you, and we're going to share a lot of our research and information that builds the case why every organization in the country really needs to focus on employee brand engagement. We like to add the word brand engagement because if your employees don't behave and have the experiences that have an effect on the customers, then there usually is a breakdown. So that's the introduction to the session.
I'll start by saying, if you take a look at all the different brands that are out there the brands that you interact with as a consumer every single day what are the ones that you believe have the true advocacy of the brand values? Where you have a customer experience with Microsoft for instance, do you feel that the people that you interact with at the service centers or the telephone centers represent what your image of Microsoft is, and how does that compare with, let's say IBM? Or take a look at McDonald's. Is the customer experience that you receive at the counter consistent with the customer experiences that you get with, let's say Burger King?
There are different kinds of values and traits and behaviors that are associated with brands, and if the experiences of the employees to the customers vary from those brand values, there usually is a brand breakdown. That's what we are talking about when we talk about the brand engagement. How do you get your employees to leave the values of the brand so that they have an effective customer experience at the end of the day?
So it all starts with having a clear vision and culture of what it is the company stands for and what the company is all about. It's almost as if you have a clear direction and a clear vision, but you also have to have a culture. I love this example of the Harley Davidson motorcycles in that it is so thick; you could almost cut it with a knife. Every employee knows what the brand stands for. Every senior executive knows what the brand stands for, and they live it and they produce it every single day.
Next trait that is necessary to have brand engagement is leadership leadership who are honest and transparent, and aren't afraid to have questions answered or don't avoid the obvious, or make sure that they have a regular, ongoing dialog with their employees.
Next is communication, which also is very much involved with communications. It has to be effective, and it must be frequent. It needs to be again, transparent, and have an open dialog where an exchange can actually take place.
The next trait in having brand engagement is a brand culture to begin with. Is the brand strong? Does everyone know what it stands for? Can people relate to it personally or is it foreign to them? And how do you build it so that it's so strong that you can in fact cut it with a knife? There's a difference between some brands that have it, and some brands that don't and as customers and consumers know the brands that are strong and those that are not. I'm going to give you some examples of them later on.
The next area is a clear and strong customer focus, rather than a manufacturing focus or a revenue focus or a sales development focus. When companies have a strong, deep customer focus, that usually creates a better, strong brand engagement for the organization and provides better customer experiences. Wal-mart, as an example their values and their culture is focused strictly on the culture of the employees to provide the best customer experiences that they can possibly have, by providing a great deal of benefits and behaviors that support this saving money and living better traits. But it's always about the customer and doing whatever they can to help their customers save money and live better.
At this point, I am curious to know you all represent large and distributed organizations, and I'm curious to understand and know how well do you feel your employees are engaged with your brand? So we're going to ask you to pick one of these four levers right now. How are your employees engaged? Are they very engaged, somewhat engaged, not at all engaged, or are you not sure how engaged they are? So why don't you go ahead and click and vote now, and we're going to tally. It's going to take about 30 seconds for us to tally the results, and we'll show you some startling information after that. So vote now, please.
The poll has ended, and I'm waiting to see the results. So here are the results. Very engaged, 14 percent, somewhat engaged is 66 percent, not at all engaged is 15 percent, and I am not sure is at 6 percent. Very interesting.
Well, here is the real statistic that I wanted to share with you right now. Unfortunately, most companies don't have engagement. This is an employee engagement study done by the corporate executive board in 2011 that shows that 71 percent of American workers are not engaged at the present time. You have to consider what that means for our economy, and in terms of people having an impact on our results.
According to Gallup, at a recent study of employee engagement, it says that lost revenue and productivity for disengaged employees translates into 370 billion dollars annually. That's a staggering number, an absolutely staggering number. So imagine if as American citizens, as corporations and corporate citizens, if we were able to reduce that employee engagement by half, that would suggest that we can save 135 billion dollars annually in increased productivity that could turn around our economy. So there is a very good reason why employee engagement is indeed important in terms of having an impact on our society and our corporate revenue.
