Employee Engagement
Rita McGee and Ann Rennie
CD24949 prelims.indd 1
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
04/11/2010 09:16
Published by the Chartered Institute of Personnel and Development,
151 The Broadway, London SW19 1JQ
First published 2011
© CIPD 2011
The right of the CIPD to be identified as author of this Work has been asserted by them in accordance with sections 77
and 78 of the Copyright, Designs and Patents Act 1988
Pages marked with the following icon
may be customised, printed out or photocopied and disseminated within the
purchasing organisation. Consultants may also customise, print out or photocopy and disseminate them to clients.
Otherwise, all rights reserved. No part of this publication may in any other circumstances be reproduced, stored in a
retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise,
without the prior written permission of the publisher.
This publication may not be sold, lent, hired out or otherwise dealt with in the course of trade or supplied in any form of
binding or cover other than that in which it is published without the prior written permission of the publisher or a licence
permitting restricted copying in the United Kingdom issued by the Copyright Licensing Agency. No responsibility for loss
occasioned to any person acting or refraining from action as a result of any material in this publication can be accepted by
the editor, author or publisher.
Design by Curve
Typeset by Fakenham Photosetting Ltd, Fakenham, Norfolk
Printed in Great Britain by Antony Rowe Ltd, Chippenham
British Library Cataloguing in Publication Data
A catalogue of this publication is available from the British Library
ISBN-13 978 1 84398 270 8
The views expressed in this publication are the author’s own and may not necessarily reflect those of the CIPD. The CIPD
has made every effort to trace and acknowledge copyright holders. If any source has been overlooked, CIPD Enterprises
would be pleased to redress this for future editions.
Chartered Institute of Personnel and Development
151 The Broadway, London SW19 1JQ
Tel: 020 8612 6200
Email: cipd@cipd.co.uk Website: www.cipd.co.uk
Incorporated by Royal Charter Registered charity No. 1079797
CD24949 prelims.indd 2
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
04/11/2010 09:16
Contents
Introduction
References
vii
xi
Section 1:
The foundations for engagement
Section 1.1: Building block 1 – Exploring the business case for
engagement
How others are making the case for engagement
The metrics
Section 1.2: Building block 2 – Assessment: where are you now?
How to gather data about engagement
Creating your own engagement survey
The employee survey
The managers’ interview
The customer survey
Section 1.3: Building block 3 – Clarifying the foundations for
engagement
Defining the organisation’s purpose
Pitfalls to avoid
The role of values
Creating a values statement
Defining the organisation’s expectations of its employees
Understanding employees’ expectations of the employer
1
Section 2:
Defining the blueprint for success
Section 2.1: Teams and their role in engagement
The motivated team member
Self-managed teams
Virtual work teams
Team reviews
Teamworking strategies that work
Coping strategies – teams under pressure
Fun at work
Section 2.2: The line manager’s role in engagement
Empowering individuals – the CAP model
Building a leadership brand for engagement
3
3
15
35
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
iii
CD24949 prelims.indd 3
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
04/11/2010 09:16
Contents
Key behaviours of management in the engagement process
Managing motivation to enhance engagement
The top team and engagement
Behaviours that derail
Keeping teams motivated and engaged and managing during
times of high stress
Section 2.3: Engaging the key stakeholders
Identifying key relationships and areas for engagement
Employee ‘voice’
Tips for navigating the legal and regulatory area
Section 3:
Move to action – the implementation stage
Section 3.1: Clarifying and explaining the employment ‘contract’
What defines a fair day’s work?
Variables of engagement
Constructing a ‘total compensation’ statement and its links
with engagement
Section 3.2: Recruit for engagement
Is there a ‘right’ type of employee?
What should you look for in a potential recruit in terms of
skills and attitudes?
What can you use to assess a candidate when looking for
attributes that will fuel employee engagement?
The job profile
Individual differences
Section 3.3: Reward and recognition for engagement
An overview of the different methods and types of reward
and their impact on engagement – which ones motivate?
