A Task Force for Employee Engagement?

Recognize This! – Is another “initiative” the way to go to help employees overcome lingering recession fears and re-engage in the workplace?

The press in the UK has been buzzing these last couple of weeks with news of the reinvigoration of the Employee Engagement Task Force initially launched after the publication of the Engaging for Success report, more commonly known as the MacLeod Employee Engagement Report, issued in 2009.

The goal of the task force seems to be to offer practical opportunities, guidance and methods for increasing employee engagement, including a forum for the sharing of best practices.

Timing couldn’t be better as another survey of 4,400 UK companies found 45% of employees are keeping their heads down to avoid layoff in an environment in which 1 in 4 companies are ignoring the need to engage top performers. Why does this matter? Shouldn’t companies be happy employees are “buckling down?” Not in this case. Risk averse employees are also producing less and innovating less out of a desire to “just get the job done and don’t rock the boat.”

Overcoming this fear holdover from the recession is a key goal of employee engagement initiatives to be addressed by the task force, though Les Allen made an excellent observation about this in his Business Performance blog:

“The Government will need to be mindful that raising levels of employee motivation and engagement is not simply a matter of pushing out another multi-million dollar initiative or two. Employee enthusiasm must be built into the fabric of an organization. Employee engagement can’t be just another “bolt on” or flavor of the month.”

Helping employees build that enthusiasm requires giving them a reason to be enthusiastic. How do you that? By recognizing employees frequently and on-the-spot for achievements and demonstrations of your company values that contributed to those achievements. Doing so links them more closely with their colleagues and your firm, encouraging them to repeat those success-driving behaviors.

Do you think this task force is the way to go? If you were a part of it, what would you recommend or contribute?

Signs Employees Are Ready to Walk and What You Can Do to Retain Them

Recognize This! – Employees are regaining control of their value in the workplace.

Where does employee retention fall in your priorities for 2011 list? Too many are still complacent, believing the poor job market will keep workers in place. But hiring is steadily ticking up and unemployment steadily falling.

How at risk are you? According to MetLife’s Ninth Annual Study of Employee Benefit Trends:
• 1 in 3 employees are a flight risk
• Employee loyalty at a three year low, dropping 11 percentage points (after a steady decline)
• Employee satisfaction is also dropping at a rate of 8 percentage points over the last three years

Since employers also admit being less focused on employee satisfaction and work-life balance at the same time they’re report dramatic productivity gains is it any wonder employees are less loyal to the companies trying to wring blood from a stone?

Forbes reported a much worse scenario of 74% of workers would consider leaving if offered another job. What will you do when those top performers do choose to leave for a better environment? Towers Watson tells us 52% of US employers say it’s difficult to attract “critical skill” employees and 25% say it’s hard to retain top performers.

Signs employees are ready to walk:

1) You no longer value employees. Have you stopped recognizing and appreciating your employees for the good work they do? Our Employee Mood Tracker found 78% say being recognized for their efforts motivated them in their job. Simply saying “thanks!” has a powerful effect. Towers Watson research found “reward policy and practice is the number one driver of intent to stay.”

2) You haven’t communicated change. Yes, change is inevitable. And usually employees will be on board with it — if you tell them what you need them to do, not just the esoteric “change.”

3) You’re ignoring employee well being and engagement, even as the economic environment improves. What does this mean? When I feel valued – when I believe my contributions are helpful to my team members, my customers, my company – I perform at my peak. But only 10% of employees feel like they’re vital company assets. Employee engagement is another key indicator of intent to stay. If people are engaged with their work and the culture of your company (their working environment), they will not easily leave.

Where does your company lie in this picture? Ready to make good on the “employment promise” to do right by employees or still living in the recession mindset of “employees are just grateful to have a job?”

What Culture Did You Create in Your Company during the Recession?

Recognize This: The good times are over for companies that took advantage of the recession on the backs of their employees.

Did you (or your company) resort to any measure necessary to survive the recession – layoffs, salary cuts or freezes, etc? Or, if your honest with yourself, did you use the recession as an excuse to perhaps trim a bit more than necessary, knowing the remaining employees would take on the additional work, for no additional pay because of their fear of losing their job, too?

If you (or your company) fall in the latter category, the day of reckoning has arrived. As reported in TLNT:

“For employers that have used the economic downturn and the scarcity of jobs to justify squeezing every drop of productivity out of workers at the expense of the employees’ mental and physical well being, this turnaround sounds a death knell, not for the companies necessarily but rather for the way they have been treating their staff.

