What is employee engagement?

By Talent Management

Knowing how and why employees become emotionally invested in an organization and its goals.

Employee engagement is the measure of how much effort employees will give to achieving their organization’s goals. While employee engagement matters a great deal to organizational leaders and human resources (HR) professionals, fundamentally, it’s an attitudinal state within the employee. Employee engagement is getting employees to put their “hearts and minds” into their daily work.

Engaged employees want to feel that their efforts can make a difference. The term encompasses both employee satisfaction and the employee’s desire to remain with the organization (retention). Unfortunately, increasing employee engagement appears to be difficult. One recent study concluded that less than a quarter of workers feel engaged at work.

A recent IBM Institute for Business Value study (PDF 1,2 MB) identifies a number of factors that influence employee engagement.

  • Community. The relationships employees create and sustain can influence their individual effectiveness and the perceptions of their organizations. The goodwill that generated through these relationships, or “social capital” can impact many factors – from facilitating cross-organizational knowledge sharing to boosting individual employee satisfaction.
  • Physical workspace and environment. The configuration and design of individual and team workspaces are critical components of the employee engagement. Organizations can use reconfigurable furniture and equipment to accommodate flexible work teams. Well-designed communal spaces can facilitate information flow and encourage serendipitous interactions, while quiet spaces promote concentration. Proper furniture ergonomics can reduce employee stress and limit physical injury. Ambient lighting, temperature control, noise, ventilation and even office location can impact employee productivity and engagement.
  • Tools. With a greater reliance on software-based tools, there are issues that, if left unaddressed, can increase employee frustration and reduce productivity. The design of the physical equipment that houses the software is key. Employees want to spend their time doing their work, not figuring out how to use the technology behind it. With an increasingly diverse and aging workforce, tools that can accommodate potential visual, auditory and mobility challenges are taking on greater importance.
  • Activities. Employees want to feel they can influence their work, build mastery and understand their work’s overall purpose. Employees are more satisfied when they understand how a task fits into the work unit’s goals and the larger organization’s mission. Also helpful is if employees have, possession of relevant knowledge or expertise, access to additional information or experts as needed, and availability of timely feedback – either from managers or automated systems.
  • Social platforms. Companies are using internal social platforms to support organizational innovation, expertise location and knowledge sharing and to help employees connect to others across the globe. These social platforms provide a common environment where employees can find relevant insights. Organizations need to create a critical mass of users to sustain the necessary level of content and attract other users. Also, they must establish rules of engagement that clarify what can be said and how the organization intends to use data shared on the platform. Leaders need to publicly support the use of the platform and recognize those who make substantive contributions.
  • Strategy and culture. An organization must consider each of these previous facets of employee engagement in light of overall business goals and culture. Defining these underlying tenets is necessary to designing experiences that not only match the needs of the individual but are aligned with organizational priorities. Once a company defines its strategy, it must help ensure that leadership behaviors, people practices and management systems consistently support the employee engagement. Informal practices matter too. If the culture is fear-based or hierarchical, employees may struggle to collaborate on open, social platforms.

Evolution of employee engagement

Employee engagement as a concept began appearing as part of management theory in the 1990s. Its popularity in human resources practice became widespread by the 2000s. However, even today the distinction between employee engagement and related concepts such as employee morale and job satisfaction can be somewhat indistinct.

In today’s digital age, employee engagement practices encompass issues such as an employee’s ability to:

  • Work most effectively anywhere, anytime on any device
  • Securely provide the right information to the right people in the right context
  • Collaborate more closely with clients, partners and co-workers
  • Create a responsive service with a clear user journey
  • Establish and maintain an expansive network of synchronized, real-time data
  • Use structured and unstructured data, including voice, video images and location data

A recent study (PDF 199 KB) showed that Chief Executive Officers of major firms have made securing employee talent a major priority to ensure business growth. In fact, 65 percent of CEOs expect that people skills will have a strong impact on their businesses over the next several years – prompting the creation of new strategies.

