The importance of good employee engagement within an organization cannot be underestimated. Over the past few years it has also become something that employers need to ensure they are aware of, if their company is to have as much success as competitors. This is because the benefits of employee engagement and the factors associated with employee engagement are the keys to long-term success in almost any industry.
The top 21 benefits received from employee engagement
Below, we have compiled a list of the top 21 ways an organization can benefit from employee engagement:
1. A reduction in absenteeism
Absenteeism not only affects individuals; it also affects management as well. It means financial costs for the organization and can get out of control if it isn’t addressed. Employees that love what they do are unlikely to take days off for no reason, or without consulting management. They should also trust that management will give them time off when they need it and ask for it. When employees are dissatisfied or indifferent to their jobs, absenteeism is more likely to be a problem because employees might take advantage of certain situations and not consider the work that needs to be done.
2. Increased retention rates
Better employee engagement has been found to reduce absenteeism by up to 41% and if they feel connected to their organization, they’re less likely to look elsewhere for employment. If their attention is focused solely on their job and they have a positive and respectful relationship with the company and the staff, they are more likely to be retained as staff.
Depending on the overall turnover rate that an organization has, having a high level of engagement can result in up to 59% lower turnover.
3. Lower risk of burnout
Burnout takes months or even years to develop, and a lack of employee engagement can contribute to it happening. Symptoms of employee burnout include:
- Severe physical and emotional fatigue
- Cynicism and a lack of interest in their work
- Feelings of incompetence which lead to a lack of productivity
Employees who feel happy to go to work and excited about the work that they are doing are less likely to feel these symptoms. They more often feel a sense of purpose and that their talents are needed by their organization. This sense of purpose allows them to keep their emotional and physical energies up, even when times are challenging personally.
4. Better employee safety
Engaged employees who are more connected to their workplaces are more likely to be aware of their surroundings and to spot potential hazards. Studies have even shown that 70% fewer safety incidents occur in highly engaged workplaces.
5. Healthier employees
As well as offering a safer work environment, having an engaged workplace often results in healthier employees in different ways. This is because engaged employees are:
- Less likely to be obese
- Less likely to suffer from chronic diseases
- More likely to exercise
- More likely to eat healthier
This is because organizations with high levels of engagement have a tendency to show more respect for the needs of their employees and encourage employees to care appropriately for their health. In return, healthy employees normally provide a better bottom line for their organizations.
6. Happier employees
The American Psychological Association estimates that more than $500 billion is lost every year due to a high level of stress in workplaces. At least some of this is the result of organizations using stress-inducing mechanisms like peer pressure or the threat of termination to motivate employees into working. These are not high-engagement organizations, though; high-engagement organizations are more likely to use practices such as employee recognition, one-to-one meetings, and feedback in order to motivate and drive performance.
7. Happier home lives for all
A study has shown that happy employees who are engaged at work are usually more satisfied with their home lives, too. This report looked at how positive experiences in the workplace extend into home and family life, resulting in more positive family interactions and better moods overall.
8. Stimulated innovation and creativity
Getting employees to share their ideas and be innovative in their everyday work builds both engagement and value for the business overall. Bringing specialists together to work and interact on a common project, and investing time on innovation within an organization, gives employees a sense of belonging and accomplishment at the same time. In return, they are likely to drive a much higher added value for the business.
Engaging employees in this way might even result in saved time and resources, as employees that are encouraged to be innovative might come up with ideas that mean organizations won’t have to turn to external sources.
9. Improved collaboration
Encouraging employees to network and communicate with each other will have the added effect of improved collaboration. Some employees may feel that they work better on their own, but some organizations have found that the best results are obtained when employees work together.
Employees who are fully engaged with their work are aware of the expectations their employers have of them. When two or more of these employees start working together, they have the potential to come up with new, better ideas. This ties back into the idea of stimulated innovation and creativity, and helps the organization to grow.
10. Developed mutual respect
Respect reflects trust, and this works both ways within an organization. Managers that value their teams and allow them to do their jobs without hovering and micromanaging will earn their respect. But individual employees should also feel comfortable asking as many questions as they need to.
It’s also essential that there is respect between managers and employees who work far from each other, as is the case with remote or frontline workers. Employers should trust their employees to do the job they were hired to do and to take time off if they feel they need it. If the employee feels they have the flexibility necessary to do their work, they will be committed to and engaged with what they are doing.