“The end is near for those practices as well as for the peace of mind that staff will remain loyal and in place. In fact, for employers who took this tactic, voluntary turnover is almost certain to rise dramatically as their employees learn there are new outlets for their efforts and talents. In addition, these employers likely will have a more challenging time making new hires as word of their actions gets around and impacts their reputations.”

In the age of Glassdoor and the like, you can’t afford for a miserly, whip-cracking, threatening reputation to get out. Sure it may have served you well in the short-term, but payback is coming.

Good employees always know what they’re worth. And I don’t mean just monetarily. They know they are worthy of respect, fair play, recognition and rewards for their efforts, and a work environment that encourages employee engagement.

What kind of culture have you been working in the last couple of years? Intimidation and fear or respectful and engaging? If the former, what are your career plans in the next 12 months?

Sacrificing Company Culture Puts Market Share at Risk

Recognize This: Commitment to your company culture cannot rise and fall with economy.

During the recession, many companies took harsh actions they likely had no choice but to do. But many others took similar actions out of fear or even greed.

Those who were able to stay the course, however, are now working from a much stronger economic position today. For example, Panera Bread’s Executive Chairman and Founder Ronald Shaich explained their approach:

“We've continued to invest in labor in our cafés and the quality of our people. We've invested in the quality of the food. When everybody pulled back and we did more, the difference between us and our competitors went up. And we've been taking market share. We had near double-digit [same-store sales] for over a year now. The stock has tripled in the recession.”

By staying the course in its commitment to its culture – the behaviors and actions that make the company work – Panera Bread is now taking the lead in its industry, even through a recession. This is not surprising, based on research I’ve written about before:

“With extreme downsizes (in workforce) in the long term, companies really do suffer relative to competitors in the same industry facing the same sets of economic conditions. Extreme downsizers are companies that cut their workforce by more than 20 percent. … Most of them lag their industry for as long as nine years after a recession.”

Can you afford to lose market position for 9 years? Did your company take drastic (or even moderate) actions in the recession? What effects are you seeing in your colleagues? Do you see any improvement as the economy improves or are the effects lingering?

A Real Holiday Present: Serve the Public Good

Recognize This: Companies are sitting on record profits, but with no change in sight for their people practices.

How flush are you feeling right about now? If you celebrate Christmas, your wallet is likely feeling quite a bit lighter or you’re waiting in dread for the Christmas present bill to come due in the new year. The harsh reality of the last two years feels much the same for many of us, but not for the corporations.

CBS MoneyWatch reported companies have experienced seven consecutive quarters of profit growth and, in the third quarter of 2010, made more money than in the 60 years the Commerce Department has been tracking this data.

Are you feeling the benefit of any of that profit? I doubt. The article goes on to report companies are sitting on the cash, more concerned with “Increasing shareholder value than the public good.”

Many would argue companies are simply following the mandate of why they exist – to make money for shareholders. I disagree. I believe companies exist to do both. It’s only logical. You can’t make money without the brains and brawn behind what you’re selling. It follows that if you look out for the “public good” by doing right by your employees, by reinvesting in them, by restoring pay levels and staff cut during the recession, by showing your employees how much you appreciate them.

Give employees a real gift this holiday season. Return to reason in your people practices. Show your employees you know they can’t keep up this pace forever. Express your appreciation for their herculean efforts and reward them appropriately.

Image credit: CNNMoney.

Employee Recognition ROI at KPMG

Recognize This: The emotional impact of recognition is huge compared to the low monetary investment.

Last month I had the pleasure of participating in a webinar, Recognition the KPMG Way: Driving Employee Engagement and Success, with Sara Turner, UK head of employee benefits and wellbeing, KPMG. Sara made quite clear the same point I’ve been making this week about the need to Involve Program Participants and Invite Their Input  when creating a strategic recognition program:

“The key is not to do this in isolation. Look how recognition links to other areas of engagement in the organization and consult with stakeholders – decision makers and users— to make sure what you’re designing will really resonate. You need to take in account how other people feel.”

The ROI of Recognition

The results experienced at KPMG have been phenomenal. They increased the number of award recipients year over year by 25% without any additional spend. But the emotional impact is even more powerful. Again, quoting Sara:

“What you get with recognition is a really emotional response. This is quite different from any other area of reward. What really sets recognition apart – and this comes through the feedback from the people – is that it’s unexpected. Though the monetary value is low, the impact is really huge.

