Employee engagement is not the responsibility of HR – it is the responsibility of the Corporation

Most companies intuitively know that satisfied employees, create satisfied customers and the result is a positive impact on financial performance. In management theory this is known as the service profit chain and starts with how the corporation treats its employees. This also used to be a key competitive differentiator – but not anymore. As all companies now have satisfaction ratings above 80%, satisfaction has become a qualifier for being able to compete – not an order winner.

Some companies have found out that engaged employees outperform non engaged employees significantly and have started to measure employee engagement.  That Employee Engagement matters was demonstrated in recent McKinsey study. It revealed that engaged white collar workers had: 16% better overall performance, 125% less burnout, 32% more commitment to their organisation and had 46% more satisfaction. Interestingly engagement also had a significant impact on blue collar workers: 27% overall better performance and 53% higher likelihood of positive career progression.

“More than 25% of US workforce is actively disengaged”

Often the results of measuring Employee Engagement are quit depressing as Gallup has found: In the US less than one third of employees are engaged and more than one quarter is actively disengaged. Senior management teams can choose to ignore the results or they can make it the responsibility of the HR function to go fix.

“31% of companies do not see Employee Engagement as an issue”

That management sees engagement as the role of HR was seen in the McKinsey study: 69% of companies surveyed identified Employee Engagement as a top priority for HR although only 43% had activities to measure and impact Employee Engagement. 31% of the companies did not see Employee Engagement as an issue.

 “Only 50% of HR’s activity is seen as value add by leaders”

Unfortunately employee engagement is not only the responsibility of an HR department, often designed to deal with operational and transactional issues rather than strategic. In the McKinsey study leaders only found half of HR’s activity to create value for the business. It is easy for the senior managers to blame HR forgetting that they themselves have created the boundaries and the rules for HR to operate under.

38% of HR professionals believe that their current Engagement actions will succeed

The view of management is shared by HR professionals themselves. Only 38% believed that their current actions in Employee Engagement would be successful.

A lot of HR activities have been designed to ensure a flow of people through the organisation with a focus on Analysis, Recruitment, Compensation, Training and Organisational Design. People seen as uniform objects responding to the same kind of motivational or demotivational activity is not something that creates engagement. Engagement is a very individual state for each employee. Engagement is also a state that connects to the corporation’s or department’s purpose and finally engagement is not only about what you do, but also how and why you do it.

The single most important driver of employee engagement has been identified as the behaviour and leadership skills of the Line Manager – not something that is fully within HR’s area of responsibility.

"Employee Engagement cannot be fixed with the current HR toolbox"

To significantly impact Employee Engagement it is necessary to either elevate it to top management level or to enable HR to participate at a strategic level. Employee Engagement cannot be fixed with the current HR toolbox.