The Global State of Employee Engagement: A 2014 Study

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1 The Global State of Employee Engagement: A 2014 Study

2 The Global State of Employee Engagement: A 2014 Study In May of 2014, BPI group partnered with research firm BVA to survey the state of employee engagement around the globe. 5,000 participants were surveyed in 12 countries, including Belgium, France, Italy, Mexico, the Netherlands, Poland, Romania, Russia, Spain, Switzerland, the United Kingdom, and the United States. The survey addressed six primary indicators of employee engagement, and how cultural differences impact engagement around the world: How engaged are employees today? How have engagement levels changed over the last year? How proud are employees of their current job and company? Do employees plan to stay with their current company? How loyal do employees feel toward their company? What factors drive engagement? About the Survey This 2014 Global Employee Engagement Survey was conducted in partnership with BVA, a leading research firm headquartered in France. 5,000 participants were surveyed in 12 countries: Belgium, France, Italy, Mexico, the Netherlands, Poland, Romania, Russia, Spain, Switzerland, the United Kingdom, and the United States. Industries: Individuals were employed in a variety of service, industrial, and public administration industries. Gender: Men 49% Women 51% Age: Under 35 years 37% years 29% years 24% 55 years and older 10% Experience: Executive level population 35% Non-executive level population 65% Responsibility for managing a team: Yes 39% No 61% 1

3 Shared Success SM: A Foundation for Employee Engagement Success in today s marketplace requires a different perspective from leaders, employees, and organizations. The world is shifting from an emphasis on command and control toward collaboration. Sustainable organizational success in today s environment requires balancing the needs and offer of the organization with the needs and offer of the individual employee. Organizations must work to understand and meet the needs of their employees. Likewise, individuals must also actively align and realign their personal value proposition with the changing needs of their organization and the marketplace. At BPI group, we call this balance Shared Success SM. When a Shared Success SM mindset permeates organizational culture, companies have a greater understanding of their employees unique needs and can adjust their offer accordingly. In turn, employees are better equipped to ensure that their offer helps the company to achieve its strategy. While the needs of each company will vary depending on its size, industry, purpose, etc., they foundationally include elements like demonstrated employee commitment and connection to the culture, effective leadership, and proven performance and results. Company offers include items like compensation and benefits, professional development, and flexible work arrangements. Employee needs also vary depending on the individual, and can shift over time based on the employee s personal circumstances and context. Employee needs typically fall into eight categories: autonomy, meaningful work, affiliation and feeling connected to the company and colleagues, flexibility to integrate work and life, career growth and development opportunities, belief in the leadership, confidence in the company s future, and appropriate recognition and rewards. Employee offers include their knowledge, skills, and abilities, as well as their passions, values, and interests. Successful companies recognize that individuals and teams have unique needs and contributions to make. They promote deep connections between employees and leaders to identify these needs and offers, and to foster relationships based on Shared Success SM. Leaders who understand the importance of these connections at the individual level see greater employee engagement, retention, and business results. Shared Success SM Framework Individual Needs Individual Offer Shared Success Company Offer Company Needs IMPLEMENTATION Shared Success SM Balancing the needs and offer of the organization with the needs and offer of the individual employee. 2

4 Survey Highlights How engaged are employees today? Globally, survey respondents reported an average engagement level of 7.8 on a 10 point scale, with 10 being very engaged. There was no significant difference between men and women in general level of engagement. Those in executive-level positions were significantly more engaged than those in non-executive roles. Additionally, those managing teams were more engaged than those without management responsibility, with managers of 10 or more people reporting the highest engagement levels. When considering age, we found that engagement levels were similar for all those under the age of 55. Those over 55 reported the highest average engagement, potentially because it is more likely that they are executive-level leaders and responsible for managing larger teams. Not surprisingly, engagement levels varied across the 12 countries surveyed (Figure 1). Belgium, France, the Netherlands, and the United Kingdom scored slightly below the overall average of 7.8/10, with all other countries at or above the average. These same four countries also had the lowest percentage of respondents indicating an increase in their engagement over the last year. In contrast, Mexico had the highest average level of engagement at 9.3, as well as the highest percentage of respondents reporting that their engagement had increased over the past year. Today, what is the level of your engagement at work? Rate on a scale of Figure 1 3