It also shows this is a piece of research that was done by Gallup as well that the earned profit share growth for companies that have high engagement is 2.6 times the rate below average, and that also suggests this is a very strong component as to why engagement as well. Also recently, Forrester did a study called the CSI Score which measures customer experiences, and it basically shows that retailers are losing 32 million dollars a year because of poor customer experiences. Airlines are losing 590 million dollars because of poor customer experiences, and the hospitality and hotel business is losing 1.2 billion dollars in revenue because of poor customer experiences. It's obvious that if these industries would improve customer engagement which has a direct correlation with customer experiences, that it would be a no brainer for them to devote time and energy to this topic.
Also in this year's Towers Perrin Workforce Study, it said that organizations with engaged employees showed a 19 percent increase in operating income for a year period, compared to 34 percent decrease for companies with disengaged employees during the same time frame. They also found that high engagement firms experienced earnings per share rates of 28 percent compared to 11.2 percent of clients for low engagement firms.
Another study also suggests that only 37 percent of employees understand what an organization is trying to achieve, and that the majority of people don't understand. If they don't understand what the company is trying to achieve and doesn't have a clear focus and vision, how are they expected to change their behavior to support those objectives? So that's why all these things are important.
Now, as consumers, we all interact with brands on a day-to-day basis and from my own personal experiences, I cited some of these examples to give you a difference the contrast between companies that have engaged employees versus those that don't. I'm curious to hear your perspective on these, but I think you all would admit that there's a difference between FedEx and the U.S. Postal Service in terms of the level of engagement of their employees.
From my personal experience, when our FedEx person shows up to deliver a package or an envelope, there is excitement, there is enthusiasm, there's a warm smile, there's a list in their step, and it's very different from going into the post office or even greeting my postal worker that comes to my home or my office to deliver our mail. It's day and night. I think you all would admit the same.
The same would be the case for airlines by and large. So you have Southwest Airlines where you have employees who are very much engaged. They are participative with the passengers, they have a sense of humor, and then versus about any other airlines as a group, maybe with the one exception of JetBlue. There's a different experience when you fly. While the environment is still the same as you're still cramped in and jammed into the airlines, the experience that you have and the loyalty you feel for the airlines for Southwest is very different than the other airlines that I've recently been on in the last few years.
The next one is, there's an absolute difference between Google and how you interact with that organization versus, let's say, AOL, which had all kinds of trauma and business recovery issues and things of that nature. There's just a difference and everybody knows it. There's a difference between Starbucks and their baristas versus Dunkin' Donuts. Both serve coffee, they're both commodity products, but the shopper experience and the in-store experience is what has made Starbucks as successful as it is versus, let's say, Dunkin' Donuts which is also successful, but creates a different feeling, a different nuance in how they created their values and their culture.
Another one this is one of my favorite examples is Enterprise Car Rental. I don't know how many of you have recently rented a car from them versus any of the other brands, but they go out of their way to shake your hand when you come up to the counter. There's eye to eye contact, they welcome you, they give you water coming off of a hot bus from some far airport, or they walk you out to the car to show you how the car works versus sending you off on your own. They treat you like you're a friend, rather than treating you as a commodity, someone who just needs an automobile or transportation. What I think is sort of ironic in my own personal experiences is that Avis says, "We try harder." I don't think they live up to that promise anymore, so there's a big difference, and it becomes a differentiator for these kinds of brands.
In a recent study that was done by AON, that was done in 2012, they identified the six component parts of employee engagement, and I'd like to review them with you now. It basically starts out with the notion of work, people, opportunities, total reward, company practices, and quality of life.
In the area of work, it has things such as the work that they do, the task that they do, the work processes, the resources that are made available so that you can do your job, and also being able to achieve a sense of accomplishment for a job well done. So those are the components that make up work. In regard to people, it's having transparency and access to the senior leadership, managers, and co-workers. There's a people focus in terms of development and growth, as well as having a focus on the customers. When there is a balance between all of those component parts around people, that contributes to strong engagement.
