Everyone wants to be a star. We have whole TV Shows dedicated to that desire. If you’re an introvert and don’t like the idea of the limelight, OK, but everyone wants to be excellent at something. Organizations want to be stars, too. Most organizations use five metrics to measure their relative stardom. They may have different names for some of them like “Patient Experience” instead of “Customer Loyalty.” Non-Profits will not measure “Profit” but there is a performance-to-budget measurement of some kind. Star performance for any organization is when all the targets of these metrics are hit and there continues to be favorable movement in each one. The metrics used by most organizations as seen in the above diagram are Profit, Productivity, Safety, Customer Loyalty, and Employee Retention. The lines in the diagram represent the fact that these metrics don’t stand alone. They can impact each other. Movement in one metric effects movement in another. For example, improved Customer Loyalty usually means there is an improvement in Profit. It can go the other way, too. A healthy bottom line means the company is going to be around for the long haul and will usually be investing in improvements to its products or services. This often has a positive effect on Customer Loyalty. A good customer wants their supplier to be profitable.
One challenge with each of these metrics, though, is that they are all trailing indicators. That means, like a report card in school, you don’t know how you did until all the numbers are in. For some of the metrics you have to wait an entire quarter to get the results. And then you can’t do anything more about it. Organizations will spend a lot of time and money on programs designed to correct one metric. For example, they may engage in cost-cutting efforts to improve Profit margins, or Lean principles to improve Productivity. How many Employee Retention strategies or Customer Loyalty programs or Safety initiatives have you experienced? It’s not that these are not helpful. In fact, as I mentioned before, positive movement in one metric can have a positive impact on another. Improved Safety performance can have a positive impact on Customer Loyalty especially if your Customers are very proud of their safety record. It can also improve Profit since Worker’s Comp costs are reduced. But, wouldn’t it be nice if there were a single metric that could move all of the others at once? Even better, what if that metric could provide predictive insight into the direction the other metrics were going to move? There is such a measurement. It’s called Employee Engagement.
A Prime Metric?
Employee Engagement (E2 in the diagram) directly impacts each of the other metrics. Favorable movement in Employee Engagement is an indicator that an organization’s other metrics will begin to move favorably as well. The data is out there on this. You can search Harvard Business Review or the Gallup Organization’s work. Countless other organizations have researched and demonstrated the role of Employee Engagement in performance improvement. One example is an article by Curt Coffman (co-author of First, Break All the Rules: What the World’s Greatest Managers Do Differently) and Jim Harter, Ph.D. called “A Hard Look at Soft Numbers
,” in which the correlation between the Gallup Organization’s Q12 and several of the above metrics is demonstrated. It is also true that unfavorable movement in Employee Engagement will have a corresponding unfavorable impact on the other metrics.
I’ve been in the contract Management Services Industry for over 20 years. During that time I’ve worked for a couple of the industry leaders and had clients in multiple industries from Sports & Entertainment, to Transportation, to Manufacturing, to Healthcare. It has been rare that I’ve run across an organization that “gets it” when it comes to Employee Engagement. I’ve encountered many individuals who do, but too many organizations run the spectrum from unaware or uninterested to “All Hat, No Cattle.” I cut my teeth on the principles of Employee Engagement during my 11 years as a pastor prior to entering industry. During that time I had the opportunity to study, up close and personal, the impact of principles on the character and behavior of individuals and organizations. When I transitioned from pastoral ministry to corporate America, I translated what I was about into this personal mission statement–“To build relationships within my sphere of influence through which I will help people discover and achieve their capacity for excellence.” It is that mission and some of the experiences I’ve had over the last 30+ years that lead me to join the Employee Engagement conversation.
My hope is that by adding my small voice to the conversation still others will catch on. Employee Engagement impacts organizational metrics, but it can’t be just about that. Employee Engagement is about employees, it’s about people. No matter what your widget, every business is a people business. Star performance begins with making work excellent for your people. Making work excellent for your people begins with being an excellent person. Here’s an important piece of information to close this post. Even if you’re not the “boss,” you can influence your organization’s stardom. I look forward to the conversation.