One of the emerging strategies for attracting and retaining the right talent is the use of artificial intelligence (AI) to increase employee engagement. AI can take all the data – structured and unstructured – and generate hypotheses, reasoned arguments and recommendations. Advances in artificial intelligence are already improving how businesses understand what their employees are telling them through their conversations, sentiments and actions.

A business can better hear its employees through AI, both for better listening and for augmenting people’s ability to accomplish tasks. Among other strategies, a business applying AI can:

  • Scale its personalization, giving every employee better and more individualized attention to their own needs, skills and interests
  • Use AI to listen to social sentiment across internal networks to recognize better opportunities, identify emerging challenges and foster transparent conversation with leadership
  • Simplify its processes, collaboration tools and systems, so colleagues with relevant interests and skills can connect, and ideas can flow more easily through the network

Why is employee engagement important?

Employees are the foundation for any business. No company can hope to successfully operate unless the right people are in the right positions. In a growing, hyper-connected world it’s becoming more difficult to find and retain those right people. Unlike their parents, younger people don’t expect to stay at one job for life and mobile careers are becoming the new norm. Companies can’t count on automatic loyalty from their employees. It will take employee engagement to keep companies thriving in today’s marketplace.

Some reasons why organizations prioritize employee engagement are to:

  • Increase productivity. Numerous studies have demonstrated that an engaged workforce can have a profound effect on an organization’s bottom line. Companies with engaged employees outperform those without by up to 202%.
  • Retain employees. Engaged employees are less likely to quit. Nearly $11 billion is lost due to annual employee turnover. Happy employees typically have fewer problems. Investing in improving the employee experience can help lower overall HR costs.
  • Attract top talent. For a company’s long-term survival, it needs a high level of employee engagement to attract and grow top-performing talent, create collaborative cultures and connect the right people to get work done.
  • Attract and retain customers. A personalized, authentic employee experience can improve engagement and enrich the customer experience. Improve customer satisfaction and sales by empowering employees to succeed. Recent research shows that organizations that score in the top 25 percent on employee experience report more than double the return on sales compared to organizations in the bottom quartile.
  • Foster innovation. Engaged employees are more likely to engage with colleagues in stimulating discussions that can become productive brainstorming sessions. Proactive engagement programs can stimulate the innovation needed to keep a business competitive in the long term.
  • Improvise creative solutions. Stimulated employees can find new ways of completing tasks and projects and will look for fresh takes on old ideas.
  • Further marketing goals. Employees who are engaged will help spread good news about your company and will help bring credibility to an organization’s marketing messages.
  • Decrease absenteeism, increase safety. A Gallup study showed that the absentee rate of engaged employees dropped by 41 percent, along with 70 percent fewer safety incidents. According to figures from Gallup, businesses with highly engaged employees suffer 70 percent fewer safety incidents.

Using software for employee engagement

Businesses have turned various software solutions that combine talent management and social collaboration tools with the power of workforce science and advanced analytics. Such software can build engaged workforces and deepen client relationships that can lead to measurable business outcomes.

Some of the software solutions offered by IBM for employee engagement include:

IBM Watson Career Coach

IBM Watson Career Coach is a virtual assistant that aligns employees’ career goals with business goals. Through interactions and updates, the software learns about an employee’s preferences and interests, makes recommendations for existing job opportunities and offers advice on how to navigate future career moves.

IBM Watson Talent Frameworks

IBM Watson Talent Frameworks is a ready-to-use job taxonomy and competency library. It provides industry benchmarks across 3,000+ job profiles and 2,000+ associated skills that have been developed over 30 years and can be personalized and curated with Watson.

IBM Talent Development Starter Package

The IBM AI-powered Talent Development Starter Package includes IBM Watson Career Coach and uses the power of IBM Watson Talent Frameworks to help a company achieve greater employee engagement, growth and internal mobility. It’s a three-month starter package designed to minimize workload for an HR team.

HR Transformation Services

Cognitive computing, process automation and digital enablement let you rapidly accelerate HR transformation and offer powerful employee experiences that drive enhanced business results throughout the enterprise. 

Talent Acquisition Services

Talent acquisition is the practice of attracting and hiring top talent to meet a company’s business needs. IBM offers comprehensive and integrated recruiting solutions powered by Watson AI and data-driven insights that help identify the skills needed and incorporate precision into recruitment and hiring practices.

