Rolling Your Eyes at Employee Engagement? It Could Cost You

Disengagement costs businesses hundreds of millions of dollars, says the CEO of Point B, a firm recently named Best Medium Workplace by Fortune.

Employee engagement has been top of mind lately. Our company was just named the #1 Best Medium Workplace by Fortune magazine, and that honors how we engage the best people. But I’m certainly not alone in contemplating the experience of my employees.

According to recent Point B research, 82 percent of U.S. business leaders say employee engagement is very important to their organization. According to Gallup, the cost of disengagement, and the lost productivity it causes, is estimated to be between $450 billion and 550 billion a year, and that weighs heavily on leaders’ minds. On the flip slide, the most engaged companies have five times higher shareholder return over five years than their lesser-engaged competitors. So, if you think engagement is simply a feel-good activity or an HR task, you’re wrong. Engagement influences every part of your business…profitability, quality, productivity, shareholder value, and more.

Building an engaged workforce isn’t easy. It’s a challenge from the day you start a business, and even tougher to sustain in a growing organization. No wonder we tend to look for silver bullets. But capturing the loyalty of highly talented people is a series of meticulous, deliberate acts that, frankly, never end. 

As CEO, those acts drive the actions and choices I make every day. In fact, they’ve forced me to learn some hard-won lessons about engaging employees as partners and people over the years:

A conversation beats a memo. Every time. Genuinely caring about each person in your company means understanding what makes him or her unique. It’s important to go beyond the typical “communicate often” tactic and have real conversations. A big part of how I stay connected is through hallway discussions, happenstance meetings, coffees, lunches and happy hours. It gives me a chance to hear personal stories and work-related challenges and triumphs from people across our company, and also allows me to share what’s going on in my world…what’s top of mind, the big issues from my perspective, what I’m most proud of, etc. The effect is two-fold: employees get a greater sense of their value and how their roles connect with the larger strategy of our company, and I get a better understanding of what makes that person unique and what’s happening on the front lines (while getting some great advice about issues that are critical to me).  

Employee expectations change over time. And you should keep up. If your people aren’t happy, motivated, and engaged…how do you think your customer will be served and in turn feel? How will that impact your brand? I fly Alaska Airlines all the time, and they create a tremendous customer experience. I think they’re the best in the business. It’s no surprise to me that their people seem really happy and engaged. And when I ask them what it’s like to work at Alaska, they rave about it.

But employee workplace expectations have changed dramatically over the last 10 years or so. Candidates are not just selecting employers, and staying at a company, based on salary and a list of perks. They want to be a meaningful part of the team and have tools that help them do their jobs effectively…all while feeling part of something bigger. We’re keeping pace with change by making one of the most significant infrastructure investments in our history. Our new collaboration platform helps people stay engaged with each other, with customer activity and with their own goals and passions. Investments of this size are challenging to make, but when employees have the tools they need to do the work they’re passionate about, it ultimately shows up in the customer outcomes they deliver.

Transparency isn’t a buzzword. If you want people toown and care about your culture and your organization, keep them informed. They need to understand not just “what” you’re doing, but also why it’s important.

At Point B, we communicate everything. Not just the good news. Unlike many private companies, we share detailed financial results on a regular basis. Our people want the real story, all the time. We let them know what’s going on, what we’re doing (and why), and we empower them to help. I’ve learned that no one wants a sugar-coated message. That only leads to a feeling of helplessness. Employees need all of the information to make the right decisions for themselves, our customers and, ultimately, each other.

Surveys are necessary, but don’t misinterpret them. There’s more to harnessing the power of a survey than asking the right questions and getting employees to answer. Survey results become magic when you measure them over time, report them back to your people and, most importantly, have conversations about them—even when those conversations are tough.

And don’t get stuck on the idea that survey results are “good” or “bad.” That view can become an emotional rollercoaster, and doesn’t help influence positive change. Remember that survey results are bits of information that help you navigate your company, much like you’d use instruments in an airplane. You get data on what people are feeling and experiencing, and that helps guide you in the right direction. Don’t get emotional. Make decisions based on the information you gather, move forward and measure the impact over time. 

Culture should be an obsession. At Point B, our obsession with culture manifests itself in countless ways, but starts with a basic principle…treat everyone well. Everyone, at every level, matters and makes a difference at our company.

We build structure around that principle in the form of our Culture Directors, a group of more than 20 employees that work with leaders across our business units to listen, adapt and drive the kind of employment and cultural experiences we want. The company-wide Culture Director reports directly to me, and provides insight and guidance on where we need to nudge, push, or flip things based on feedback.

I can tell you that the commitment to building a highly engaged workforce is not to be taken lightly. It’s a never-ending, constantly changing, emotional roller coaster ride that is not for the faint of heart. From the start, you have to put in the commitment, diligence, and passion to overcome the complacency, issues du jour, and heartache that comes from trying to make things as good as you know they can be. But the rewards are almost indescribable as you see your organization evolve and become successful at getting, and keeping, the very best people out there. 

Mike Pongon is the chief executive officer at Seattle-based Point B.

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