Although many companies are focused on improving corporate performance,
they may be using the wrong measurements to keep score of
how they're doing. The CFO, for example, might be using the
yardsticks of revenue growth, cost of goods sold, days in
inventory and DSO, or days sales outstanding. His attention
may be glued to hot new developments in business process improvement
and using software to automate processes. Software and technology
are great, but whoa! Let's look at more than process improvement
to better our key financial measures. Although seeing the
needle rise on financial performance is crucial to all organizations,
getting it into the stratosphere requires improvement in more
than just the process area. It requires that leaders take
a broad view of the company and look at the combination of
everything - process, systems and people - and envision them
all clicking together.
This is not to accuse leaders of ignoring poor performance.
But many do fail to see the big role that people play in processes.
We can automate process and measure process and monitor
systems, but the area with the highest degree of variability
is the one which people occupy.
How do you measure the effectiveness of people?
- That's a very good question. One way to do it is to measure
employee engagement, a seemingly fleeting quality in our
organizations. If you doubt this, just follow the numbers
to their sad conclusion. Surveys show that
less than a third of workers describe themselves as engaged
in their work. Engaged employees are the ones who care out
the job enough to perform at the highest levels. Another
10 to 18 percent, are deeply disengaged, and are even looking
elsewhere for employment. The rest, about 60 percent, fall
somewhere in the middle.
But instead of looking at employee performance when financial
numbers are weak, top managers often look at the business
process to see where the errors are. We all must understand
that we cannot remove the employee from the process. People
play a critical role in processes, most significantly when
something outside the norm of the process happens - a glitch
in the software, if you will.
Perhaps a customer heats up the phone lines with a billing
discrepancy. Only people can figure out the problem and
find a solution in which both the customer and the company
win. It is people who must perform superbly to solve the
problem, and that means an engaged employee, one who understands
the problem and cares enough to see it through to a solution.
Until top managers realize that employee engagement plays
a key role in driving financial and operational performance,
and put engagement-friendly programs in place, they will
not achieve the level of performance they desire.
Employee engagement is not only about turnover or worker
satisfaction; the boredom or indifference of an unengaged
employee touches everything, including financial and operational
statistics.
For example, an accounts receivable problem might really
be a "people problem," and it might ripple across the whole
company. Although the CFO turns to the accounting department
when he sees a money problem, the real weakness could be:
- A problem in customer service that creates unhappy customers who are
paying slowly
- A problem in sales that is turning customers against the company,
causing slow payment
With all of the potential places that
irritating problems can hide, don't you want more than a third of your
employees trying to ferret them out and eradicate them?
The unengaged workforce is a tough problem - otherwise it would not
stick to us so stubbornly - but we can make headway in addressing it. We
can do it by:
- Making sure we have the right person in the right job from the very
start
- Providing training that ensures employees have the skills to do
their jobs
- Putting in place managers who understand what their employees need
and show them how to get it.
We have to address the issue of
workforce engagement on several fronts, just as we do any dug-in problem.
Only then will we begin to see that small percentage of engaged employees
creep up, maybe to 35 percent, 50 percent, or even higher. Only then will
other significant numbers begin to rise as well. The sky's the
limit.
Your Workers May Not Be Engaged If
- They miss important deadlines, not once, but chronically.
- They frequently report that they are too ill to come to work, and
usually on Fridays or Mondays.
- Key managers expect high turnover.
- The same errors appear on the ledger sheet month after month.
- No one accepts responsibility for common mistakes.
- Team members are not communicating about basic job duties.
- No one can find Jennifer Employee after 3 p.m.
- Unfounded rumors about the organization frequently float throughout
the office.
- Important equipment needs repair or replacement, and no one reports
it, fixes it or replaces it.
- Workers' pay remains the same even as their performance soars.