In the areas of opportunities, when people know there are advancement opportunities and career opportunities as well as learning and development opportunities, those also contribute to engagement. Next is total reward. It's all the things that most HR people deal with on a regular basis such as benefits, compensation, and recognition, and so on.
Next are company practices. Many of the things I've already talked about here is how people interact with the HR department and their programs, managing their performance on a regular and ongoing basis, brand alignment, so they walk the talk and walk the walk in terms of living the values and the essence of that brand, organizational reputation in terms of its image, and how other organizations view the organization as their reputation in their community, diversity, as well as communications on a regular or ongoing basis.
Lastly is the quality of life. It's the physical work environment, it's the balance of life and work balance. All of those factors, in combination, contribute to employee brand engagement.
These are some of the things that you need to think about and take into account when developing an employee engagement checklist.
The first one is, is the strategy that you have as a company overall clear? Is it well-communicated and are the priorities understood by all, especially the managers and associates? Because they're the ones that drive it down, cascade it out into the organization. It really is not enough for the messages and the communications and the behaviors to be only from the corporate leadership. It needs to be cascaded all the way down into the rank and file in multiple locations around the world.
The second one is, is the leadership team aligned to deliver clear, unambiguous direction? Are they ready? Are they prepared? Are they trained? Do they have the skills? Do they have the mouthpieces? And do they show it as a team? And are they evaluated as a team to 360 evaluations or by peer-to-peer recognition of the team itself to do what they have to do?
Thirdly, do the processes that they have inside the organization work efficiently and effectively, or are there built-in conflicts? That also goes and correlates together with the alignment. Or do they have a clear understanding of the needs of each of the demographics of the associates or the employees? A mistake that is often made and experiences that we have seen is that most companies roll out a one-shoe-fits-all approach in terms of its messaging, communications, and programming. What we have found is that the more you're able to segregate or segment the different messages as well as tactics to the different audiences, you're a lot better off than having a one-shoe-fits-all approach.
And then lastly, what do our customer say about the company, and how does it impact the attrition, the retention, and overall profitability sustainability? Basically, you need to make sure that your customers have a voice in your business objectives, in your programming, and in your overall strategies so that it gets conveyed on a regular and on-going basis.
In order to communicate and have answers to those questions, an organization, typically, would have to conduct market research and employee brand engagement programs and studies. In our case, we have a proprietary tool called Change Effects, and I'm going to call on my colleague, Steve Mamarchev. He's our vice president of marketing research and best practices who is going to give you a flavor of the necessary requirements for being able to do an effective employee brand engagement survey so that you can start the process to effectively create a program that has sustainability and impact for your organization, so Steve?
Thank you very much, Allan, and you can move to the next slide. Yes, great. Thank you. For those of you who are participating in today's Monster webinar on employee engagement, welcome. I'm going to take a minute or so to give you a story that I think is very appropriate in terms of understanding why the assessment of your current status of employee engagement is so important. I'll go back to something that all of us can certainly identify with. Most of us undertake a physical exam at some point, some of us annually, others of us less frequently. Though often intrusive and at times painful and inconvenient, we take physicals for very specific reasons: to ensure that we're in good health, to identify areas which may manifest into major long term health concerns, and determine what corrective measures, actions, and behavior modification can prevent problems from arising in the future. I think this analogy applies to the notion of an organization's assessment of employee engagement.
I'll take you back a few months ago. A client of ours was considering an employee engagement assessment, decided to postpone the research. Quite simply, they didn't want to hear a lot of bad news. I offered this observation: "What if you or your child or your parents were showing increasingly severe symptoms of sickness? Would you hide and hope they would go away on their own, or would you seek help to identify the cause of these symptoms, to find a cure, and determine how to prevent a relapse?" Most of us, rightly so, would do the latter. I believe that this notion applies strongly to employee engagement. So that rather than hiding behind available assumptions and wishful thinking, it is best to identify the sources of disengagement and to determine corrective measures, and desire to improve engagement in a sustainable fashion. Our next slide please, Allan.