11. Encourages personal responsibility in employees
Employee attitude changes when they feel engaged in what they are doing, and those who are engaged probably won’t be interested in seeing “how much they can get away with” when working. Instead, they will see themselves as part of the company’s success and look for opportunities to help others do well in the work environment as well.
12. More effective leadership
Managers and leadership teams that want employees to be more engaged will find this is more easily achieved if they connect with them first. This means spending time engaging with them, getting to know them, and learning what they care about most. If an employee feels more connected to their managers, they will often be more receptive to what their managers have to say. In turn, this makes them more likely to listen to leadership and management because they know that their managers care about what is important to them.
Overall, this should result in a boost to morale, employees work harder because they are excited about their jobs, and engagement is increased.
13. Boosted employee positivity
A positive work environment plays a large part in developing employee engagement. Increased positivity creates:
- A better attitude at work
- Employee confidence in their organization and its future
- Satisfied employees
- Better business relations both in and outside of the organization
14. Increased productivity
An increase in engagement often results in higher productivity within an organization. This is because engaged employees with a positive attitude tend to work harder and more proactively in order to reach their goals. On average, experts suggest that this can increase productivity by up to 17%.
15. Better quality of work achieved
Quantity of work completed is not the only thing that will improve with higher engagement. By improving employee engagement, you will also be improving the quality of the work employees are carrying out from day to day. This is because employees that are fully engaged in what they are doing are less likely to make mistakes and more likely to achieve excellence.
16. Increased customer satisfaction
When employees are engaged, this is usually reflected in the levels of customer service that they provide. Making a customer feel valued and creating a positive customer experience is a vital step in building a positive customer relationship. This, combined with a better quality of service or a better product offered, is more likely to result in satisfied customers. Satisfied customers are then more likely to make more up-sales and cross-sales and drive even higher returns on customer success management.
Happy customers also double up as good PR for your organization because they will probably talk to others about the great experience they had.
17. More sales
A better quality of product or service, combined with better productivity and better customer service, will almost always result in better sales numbers. It has been found that highly engaged organizations see an average of 20% higher sales than disengaged competitors.
18. A higher profitability
The latest research conducted shows that having more employees engaged in their work results in a higher level of profitability. It was said that highly engaged organizations have 21% higher profitability than their peers and competitors.
When an organization experiences a period of particularly high profitability, it’s advised that this money is reinvested in employee engagement tech and activities. This will help to preserve profitability growth and keep the company on a steady, upward trajectory.
19. Higher stock prices
Professionals often refer to the Engagement-Profit Chain when explaining how this works. This describes a series of events that happen as a chain reaction, owing to the efforts of engaged employees.
An engaged workforce will lead to:
- Higher service, quality, and productivity, which will lead to…
- Higher customer satisfaction, which will lead to…
- Increased sales, which will lead to…
- Higher levels of profit, which will lead to…
- Higher shareholder returns (i.e. stock prices)
20. Encouraging loyalty
Employee engagement is closely related to loyalty. When employees are engaged in their work they are emotionally invested in what they are doing, and this feeling of emotional investment helps to foster and encourage loyalty. This makes them less likely to leave the organization, as they care about the company’s success and feel appropriately challenged by their work.
21. Encouraging advocacy
Naturally, employees are going to talk about their job outside of work, and sometimes the negatives are easier to share than the positives. But this does not have to be the case, as what an employee shares is obviously dependent on their experiences of working. This is why working on employee engagement is necessary for an organization – to encourage positive experiences within the workplace that employees then go and tell others about.
This kind of advocacy is great free publicity for an organization, and can lead to more loyal customers, more high-quality job applicants, and higher revenues as a result of these. It can also be one of the biggest benefits of employee engagement to employees themselves, as their advocacy can turn into referral bonuses if they network with the right audiences. Incentivising these advocates with work benefits and recognition is an excellent way of thanking them, too.
Conducting a cost-benefit analysis of employee engagement
It might be worth conducting a cost-benefit analysis of employee engagement for your organization, based on the information and the benefits you can already expect to receive that we have listed above. This will, perhaps most importantly, help you to decide whether the decisions implemented and the effects they will have on your company outweigh the financial costs involved in introducing them. A quick step-by-step process of this cost-benefit analysis would look like this:
- Identifying all potential costs involved in improving employee engagement (this includes benefits you could provide)
- Measuring the potential costs and benefits against the original objectives of this scheme
- Looking at areas where costs could be reduced
- Documenting what you find
- Doing this regularly and updating it each time
There are also other benefits to measuring employee engagement and looking closely at what it can bring to your organization.