Discussion of organisational capability frequently centres on having the right people in the right roles at the right time. Organisations now also recognise that the extent to which they mobilise and engage those ‘right’ people is a key driver of business performance.
At a time when organisations require their people to be increasingly innovative, to do more with less and to perform consistently under conditions of uncertainty and change, what they do to generate this engagement and channel it in a way that directly supports their strategic priorities is increasingly important.
Employee engagement – the extent to which employees feel committed to an organisation’s success, and demonstrate this commitment in their work – is an important foundation for a productive organisation
Happy, satisfied employees are a great asset, but their commitment is what generates discretionary effort. Engaged employees are known to invest more effort, be more reliable and stay longer. There is significant evidence at an organisational level to support this, with lower absenteeism and lower turnover amongst high-engagement organisations, as well as stronger performance on financial indicators.
High-engagement organisations perform better on HR and financial indicators
At an individual employee level, however, there is relatively little evidence to suggest that highly engaged employees actually generate better ideas, produce better work and deliver outcomes that better support an organisation’s strategy. Engagement is an important foundation for a productive and high-performing organisation; but on its own, it is not sufficient to mobilise people in a way that supports strategic goals.
In order to encourage and enable employees of all levels to support strategic priorities, organisations need to look beyond engagement and address three fundamental drivers of productivity
Three fundamental drivers of productivity and performance
While each of these is important and goes some way towards enhanced individual and organisational productivity and performance, the power lies in the combination of all three.
A clear starting point for strong performance is a well-defined vision and a clear strategy to achieve that vision. Leading organisations work hard to ensure everyone in the organisation, from senior leaders to frontline employees, clearly understands this vision and strategy. They invest effort in translation of this strategy, so that employees at all levels can clearly identify how their role and activities contribute to it.
This line of sight not only creates a more inspiring sense of purpose for individuals, but also helps to ensure that what people do day-to-day helps the organisation to perform well. Employees may feel committed to the organisation’s success, but if they don’t have this clear understanding of what that success looks like, and how they can support it, their commitment won’t necessarily translate into better performance.
As described above, employee engagement is about commitment to an organisation’s success and a willingness to contribute to it. Leading organisations build on this to create a strong emotional connection between employees and the organisation. This is driven by caring leaders, trust and empowerment, integrity, and a compelling mission and purpose.
On its own, emotional commitment can turn into misguided passion. While employees may work hard, it may not be on the things that are going to help make a difference to the realisation of your strategic goals. However, emotional commitment coupled with an understanding of the vision and strategy means that employees are more likely to invest discretionary effort in the things that matter.
At Nous, we define organisational culture as shared mindsets and demonstrated behaviours. Culture is known to be a key driver of organisational performance. What people do and the work they deliver is obviously important, but how they behave and interact with each other and with customers can impact substantially on the extent to which an organisation is positioned to achieve its strategic goals.
Employees may understand the organisation’s goals and feel committed to its success, but ingrained behaviours, habits and ways of working can inadvertently undermine performance if these are not aligned with the organisation’s vision and strategy. A positive culture, where employees identify with the values of the organisation, also plays an important role in fostering the emotional commitment described above.
Leading organisations actively manage their culture to ensure this alignment. Those that do this well carefully examine the values and behaviours required to support achievement of their goals, and then actively recruit for, embed, reward and reinforce these behaviours.
A productive workforce still requires having the right people in the right roles at the right time, but addressing these three drivers of productivity will ensure they also contribute in the right way to support your organisation’s strategic goals.
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