5 How have engagement levels changed over the last year? Respondents were asked to compare their current level of engagement with their level one year ago. 44% of respondents said their engagement had increased; 43% said that it had remained the same (Figure 2). Again, we found no significant difference between men and women. Age, however, was a significant factor in changes in engagement levels in the last year. 57% of respondents under 35 years old indicated that their engagement had increased, while only 25% of respondents over 55 years old reported an increase. 40% of those who are least engaged - a score between 0 and 5 on the engagement scale - indicated that their engagement decreased over the past year, with another 44% saying it had remained the same. On the contrary, 60% of those who are very engaged a score of 9-10 on the scale - responded that their engagement had increased, with another 30% saying it had remained the same. Compared to a year ago, would you say that your degree of engagement to your work... Figure 2 4

6 How proud are employees of their current job and company? In general, respondents expressed slightly higher levels of pride in their current job than in their current company (Figure 3, Appendix: Figure 7). While there was no significant difference between men and women, pride was slightly lower for those between ages 35 and 54, with those above 55 having the highest levels of pride. There was also a significant difference among those in executive levels and management, with those managing more than 10 people being particularly proud of both their job and company. Interestingly, over half of those who self-identified as least engaged still expressed pride in their job and company, implying that one can be proud to work in a company or role and still not be fully engaged. Are you proud to work in your current company? Figure 3 5

7 Do employees plan to stay with their current company? When asked about their current career priorities, slightly over half of all respondents indicated a desire to remain in their current position (Figure 4). A significantly smaller percentage indicated a desire to change companies or to change positions within the current company. 10% of respondents expressed a desire to start their own company, and 4% of respondents would like to stop working all together. Gender had little impact on career priorities, but age had a significant influence. The need for a change of position or company decreased with age, while the preference to stop working increased. Non-executive level employees were more likely to want to change companies. Of note, over half of those who were least engaged said their priority was to continue in their current position or to move to a new position within the same company. The next largest percentage of those least engaged indicated a desire to change companies. Of those who are most engaged, the majority plan to stay within their current position. Of note, while the majority of respondents in all countries indicated a desire to continue in their current position, this was not the case in Mexico. In spite of having the highest engagement level, only 30% of respondents in Mexico indicated that staying in their current position was their priority. 33% expressed an interest in changing positions within the company, more than double the overall average. An additional 30% would like to start their own company, three times the overall global average. These results potentially indicate a highly motivated and entrepreneurial spirit in Mexico today. Today, what is your priority? Figure 4 6

8 How loyal do employees feel toward their company? The survey looked at several factors impacting loyalty to the company, including assessing whether employees feel a sense of belonging, if they feel that they have no choice but to stay in their current company, and if they would be willing to stay if offered a position in another company. While the majority of respondents said they felt a real sense of belonging with their company (Figure 5), the percentage was significantly higher for those in executive-level positions and those managing a team, particularly of 10 or more people. This indicates that a sense of belonging is related to the amount of responsibility and perhaps authority an individual has. Not surprisingly, the majority of those who are least engaged also said they didn t feel a sense of belonging, and would be willing to leave the company if offered another position. Over half of the respondents said they had no choice but to stay with their current company. This feeling was more prevalent for those 35 and older, which may indicate those 34 and younger are more willing to take a risk or feel they have less to lose. Those in non-executive level positions also indicated not having a choice more frequently than those in executive level positions, implying a feeling of limited options, possibly due to a lack of education or experience. Interestingly, of those least engaged, more than two-thirds felt they had no choice but to stay in their current company, while only slightly more than half of the highly engaged said the same. Results like these demonstrate the importance of identifying the least engaged employees in a company in order to understand how to engage them, or consider exiting them if necessary. Typically, employees can be categorized as either engaged, not engaged, or disengaged. Engaged employees are those who outwardly demonstrate their pride in and commitment to the company. While the not engaged may not actively promote a company, in most cases, they won t actively demote it either. Disengaged employees, however, are those who are most likely to actively work against a company, and will look for others to join them in their disengagement. These are the individuals that can cause a good team to decline, a change to fail, a process to break, and can generally derail progress. Having candid conversations with these disengaged employees about their needs and the company s ability to meet those needs is critical to relocating them either inside or outside of the organization. Personally, do you agree with each of the following sentences? Figure 5 7

