Engagement Equals Profit
What every company wants is engaged employees. Why? Because engagement is the key to high performance.
Engaged employees directly impact the firm’s bottom line. Employee engagement is positively linked to profit. (Ketter, 2008). This means that increasing employee engagement will help increase company profit.
According to a 2009 Gallup survey, businesses scoring in the top half of employee engagement doubled their ability of delivering high performance compared to the organizations in the bottom half. In the 2010 Gallup report, the findings showed that businesses that scored in the top 10% of employee engagement surpassed their competitors by 72% in earnings per share. (Gallup Employee Engagement Index, August 2009).
Recent research has shown that having a higher proportion of engaged employees in a company has a positive relationship with the company’s profit margin (Ketter, 2008). The amount of increases in performance has reported to be around $2 million resulting from employee engagement initiatives (Vance, 2006).
The reason for this increase is that engaged employees try harder. Engagement is positively correlated with effort and negatively correlated with turnover (Shuck, 2010). Engaged employees average 27% less physical absenteeism (Wagner & Harter, 2006). This saves organizations an average of 86.5 million days per year in productivity (The Gallup Organization, 2001).
With all of this overwhelming research it is no wonder why businesses should look to increase employee engagement. Because engaged workers are productive workers.
References:
Gallup Employee Engagement Index, August 2009
The Gallup Organization, 2001
Ketter, P. (2008). What’s the big deal about employee engagement? T+D, 62(2), 44-49.
Shuck, M. B. (2010). Employee engagement: An examination of antecedent and outcome variables. FIU Electronic Theses and Dissertations. Paper 235, http://digitalcommons.fiu.edu/etd/235
Wagner, R., & Harter, J. K. (2006). 12: The great elements of managing. Washington, DC: The Gallup Organization.
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