Causation Found: Engaged Employees Generate More Financial Success (not the other way around)

Engaged employees create financial success. Gallup has found causation.

“We find that the path from the individual engagement elements to financial performance is stronger than the path from financial performance to engagement.”

What does that mean?
Focus on the people first, not the numbers. If you have more engaged employees, they will generate greater financial success.

If you choose to focus on the numbers first, believing (wrongly) that employees will become engaged because they work for a financially successfully company, then you will actually realize less financial success.

Why should you care?
Gallup puts it well:

“If employee perceptions are the main cause of financial performance rather than the reverse, we know that managers can take action to improve employee perceptions and therefore have an impact on the bottom line.”

How do you do it?
So what steps can managers take? As Globoforce CEO, Eric Mosley, and I say in our new book Winning with a Culture of Recognition:

"The connection between engagement and higher performance is obvious, and while there are many ways to inspire engagement (and even more to kill it) all involve communicating and rewarding desired behaviors based on defined values.

"Done right, recognition communicates the right behaviors, rewards and reinforces those behaviors, and gives a sense that the organization values employee contributions. Done right, recognition is management’s positive way of creating engagement.

"Engaged employees are important contributors to the company’s culture and continually reinforce values that support the company mission as well as the bottom line. At its most powerful, recognition continuously propagates and reinforces desired behaviors throughout the company."

If you want a detailed guide on how to use strategic recognition to increase employee engagement, Winning with a Culture of Recognition is available this Monday, October 4 (or pre-order now on Amazon). Learn how other companies applied strategic recognition and the results they achieved.

It’s time to finally kick the “bottom-line first, people second” approach to the curb once and for all.