The Ultimate Guide to Employee Engagement

Student

Content Creator

Content Writer

Ahrefs

Surfer SEO

WordPress

Loom

Let me paint you a picture.

You work at a company with values and a mission that you love. You know exactly what’s expected of you at work, and you feel like you have the support to do it. You’re content to stay late once a week because you genuinely love finishing projects that are just outside your comfort zone.

You have a two-year plan for growth in your position and feel stable in your job. You work from home three days a week and feel like you have an outstanding work-life balance. At the end of your annual review meeting with your boss, you leave satisfied with your job and ready for the new year.

This is an example of an engaged employee. They’re productive, motivated, and satisfied. But how did this employee get here? What factors played into this seemingly idyllic picture of success? To understand that, we have to begin with the basics.

Employee engagement refers to how involved, committed, and enthusiastic employees are about their work. It measures how effective workplace factors such as culture, management, and rewards connect employees and their organization.

Well-engaged employees demonstrate dedication. They support organizational goals, commit discretionary effort above job requirements, support their teammates, and are excited to grow.

Engaged employees aren’t just pleasant to be around. Engaged employees are 87% less likely to leave an organization than disengaged workers. That means less turnover and less money to spend on hiring someone new.

This is just the tip of the iceberg. As you read on, you’ll see how employee engagement affects a company’s bottom line too. In this comprehensive guide, learn everything you need to know about employee engagement.

Get Loom for Free

What is employee engagement?

The definition of employee engagement is the level at which employees feel committed, connected, enthusiastic, and involved in their workplace. It’s made up of the employee’s emotional connection to their work, employer, and team.

Employee engagement is demonstrated by how the employee works. Engaged employees are attentive and committed. They often stay late or work harder without feeling obligated or pressured to do so.

Employee engagement is affected by two main factors.

Perceived value – How an employee views their employer and the value of their job, from salary and benefits to responsibilities and location flexibility. This can be opportunities for growth, mentorship, workload, schedule, and more.

Employee experience – The employee’s organizational experiences from orientation to exit. This includes workplace communication, relationships with their boss, their coworkers, and the workplace environment.

Why is employee engagement important for a business?

Every day, your employees perform in a way that affects your business and their teams. Highly engaged employees hold favorable opinions of their workplace. They feel connected to their team, their job, and the company’s success.

Engaged employees go above and beyond and speak highly of the company to everyone they know. They encourage the employees around them to perform as well as they do verbally and through model behavior.

Here are five ways engaged employees affect a business.

Higher productivity – Engaged teams see a 17% increase in productivity.

Higher employee retention rates – Engagement is the key to higher retention rates. Teams with moderately to highly engaged employees experience an 18% decrease in turnover rates. When an entire business is more engaged, Gallup suggests they can see up to 59% less turnover.

Lower rates of absenteeism – Engaged employees are not only less absent themselves but also encourage their co-workers to show up. Teams with high engagement levels reduce absenteeism by up to 41%.

Better customer service – Companies with engaged employees have shown a 10% increase in customer ratings.

Increased revenue – Highly engaged employees result in 21% greater profitability, according to Gallup. On the other hand, Forbes says disengaged employees cost their companies approximately 34% of their salary.

Drivers of employee engagement

Employee engagement is a complex matrix. Human beings are intricate, and so are the explanations for their performances at work. We’ve all had those months where it seems like everything goes wrong. We’ve also all had that one job we just did not like. How do you know which it is?

We’ve gathered the most identifiable employee engagement drivers and how they actually affect your company. As you read, consider which of these factors might need work in your company right now.

Company Culture

Company culture is a company’s values, informal systems, formal systems, and leadership behavior. Any employee who isn’t on board with your company's operations will not be engaged. They need to be emotionally invested and connected to your company or at least their role within your company to perform well.

Whether they’re most excited about your mission, the benefits you provide, or their coworkers, engaged employees need to feel like they fit into your company culture. This is just one aspect that helps employees feel like they belong and have a purpose.

Workplace Wellness Initiatives

Employees can’t be engaged if they’re not thriving. Employees who are not physically and mentally healthy will not be productive or engaged. Some teams with engaged employees even see 53% fewer missed days, which Oak Engage attributes to better mental health.

