The employee engagement equation is a complex one. For years organizations have been trying to identify the combined variables that produce an engaged workforce.
Gallup, a research-based performance management company, links employee engagement to well-being. In his October 2012 T+D Long View interview, Tom Rath, global practice leader at Gallup, says: "We know that when an organization starts to invest in the overall well-being of an employee, not only is that good for the bottom line, it's good for employee engagement. You can also see how that improves the workers' physical health, makes them more likely to contribute to the community, helps them understand how to manage their finances, helps them to have better relationships with their spouse, partner, kids, and loved ones. It also helps to get their career on the right track."
Recent research from global professional services firm Towers Watson sheds new light on the employee engagement conversation. Its 2012 Global Workforce Study, a survey of 32,000 employees across 30 countries, calls for employers to focus on "sustainable engagement." The report defines such engagement as the intensity of employees' connection to their organization based on three factors: the extent of their discretionary effort committed to achieving work goals, an environment that supports productivity in multiple ways, and a work experience that promotes well-being.
The two key ingredients necessary for sustainable engagement to flourish is effectively enabling workers with internal support, resources, and tools; and creating a work environment that more fully energizes employees by promoting their physical, emotional, and social well-being. CEOs who view themselves as "chief energy officers"—encouraging, supportive, positive, and inspiring cheerleaders—can influence and engage employees with such contagious energy, says Tony Schwartz in his November 2012 Harvard Business Review blog post, "New Research: How Employee Engagement Hits the Bottom Line."
In a recent analysis of 50 global companies, Towers Watson finds that companies with high sustainable engagement report an average one-year operating margin of 27 percent, which is close to three times higher than companies with low engagement.
"While many other elements affect margin—and in more direct ways—this finding underscores why organizations need to think more broadly about all of the factors that influence their performance, in both the short and long term," the report notes.