The role of performance management and its link with
engagement
The role of competencies in the engagement arena
Dealing with poor performance while maintaining high
engagement levels
Engaging ‘survivors’
Recognition schemes and linking them to engagement
Section 3.4: Communicate for engagement
Methods and techniques for communicating purpose and
expectations
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
iv
CD24949 prelims.indd 4
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
04/11/2010 09:16
Section 4:
Learning and engagement
Section 4.1: The conditions for engagement
External scenario assessment
The internal focus
Section 4.2: The engaged organisation
The engaged organisation must be a learning organisation
The organisation’s approach to learning and development
Section 4.3: The engaged individual
Induction and engagement
Working with comfort zones – learning agility
Coaching to help people achieve ‘flow’
Energy cycles
Are you keeping your ‘millennials’ happy?
Developing your managers to enhance engagement
Managerial capability self-assessment tool
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
Contents
How to improve your communications channels and processes
Collaboration and communication with employee
representatives
Communicating in times of crisis
v
CD24949 prelims.indd 5
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
04/11/2010 09:16
CD24949 prelims.indd 6
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
04/11/2010 09:16
Two cups of tea
I arrived early, introduced myself then waited for half an hour in reception. Eventually
the receptionist, who didn’t have a record of my name as a new arrival to the
company, told me that no one would be available to show me around and no one was
expecting to meet me. I made my way up to the third floor, where the notice board
indicated my new office was located, and a woman was standing at a reception desk.
I told her I was new then asked her if she would show me where I might be working.
She nodded, but didn’t tell me her name, she went on to enthusiastically greet another
woman who had come up in the lift with me.
introduCtion
Introduction
‘Hello Jill.’
‘Hello Pam.’
‘Hello,’ I said again. ‘I’m Susan.’ Silence. I followed them to a small room with a kettle
and a microwave. They talked about a funeral they had attended, made two cups of
tea for themselves and I followed them to the office.
A little later, my supervisor burst in. ‘Sorry’ he said. ‘Bloody boss had me sorting out his
car insurance. Anyway. I’m sure you’ve made yourself known to everyone.’ All around,
people stared at me blankly. ‘Oh, by the way.’ He added with a laugh. ‘There was a
problem with your CRB check.’ The others gave me an odd look. (The problem turned
out to be the fact that I had used the title Ms instead of Miss on part of the form.)
My new contract had emphasised the ‘on-the-job training’ I would be offered, so I
had a few questions prepared to get the ball rolling. It turned out that the on-the-job
training consisted of getting ‘stuck in’ and asking for help when needed. My first task
was to complete the filing of the incumbent who had used the desk before me.
It took Jill and Pam three days to ask me my name, then three weeks to remember it
correctly. My supervisor, although friendly, was hardly ever around, and had long lunch
hours with his mates. I was forced to ‘make it up as I went along’!
And a cup of coffee
I arrived early, but the building was already filled with lively people. Some were wearing
sports gear, fresh from the gym. Men and women were bringing their children into the
vii
CD24949 prelims.indd 7
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
04/11/2010 09:16
introduCtion
crèche. There was a coffee bar on the ground floor and I joined the queue. I listened
into the conversations around me.
Most were business-related: colleagues ‘sounding out’ before attending a meeting or
putting together a team for a forthcoming project. There were others there, too:
clients, union representatives, even the local MP.
I took my coffee and wandered over to the notice board. It advertised forthcoming
talks that had been organised, on both work and non-work-related topics. There was a
thank you letter from an employee who had run the London Marathon and had raised
a very large sum for charity with the help of her colleagues. Many had ‘cheered her on’
on the day. The president of the company would be giving out awards for ‘Team of the
Year’ the following Friday ‘for the most innovative idea for a new product or service’.
The winners would be treated to an evening at a local restaurant.
A man came up behind me. ‘Susan?’ he asked. ‘Delighted to see you here so early.’ It
was Jim, my supervisor. He bought me another cup of coffee and directed me to a
table. ‘Let me tell you about my plan for today. . .’ He then escorted me to the office
and introduced me to the team. I was to spend time with each of them over the
following days, learning about all aspects of the department. I was given a full induction
and joined them all for a welcome drink on the Friday evening.
So, which of these really happened?
Both, actually. Needless to say, Susan didn’t thrive at the first organisation. Her
colleagues turned out to be very pleasant people, but they were given little opportunity to develop or to enjoy their day-to-day work. As a consequence, they were
unmotivated, kept their heads down and spent their weekdays making plans for the
weekend.
