It’s wisdom practically as old as the hills: always treat your employees as well as you want them to treat your best customers. And when it comes to ROI, employee engagement is an integral part of driving and maximizing your revenue.

It’s difficult, if not impossible, for an organization to achieve success without the backing of a dedicated team of employees. Employee engagement is particularly relevant for companies with a large group of frontline staff.

Your customers are, after all, human, and people connect with people, not businesses.

Author and entrepreneur Kevin Kruse describes employee engagement as the emotional commitment an employee has to an organization and its goals. When employees are engaged, Kruse says, they work on behalf of your organization’s goals and use discretionary effort.

Additionally, when your employees are engaged, they are more productive, exude a positive attitude and take an interest in your organization’s success.

But if you are going to devote time and resources to employee engagement, what will your return on investment be?

Key Takeaways:

  • Employee Engagement Drives Productivity and Revenue: Companies with engaged employees consistently outperform those with low engagement by a wide margin, showing higher productivity, better customer service, and increased revenue.
  • Effective Engagement Starts with Listening and Appreciation: Encouraging feedback, thanking employees, and fostering open communication creates a positive work culture that values each employee’s contribution, fostering loyalty and dedication.
  • Engagement Benefits Both the Company and Customers: When employees are engaged, they feel connected to company goals, leading to better customer interactions, stronger brand loyalty, and a positive public image.
  • Data-Driven Hiring Can Improve Engagement: Utilizing analytics to recruit employees who align with company culture helps ensure that new hires are a positive fit, enhancing overall team engagement and retention.
  • Simple Engagement Practices Yield Strong ROI: Small changes, like improved communication, recognition programs, and empowerment, can lead to significant boosts in employee satisfaction, which translates to higher overall ROI.

Employee Engagement and Your Bottom Line

An engaged workforce can truly impact and drive revenue.

Here are just some of the statistics that demonstrate the positive effects of employee engagement:

  1. Organizations with engaged employees outperform those with low employee engagement by 202%.
  2. Three-fourths of employees that work for companies with financial performance that is significantly above average are moderately or highly engaged.
  3. As of May 2016, the 32.7% of U.S. workers are considered to be engaged in their jobs. (Gallup).
  4. Research revealed engaged companies have five times higher shareholder returns over five years (Kenexa).
  5. According to another 2016 Gallup meta-analysis study of over one million employees working for 230 companies in 49 different industries, those businesses with employee engagement scores within the top quartile of Gallup’s database have 70% fewer safety incidents than those in the bottom quartile.
  6. A 2015 SHRM study found 70% of surveyed employees ranked being empowered to take action on the job when a problem or opportunity presented itself as an important component of their engagement.
  7. According to research conducted by Towers Perrin, companies with engaged workers have 6% higher net profit margins

3 Tips to Start Engaging Your Employees

Though the drivers vary from industry to industry and person to person, there are certain factors that affect employee engagement and, consequently, employee ROI in most organizations. Just as you expect a return on the investment that you make in your employees, your employees will invest their efforts and time in your organization if they expect a reward.

Employers with the most employee engagement create a well-defined and intentional culture that values the opinions of all of its employees, appreciates their efforts, and fosters open communication.

  1. Listen up: As companies like Amazon have discovered, listening can pay off quite well. If you want to engage your employees, it’s important to provide them with an outlet to share their opinions. This doesn’t mean that they must be involved in every high-level decision, however, allowing employees to give feedback doesn’t just allow them to feel more a part of the company.
  2. Thank them: Organizations with engaged employees thank them for their contributions. Appreciation can be shown through monetary rewards, or recognition events or simply by saying “thanks.” Employees feel appreciated when they understand how their contributions support the goals of their employer.
  3. Keep the lines of communication open: Communicating openly, expressing expectations clearly and encouraging feedback helps employees to feel like they are part of a team.

The Business Case for Employee Engagement

Investing in employee engagement doesn’t just create a positive workplace; it has measurable, bottom-line impacts. Here’s why engagement matters for your business:

  • Higher Productivity & Profitability: Engaged employees can increase company profitability by up to 21%.
  • Lower Absenteeism & Turnover: Engaged teams experience up to 41% lower absenteeism and 59% less turnover, reducing costly hiring and training cycles.
  • Improved Customer Satisfaction: Engaged employees often go the extra mile, leading to higher customer satisfaction and loyalty.

Employee engagement directly supports your organization’s financial performance and strengthens workplace culture, making it a strategic priority for sustainable success.

Using Technology for Employee Engagement

Technology offers innovative ways to enhance and measure employee engagement:

  • Real-Time Communication & Recognition: Tools like Slack and Microsoft Teams facilitate daily communication and quick recognition.
  • Engagement Platforms: Software like 15Five or Officevibe allows for regular pulse surveys, anonymous feedback, and peer-to-peer recognition, providing managers with a clear view of team morale.
  • Data-Driven Insights: Analytics from engagement platforms can identify trends and areas needing attention, allowing HR teams to tailor strategies for maximum impact.

Using technology strategically ensures that engagement efforts are responsive, relevant, and seamlessly integrated into daily workflows.

Common Engagement Pitfalls to Avoid

While employee engagement is essential, certain missteps can hinder progress. Key pitfalls include:

  1. Infrequent or One-Off Initiatives: Engagement should be a continuous focus, not limited to annual surveys or occasional team events.
  2. Generic Strategies: Different teams have unique needs. Tailor engagement initiatives to be meaningful and effective for each group.
  3. Lack of Follow-Through: Seeking feedback without acting on it can erode trust. Employees want to see that their input leads to real change.
  4. Over-Reliance on Perks: Perks like snacks or parties are nice, but they don’t replace authentic recognition, career growth, and open communication.

By understanding these common pitfalls, organizations can craft engagement strategies that resonate and lead to genuine improvement.

Building a Culture of Continuous Feedback

A culture of continuous feedback is essential for engagement and growth. Here’s how to build it:

  • Regular Check-Ins: Weekly or bi-weekly one-on-ones allow managers to stay connected to team members, addressing issues in real time.
  • Balanced Feedback: Focus on strengths as well as areas for growth. This balanced approach builds confidence and motivation.
  • Anonymous Surveys: Allowing for anonymous feedback creates a safe space for employees to voice concerns they might not feel comfortable sharing directly.

Encouraging open, constructive feedback helps employees understand their impact, enhances trust, and fosters a greater sense of investment in the company’s success.

Wrapping Up

Technology is another employee engagement tool that should not be overlooked. Companies now have powerful options at their disposal that can help them to target employees that fit in well in specific environments and will excel in a frontline position.

A workforce report by Aflac states that 38% of employers state most lost productivity in their organizations stems from a lack of qualified talent. By utilizing data-driven processes to bring in talent that will enhance a positive company culture, you can improve the overall engagement of your team.

Read more: Visualizing the Employee Engagement Index, by Industry