“In monetary terms, recognition is so much less expensive [than other reward systems], but what you get is this emotional gut response from people who are overwhelmed, happy and excited when they get an award. People are so engaged because someone has appreciated the extra effort they’ve gone to and taken the time to make sure they acknowledge it and that others acknowledge it as well.”

Did you miss the webinar? Listen in here.

Have you ever been “overwhelmed, happy and excited” by being recognized in your workplace? Tell me the story. Better yet, how often have you felt that way?

Knowing the Path to Your Destination * How to Communicate Your Strategic Plan

How’s your 2011 planning going? What changes do you see on the horizon for your organization’s strategic plan?

There’s been a great deal of fluctuation in strategic plans during the last three years as companies have reacted to economic pressures in numerous ways, from drastic cutting of employees (how do we get the work done without them?) to evaluating relevance in a rapidly changing market (do people even want to buy my product any more?)

The more critical questions, however, are:

1. Do your employees know how the strategic objectives have changed?
2. Do they know how to adjust their work to align with the new objectives?


A recent SmartBrief on Leadership poll found that, for 40% of employees, the answer to both questions is “No.”

These findings are worse than the results of an earlier Mercer study I wrote about before that found:

“Simply put, almost two-thirds of all employees are 33% as productive as they can be because they don't understand what they are now asked to do.”

The comments of Mike Figliuolo, managing director of ThoughtLeaders, in reaction to the SmartBrief poll explain the hazards of not getting everyone focused on the same plan:

“Without a defined destination, you’re simply making widgets, and you may wake up one day to find the widget is obsolete because the strategic landscape around you changed while you were hunched over the widget machine.”

So how do you solve this? Don’t forget these two critical steps:

1) Inform people of the destination. Make sure all employees know what the end goal is.

2) Inform people of the path. Knowing the destination is useless unless you know how to get there.

One of the most effective methods for repeatedly communicating both the destination and the path to all employees is through strategic employee recognition. In this kind of employee recognition program, you frequently and in a timely way acknowledge and express appreciation to employees when they contribute to achieving the strategic objective while demonstrating the company values. If you do this consistently, employees come to understand how they, personally, are contributing to the strategic plan, and desire to continue to do so.

Do you understand both the destination and the path? Are you helping those who work for you to understand as well? How?

“The Power of Post-Recession Recognition”

I’m honored to have an article I wrote included in last month’s issue of Workspan magazine: "The Power of Post-Recession Recognition." Here’s a key excerpt:

“The survey showed 45% of respondents from organizations that had a recognition program before the recession said investment in recognition had decreased since the start of the downturn. Organizations that decreased spending on their programs saw significant negative impacts from their actions, including decreased employee engagement (59%). After experiencing such impacts, 42% of organizations that cut spending during the downturn now say they plan to increase spending in 2010. …

“Looking ahead, the respondents who did not have a recognition program before the start of the recession are considering starting one within the next year, most notably focused on employee engagement, making the case that ignoring employee recognition in a downturn is a hard lesson learned. Furthermore, perhaps keeping in mind some of the questionable business practices that hurt companies at the beginning of the recession, many respondents indicated values-based recognition will be a clear priority. The idea behind values-based recognition is ensuring that employees display the right behaviors in achieving company goals. Reinforcing an organization’s beliefs will also help businesses reinforce their employer brand, which will benefit them as they work to retain employees and attract new talent.”

Click through for a full analysis of the results of our survey and the six recommendations to properly calibrate strategic employee recognition programs for the economic realities of today.

Keeping What’s Important * Employee Recognition

It’s always good to be validated by the research. Thankfully, we did not see companies we work with contracting their recognition efforts in the recession. Most saw the importance of continuing employee recognition programs as critical to their ability to maintain employee morale and foster engagement in frightening and trying times.

Recent research from Accenture, “The High-Performance Workforce Study 2010,” found the same to be true for many organizations:

“Incentive, training and other related workforce programs at US and international companies held steady or were increase the past 12 months. … In the US, 39% made no changes to their recognition programs, while 28% increased them. For incentive compensation, the figures were 45% and 23% respectively. … International companies showed even more support for retaining or growing recognition, incentive and training programs, with just 15% and 19% cutting recognition and incentive compensation programs, while about 75% maintained or grew them.”