As Allan mentioned, there are lots of employee engagement assessment tools around. There's Gallup, Towers Perrin, Connexus, and others, and we particularly like the Change Effects assessment tool. It easily allows an organization to assess the effectiveness of its mission and vision. It helps determine the extent of leadership alignment within its organization. It evaluates the communications of processes such as metrics and controls and vehicles, and the ability and desire to be able to change or modify behavior. It certainly helps to analyze the current enrollment of employees, and helps measure the cultural alignment within that organization. These can be done in real time online, and with your employees as we'll soon demonstrate. Next slide please, Allan.
Overall, there is significant value in terms of an engagement and alignment of analysis for one's organization. These are significant. Section analysis helps to determine whether in fact you are aligned with your people, processes, strategies, and how they all connect with market opportunities. It helps flatten and distribute the leadership effectively. It pinpoints areas that require management attention and prioritizes those actions. It helps to isolate the internal areas that are highlighted by best practices, and those that are afflicted by worst case scenarios. It certainly helps to create and launch improvement initiatives that can be sustained over time. It helps identify and highlight skill gaps and ways to close the gaps permanently. And most significantly, it helps to assist in developing strategic and sustainable short and long term action plans that you can use for your organization that will ultimately improve the performance of employee engagement. All of these elements will lead to a highly engaged workforce. If in fact you work these in concert and the ultimate goal is to improve the overall engagement which you see in that white bull's eye.
As we continue, we have developed a robust survey instrument that has content input from the conference board and the corporate leadership council. It is customizable, it is online, it's deployed in real time, and results can be attained within 24 hours, and it also offers a 360-degree view since all employees participate. Next slide please, Allan.
What I'm going to do is have you take a look closely at this particular chart. You will notice that there are a series of rings, slices, and a bull's eye similar to what you've maybe seen on a dart board. The outer rings, and I wish I had a pointer to point and enlarge the outer rings, are factors or individual questions that serve as the key indicators of the extent or lack thereof in employee engagement. In examples where you can see where the survey questions are one, two, three, you'll see areas such as team work, common goals, a sense of ownership, and distributed leadership. All these factors are then aggregated to form a category or critical success factor such that will lead to the employee engagement. In this instance, you will see the critical success factor pointed out as leadership.
There are five critical success factors or categories that form the inner ring. They are communication, culture, leadership, environment, and alignment, and depending upon your organization, you can take a look at other categories, such as vision, mission, and communications, that can also serve to bring together the whole notion of employee engagement and alignment. Lastly, by aggregating these critical success factors, you will determine for your organization the employee engagement index for the bull's eye, and that is where you're aiming for as a high- performing, employee engaged organization. Let me just make sure that we're here in terms of this continuation.
You will also notice that this particular chart has three colors: green, yellow, and red. The green areas indicate factors that are high performing ones that don't require attention. And then in this instance, there is one here that's been highlighted Recognition and that is of course very, very critical as Allan pointed out early on, and the yellow, which is the most prevalent in this chart highlighted by areas of opportunity for improvement. But most significantly you will notice red factors. Those are the ones indicating necessitation of immediate attention and remedial action. So in the example here, the organization is performing probably at a mid-level. There's one area of green, which is a high performing area, and there are three areas of red, that necessitate immediate action. Next slide, please.
The ability of Change Effects allows organizations to analyze the data through the lens of various demographics. Here you'll see three designations team one, team two, and team three. In this instance, team one could be senior management, team two could be middle management, and team three could be rank-and-file, or it could actually be 20 years plus experience with an organization, in the middle 5 to 20, and on the far right, less than five. These are simply examples that show the ability of the tool to be able to provide an analysis of granularity to bring to the attention where the organization requires immediate attention across specific demographic groups.
