The Impact of Employee Engagement

By on June 30, 2015
The Impact of Employee Engagement

As consumers, you and I are confronted daily with dramatic examples of sales-killing behaviors. In many cases, the behaviors we encounter hardly get our attention because we’ve become so accustomed to them. Experiences like one I had recently are commonplace. I was in the checkout lane of a large supermarket and asked the checker, who was, frankly, looking rather annoyed, “How’s it going?” With a scowl on his face, he replied, “Five minutes and I’m out of here.” I thought to myself, “I wonder if I should shop here if this place is so bad.”

I find it just amazing that the clerk who said, “Five minutes and I’m out of here” saw absolutely nothing inappropriate in saying this to a customer. He was utterly oblivious to the impact this statement would have on whether or not I ever shopped in this grocery store again. Alternatively, it’s quite possible that he didn’t care if I ever returned.

Contrast this behavior with that of a clerk in another grocery store. My wife, Dolores, and I were in our favorite grocery store going through the checkout lane. When the checker picked up a carton of eggs we were buying, she looked at the eggs, shook them gently and moved her fingers over the eggs to make sure they all moved and weren’t stuck to the package. She added, “I wouldn’t want you to get home with a cracked egg.”

Two retail clerks. One engaged in her work, the other not engaged. Two retail grocery chains. One near the top of its industry in sales per square foot, the other very average.

Engagement made the difference

A study of 90,000 workers in 18 countries by Towers Perrin on the impact of employee engagement states the following: “Firms with the highest percentage of engaged employees collectively increased operating income 19% and earnings per share 28% year-to-year. Companies with employees who are less engaged experienced operating income declines of 33% year-to-year and 11% in earnings.”

Further, the Towers Perrin study found that highly engaged employees believed that they could and did contribute more directly to business results than less engaged employees. 84% of highly engaged employees believed they could impact the quality of their company’s work product, compared to 31% of the disengaged. Their study also states, “It’s impossible to overstate the importance of an engaged workforce on a company’s bottom line.”

And what impact does employee engagement have on financial performance? As described in a monograph written by Dr. Gary Rhoads, Professor of Marketing at Brigham Young University, Best Buy was able to demonstrate that an increase in engagement among store employees of 0.01 on a five-point scale resulted in an annual profit increase of $100,000 for the store.

Lean drives engagement

Want to know how your company can develop a cadre of employees who are highly engaged in their work and focused on continuous improvement? We have well-tested and proven Lean training and consulting resources that can make this happen. Call me anytime at 314-303-0612 and let’s discuss. I’d very much appreciate having the opportunity to meet with you to review how we can support your drive to higher degrees of productivity and profitability.

About George Friesen

George Friesen serves as Business Practice Leader - Lean Manufacturing for the Workforce Solutions Group of St. Louis Community College. He has led the College's Lean business practice area since 2000. Prior to joining the College, George worked for Maritz Performance Improvement Company. Over the past 35 years, he has served a wide variety of Fortune 500 companies, specializing during the past eleven years in Lean Manufacturing, focusing especially on the 5S System, Lean leadership and thinking processes, Value Stream Mapping, and Lean team building. George is a graduate of Washington University (AB), Webster University (MA), and United States Air Force Flight Training.

3 Comments

  1. Felisa Fisher

    June 30, 2015 at 6:01 pm

    Many employees are disengaged because they find no joy in what they do for work and of it can be many more circumstances that cause this dislike for their job. I can understand their thinking because this was me. Now I am in search of finding a job that I will at least like so I don’t have to put on a fake smile. I desire to be engaged and help people enjoy their experience because I am a consumer also.

  2. Sarah Friesen

    June 30, 2015 at 10:22 pm

    I recently experienced outstanding customer service from a hotel manager when traveling overseas. On the day my family was scheduled to check out (with a long travel ahead of us), my daughter fell ill, sick to her stomach. Since we were not in the U.S., we had difficulty figuring out what sort of medicine to get from a local pharmacy. I mentioned it to the hotel manager as I was checking out, she first called her mother (who worked in a healthcare field), and gave her mother the names of the U.S. meditcations I was trying to find. Her mother was able to recommend the equivalent medicine in their country, which worked well. It was ironic that the person working at the pharmacy did not have the interest to try to find what I was looking for, but the hotel manager did. She went the extra mile, despite the fact that I had already settled the bill and she had no immediate financial gain from my getting the correct medicine.

    • George Friesen

      July 1, 2015 at 6:49 pm

      What a great example of going the extra step to serve a person in need. Obviously, she was a person who was strongly engaged in pleasing the customer.

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