This report further supports Globoforce research and Towers Watson/WorldatWork research that companies on a global basis did not reduce or eliminate recognition and incentives programs on as drastic a scale as anticipated. This should help employers as they work to rebuild staff to pre-recession levels but may have to overcome a work atmosphere tainted by cost-cutting actions.

Globally, just over half of employers feel they are prepared to adapt and manage change in economic uncertainty. Strategic recognition is a powerful tool for change management, especially as a communications vehicle for changing strategic objectives and how employees can contribute to those objectives in their daily work.

Rehumanizing the Workforce: Telling Stories that Resonate

This week I’ve discussed the death of trust and loyalty in the workplace and the dehumanization of the workforce, but I didn’t offer many solutions.

Of course, I believe the obvious solution to much of the outfall of these practices is strategic employee recognition. Restoring trust and humanity begins with a simple “thank you” – an acknowledgment that people are noticed, appreciated and recognized for what they do that matters.

But for recognition to be strategic – indeed, for recognition to overcome the death of trust and dehumanization – it must resonate deeply with employees. It must help them see that they are not cogs in the machine, but deeply valued and appreciated contributors that are helping to achieve the company mission. And the best way to do that is to link every recognition to a story that resonates in that way.

Going back to the Financial Times article I’ve referenced all week:

“Generation Y is looking for a different relationship with employers. ‘Gen Y wants to feel part of a team, a community, rather than being an individual cog in a big corporate machine.’ They expect companies to offer more than a pay cheque, and look to its values to accord with their own. …

“Communication with employees relies on telling them a story that resonates. The organisation’s narrative – ‘where we’ve come from, who we are, where we’re going and how we’re going to get there” – is boring for many employees. But if a colleague can provide a real example of how she put the company’s vision into practice by, say, helping an angry customer, it will have more impact than a mission statement from HR. ‘More important are the personal stories that people tell to bring the organisation’s story to life.’”

I’ve written before on the research in which GenY reports the most important thing to them in an employer is the company mission and values aligning with their own. For all employees, regardless of generation, knowing they are contributing to the company’s success helps reconnect to the organization, re-energizing and re-engaging them in your company’s mission.

As I said in a comment to a TLNT article on restoring trust with candor:

“Tell people how each of them can make a difference. Objectives/goals are a moving target in many organizations right now. Employees may know what their "tasks" are, but they don't know any more why those tasks matter -- how they're helping the company pull out of the recession and regain a sound footing. That knowledge alone goes very far giving employees a reason to reengage, recommit and trust again.”

What are your solutions for restoring trust and rehumanizing the workplace?

Inmates or Teammates: Rehumanizing the Workforce

During the last couple of years, I get the feeling that corporations have reverted to workplaces of the Industrial Revolution, where people are seen as just another cog in the machine that can be easily pulled out and replaced if necessary.

This dehumanization is no small matter. In the Financial Times article I reference in my last post, Jonathon Hogg, head of the people and operations practice at PA Consulting, commented:

“Too many human resources departments became fixated with systems that make an organisation more efficient but dehumanise management. Companies have put in all sorts of process to measure and evaluate performance, an arithmetic approach to assessing people. This puts the focus on compliance and fulfilling quotas, not engaging with staff.”

This reminds me of the prison system in which inmates are assigned numbers. To the prison guards, they are not called by their names or referred to by name in any way. They are their number: Inmate 173658.

Even outside of the performance appraisal process, employees know they are viewed as nothing but cogs in the machine. A recent Wall Street Journal article made this abundantly clear, discussing the “near historic” profits U.S companies are pulling in after “re-tooling their operations.”

“For all U.S. companies, the Commerce Department estimates second-quarter after-tax profits rose to an annual rate of $1.208 trillion, up 3.9% from the first quarter and up 26.5% from a year earlier. … The data indicate that big companies are recovering from the downturn faster and more strongly than the overall economy, helping send stock prices higher this year. To achieve that performance, companies laid off hundreds of thousands of workers, closed less-profitable units, shifted work to cheaper regions and streamlined processes. … Despite the hefty profits, executives aren't expected to boost spending on new employees, products and equipment anytime soon.”