And you can see, in this instance the organization in the far left requires a lot of attention, the group in the middle is performing very well, and the group on the far right is actually in the middle and has both high performing areas and those that require attention. So basically, this is a brief overview of Change Effects, how an employee engagement assessment tool can work, and what you can do to pinpoint areas of remedial necessity, and those that have longer term opportunities for improvement.
Great. Thank you, Steve. So in summary, what I'd like to say is that I hope we've demonstrated the importance and the imperative in building the business case for employee brand engagement within your organizations. It has a direct impact on loyalty, on revenue, on shareholder value, and on customer experiences. That is what will make the difference and differentiate your organizations in the marketplace against your competitor frame. It is something that shouldn't be taken for granted. It needs to be managed as a process, just like you would any other process within an organization. It has to have funding. It needs to have vision and a person or a group who has responsibility for driving it, much like you would manufacturing or logistics or supply chain or marketing or anything else, and it really is the differentiator that can make the difference between a highly performing, successful organization and one that is just mediocre. It makes the difference between the companies that are exceptional and those that are just average in our view. We hope we've demonstrated that for you today.
I should also add that our company, Inward Strategic Consulting, has a thought leadership publication that we put out quarterly called "Looking Inward," and the third quarter of this year, which is going to be coming out in October, is going to have an entire issue devoted to employee engagement and case histories and best practices of companies that are performing at that level. And if you all would like to see a copy or get a copy of that magazine, you could download it digitally, or we'd be more than happy to send you hard copies. All you need to do is go to our website at www.inwardconsulting.com and register to become a subscriber, and we'll be happy to do that. At this point in time, Jill and Jeff, I'd be happy to open it up for questions from the participants.
Thank you very much, Allan and Steve. This is great. I really appreciate all the input and the knowledge. As you mentioned, you were going to open it up for questions right now. I think, Brian, if you could try to queue up some of the questions on the phone, we're going to look to see if there are any questions that came in over the system.
Thank you. Ladies and gentlemen, if you wish to ask a question, please press the one, followed by the four on your telephone. You will hear a three-tone prompt to acknowledge your request. If your question has been answered and you would like to withdraw the registration, please press the one, followed by the three. If you're using a speakerphone, please lift your handsets before entering your requests. And once again, if you have a question or a comment, please press the one, followed by the four on your telephone at this time.
Thanks, Brian. We do have a couple questions that have popped up in the Q&A. So Allan and Steve, if you're ready, we're going to start running through some of these questions for you, okay?
Sure, my pleasure.
All right. So one of the first questions that came in says, have you performed employee engagement surveys for a large, diverse manufacturing environment, and what does that look like?
Yes, actually we have and what it looks like is certainly a mosaic. In the instance of an organization that has very diverse business units, we have found that some show high levels of engagement, some do not, in this particular instance. The challenges of course are to somehow link the areas that are effective in those siloed areas that show high performance and to understand the factors that bring effective alignment, and try to apply those to those that are more dysfunctional. Other business units, to show where the gaps are and to understand how they can take the corrective measures so that they can mirror those business units that are performing better. We also found that that can vary by country, that it can vary by years of experience with an organization. So large manufacturing enterprises, we've seen probably more instances of business silos being dysfunctional, rather than any other particular factor.
Another factor I should add to that is the differences between unionized and non unionized organizations, also usually shows there's a high level of discrepancy between those factors.
That's great, thank you. Another question that came in, it's kind of a combination here. One of them comes in and says, are there any differences between various sectors, and then we were just talking about manufacturing but others are saying, how would that differ for retail or some other type of sector, but it also comes across as your slide mentions various larger companies. One of the questions that came in as well, are there any special ways that you might recommend helping small companies?
