What Impact Does Employee Engagement Have on Revenue?

employeeengagement.jpgIn today’s economy, the bottom line has become more important than ever before—especially within publically traded and international organizations. That’s why companies around the world are ever vigilant for ways to increase their profit margins, without adding additional expenditures. And one extremely viable method of achieving this much-desired result doesn’t actually cost much at all. In fact, all it takes is a dedication to change and a desire to grow. What exactly is this magical tool? It’s called employee engagement and it’s the focus of nearly every successful business in the world today.

Just How Powerful is Employee Engagement?

Well, to better understand its strength, we need to turn our attention to Gallup’s recently released report titled, “The State of the American Workplace.” In it, they discuss the correlation between active employee engagement and nine integral performance outcomes that businesses, nonprofits, and other organizations alike strive for on a daily basis. These performance outcomes were developed as a result of Gallup’s 2012 meta-analysis on the Q12 using 263 research studies across 192 organizations in 49 industries in 34 countries. Within each study, researchers strategically calculated the business/work unit level relationships between active engagement and the subjects’ performance outcomes. As such, they discovered a direct connection between employee engagement and these nine outcomes of performance:

  • Customer Rating
  • Profitability
  • Productivity
  • Turnover
  • Safety Incidents
  • Skrinkage (theft)
  • Absenteeism
  • Patient Safety Incidences
  • Quality (defects) 

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*Image from State of the American Workplace

Engaged Companies Outperform Their Competition

Looking further into Gallup’s study, they also discovered significant differences in performance between engaged and disengaged employees, finding that those scoring in the top half nearly doubled their odds of success on the job. In fact, those at the 99th percentile had four times the success rate of those in the 1st percentile. If that’s not enough evidence to make you believe, Gallup also found that organizations with a high level of engaged employees significantly outperformed their competition in earnings per share. In turn, these stats correlate the fact that those same organizations were better positioned to rebound after the recession and regain the shares they had previously lost.

Employee Engagement Survey | C.A. Short Company

So, what does it all mean? It’s simple. To maximize your team’s work power, you must actively engage them on multiple levels and showcase their individual worth to the organization. By allowing employees to understand and get behind what your brand stands for, you proportionately increase their desire to go above and beyond their job title for the good of the organization. Obviously, this in turn should lead to an increased bottom line and better earnings across the board. To put it another way, they need to feel worthy of their worth.

Begin at the Top

Ideally, the best way to begin engaging your team members is to begin at the top. To enact the changes needed for active engagement, leadership must be on board and willing to follow through themselves—to lead by example. You should never ask an employee to do one thing, while their managers do another. Not only is it a step backwards in terms of engagement, but it can also affect moral and hinder sustainable growth. So, generate a comprehensive safety plan, listen to the needs of your employees and put into motion a plan that understands, delivers, and builds upon the needs of the organization as a whole. Because, without a focus on employee engagement, you run the risk of the organization—and your revenue streams—falling backwards, rather than standing up straight or pushing forward.

35 Ways to Influence Corporate Culture and Increase Your Bottom Line

 

C.A. Short Company partners with companies to manage, drive and facilitate increased employee engagement to increase financial performance, productivity, quality, and core performance outcomes. Our process and research-based platform enables executives and managers to engage their teams to increase the bottom line, motivate staff, and incentivize positive behavior. To request a Complimentary Consultation, please click here. 

 

 

Topics: Employee Recognition, Employee Engagement, Employee Recognition Strategies, Communciation, Gallup Q12

Chris Sotos

About the Author
Chris Sotos

Controller
Chris joined C. A. Short Company in June 1994 and has been the Controller since November 1996. He is responsible for overseeing the company’s accounting and financial functions. Chris has a BSBA in Finance and an MBA from The Ohio State University. He also holds a Certified Financial Planner™ certification. Chris enjoys spending time with family and friends, traveling and watching sports.

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