Companies know they’re putting the squeeze on employees, as noted in this Market Watch article:

“Some companies acknowledge that workers are feeling squeezed. Among all employers, 61% said their cost cutting has increased employees' workloads, while 53% said cost cutting has made it harder for employees to manage their work-related stress.. …

“And workers are feeling under-appreciated, other recent data indicate. Fifty-two percent of employees said their employer has done nothing to reward their achievements in the past year, and 59% said they are making the same or less than they were two years ago, according to an August survey by Glassdoor.com, a career and workplace community.”

What’s the likely outcome if this dehumanization continues? Workers looking out for themselves, especially as the economy improves, as this BlessingWhite research notes:

“Employees are weary of cost cutting, organizational triage, and anxious business conditions. Star performers in particular may be tired of performing heroics for their employers. They're ready to crawl out from the safe place of 'at least I have a job' to think about their future.”

How are employees viewed in your workplace? As inmates who are nothing more than a number, interchangeable at will and not to be troubled about? Or as teammates with value and worth that should be honored, noticed and recognized?

Employee Trust in Its Death Throes

Employee trust in and loyalty for the employer has been dying a slow, agonizing death for the last several decades. It began with massive layoffs in the 1970s-80s when employees who thought they had a job for life, like their parents before them, found themselves pounding the pavement looking for work. The children of that generation are now the Generation X workers, who have seen the pain experienced by their parents repeated at least two to three times from the late 1990s dot-com bust to today’s Great Recession.

The result? No one expects their employer to look out for the employee’s best interests. Employees are out for themselves, with all the implications that implies for teamwork, community and social integration in the workplace.

An excellent article last week in the Financial Times, “Give More Power to Your People,” dealt with topic brilliantly, using the example of a cultural turnaround at British Gas. The article raises three themes I deal with throughout the week in my posts, the themes of employee trust and loyalty, the dehumanization of the workplace, and rebuilding an employee relationship with stories that resonate.

On trust, the article cited two experts on the topic:

Octavius Black, chief executive of the Mind Gym, a performance consultancy, warns that while staff retention has held up during the downturn, that could soon change. “Over 60 per cent of employees currently say they plan to switch companies, with 25 per cent actively looking for a new job,” he says. “The risk is even more acute with top performers, whose feeling of engagement with their employer has dropped three times faster than the average employee’s in the past 12 months.”

Jonathon Hogg, head of the people and operations practice at PA Consulting, a leading management and IT consulting firm, says the recession has changed how employees view their relationship with employers. “Employees are disappointed with business.”

Is there an opportunity to restore employee trust? The answer to a plea submitted to the “Dear Workforce” article in Workforce Management gives some guidelines, mostly around open, honest communication with no hidden agendas. Of course, in an environment when trust has already been lost even getting employees to believe you are honestly communicating with them is a struggle.

I believe the trust relationship can be restored, but not until overcome the dehumanization of the workforce – the topic of my next post. What do you think? Is trust dead? Can it be restored? Should it be restored? How?

Employee Engagement Continues to Fall, along with Shareholder Return

Why should you care about employee engagement? Because it directly impacts shareholder return, EPS, financial improvement and competitive advantage.

Hewitt research found a 63% differential in total shareholder return for companies with high employee engagement vs those with low engagement:

“Organizations with high levels of engagement (where 65 percent or more of employees are engaged) outperformed the total stock market index even in volatile economic conditions. During 2009, total shareholder return for these companies was 19 percent higher than the average total shareholder return. Conversely, companies with low engagement (where less than 40 percent of employees are engaged) had a total shareholder return that was 44 percent lower than the average.”

Gallup research found companies in the top 25% for employee engagement have (as compared to bottom 25%):
• 37% less absenteeism
• 25% less employee turnover in high-turnover organizations (such as retail)
• 49% less turnover in low-turnover organizations
• 27% less shrinkage
• 49% fewer safety incidents
• 60% fewer product defects
• 12% higher customer metrics
• 18% higher productivity
• 16% higher profitability

And that’s just the start. Gallup also found :
• EPS exceeds competition by 28% (top 25% for employee engagement)
• EPS exceeds competition by 72% (top 10%)
• Growth trajectory (for financial improvement): 2.5 times the competition (top 25%)
• Growth trajectory: 3.9 times the competition (top 10%)

What did the level of employee engagement mean to companies during the recession?
• Those in the top 25% that were trailing competition before the recession surpassed the competition in 2008.
• Those in the top 10% were already ahead of their competition in 2007, but widened the gap further in 2008.
• Those in the bottom 25% for engagement in 2007, however, followed the same downward trend as their competition during the recession.

