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Business Metrics And Employee Engagement: We Have It Backwards

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Successful Businesses Engender Higher Employee Engagement Scores, Not The Other Way Around

by Robert Bacal

In the previous article we explained that employee engagement might cause better business results, but that one alternate explanation of the research findings is that BOTH are affected by another cause, and in fact, have no causal relationship between them.

The Third Interpretation of The EE/Business Results Research

There's yet a third interpretation of the research results here. In fact, in my opinion its actually the most likely explanation why research finds a correlation between many business results, and employee engagement scores.

Successful Businesses Are Better, Happier, More Engaging Places To Work

Imagine that you work for a bakery that has teetered on the brink of bankruptcy. You love baking, and you like the company, but after a year of uncertainty, your stress levels go up and up, it gets harder to go to work in the morning, and beyond all that, your co-workers and boss are also stressed out, volatile, and often upset.

Success breeds engaged employees,not the other way around.The most likely explanation for the correlations between employee engagement and business indicators is that successful businesses are better places to work than failing businesses. Success causes engagement, not the other way around.

Do you think if we measured your engagement levels, we would find them high?

Contrast that with working for a successful and stable business. Sales are great, profit margins are excellent, there have been no staff cuts for a number of years. You even get raises. Generally, people aren't worried about losing their jobs, and neither are you. You feel secure. Unthreatened. Not only that but the company has extra money to spend on training, so you can learn new skills, and develop your career. There are enough staff... you don't feel overworked.

And on and on. You get the picture. What do you think we'd see about your engagement levels if we measured them, and those of your colleagues?

This is such a no brainer issue, it's amazing it's not talked about more. It's a completely plausible explanation for the data showing "a" relationship between EE and business outcomes.

It's far more likely that working in a successful, stable and profitable company causes higher levels of employee engagement, than it is that EE causes business success.

Unfortunately, if you read the many research reports, even from reputable firms, there is little explanation that this is as plausible an explanation -- that business success causes EE improvement, as is the reverse. Is it because the research companies also sell products and services that DEPEND on people believing that EE causes performance?

Note: The research on the relationship between employee engagement and stock prices, often cited as a good reason to improve employee engagement, actually provides evidence that in fact, engagement does NOT make businesses more profitable, but that successful businesses "grow" more engaged staff.

About Company

Bacal & Associates was founded in 1992. Since then Robert has trained thousands of employees to deal with angry, hostile, abusive and potentially violent customers. He has authored over 20 books on various subjects, many published by McGraw-Hill.


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