9 What factors drive engagement? The survey presented 21 potential factors of engagement and asked respondents to indicate both the importance of each factor to their engagement, as well as their overall satisfaction with the factor in their current position. Overall, the highest percentage of respondents indicated good life/work balance as a very important factor in their engagement (Figure 6). Closely following was the belief that they were fairly paid. When we compared the level of satisfaction with each factor to its importance, these same two factors also had the largest gaps indicating the greatest areas for improvement. We saw varied responses across the 12 countries that were surveyed. In countries like the United Kingdom, Italy, the Netherlands, Romania, and Switzerland, the highest percentage of respondents indicated that good life/work balance was very important. In contrast, in the United States, Spain, and Mexico, the feeling of being able to produce quality work was indicated as very important by the highest percentage of respondents. In Poland, Belgium, and France, the quality of the team environment was rated very important by the highest percentage of respondents. Within Russia, the belief that employees are fairly paid was rated very important by the highest percentage of respondents. Overall, the varying results by country highlight the need for global companies to carefully consider the impact of cultural and regional differences on employee engagement. Engagement is impacted not only by an employee s experience within the company, but also by the social, political, economic, and environmental context within which they work. Companies must consider these external factors when designing and implementing global employee engagement surveys and initiatives. 8

10 For each of the following factors, please indicate if it is an important factor in making you feel engaged in your work. Figure 6 9

11 Leadership Practices Impacting Engagement How leaders think and behave has a tremendous impact on organizational culture and employee engagement. At BPI group, we believe everyone deserves a great leader. Great leaders excel in four key leadership practices: Strategize, Develop, Execute, and Engage. A leader s capability in each of these practices directly influences engagement, and ultimately, organizational success. When these four leadership practices are in balance, leaders can effectively lead for both long and shortterm results, while maintaining focus on both people and task responsibilities. Develop. Developing is a long-term, people-oriented practice. The survey showed that employees across the globe are consistently more engaged when they feel they can genuinely improve their skills, gain knowledge and experience, and develop their career within the organization. Leadership Strengths Strategize. Strategizing is a long-term, task-oriented practice. As demonstrated by the survey data, employee engagement levels are impacted by their alignment with, and connection to, the company s strategy and values. When leaders explicitly communicate and demonstrate the company s vision, values, and strategy, employees better understand where the company is headed and how it will get there. This clarity strengthens employee confidence in the company s future, and their ability to connect their own responsibilities to the greater goals of the organization - another important factor of engagement according to the survey. To further foster alignment and, ultimately, engagement, effective leaders help employees understand how their role and daily work directly and indirectly contribute to achieving the long-term strategy. Short-Term Long-Term Strategize Challenge Convention. Visualize Possibilities. Set Direction. Tasks Execute Mobilize Resources. Remove Roadblocks. Deliver Results. Develop Stretch Boundaries. Empower People. Maximize Potential. Engage Connect with People. Inspire Commitment. Instill Collaboration. People While it is ultimately the employee s responsibility to drive his or her career development, it is the leader s - and organization s - responsibility to create opportunities and space in which this can occur. Formal and informal skill development programs, mentoring, coaching, stretch assignments, and action learning are all effective means of meeting this employee need. (continued) 10

12 Additionally, survey results indicated that receiving regular feedback from their supervisor about the quality and efficiency of their work is an important factor in maintaining an employee s engagement. Leaders must help create a culture conducive to, and supportive of, ongoing and honest feedback through regular coaching conversations focused on an employee s performance, development, and career. Execute. Executing is a short-term, task-oriented practice. Employee engagement is also impacted by the leader s ability to create an environment in which employees can easily execute the strategy and produce quality work. According to the survey findings, employees are more engaged when they have a clear understanding of the expected objectives of their work, as well as having the necessary means, resources, support, and information to do their job. By ensuring these essential needs are met, leaders enable and equip employees to perform their work independently another important factor in engagement. Setting employees up for success and enabling them to effectively complete their work communicates the organization s belief that the work is valuable and the employee is important to the organization, further increasing employee engagement and quality of work. Engage. Engaging is a short-term, people-oriented practice. A leader who engages employees must first be engaged themselves. An engaging leader is one who authentically connects with people, inspires commitment to the company vision and strategy, and fosters collaboration. The survey data shows that employees want high quality relationships with their manager, which includes a feeling of being listened to and respected, as well as opportunities to voice their opinion. The quality of their team environment is also important. It is through these high quality manager and team relationships that employees feel trusted to do their job - another leading factor of engagement according to the survey. As managers and employees have formal and informal oneon-one and group opportunities to authentically share ideas and collaborate, engagement increases. 11