Still think employee engagement doesn’t matter?

Strategic recognition is one of the most powerful methods for improving employee engagement. Be sure to check out our new book "Winning with a Culture of Recognition," available on Amazon now!

Employee Engagement Continues to Fall as Business Practices Remain Unchanged

Are you concerned about your levels of employee engagement and how your employees are responding are we approach year two of pay cuts, no pay raises, increased workloads, and little appreciation?

If not, you should be. Hewitt recently released startling figures from their Global Engagement Database that show employee engagement is continuing to decline, even as the economy recovers. In fact:

“For the first time in a decade, the percentage of organisations with decreasing Engagement now exceeds the percentage with increasing engagement."

Can you blame employees? They are working harder, longer and for less. Telling them “your pay is your thanks” just isn’t cutting it any more. Employees understand why their companies needed to cut-back, but that doesn’t change their need to be told, “Thanks. You did a great job. They way you handled the project really demonstrated our commitment to quality and integrity. Well done.”

And the fallout from not giving that appreciation is real. Talent Management magazine recently reported on our own “Restarting Recognition during the Recovery” research, highlighting:

“One survey respondent said that when a monetary recognition program was removed, employee satisfaction went from 72 percent to 32 percent. The majority of companies (71 percent) that held steadfast in their employee recognition programs and increased spending saw an uptick in employee engagement, whereas 59 percent of companies that decreased spending saw a dip in employee engagement. …

“In a recent Deloitte survey asking employees about factors that would cause them to stay at or leave their current organization, 25 percent of employees cited nonfinancial recognition from supervisors or managers as a reason to stay, while 20 percent cited the lack of this recognition as a reason to leave.

“However, organizations also realize that money talks. So it’s no surprise that organizations that increased their investment during the downturn realize that the recovery is no time to let up on these efforts. A majority (53 percent) of these companies plan to increase their investment in recognition.”

What are you doing to show your employees the appreciation they deserve?

How to Bounce Back from Extreme Downsizing

What’s your biggest concern in the next six months? WorldatWork recently reported the results of ComPsych Corp. survey asking just this question of HR managers. The answer itself is not surprising: “Maintaining employee productivity and morale” (31%). I do have to admit, however, that I was surprised that this outranked “Dealing with health-care costs and new legislation” (26%). Admittedly, I listen to my US colleagues and follow the US healthcare debate through the lens of my own lifetime experience with the Irish healthcare system, but it’s clear to me that these changes are of serious concern to employees, HR Pros and company leaders alike.

And yet, employee morale and productivity remains the greater concern. Why is this? The obvious answer is the fallout from actions taken during the recession. US National Public Radio (NPR) recently commented on research out of the University of Colorado, Denver, which found:

“With extreme downsizes (in workforce) in the long term, companies really do suffer relative to competitors in the same industry facing the same sets of economic conditions. Extreme downsizers are companies that cut their workforce by more than 20 percent. … Most of them lag their industry for as long as nine years after a recession.”

The obvious findings from the research? “Cutting a workforce so deeply can have a negative impact on the morale of employees who remain.”

More importantly, what’s this mean in the workplace? Even for those still employed, the atmosphere itself is toxic. An ex-employee of Alcoa, a producer of aluminum, noted:

“Anxious workers can create problems. Especially if your job is in a dangerous workplace. … Your mind’s not going to be totally committed to focusing on what you’re doing, when in the back of your head you’re thinking, ‘Man, am I getting laid off?’”

And don’t think you can rest easy if your workplace managed to keep layoffs to a minimum (or avoided layoffs altogether) in the last couple of years. Your employees are well aware of the actions taken elsewhere and now the threat of a “double-dip” recession. Their fears are still impacting their work.

So, considering this very real atmosphere of fear in many workplaces, what are you doing to reassure employees and help them stay focused on the job at hand? The most effective, most positive action you can take is to reassure employees of their value to your organization by recognizing their efforts that are contributing to your objectives.

Diffusing a Negative Environment * The REAL First Step to Recovery

I thought I’d read just about every possible angle on jobs, employee loyalty, retention strategies, rehiring strategies, etc., as the economy improves. I was wrong. Last month, the Wall Street Journal offered a new twist: “Coping as a New Hire at a Dispirited Firm.”

