Organizations seek to maximise the productivity and profitability of their

staff! Individuals seek satisfaction from their work! If both can be

achieved concurrently, there is a true Win-Win! The impact of an
engaged workforce over an unengaged one is dramatic.
What is Employee Engagement and why does it matter?
Having emerged from consulting practice employee engagement is a term that is still being
researched and debated in academia. We can be engaged in battle, engaged to be married, or
engaged in a work contract but what does it mean for staff to be engaged at work? Most people
understand engagement as an attitude or behaviours that imply being busy with, involved in, attracted
by, committed to, retained and held fast in our work or organisation. It encompasses many well
researched, traditional organisational psychology concepts such as job satisfaction, organisational
commitment and intention to stay with an organisation, as well as emerging concepts in the field such
as proactivity, adaptivity and flow.
We measured a broad range of these concepts together in one study of 180 Australian organisations.
We looked at how the measures related to each other (factor analysis), and which ones best predicted
organisational outcomes of employee turnover, productivity, health and safety. Basically we found that
all of the measures are tapping into a single overarching factor, employee engagement, and yet sub-
categories could also be identified. That is, engagement isnt new its a blend of many old wines in a
new bottle. It is an all-encompassing positive attitude toward work, with sub-components. All well-
designed measures of engagement (and its related concepts) correlate very strongly, so as long as
youre measuring some, and preferably a few, of the components in the model then youre fairly safe.
We also found that attitudes were a stronger predictor of organisational outcomes than self-reported
behaviours, that is, how a person feels about their job and organisation. Ideally, a good engagement
measure will focus upon attitudes towards ones job and the overall organisation, and if you want to
predict turnover then ask about intention to stay. We call this measure Passion.

Job Satisfaction
Positive Affectivity
Absorption
Dedication
Vigour
Intention To
Stay
Organisation
Commitment
Citizenship
Behaviours Towards
Organisation
Citizenship
Behaviours Towards
Individuals
In-Role
Behaviours
Adaptivity
Discretionary
Effort
Proactivity
JOB SATISFACTION
PROFICIENCY
ATTITUDES
BEHAVIOURS
E
M
P
L
O
Y
E
E

E
N
G
A
G
E
M
E
N
T
See Langford, P. H. (2010). The nature and consequences of employee engagement: Searching for a
measure that maximizes the prediction of organisational outcomes, in Albrecht, S. (Ed.) Handbook of
Employee Engagement. London: Edward Elgar Publishing.


Why it matters...
As our study indicated, engagement is associated with a wide range of substantial tangible outcomes
for organisations both in terms of retention/turnover & productivity. Our research shows 5% higher
employee engagement is associated with:

1.5% lower employee turnover; for a 1000-person organisation thats 15 fewer people leaving
per year, and $1m lower turnover costs for the organisation per year
2.5% higher productivity; $2500 higher productivity per person per year; for a 1000 person
organisation thats $2.5m higher productivity for the organisation per year
Even if you achieved no other gains (e.g. safety, absenteeism, workers comp, reduced fraud &
risk, customer loyalty, innovation), thats a benefit of $3,500 per employee per year.
Organisations can estimate the impact of engagement in their own organisations by conducting linkage
analyses - comparing key performance indicators with engagement scores across different work units.
However, while engagement is a practically useful single performance indicator of key organisational
outcomes, its not the whole story. Measuring only engagement can lead to a so what? reaction. In
order to improve engagement, and hence performance, we need to also measure the management and
work practices that drive engagement.

What do you think is important for engaging employees and driving success in your
organisation? What evidence is there for this?
If you believe the popular media, then you might be led to believe that factors such as immediate
supervisors/managers, work-life balance, team relationships and monetary rewards are crucial to
engage employees. Youd be wrong.
Our research with over 1500 Australian organisations, and 16,000 employees, across a large number
of work practices and systems has consistently shown three core systems of work practices that drive
engagement.

