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Case Study: Measuring ROI in Employee Engagement With a Bonus

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Set in an extremely competitive industry, this case study shows the impact and return on investment of an employee engagement system with a significant bonus attached.

Because of a lack of engagement, National Crushed Stone, a large construction aggregates company, decided to pilot a program of revised employee engagement coupled with gainsharing. The company was able to develop credible data to show the contribution of the new program and the effects that it had on operations.

 

As employees become more engaged, they are rewarded through a gainsharing bonus that shared half of the cost savings. The system design is shown in Figure 1.

Figure 1. System Design

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The results are very impressive, exceeding the expectations of all involved. The total monetary benefits of this program was $1,385,336, and the total cost was $129,886. The ROI was calculated to be 967 percent, which means that for every dollar invested in this program, another $9.67 was returned after the dollar was recovered.

This brief case study attempts to take some of the mystery out of measuring the success of engagement, particularly when pushing measurement to the impact and ROI levels. This is the ultimate level of evaluation for executives, where they can clearly see the return on their investments in this important area.

More details on the background, methodology, and case study examples are in ATD’s new book, Measuring the Success of Employee Engagement: A Step-by-Step Guide for Measuring the Impact and Calculating the ROI.

About the Author

Patti Phillips is president and CEO of the ROI Institute and is the ATD Certification Institute's 2015 CPLP Fellow. Since 1997, she has worked with organizations in more than 60 countries as they demonstrate the value of a variety of programs and projects. Patti serves on the board of the Center for Talent Reporting, as Distinguished Principal Research Fellow for The Conference Board, and as faculty on the UN System Staff College in Turin, Italy.

Patti has written and edited numerous books and articles on the topics of measurement, evaluation, and ROI. Recent publications include Measuring the Success of Leadership Development, Making Human Capital Analytics Work, Measuring the Success of Learning Through Technology, Measuring the Success of Organization Development, and Measuring Leadership Development: Quantify Your Program's Impact and ROI on Organizational Performance.

About the Author

Jack J. Phillips, PhD, is chairman of the ROI Institute and a world-renowned expert on measurement and evaluation. Phillips provides consulting services for Fortune 500 companies and workshops for major conference providers worldwide. Phillips is also the author or editor of more than 100 articles and more than 75 books, including Measuring the Success of Leadership Development: A Step-by-Step Guide for Measuring Impact and Calculating ROI (ATD Press). His work has been featured in the Wall Street Journal, Bloomberg Businessweek, Fortune, and on CNN.

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