The article is targeted to the new employee walking into the typical workplace devastated by layoffs, etc., during the recession. Advice includes “keep a level head,” and “stay neutral and positive.” This is solid advice to the new hire entering a tough environment, but what about advice for the leadership of that company to diffuse the negative environment itself?

Times were tough and are slowly getting better. Management in many companies made difficult decisions and executed those decisions -- some well, many poorly. The results of those actions certainly left dispirited employees in their wake. But if companies are now positive enough to begin hiring, then they MUST do something to reinvigorate the atmosphere of the workplace for those still there.

There is no easy or quick way to do this. Open, honest, direct and personal conversations -- as groups and between individuals -- is a critical step. Just being able to hire more bodies won't help companies return to past levels of profitability and productivity. They must also restore employee sentiment, attitude and morale.

Globoforce Joins Compensation Cafe Bloggers: Debut Post on Employee Economic Reality

What’s your personal “blog roll?” What sites fill up your reader or do you find yourself regularly visiting throughout the week to keep you finger on the pulse of your industry?

My blog roll is quite long. Just a few I follow are listed in the footer of this blog. But one I’ve found to offer consistently valuable insight on the varied aspects of compensation is Compensation Café. A round-up of industry experts from around the world, the Café prides itself on “serving up straight talk, original thinking and caffeinated discussion on everything compensation.”

I’m pleased and honored to have been recently added as a regular contributor to Compensation Café. My debut post appeared today, in which I discuss the bi-polar nature of the economic news in the last month and the impact that’s having on your employees. As I note in the post:

“Company leaders cannot predict when we will pull out of the recession sufficiently for employees to decide to jump ship. We do know, however, that half of employees are disaffected in the workplace and even those who are engaged (high-potentials) will leave for a more fulfilling or appreciative work environment as soon as they are able.”

Hop over to the Café to read the news and research backing up this conclusion or to check out the insights from the blogging team. A few of my recent favorites:

From Margaret O’Hanlon on Performance Management: Pop Quiz: Can You Use "Mid-Year Review" & "Business Investment" in the Same Sentence?

“Instead of using your performance appraisal process as the context for mid-year reviews, dig deep into the business issues your company is facing with products, services, customers, technology. Check out how your stock has trended and learn why. Work with leadership to build an accurate, insightful business case that will educate managers and employees.”

From Laura Schroeder on Engagement: Strings Attached

“At the end of the day, it’s a complex mix of factors that keep people in a job or lead them to move on so I think we need a better word than engagement. My suggestion is connection because people who feel personally and professionally connected to a company, to a manager, to a group of colleagues, or to a particular job, are more likely to give more of themselves and less likely to go elsewhere.”

From Chuck Csizmar on Global Recognition & Reward: The Risk of Global Standardization

“You might think that the positive aspects of employee recognition programs are a universally accepted principle, but that's only partially correct. Important difference exist when something can be viewed from multiple perspectives. In some cultures / national identities the role of the team is such a core element of employee identification that seeking out an individual contributor for recognition is not an accepted practice. Some employees might be reluctant to step forward, or be pushed into the spotlight.”

Pour a cup of coffee and settle in for some good discussion at the Compensation Café. I hope you enjoy the conversation and learn as much as I do.

Don’t Kill Health & Wellness * Leverage Engagement & Recognition

Do you have a health and wellness program in your organization? What about an employee engagement initiative? If you have both, do you look for correlation between the two? How about causation?

Causation, of course, is harder to prove than correlation, but Gallup recently released interesting research on the effects of employee engagement on employee health.

“Engaged people feel less stress, and the stress they do feel is offset by a lot more happiness and enjoyment and interest. …

“Not only do anxiety and depression take a personal toll on workers, but they also result in significant direct costs to businesses in medical expenses -- and indirect costs, including lost productivity. In 2000, for example, the economic burden of depression in the United States was estimated at $83.1 billion, which included $26.1 billion in direct treatment costs and $51.5 billion in indirect workplace costs from absenteeism and "presenteeism," or reduced productivity while at work due to depression. And a 2003 study found that workers with depression reported an average of 5.6 hours of lost productive time at work each week, compared with an expected 1.5 hours of lost productive time among workers without depression.

“A recent Gallup study into the effects of disengagement on mental health -- conducted February 2008 through April 2009 -- studied U.S. workers as the country moved through the recession. … actively disengaged employees were 1.7 times as likely as engaged employees to report being diagnosed with anxiety for the first time in the next year. And actively disengaged employees were almost twice as likely as engaged employees to report being diagnosed with depression for the first time in the next year.”