Providing free wellness initiatives that are inclusive for all abilities encourages employees to stay healthy. You can try offering mental health counseling benefits, a gym membership, fitness challenges, and great health insurance.

Flexibility

Having a work-life balance is key to employee health, engagement, and retention. Allowing employees to work hybrid, remote, and flexible hours gives them the freedom to make healthier choices. From freeing up time for exercise to reducing commutes, making time for family to increasing an employee’s sense of control, you’ll find your employees less stressed and more grateful.

Seamless Onboarding

Onboarding is stressful for a new employee. There’s no way around it. Starting a new job is a high cognitive load scenario. But you can make it easier. Don’t forget onboarding and orientation are a new employee’s first impression of your business. For them to be engaged, they need to feel emotionally invested in your company.

You can help them become emotionally invested by giving them a great employee experience from the start and making them feel like they belong. Harvard Business Review notes that a great onboarding process can improve new hire retention by 50%.

Positive Work Culture

In a positive work culture, employees’ opinions matter. Their workload is achievable, and their team participates in accomplishing their goals. They have access to personal and career development opportunities and are supported in pursuing them.

Positive work culture also includes motivating work that is challenging but not impossible. Their team leaders model excellent workplace culture and inspire them to thrive. These environmental factors foster a healthy and optimistic relationship with your company for the employee.

Productivity and Time Management Tools

Measuring productivity can bring revolutionary changes to a company. Knowing how productive different aspects of your company allow you to make changes that help both your employees and your business. This can help you see where you don’t need to have a meeting or could optimize in other ways.

Giving access to productivity tools and opportunities for asynchronous collaboration works in two ways. Management can see how to improve employee engagement. Employees can accelerate their collaborations and productivity more easily.

Sense of Belonging

According to McKinsey, belonging can increase your retention rates by 50% or more. It’s also a productivity factor. That same report showed that belonging could also lead to a 56% increase in job performance.

While flexibility is important to employee engagement, retention, satisfaction, and health, so is connection. Engaged employees should feel connected to their coworkers and the company. They need to feel like they belong there.

Supportive Leadership

A sense of belonging starts with supportive leadership. Strong leaders will foster connections within their teams. They also provide a pathway to growth and future opportunities. A good leader keeps communication channels open and responds to feedback from their team.

Supportive leadership can come in the form of:

rewards and recognition

learning and development opportunities

succession planning

Effective workplace communications

It’s estimated that U.S. businesses lose at least $128 billion yearly due to employees wasting time trying to communicate effectively. Good communication in the workplace is crucial for productivity and company culture. No one wants to slack-splain every day.

Poor communication has a ripple effect. 80% of U.S. employees confessed to feeling stressed because of incompetent employee communication. Loom found that miscommunication and/or misinterpretation caused 20% of knowledge workers to get reprimanded, demoted, or even fired. A great workplace communications strategy can go a long way toward employee engagement by keeping teams connected and understood.

10 Employee engagement strategies for a better workplace

Looking for employee engagement ideas? A well-rounded employee engagement strategy will encourage growth, foster teamwork, support individual employees, and provide the basic benefits they’re seeking. Each of these ten strategies will support one or more of these aspects.

1. Identify areas of improvement

It’s impossible to increase employee engagement if you don’t know what’s lacking. Identify where you can improve your engagement strategy by gathering feedback. Then, prepare a plan to address areas affecting engagement.

2. Open up feedback channels

Feedback is where you’ll find the most answers to your engagement problems. The most accessible and helpful feedback is usually anonymous surveys. You can send out employee engagement surveys, pulse, new hire, exit, or stay surveys to determine how your employees feel.

Open office hours are another great way to show your employees that you are there for them and you’re ready to listen. In general, it’s always good to have a workplace communication strategy. Your employees need to know how to communicate with their company’s leaders.

3. Always follow up on feedback

After you send out feedback surveys, always follow up. Let them know you’ve heard them and what you plan to do about their feedback. Schedule an intermediate time to provide a progress update if the change isn't immediate.

