What is Employee Engagement?

Employee engagement is the mental and emotional commitment an employee has towards their work inside a company, team, and organization. If a company uses a successful employee engagement strategy, employees will work towards organizational success without additional supervision and management.

That doesn’t diminish the team manager’s importance, but it makes it easier for managers to have highly engaged employees.

You always go the extra mile for your employees. But, do they reciprocate those efforts? Employee engagement is the key – and it’s more than pizza parties and a pat on the back.

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What is Employee Engagement?

Employee engagement is an organization’s approach to creating an environment and culture that strengthens the emotional connection an employee feels with their organization. This usually occurs when there is a positive employee experience and job satisfaction.

Employee engagement initiatives can motivate them to go the extra mile every day, understand and efficiently execute their role in the organization, and feel enthusiastic about their work.

Some managers confuse employee engagement with employee satisfaction.

They are, in fact, separate things – and here’s how they differ:

You may have a satisfied employee, but that doesn’t guarantee that they’re doing more than simply what’s needed.

However, if the same employee is engaged, it could contribute a lot to their overall performance – enabling them to carry out their tasks.

They may even prepare or plan out future tasks, find ways to optimize various processes or assist other teams with their projects, and more.

This ‘engagement,’ as a result, adds value to the organization and contributes to its long-term growth and sustainability.

Employee engagement

Employee Engagement – What Do the Stats Say?

Let’s have a look at a few statistics to get a better idea of employee engagement:

  • According to a report published by Gallup, highly engaged teams generated 21% higher profits.
  • The Engagement Institute found that disengaged employees cost U.S. companies somewhere between $450 to $550 billion per year.
  • A 2017 Gallup report states that engaged employees can boost productivity by 17%.
  • A more engaged business unit is 12% more focused on customer advocacy.
  • Employee engagement can reduce workplace absenteeism by 50%.

Why is Employee Engagement Important?

Let’s discuss the benefits of employee engagement from both perspectives.

1. Engaged Employees are Emotionally Invested

Engaged employees develop a positive emotional connection with their employer, and the organization (and its strategic goals) understand that they’re part of something bigger than themselves.

Such individuals are self-motivated, enthusiastic about their jobs, and find satisfaction in working for the betterment of the organization – all of which are characteristics of an ideal profile. However, sparking an emotional connection works like a cycle – as a leader, you must first develop a strong emotional intelligence yourself, which can strengthen the positive feelings they have for their work.

For example, Komatsu – a Japanese construction equipment manufacturer – experienced a 37% rise in employee engagement after investing in a month-long leadership development program that focused on employee engagement strategies.

2. Employee Engagement Boosts Productivity

While experimenting with different measures to increase the productivity of their teams, such as indoor plants and wearable gadgets, to name a few, employers forget one thing – some of those measures don’t drive employee engagement in any way.

Engaged employees will always strive to complete their tasks on time.

The concern of an engaged employee isn’t limited to their job – they care about the organization as a whole and contribute wherever they can.

This means that they’re motivated to volunteer and make discretionary efforts, which result in greater satisfaction and higher productivity, as proven by Gallup’s research.

3. Employee Engagement Can Reduce Turnover Rate

Your employee turnover rate can play a huge role in your organization’s success. According to one of Gallup’s reports, the turnover rate for millennials alone costs the U.S. economy somewhere around $30.5 billion per year, including everything, from hiring expenses to training new hires.

Since millennials became the largest generation in the U.S. workforce, overtaking Gen X’ers in 2016, it’s time employers addressed this issue of high costs resulting from employee turnover.

A strong employee engagement strategy is the key to employee retention and keeping that turnover rate under control.

On average, engaged employees remain more content with their existing jobs when compared to their disengaged colleagues.

4. Employee Engagement Can Cut Down Workplace Absenteeism

According to Centers for Disease Control and Prevention (C.D.C.), U.S. employers collectively lose $225.8 billion each year because of employee absenteeism.

This loss results from direct and indirect costs associated with low productivity, such as overtime bonuses, loss of sales, etc.

While there can be several reasons for workplace absenteeism – with sickness being the obvious one – low morale and stress are two culprits most employers miss, both textbook symptoms of disengagement.

As per Gallup’s findings, companies that focus on employee engagement experience lower employee absenteeism.