Purpose, Participation and Progress
These systems support three fundamental needs of human beings to:

Believe in a purpose for what they do
Belong to a group in which they experience participation, recognition, and growth
Achieve progress towards the goals of their group - to make a meaningful and significant
difference.
Participation involves many traditional HR practices, as well as communication between staff and
managers and between groups across the organisation. It includes learning & development,
involvement, recognition, feedback on individual performance, supervision and support, and career
planning, development and opportunities.
Progress includes continuous improvement and achievement of organisational goals, perceptions of
innovation & success, and delivery of quality goods or services that staff are proud of. It indicates a
virtuous circle in which engagement not only drives individual and organisational performance, but
successful organisations in turn motivate and ignite passion in employees.
In this article I will focus on the Purpose system. Of all the work practices that drive engagement,
practices that support organisational purpose seem to get the least air-play. Why is that? Does talking
about vision, mission and values seem a bit cheesy? American? Do such practices really apply to us
down-to-earth Aussies, with our healthy cynicism of grand visions and lofty ideals? By all accounts
many managers see themselves (or their staff) as materialistic, individualistic and hedonistic not
idealistic!

The strongest driving practice
Nevertheless, our research in Australian organisations showed that employees belief in the purpose,
work and values of their organisation was the strongest driver of passion or engagement even
stronger than other commonly identified drivers such as career opportunities, rewards and recognition.
Aussies are fired up by Purpose!
We found that we were often challenged about this finding. Voice Project works with many not-for-profit
organisations it may be true there, some managers argued, but not in my corporate environment.
Similarly, our NFPs argued that their cultures were unique people worked there for the mission, not
the money. So we conducted a study specifically comparing around 50 NFP and 50 corporate
organisations. It is true that our NFP clients generally enjoy a stronger overall endorsement of their
mission and values than in other sectors. BUT, the same three systems emerged as the key drivers in
both sectors. There was no difference between the sectors on the impact of mission & values on
Passion. Purpose is just as important in regular, for-profit organisations. As an aside, we did find that
rewards were not as engaging in the NFP sector (and just as well)!
Our opponents continued. Maybe its not just about what sector youre in, maybe its about whether
youve got a really noble or socially-driven purpose. Much of the management literature does tend to
argue that mission & values should invoke a higher purpose - a purpose that indicates service to
society. So in another study we looked at how staff rated the purpose of their organisation in terms of
its social value, and whether this affected the impact of that purpose on passion. Again, ethical and
socially responsible missions do engender a generally higher level of passion. However, the engaging
impact of staff belief in the organisations mission and values is the same regardless of how grandiose
or significant the cause. Really, any general contribution to the well-being of others is worthwhile. This
finding is consistent with Collins & Porras who argue any purpose or values can be engaging using
tobacco company Phillip Morris as an example with their values such as freedom of choice and
winning beating others in a good fight.
Still not convinced, some managers will acknowledge that belief in the mission and values do drive
front-line delivery or core staff (e.g., teachers, carers, customer service staff) but raise questions about
how motivating they really are for support staff. Universities are a great example of this split between
core and support staff. We found a pervading belief among senior managers in universities that
academic and general/professional staff are motivated by different things. So, we studied staff in 8
universities, split by academic and general classification. As expected, belief in the mission and values
of the university was one of top drivers for academics (2
nd
of over 30 practices). For general staff, there
were some slight differences, but not as much as might have been anticipated. Belief in the mission
and values was the 4
th
strongest driver of passion. However, another Purpose practice emerged as
being particularly important for these staff - role clarity the ability to see the link between what they do
on a day-to-day basis, and the successful delivery of the organisations core purpose.

Purpose drives passion even in Australia, in for-profit corporations, it doesnt have to
be a higher purpose, and its important for all types of staff.
Purpose in practice
So how does an organisation build its Purpose system? What practices can it implement to reinforce
staff belief in the purpose, work and values of the organisation?

1. Vision and strategy clear organisation direction
We are rightly sceptical of words. In the political sphere we have learnt that there is very little
correlation between words and actions, and unfortunately this is also the case in many
organisations. Sometimes actions do speak louder than words, but we are so cynical about
words that we are in danger of undervaluing the impact of words. You need clear, consistent,
frequent and inspiring messages about direction, strategy and values from the top.
One organisation that I worked with was a commercial education provider. The first survey we
conducted with them revealed low engagement overall. The CEO was about to retire and it was
a welcome change of leadership. Understandably, staff also indicated they had no clear idea of
the future direction and vision for the organisation under the yet to be tested new leadership.
Eighteen months down the track, we conducted a second survey this time with fantastic
results showing strong awareness of a clear organisation direction. Satisfaction with the amount
of communication from management had increased, along with confidence in leadership.
However, engagement had only marginally increased, and belief in the overall purpose of the
organisation had actually dropped. Discussion with the executive team revealed that they had
been sharing mostly financial information with staff, and articulating their goals in terms of
revenue. The new leadership had underestimated the power of words, and created a huge
mismatch between executive and staff perceptions was the purpose profit? Or providing
quality education (in a sustainable way)?