4. Provide growth opportunities

Upward mobility is a critical engagement driver. Companies that give their employees time to innovate and channels to upskill will see their engagement rates and productivity improve. Mentorship, upskill planning, and professional development can also foster growth.

5. Set goals

When employees understand their role within an organization, and what is expected of them, it’s easier for them to show up the way you want them to. When they have goals in mind, they also feel a sense of purpose. Team leaders can help your employees and teams set goals. These can be project-related, KPI, or career-related goals. Every employee is a part of your organization’s success and needs to know precisely how they’re contributing.

6. Recognize employees

Employees want to be recognized for their efforts. Recognition fosters a sense of belonging and appreciation. It helps employees to know when their work leads to the success of their coworkers or the business. There are so many ways to show your employees you see and appreciate their efforts.

A simple way to start is by verbally acknowledging strong performances either in-person or through a quick message. You could establish a practice where you recognize one great thing from each employee monthly. Whatever it is, show your employees that you care and appreciate them.

7. Train managers

Managers are responsible for the most noticeable changes in employee engagement. If you want to see big results, train managers. Equip them with the ability to be coaches, not just delegators. A great manager will help employees grow, get them invested in helping their team, and keep things running smoothly.

8. Foster a welcoming company culture

Set standards for behavior, mission, vision, and values. These are what company culture is made of. If you hold your entire company to those standards, your team will be more cohesive and engaged. Show your employees what you want your company to be so they can fit into that vision.

9. Prioritize employee well-being

Paid time off and sick days are basic well-being gestures. But employee well-being is more than that. Well-being is an employee’s mental, physical, and emotional health. It drives productivity and engagement.

You can foster employee wellness through flexible work locations, adaptive scheduling, and accessible health and fitness programs. Great employers will consider offering no-meeting days, project management strategies to reduce overbooking, gym memberships, and mental health counseling.

10. Monitor productivity

Productivity is an indicator of many things. An unproductive employee could lack the skills, tools, or support needed to get the job done. But, worse, they could be disengaged. Either way, monitoring productivity can help companies support their employees better across the board.

Maintaining employee engagement

Employee engagement isn’t something you can deal with once and move on. Like that houseplant in your office, it takes ongoing maintenance. You did water your plant this week, right?

The most effective ongoing maintenance will flow when you can nail communication and opportunity. These two aspects touch on every piece of employee engagement, from perceived value to employee experience.

To foster strong communication, leadership needs to set up a communication strategy. The most productive strategy is opening a communication channel for feedback. An anonymous feedback method and open office hours are a great start. Engaged employees feel heard and understood.

Ongoing growth opportunities provide your employees with purpose. You can encourage innovative thinking by providing time for creative problem-solving and upskilling. More than that, opening up cross-training opportunities and mentorship channels will help your employees grow and succeed. Your employee’s growth and engagement benefit both you and them.

How do you know your employee engagement strategies are working?

There’s no way to know if your employee engagement strategies are working if you aren’t measuring them. Engagement needs to be measured across the entire organization, within groups and teams, and at an individual level if you truly want to understand where engagement tactics can be improved.

How can you measure seemingly intangible employee engagement? Surveys and interviews can provide a direct channel for monitoring engagement. Engagement levels indirectly affect sales, customer satisfaction, and turnover rates. When you begin monitoring employee engagement, take note of your scores in these areas so you can tell whether your strategies for improvement are working.

Here are some ways to measure employee engagement.

Pulse surveys

Sentiment analysis

Employee net promoter score

One-on-one meetings

Stay and exit interviews

Turnover

Business metrics

Conclusion

We are often asked, "What's the single most effective strategy for improving employee engagement?" The answer — as with everything — is "It Depends". The truth is that there's no one-size-fits-all, silver bullet solution. It would be best if you targeted your efforts based on your real drivers of engagement and cultural and organization-specific drivers.

The simplest way to think about employee engagement is by breaking it down into two parts. The first part is the value an employer brings to the employee. The second is the employee’s experience or how they are emotionally connected to their work.

Sure, this topic is complex and multifaceted. Don’t let that overwhelm you. Employee engagement can be improved one step at a time. The first step is learning more about it. The second step is acknowledging your company’s engagement issues and doing something about it.