13 What Does It All Mean? The answer to What engages people? varies based on each employee s unique individual needs. Companies aspiring to increase engagement must first recognize that the individual needs of their employees vary across levels, functions, and geographies. By implementing actionable employee engagement surveys and fostering authentic communication between employees and their managers, companies can better identify what engages employees in their unique context. Companies with high engagement often utilize pulse surveys to track and communicate engagement throughout the year, rather than relying solely on annual data. When employee engagement is measured accurately and regularly, it serves as a good indicator of how well the company s offer meets each employee s needs. Develop the engaged, influence the not engaged, and relocate the disengaged. To effectively improve engagement, companies must have a clear understanding of the proportions of their employee base that are engaged, not engaged, and disengaged. By concentrating efforts on further developing engaged employees, a company can capitalize on their existing commitment, higher productivity, and quality of work. Depending on the proportion of non-engaged employees, companies may want to invest in efforts to shift the non-engaged into the engaged category. When addressing the disengaged, companies should look to relocate the employee within the company to a role where they may be more engaged, or outside of the company where they will find a better fit for their needs and offer. Increasing engagement requires building a relationship, not a programmatic approach. Employee engagement can t be addressed simply by offering company-wide programs or launching a new engagement initiative. Engagement is an individual issue. Leaders and managers must invest the time and resources to building relationships with their employees at all levels. Organizations may not be able to address every individual employee need, but they should demonstrate to employees that they are concerned about their needs, and consistently strive to create a balance resulting in Shared Success SM. Having oneon-one and manager-led team conversations fosters engagement from the ground up. Successful companies create an environment in which employees have the freedom and space to meet their own needs, within the realm of meeting the company needs. Employee engagement requires effective people leadership skills. Companies struggling with employee engagement often lack capability in people leadership skills. It is still a common practice for individual contributors to be promoted to a management position based solely on their performance, and not on their ability to engage and develop others. As managers play a key role in fostering employee engagement and promoting a culture of Shared Success SM, it is critical that they have the skills and capability to be authentic, have focused feedback conversations, and develop connections with their employees. Investing in the development of managers people leadership skills will improve the individual employee-manager relationship, and yield increased engagement overall. 12

14 Employee engagement is an indicator of organizational change readiness. Large-scale organizational change requires massive amounts of employee energy, commitment, and loyalty in order to be successful. Companies that start from a foundation of strong engagement will more easily garner the buy-in and discretionary effort of employees in support of the change. Unfortunately, many companies only begin to pay attention to engagement once they are ready to implement a change. At that point, it is often too late. Employee engagement must be addressed as an ongoing element of organizational culture, which takes strategic consideration and time to develop and evolve. Take steps to create a culture of engagement. Measuring employee engagement alone does little to strengthen engagement. In fact, measuring engagement and not communicating and committing to subsequent action can have a decisively negative impact, causing feelings of distrust and disengagement. At a minimum, we recommend companies follow up on an engagement survey by acknowledging the results, sharing the high-level detail with employees, and indicating at least one area of focus they are committed to addressing over the next year. If your company doesn t have the time, commitment, or resources to address the potential issues identified in a survey, then consider waiting to conduct the survey until these investments can be made. In the meantime, look for opportunities to foster engagement in other ways: seek to understand your employees individual needs, and work intentionally to create a culture of Shared Success SM. If you are not currently measuring and actively building engagement, we encourage you to start now. Start before you need your employees to support a massive structural change, implement a new product, or achieve higher sales targets. Start before you need them to shift from a competitive to collaborative mindset, or to put customers first. Start by measuring engagement, but remember: an engagement survey is simply that - a survey. It is a moment-in-time representation of how employees are interacting with and feeling about their work environment, providing you with baseline data from which to measure progress. 13

15 Appendix Are you proud to work in your current job? Figure 7 14

16 Percentage Gap between satisfaction and importance in making employees feel engaged. Figure 8 15

17 For each of the following factors, please indicate if it is an important factor in making you feel engaged in your work, and how satisfied you are currently. Figure 9 About BPI group BPI group is a global management and human resources consulting firm, focused on helping individuals and organizations navigate change. We partner with HR and business leaders to align, engage, develop, and transition talent for sustainable success. Organization Success Align + Engage Develop Transition We build optimal structures and get people engaged in their roles. We inspire individuals and teams to achieve maximum performance. We help individuals and organizations make the most of change. individual Success 16

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