Workers who aren’t engaged might not feel motivated to show up for work every day, let alone give 100%.

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5. Successful Employee Engagement Strategy Boosts Customer Satisfaction

Engaged employees are more passionate about serving customers and increasing customer loyalty.

They’re consistent with their efforts in dealing with the public, regardless of the day or time.

An engaged employee will interact with a customer at 5 PM with the same enthusiasm and energy as they would at 11 AM.

Although, in a perfect world, every person in your organization should be engaged, workers who regularly contact customers (like sales agents, customer reps, cashiers, etc.) must be all in if you want to deliver delightful experiences.

Since all buyers expect to be treated like royalty, having a team of professionals that go above and beyond can help you create solid and fruitful relationships, strengthen your brand’s image, and increase customer engagement.

6. Engaged Employees Want to Grow and Learn

Apart from the promise of a steady paycheck, work-life balance, and other employee incentives, the modern workforce expects growth opportunities from their employers.

It’s easier to motivate engaged employees to learn and get them on board with training and development programs.

Such workers seek challenges and ways to grow as professionals to take their careers to the next level.

They strive to make an impact and prioritize the company’s growth above all else.

7. Employee Engagement Makes the Workforce Happier

On average, organizations that view their teams as resources rather than individuals report lower satisfaction, morale, and productivity.

A key characteristic of organizations that work to increase employee engagement is that they don’t resort to traditional, harsh methods of ensuring productivity and performance, such as strict punishment policies.

Instead, they use tactics like one-on-one feedback sessions, creative reward policies, and recognition for a job to drive employee engagement.

Employee-oriented tactics such as these result in better working environments, higher productivity, and lower stress, but it also makes the team happier. To measure the effectiveness, use interviews or an employee engagement survey.

7 Tips to Increase Employee Engagement

The benefits of highly engaged employees are tempting, but what drives employee engagement?

Here are some tips:

1. Devise a Formal Onboarding & Training Process

You have to engage employees from day one.

New hires want complete clarity on expectations – their exact set of responsibilities and how their roles fit into the bigger picture.

Never assume that they don’t need detailed information, regardless of their previous experience.

By going through an onboarding process and receiving these guidelines, your new employees will start their journey on the right foot. You can use tools to check and inform, such as employee engagement surveys and onboarding interviews.

In fact, from day one, they’ll want to take the initiative and make an impact.

To make the onboarding process smoother, follow these tips:

  • Communicate the workplace culture and business outcomes, including the organization’s values and norms.
  • Schedule one-on-one meetings with other team members and introduce them to the gang.
  • Create an employee handbook for the fresh fish and assign one of high performing employees as a mentor.
  • Assign simple and easy tasks initially – don’t test-drive their responsibilities all at once.
  • Familiarize them with the tools your company uses, such as a C.M.S., CRM platform, etc.

You also need to establish an effective training program that incentivizes discretionary effort, apart from the onboarding process.

The program should target your entire team.

Here are practical employee engagement strategy pointers:

  • Start by assessing the areas that need improvement. For example, cybersecurity, workplace ethics, etc. For all new employees, you may follow a standard training protocol.
  • Communicate the learning objectives of the training program. For example, if the program focuses on new software, let your team know the benefits of familiarizing themselves with the new platform and how it could benefit the whole organization in the long run.
  • Design learning material that is easy to comprehend. You can make slideshows, PDF files, and video lessons.
  • If you have a large workforce to train, consider investing in a decent learning management system.

2. Acknowledge Your Employees

It’s impossible to engage/establish an emotional connection with someone if they don’t acknowledge you.

While acknowledgment isn’t an effective employee engagement strategy on its own, a lack thereof will result in employee disengagement.

As a manager, you already have a lot on your plate. Praising your team for all engagement efforts might seem exhausting and unnecessary.

However, it can work wonders for employee satisfaction and business outcomes.

A 2013 Globoforce study found that 89% of employees felt more motivated when told that whatever they were doing was right.

While that may raise some questions regarding constructive feedback, it points towards a simple act of acknowledgment and the effects of micromanagement (more on that later).

Follow these tips to acknowledge your employees:

  • Greet whoever crosses your path and ask them about their day.
  • Praise and reward your employees who go the extra mile in front of the whole team.
  • Remind your employees about the significance of their roles and how their efforts keep the business afloat.
  • Involve them in decision-making processes and ask for their opinions to show they matter.