2. Results focus what are you measuring?
In order to focus on results you need to measure results. And measuring something immediately
raises its importance and profile in an organisation. While it sounds simple, those of you who
have tried to implement individual or organisational KPIs will know that this is a complex and
hotly contested issue. Trying to decide what will be measured immediately raises differences in
what people think is important what the real purpose and work of the organisation should be.
However, purposeful organisations will not shy away from the challenges of measuring results.

3. Belief in mission & values choosing the right people
This is about creating people alignment through recruitment, selection, orientation and
socialisation, retention, and succession management. One organisation we work with calls it
sharing the DNA, and their employees demonstrate extremely strong belief in the purpose,
values and work of their organisation.
Here is what some of the employees say about working there:
we as a company / the people that work in it ALL have the same attitude and it is applied in
respecting and valuing our clients
Honest belief in their core values and ability to hire staff that believe same
walks its talk it really does try very hard to follow its mission, vision and core values
Staff believe their jobs are important and worthwhile
I have worked for other organisations over the past 10 years and can honestly say that this
organisation seems to have so much more to offer and relate to, for the community and its
needs
Their Chief Executive says Im pretty passionate about recruitment. And thats just to say that
we dont hire on the basis of knowledge and skills, we hire on the basis of attitude. So lots of
people in our industry would say, must have knowledge of this or must have certificate that ...
You can teach them that. We prefer to actually say youve got a really good attitude well train
you. A good example [one of our GMs] was hired to be in charge of capital works and he had
no experience in our industry or constructionBut he actually had a bunch of must haves
which were numeracy, negotiation, alignment with who we are Too many people hire on the
basis of knowledge and fire on the basis of attitude.

4. Role clarity
People need to know how they fit the big picture, and understand the link between their work
and the customer. One organisation we work with, a manufacturer of health products, has
posters for staff on the assembly floor showing where their part fits in the whole, and patients
using the product with quotes on how it has impacted their life. We need to work hard at making
sure support staff especially understand why their jobs are important. Think about your latest
induction for a recent recruit. How much of the session was devoted to explaining what the
person does, rather than why their role is important to the end user of your products or
services?

5. Ethics, integrity & alignment
Finally it is important to remember that your purpose is not just what you "tell" employees, but
what you do. The best way to disappoint and disengage everyone is to raise expectations
without matching action. Talking up values and purpose is a double-edged sword. I know of an
organisation that spent a almost a year developing a fantastic mission and values statement.
Organisation direction was clear, belief in mission & values was high, but engagement dropped.
Staff reported very low satisfaction with the extent to which the organisation lived its values. The
whole exercise raised staff expectations which were not followed through with action.

Building a visionary company requires 1% vision and 99% alignment
Collins & Porras (1996) HBR

The real work is constantly evaluating your strategy, systems, processes, practices and people against
your values and purpose, and progressing towards your vision.
How well is your organisation practicing its values? Does it walk the talk? How do you measure
alignment of your systems, practices, processes and people with your purpose and values?






About Voice Project

Voice Project is a research and consulting organisation specialising in surveying engagement,
leadership and service quality. Our purpose is to improve organisations by giving people a voice. We
have grown out of an organisational psychology research programme at Macquarie University and our
team of 17 people are based on campus at Macquarie University. We have now completed 420
surveying projects across 180 clients, collected benchmarking data from over 2,500 organisations, and
given a voice to over 500,000 employees and clients.


About the Author

Dr Louise Parkes is an eminent Australian researcher and consultant, with over 10 years experience
in the HR field. Dr. Parkes holds a Ph D in Organisational Psychology from University of New South
Wales and is a Bachelor of Science (Psychology) Honours from University of New South Wales.

Dr. Parkes can be reached at louise.parkes@voiceproject.com.au