Employee engagement is not an ideal concept. There are dozens of definitions, confusion and controversy as to its origins and meaning, and considerable hype and exaggerated claims as to its impact. Studies show that far more HR departments simply survey it rather than making any policy changes to raise it.
So why bother? Over the past decade, UK productivity has been poor, both by historical and comparative standards. The reasons for this decline are much debated. However, academics, economists and the government do seem to agree that how people are managed at work and their attitudes to that work have a significant part to play in improving our national and corporate performance. Productivity Issues: Past, Present and Future, a report published by the Peterson Institute in November 2015, suggests up to a third of the UK’s productivity shortfall is down to these ‘soft’, intangible capital dimensions of management practices and employee behaviour.
Since then, a weighty volume of research evidence has been produced to show associations between HR and management practices, employee attitudes and engagement, and individual and organisation performance. These include lower staff attrition and absence, improved safety, higher levels of customer service and financial performance, and better productivity.
Nevertheless, over-simplistic, supposedly universal models and recipes for high engagement and performance help to give the concept a bad name.
In The relationship between total reward and employee engagement: An evidence-based review, a report published in May 2016 on developing an engaged workforce for NHS employers, the Institute for Employment Studies (IES) concludes: “The relationship is complex, situation-specific and generally involves multiple factors and drivers, financial and non-financial.
“The evidence gathered makes it clear that there is no ‘silver bullet’ that will result in employees being automatically engaged, leading to performance benefits flowing.”
Rather than copying a set of universal practices, each employer therefore needs to do the following: research the drivers and determinants of its own employees’ engagement levels; know its direction and values; implement a bundle of HR practices which are likely to positively influence employee engagement and performance; be evidence-driven as to what works, adapting policies and practices accordingly; and be innovative, rather than copying what competitors are doing.
Duncan Brown is head of HR consultancy at the Institute for Employment Studies.