Happy staff will have your profits soaring

May 9 2008 By Erikka Askeland

Disengaged employees work against firm, study reveals

What is it like to work here? The answer to this question is the key to describing workplace culture. Are employees encouraged to tell the boss what they think or do they do what they are told? Do employees go the extra mile or leave for home at 5pm sharp?

The answer can also indicate how engaged employees are. A relatively new field of studying employee engagement reveals that companies who are successful see the results on their bottom line.

"Engaged employees work with a passion and feel a profound connection to their company," says Peter Casebow, CEO of management skills development company Goodpractice.net. "They drive innovation and move the company forward."

If that sounds appealing then the alternative is less so. Employees who are not engaged are essentially 'checked out'.

"They are present and do what's expected of them, but have no real energy or passion for their work," says Casebow.

"Actively disengaged employees aren't just unhappy in their work; they are busy acting out their unhappiness. These employees work against the organisation, and seek to undermine what their engaged colleagues accomplish."

According to PricewaterhouseCoopers, rapid economic change and uncertainty in many markets makes taking measures to address employee engagement more relevant than ever.

Levels of engagement are even beginning to be perceived by some investors as an important indicator of a company's financial health and sustainability. There is no doubt that actively disengaged employees are bad news for business.

In 2005, home improvement retailer B&Q hit hard times. It was rapidly losing market share, sales were falling at a rate of nearly nine per cent a year and customer satisfaction had fallen. In an increasingly competitive DIY retail market, B&Q was in trouble, and something had to be done.

When it investigated the source of the problem, it discovered 26 per cent of its employees were actively disengaged.

B&Q was spending over £120 million in wage costs to people who were actively working against the business. At this time, only 33 per cent of employees were positively engaged, with 41 per cent in the middle that were neither engaged nor disengaged.

"B&Q was keen to win back the hands, hearts and minds of its not engaged employees, and reduce the numbers of those who were actively disengaged," says Casebow.

With a new management team in place, B&Q quickly introduced an organisational development action plan - Great Place to Work Campaign - with improving employee engagement at its core.