Change Management Services

To help employees embrace change, IBM offers a consumer-style platform with engaging elements designed to encourage employee buy-in and enthusiasm for a company’s vision. IBM digital change services are a new approach to change, powered by behavioral science and analytics. 

Talent Development Services

Experienced IBM professionals help reinvent HR and talent to maximize workforce performance for the digital era. IBM digital change services help accelerate employee engagement, assure behavioral change and measurable adoption.

Employee Engagement Services

The creative employee experience design approach from IBM combines behavioral science and analytics, IBM Design Thinking techniques, mobile and social technologies, and digital change consulting.

Key features of effective employee engagement

By creating a differentiated work experience for employees, a company helps its employees thrive and grow in a constantly changing environment.

One IBM study (PDF 396KB) identified several practical “best practices” that help employees become more engaged:

  • Publish a statement of the organization’s mission, vision, values, or strategy.
  • Conduct an employee opinion survey.
  • Sponsor activity or training sessions aimed specifically at quality improvement.
  • Collect customers’ feedback about the organization’s products or services and share it with employees.
  • Conduct regular performance appraisals.
  • Cross-train employees to perform other jobs in the organization.

Another IBM study (PDF 1,2 MB) identified five practices that organizations are currently using to create more effective experiences:

Personalization. Many companies recognize the importance of balancing the needs of the organization with the unique characteristics of individuals and workgroups. Therefore, they are looking for ways to tailor the employee experience to address both requirements. From a social perspective, this might include enabling employees to develop profile pages on a collaborative platform. At the physical level, this might include empowering individuals to configure their work areas to match both their work requirements and their personal tastes.

Transparency. Employees want to know how their efforts contribute to larger goals and have a purpose. In fact, meaningful work may be the biggest contributor to better employee engagement. The HR Exchange Network in 2018 found that one of the most effective tools for increased employee engagement is the use of social media. The use of social platforms gives individuals a forum to raise concerns, contribute innovative ideas and maintain an ongoing dialog with leadership. Social platforms can also reveal informal networks and identify influence leaders.

Simplicity. Even simple activities, such as running an effective meeting, are often complicated by conference rooms equipped with incompatible technology and virtual platforms that freeze at key moments. Simplification efforts, like removing non-value-add process steps, providing easier access to knowledge bases or changing the way information is displayed, can create a more positive work environment.

Authenticity. It’s important to align employee experiences to the organization’s culture and value system. Organizations can express corporate values in numerous ways, from the physical design of corporate headquarters and local offices, to the establishment of corporate events. If a company’s philosophy isn’t reflected in their interior design can be seen by employees as inauthentic – an impression that can trickle down to clients.

Responsiveness. Consumers want to provide input and they expect companies to respond to their ideas and concerns. By embracing employees’ willingness to engage, organizations can work more effectively with an increasingly vocal and dispersed workforce. Companies can gain valuable insights and turn those insights into action to improve organizational knowledge, productivity, performance and employee engagement.

Case studies for effective employee engagement

IBM helps global biotech firm find better talent and improve metrics

IBM acted as a recruitment process outsourcing provider for sourcing, screening and scheduling process accountability.

Read more (PDF 59 KB)

Goodwill of North Georgia Goodwill used Watson Talent Frameworks to define job profiles, hire and promote top talent and more.

Read more

Blogs about employee engagement

Why cognitive technology is crucial to a good employee experience

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5 Employee Engagement Lessons From IBM

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More resources for employee engagement

Designing employee experience

Learn how a unifying approach can enhance engagement and productivity.

Read more (PDF 1,2 MB)

Unplug from the past: The Chief Human Resources Officer perspective

Access data and interviews from more than 2,100 CHROs to explore how HR leaders are responding to crucial changes in the business landscape.

Read more (PDF 199 KB)

Competencies in the cognitive era

Discover how to apply artificial intelligence to attract talent, create collaborative cultures and get work done.

Read more (PDF 541 KB)

Why is candidate experience so important?

Read about seven insights that will change how to think about the candidate experience.

Read more

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