3. Communicate Company’s Goals

Running a business without goals is like shooting darts in the dark.

Where new employees need to know how they contribute to the team’s overall success, existing workers need reminders about the company’s existing goals.

However, it all starts with you. First, you have to define your goals.

A tried and tested way is to break down your long-term goals into smaller ones that lead the organization closer to success, one step at a time.

Follow these tips to set your goals and improve employee engagement:

  • Analyze what your company needs to get to the next level.
  • Use the S.M.A.R.T. technique, i.e., make your goals specific, measurable, achievable/actionable, realistic, and time-bound. An excellent example of a SMART plan is: “closing X sales by the end of the 2nd quarter.”
  • Set monthly, quarterly, semi-annually, and annual goals to make your vision attainable.
  • Involve your team in the goal-setting process to engage them.
  • After setting your goals, create plans to achieve them. For example, if your goal is to “generate X amount of leads in Y months,” one of your plans could be to create a lead generation piece to encourage people to sign up.

Once you’ve set your company goals and created a game plan, you must connect employees with the goal.

These tips will help create a clear understanding:

  • Have meetings once a week or twice a month to discuss progress, provide a refresher on existing goals, and/or discuss future goals.
  • If you’re using project management or team collaboration tools such as Asana, Slack, or Trello, create a separate folder where you list relevant organizational goals.
  • Get a whiteboard for your workplace on which you can write the goals for everyone to see. To make things fun, hang a metallic bell next to the board and have one of your employees ring it every time you achieve a significant milestone.
  • Use an employee engagement survey to see how employees engage with company goals.

4. Provide the Necessary Resources

At times, it’s easy to motivate employees to get things done. But even an engaged workforce won’t do much without proper resources.

These resources could be anything, including a fast computer with working peripherals, software that makes the job easier, or manuals. Even a free daily coffee can boost employee happiness and productivity.

Lack of proper resources results in frustration, stress, and disengagement. Furthermore, it can hurt meaningful relationships team members create with other employees.

To provide resources and improve employee engagement, do the following:

  • Create a separate monthly budget for the provision and maintenance of critical resources.
  • Assess what the team needs from time to time. You can have one-on-one meetings with your employees and ask them what they need. If it’s in the company’s best interest, consider getting those things.

5. Remove Communication Barriers

According to a study by The McKinsey Global Institute, organizations with robust employee engagement strategies experienced a 20-25% increase in productivity.

This connection starts by removing barriers to communication.

Working in silos and removing healthy inter-department interactions may not be suitable for engagement.

The top management also needs to be more transparent and open to communication.

In a nutshell, managers need to be approachable and available to provide counseling and guidance. Furthermore, they should collect employee feedback. Ways to collect are various employee surveys.

This will result in a cooperative environment where maintaining employee engagement becomes easy.

Here are some tips to promote open communication:

  • Have group meetings every other week or month, where all employees are encouraged to speak up and add to the discussion.
  • Encourage managers to hand out employee engagement surveys.
  • Don’t hold back from sharing valuable feedback, and encourage your employees to do the same.

6. Provide Feedback

Do you provide enough feedback to your employees? Do you collect feedback?

These are some of the questions that every manager needs to ask themselves.

A great way to increase employee engagement is to have one-on-one sessions, where you break down their performance and discuss strengths and weaknesses. It promotes healthy company culture, but it also creates mutual respect.

It’s not realistic to expect managers to have regular internal communications with a team of 100 professionals.

However, designating an hour every week or two to provide quick feedback and promote personal growth to one unit is reasonable.

Here are some tips on giving actionable feedback to your employees:

  • Highlight an employee’s progress and other accomplishments, even if the overall feedback is negative.
  • Have performance evaluation interviews at the end of every month, quarter, or year, during which employees get in-depth feedback.
  • Help employees achieve personal growth by asking how you can help.

7. Don’t Micromanage

Micromanagement is perhaps the biggest employee engagement killer.

If employees must perform even the slightest tasks in specific ways, it can be discouraging and lead to a lack of productivity.

While it’s true that specific jobs require workers to follow standard operating procedures, in most cases, close supervision and a “my-way” attitude from managers can lower morale.