Sure. Actually we like working with small companies as well all the time. When you have a smaller company, you could actually be more inclusive and transparent, and when you have a dozen or so, or thirty or so people, bring them all in a room together and have them participate in the internal engagement things that need to be conveyed. What is the message that we want to convey? What's the best way to do it? How do you inform people about the information on a regular and ongoing basis?
Two would be, what is the training programs that we all can create through a bonded mentality and collective consensus kind of programming.
Thirdly, as a group, decide how you want to be evaluated and how to do peer-to-peer programs to support what it is they want to achieve collectively, to achieve employee engagement.
Then the fourth phase with the first program would be how do they want to be recognized when they step up and are engaged based on the performance of their evaluations and appraisals. Do they want to get a big bonus or they want to get a pat on the back or they want a week's extra vacation?
So when you have a small organization and you bring them all together and you have them collectively communicate what it is that they can do to improve engagement, and then you put those actions into programs and processes, it's very formidable. It's very, very strong, and it also contributes to a more engaged culture from the get go. So I strongly feel that it's easier, frankly, with smaller organizations than large distributed organizations where there are multiple layers of management, business units, and the cascading of messages and programs are more complex and difficult.
That's very, very true. I'd like to add to Allan's comment. We've also seen with organizations that are relatively small, extremely high levels of engagement. And I think that one of the key points that seems to happen is that even though there was high management involvement because the organization did not have many layers, there was also a sense of empowerment with a lot of individuals within the organizations. That certainly then felt that these people were connected and engaged with the senior management because they felt that they were empowered, they had the ability to make action, they were in control of their lives rather than having it being defused and given orders by what could be a senior management in a more of a top down environment.
When we do this with our clients, even if it's a large corporation, we try to break it down into smaller groups themselves, and then ladder it up to an overall organization structure. Why? Because we want to build that consensus. We want it to be participative. We want to make sure that everyone feels that they have a stake in the ground that they have buy-in. So it works for large, as well as smaller organizations when you have this consensus and participatory approach.
All right, thank you. Brian, I didn't know if any questions have been coming in over the phone. I figured I'd check with you.
There are no questions at this time.
Okay, great. We do have quite a few others here. One of the questions that came in, they were trying to understand how do you get upper management to realize that there could be some engagement challenges, and how do you get them to be engaged themselves in pursuing this type of opportunity?
The first way is by providing them with diagnostic metrics and measures such as Change Effects, that illustrates that there is a problem or not a problem. That's one.
Two, take a look at the symptoms within their organizational structure. How is sales performance increasing compared to the competitors that may have more engaged employees than their own? Is there a retention problem within the organization? Are people leaving at the new levels that are causing the organization to not be effective in their performance of their jobs? Another symptom is loss of customer satisfaction if their scores start declining, or they're losing business opportunities to other competitors. These are all symptoms that would suggest there are problems that need to be addressed, and employing brand engagement should certainly be one of the things that they should explore.
Once they identify that employee engagement is a priority and they set a program in place, we know that one of the best ways to get the leadership to become engaged is when you actually hold them accountable to their own behaviors so that they become more engaged with what they're trying to achieve, and provide better customer experiences, better more engaged with their own employees, and things of that nature. We find that the best ways are 360-degree assessments of the senior leadership team amongst themselves, against clear set of goals and objectives that they are measured on an annualized basis, as well as them to identify how they want to be compensated and recognized for their new behaviors that they will embrace to support employee brand engagement.
I'll give you an example, we had one I can't tell you who but we had one executive management team that when they were launching a new brand program and the senior leadership wanted to be held accountable amongst their peers; they basically said they were going to hold back 20 percent of their employee incentive comp package for the year if they did not live up to the brand values. Then they would be evaluated by their colleagues on the executive committee, and there were actually two people on that team that did not get their 20 percent, and their shares were distributed to all the people who did. That says a lot.
Yeah, that certainly does. Another question that just came in was, what are the major obstacles that you find with some of your clients, and does that really differ when you look at either different sectors or different size of companies?