Obviously, the recession and its effects on the workforce has caused employees to react in a variety of ways, including with physical and mental symptoms of illness. How they will choose to handle that reaction is an even more important question.

The Chief Happiness Officer blogger, Alexander Kjerulf, recently posted the story of a reader of his book, Happy Hour is 9 to 5. The reader tells of his decision to change careers into one that paid much better but required him to leave the field he loved. After gaining 100 lbs. and suffering several other physical ailments, the reader completed an exercise in Kjerulf’s book. The main lesson he learned:

“I used to take better care of myself when my work was more in line with my personal values.”

The main take away – you may not be able to alleviate the stress of layoffs, pay reductions or other challenges faced by your team. But you can help them see how their personal values are reflected by your company values. You can give them a greater sense of personal meaning and purpose in their work.

*image credit: Flickr

How Rooted Is Your Workforce? Towers Watson Global Workforce Study

Towers Watson recently released an executive summary of their 2010 Global Workforce Study, noting primarily the impact of the recession on employees. Key findings include:

“Our study reveals a recession-battered workforce — one with lower expectations, increased anxiety and new priorities. … The desire for security and stability trumps everything else right now, in part because employees see security as a fast-disappearing part of the deal. Confidence in leaders and managers is disturbingly low — particularly in terms of the interpersonal aspects of their respective roles.

“In short, “business as usual” on the people front is not an option because there is no business as usual any more. (emphasis original) … Employers need to adopt new and creative practices to balance effective cost and risk management with enhanced employee retention and engagement. Employees will likely view careers, skill building and mobility very differently from how they did in the past.”

While I agree that confidence is low and that there is no such thing as business as usual any more, I believe the current low mobility of employees will change, and it will do so relatively soon. Employees have seen the lack of commitment the company has towards them. Just as this has escalated in the last 30 years, it will only continue to do so as employees use an improving economy to exercise their ability to find new, better, more exciting work.

Trust in management is lost. Some see this as a permanent break in the employee/employer workplace relationship. Dan Pink coined the term Free-Agent Nation more than a decade ago referring to this phenomenon.

While mobility is currently at a low point, this will change. The primary benefit of a free-agent nation to the employer is the constant stream of new, fresh ideas. But the costs are potentially much higher from the investment to find, hire and train them, the loss of accumulated knowledge in longer term employees, and the loss of people to serve as mentors to new employees on the company culture as well as the job function.

What do you think? Are employees so in need of job security they will stay put and hope for a return of “jobs for life?” Or do you think this is a temporary state of mind, soon to change as opportunity improves? What are you doing to prepare now for the outcome?

Employee Engagement Trending Downward

Recent results from Modern survey on the state of employee engagement in the U.S. have shown employee engagement down in all aspects.

“After a year of upward trending engagement scores, Modern Survey's latest study on employee engagement in the U.S. workforce shows a precipitous decline in workers' psychological investment in their organizations. While the economic recession may have temporarily motivated employees to put forth extra effort on the job, the latest data from this scientific study suggests U.S. workers may have hit their breaking point, as all five components of Modern Survey's Employee Engagement Index are now trending downward. …

“The most significant declines are statistically significant six percentage point drops in the number of workers who say they "take pride in their company," (from 79% in August 2009 to 73% in February 2010) and "intend to stay with their company for a long time" (from 63% in August 2009 to 57% in February 2010). …

“Bruce Campbell, Senior Consultant at Modern Survey, believes that if companies do only one thing right now in regards to employee engagement, it should be to express sincere appreciation for employees and recognition of their contributions, and it should come from the organization's most senior leaders first, then repeated and reinforced by managers at all levels.”

Of particular interest in this research are two points. First, the comment that “US workers may have hit their breaking point” as the reason for the drop – this could also be attributed to repeated signs that the economy is improving, giving rise to employee hopes to find a new job. As Right Management research noted, 87% of Americans are engaging in some level of activity to leave their current position. The distraction these thoughts bring are sure to lower engagement levels as well.

Second, Bruce Campbell’s advice bears repeating: if you only do one thing now to contribute to employee engagement, recognize and appreciate your employees. Repeat and reinforce at all levels to help employees see the meaning and purpose in their work, know they are appreciated for their efforts and help them to once again take pride in your company and stay for the long term.