In every job – especially those that require creative input – a level of autonomy should always be there.

Don’t limit autonomy to setting goals and personal schedules – make it part of day-to-day tasks without consequences.

Another aspect of micromanagement is providing too much feedback.

A 2007 experiment included two groups. Group A received more feedback than group B.

The result – group B performed 11% better than group A.

Here are some tips to avoid being a micro-manager:

  • During meetings, discuss matters with an open mind, and look to learn something new.
  • Realize that there could be more than one “right way” of doing certain things, and allow your employees to use their creativity to do them. For example, if an employee prefers to use a particular layout and shortcuts for software, let them do it, as long as it doesn’t interfere with their work.
  • While creating or revising S.O.P.s, encourage your employees to provide any suggestions or overall feedback.

The 5 Hottest Employee Engagement Trends to Follow

Here are five key employee engagement drivers that you can leverage to incentivize a high-performing workforce.

1. Unique Financial Incentives

According to classical management theories, money is the most extensive employee engagement motivator.

While that’s no longer relevant in today’s landscape, financial assistance, such as medical coverage, can engage employees.

However, some companies are providing this financial assistance in unique ways, catering to the needs of the modern workforce.

A good example is student loan repayment.

Some organizations are offering to repay student loans through platforms like FutureFuel.

This particular benefit has shown promising results in terms of satisfaction and retention. In fact, according to a survey, 86% of employees would want to work for you for five or more years if you offered to help pay off their college loans.

So, think beyond medical insurance and free lunches and develop a unique way to assist your employees.

2. Working for a Cause

Another thing that drives employee engagement in today’s workforce (most of which includes millennials) is involvement with causes.

A study found that organizations focused on their C.S.R. (corporate social responsibility) strategies and worked on different causes found it easier to retain millennial employees.

So, to make your employees feel like they’re part of something bigger than themselves and engage them, consider giving back to the world in other ways.

If you already haven’t, start by creating a C.S.R. strategy.

Keep these tips in mind:

  • Pick one cause that you want to work towards. It’s tempting to work towards multiple causes at once, but you can’t save the world in one go. Use employee surveys to figure out the best cause.
  • Align employees’ actions with the cause you’re working for, both at work and in their personal lives.
  • Plan small C.S.R. activities throughout the year, such as tree planting, fundraising for a local animal protection group, etc.

3. Increased Flexibility

The modern employee wants to have their decision-making process.

Flexibility reduces the stress of getting the job done in a specific period and provides a sense of autonomy, which are perfect for engaging employees.

In another study focused on millennials, 77% of respondents said that a flexible working schedule made them more productive.

So, ditch the mandatory 9 to 5 regime and cut your employees some slack.

4. Leveraging Gamification

At times, employees find it challenging to wrap their heads around specific incentives and company policies.

Modern organizations have come up with a solution to this problem – gamification.

By gamifying your onboarding process, training programs, and other day-to-day tasks, you can experience a rise in employee engagement.

For example, you can leverage an app that tracks employees’ heart rates and reward them for working out.

You can also gamify assessments, where employees participate in an immersive experience.

5. Emphasis on Employee Experience

With a great emphasis on making companies “people-oriented,” more and more organizations emphasize employees’ experiences in their company culture.

Also known as EX, this concept involves how an employee feels within their workspace and what they observe, which can decide engagement factors.

So, how do you provide the right kind of employee experience? S.H.R.M. says that it’s a combination of the following factors:

  • Culture
  • Technology
  • Physical workspace

Building the right company culture is a slow process. You can speed it up by using an employee engagement survey.

However, you can experience results across the entire organization if you work on technology and physical workspace.

With technology, you can provide better tools and ample training.

As for your physical workspace, make sure that your employees aren’t feeling crowded and are working in a safe and pleasant environment.


Engaged employees scale your business and you create an engaging environment with the right tools and mindset.

It all falls on fostering a culture of employee engagement, ditching the traditional management style, and building a team that takes pleasure in showing up to get things done – every single day.

If you are new to Human Resources and are looking to break into an HR role, we recommend taking our HR Certification Courses, where you will learn how to build your skillset in human resources, build your human resources network, craft a great HR resume, and create a successful job search strategy.