The first one is denial that there is a problem and being able to diagnose the problem correctly. That's number one. Having a Change Effects or any other tool helps identify that.
The second one is no one seems to take responsibility for employee brand engagement. Is that something that should be in the marketing department? Is it in the training department? Is it the communications department? Is it in HR? So it's nebulous, it's out there and that's one of the points I made before in the presentation is that someone has to have the leadership and the roles of responsibilities for employee brand engagement because it is that imperative. It's having an impact on performance. It has an impact on revenue, no different than procurement or manufacturing or quality management is. So there needs to be someone within the organization who has a full-time responsibility for building and monitoring and maintaining employee brand engagement. That's the second obstacle.
As I said, I would think that the third obstacle for a successful program is lack of a process. Most companies think that it's a one-off. We need to give everybody T-shirts and baseball caps with our new logo on it, and they are all going to be engaged. Well, that's a sure symptom of failure, in my opinion. It needs to be a four-phased process, and it needs to be managed like a process. The four phases are:
- Informing your people about what's expected of them to convey and be focused on the customer and the customer experience.
- Gaining their understanding and training them. In fact, one of the big areas that we are involved with is gamification, and how gamification is the best way to communicate adult learning to an organization around these themes.
- Gaining their commitment, and their commitment comes from peer-to-peer recognition, overhauled appraisal systems, holding people accountable to their objectives and goals through the year that are all based around employee engagement and customer service.
- Recognition and reward systems that are tied to those goals, their understanding, and the information about what it takes.
So if the people do what is expected of them as a result of going through a sustained employee engagement process, how are they going to be recognized? They could be broken down as small groups, as well as for the enterprise as a whole in one large global organization. Does that answer your question?
It definitely does. I want to check with Brian to see if there's anything that came over the phone, otherwise we do have one more question here.
Once again, ladies and gentleman, if you have a question or a comment, please press the one followed by the four on your telephone at this time.
Great, thanks Brian. So another question that came in, Allan, was, it would be great if you could provide an example associated with the specific impact or even maybe the company where it was acknowledged, and then you could show the impact of the changes that were done and how was it done correctly so that people could see where the overall benefit might lie.
There's one example that's not a client of ours but it is a good example nonetheless that you can find. Unfortunately, I can't give you any proprietary examples for our clients. They're very strict with us in that regard. But there is a published record of Best Buy where they have found that where they are able to engage, if they can improve one-tenth of engagement within a period of time, that could contribute as much as a $100,000 of incremental revenue per store. If they could only increase engagement one-tenth of a percent for that store, that represents a $100,000 of new revenue.
As an example of that directly, one of the things that Best Buy has just done is they announced at their last shareholders meeting that they're investing over a hundred million dollars into training their employees to do a better a job at representing their products and services in the store, to enhance better customer experiences because if they're able to improve it one tenth of a percent and gain $100,000 incremental revenue, imagine if they're able to improve it ten-fold and the impact it will have on performance. So there is one example.
There are others, I don't have them with me at the moment, but there are other examples on our website of companies. Also, frankly, as we interview for this "Looking Inward" article on employee engagement in our upcoming magazine, we interviewed Enterprise Car Rental and we have some quotes from them, as well as the Ford Motor Company, Chrysler, and Southwest Airlines. I just don't have them off the top of my head right now, but there are a lot of instances and examples of how it had an impact on return on investments.
That's great, thank you very much. We're right here at the top of the hour, and I'd like to thank you both, Allan and Steve, once again for sharing your expertise with us today. This does conclude today's event. As mentioned, a recording of this event as well as all the materials will be available in the next few business days, and it will also be posted to our hiring site which is hiring.monster.com under the Resources tab. Thanks again for joining us, and if you want to check out the next webinar, that's listed under our Events tab as well, on the hiring site. Thank you very much and appreciate everyone's time today.