Low Engagement, High Costs!

by James Joseph Brown

The numbers aren’t very good. In fact most would consider them downright grim. The numbers I’m talking about refer to the percentage of North American workers who are either not engaged, or actively disengaged.

Since Curt Coffman and Marcus Buckingham released their the book First, Break all the Rules, the subject of employee engagement has become a hot topic and gained attention around the world. It isn’t hard to get most business leaders to agree that an increase in engagement is likely to increase productivity, retention, customer satisfaction, and profitability.

Yet despite the notoriety, and attention paid to the subject, employee engagement figures keep going on the wrong direction. And very few organizations are making the critical investments of time and money needed to improve these levels. I wonder if looking at the everyday costs accrued by a lack of engagement might make that difference.

According to the results of several recent surveys and studies, including the Gallup Organization, the North American workforce consists of 29% Engaged employees, 55% who are Not-Engaged, and 16% who are Actively Disengaged. Think about that for a moment, this means that 71% of the workforce are not giving a full effort at work and perhaps may even be doing their best to work against the organization.

Now your company may have numbers that are better than these averages, but unfortunately there is just as much chance that your results are even worse. Unless you are consistently measuring your engagement you won’t know for sure.

So what? What are some of the costs of having 70% of your workforce disengaged? Well, there are a lot of different costs that we could look at like lateness, absenteeism, withholding effort, low employee morale, and conflict. But let’s take a look at a simple tangible cost you face every month, your investment in payroll and benefits.

When asked, most managers and business owners suggest that Not-Engaged employees are only contributing about 50% of their effort and capabilities to the organization. And they also see the Actively Disengaged employees contributing only 20%, although the case could be made for a negative number when it comes to this group because they are taking away from what everyone else is doing.

For the sake of example and to be fair, let’s go conservative and assume that Engaged employees contribute 100% of their effort and everyone else is only contributing 50% of what they are capable of doing. Since 70% of your workforce is only giving back 70% then 35% of your payroll is pure cost, meaning you aren’t getting anything for the investment.

Now for the sake of example, say the average wage and benefits your employees earn is $50,000 per year. If you’ve got 100 employees you’re looking at $1,750,000 paid in salary and benefits for which you get absolutely nothing in return. If you’ve got 10 employees, your cost is $175,000 a year.

You might think, so what? Isn’t this just the cost of doing business today? Well think about it for a minute. These costs are more than just money going out for no reason. Disengaged employees are more likely to leave, after you’ve spent a lot of time, energy, and money training them. Actively disengaged employees are likely not to leave but they will drive off the Engaged employees who are getting most of your results.

Whether you’ve got 10, 100, 1,000 or 10,000 employees. Engagement matters! And there are ways you can measure your levels of engagement, help employees get engaged or re-engage and improve the productivity of your workforce. Engagement isn’t free, but it can’t be bought. Start today to reduce your costs and improve the productivity and profit in your business.

About the author

James Joseph Brown, “Jim”, is the founder and principal consultant at Empower Performance Group. He is an Adult Education and Psychometric Assessment expert and committed to helping organizations engage their employees to the highest degree possible. Engagement depends on three key principles; putting the right people in the right positions, developing the skill and competency of leaders, and encouraging personal accountability on the part of all employees. For more information on solutions provided by Jim and Empower Performance Group, please visit [http://www.job-matched.com] or [http://www.trainingthatworks.ca].