The second organisation was known for having a high level of ‘employee engagement’.
Its regular employee surveys revealed that over 85% felt ‘highly motivated’, and not
just because there was a coffee bar on the ground floor!
The Toolkit
This Toolkit looks at the various components that need to be in place to help to create
the second scenario. It also gives you insights into why so many organisations fall into
the first.
viii
CD24949 prelims.indd 8
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
04/11/2010 09:16
• What are the essential elements that need to exist to engage employees?
• How can HR professionals assist in enabling engagement?
introduCtion
There is a direct link between engagement rates and customer satisfaction, which
is in turn linked to profit or efficiency. Organisational capability efforts will come to
nothing if engagement is low. In order to achieve success, there must be adequate
attention placed on building and then managing engagement. This Toolkit provides an
overview of the latest ideas and approaches to engagement. It helps to answer some
key questions, including:
• Who needs to be involved?
The engaged
company
s
ate
cre
cre
ate
s
The conditions
of engagement
creates
The engaged
employee
The Toolkit is split into four sections:
Section
Section
Section
Section
1:
2:
3:
4:
The foundations for engagement
Define the blueprint for success
Move to action – the implementation stage
Learning and engagement.
Throughout this Toolkit we will explore the concepts of both rational engagement
and emotional engagement. According to the Corporate Leadership Council (2004),
‘Emotional engagement is defined as the extent to which employees derive pride,
enjoyment, inspiration, or meaning from something or someone in the organisation. While
rational commitment is defined as the extent to which employees feel that someone or
something within their organizations provides financial, developmental, or professional
rewards that are in their best interests’ (Corporate Leadership Council 2004).
Sections 1, 2 and 3 focus on key elements of rational engagement. Section 4 is
primarily aimed at supporting your attempts to build emotional engagement.
ix
CD24949 prelims.indd 9
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
04/11/2010 09:16
introduCtion
Access and terms of use for Toolkit tools
You can access the downloadable tools by visiting
www.cipd.co.uk/tsm
If you work in an organisation you can use them as a facilitator with your employees.
The tools can be customised to suit your organisation. For instance you can add your
own logo, insert or delete whole chunks of text or images, and change the formatting
to suit your company branding. If you wish to place the electronic files on a company
intranet or use them across multiple sites/offices, please email publishing@cipd.co.uk
to apply for a multi-user licence.
If you are a consultant you can adapt the tools to the needs of your client for a specific
project. Your client and their employees have the right to keep and reuse the tools for
the lifetime of this project. Unlicensed file-sharing is, of course, a breach of copyright
law
x
CD24949 prelims.indd 10
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
04/11/2010 09:16
ACAS. (no date) Information and consultation of employees [online]. London: Advisory,
Conciliation and Arbitration Service. Available at: http://www.acas.org.uk/index.
aspx?articleid=1598
referenCes
References
ALIMO-METCALFE, B. and ALBAN-METCALFE, R.J. (2008) Selected reports from the
12th World HR Congress, London.
ALIMO-METCALFE, B. and ALBAN-METCALFE, R.J. (2001) The development
of a new transformational leadership questionnaire. Journal of Occupational and
Organisational Psychology. Vol 74. pp1–27.
ALLEN, R. and HELMS, M. (2002) Employee perceptions of relationships between
strategy rewards and organizational performance. Journal of Business Strategies. Vol 19,
No 2. pp115–139.
ASHKENAS, R. (2009) Simply effective: how to cut through complexity in your organisation
and get things done. Boston: Harvard Business School Press.
BAND, D.C. and TUSTIN, C.M. (1995) Strategic downsizing. Management Decision.
Vol 33, No 8. pp36–45.
BERR website: www.berr.gov.uk/policies/employment-matters/rights/info-con
BESTCOMPANIES GROUP website: www.bestcompanies.co.uk
BLESSINGWHITE. (2008) The state of employee engagement – highlights for UK and
Ireland. Skillman, NJ: BlessingWhite.
BLOOM, B.S. (1956). Taxonomy of educational objectives, handbook i: the cognitive
domain. New York: David McKay Co Inc.
BOYLE, M. and COLLINS, J. (2007) Q&A with management guru Jim Collins. Fortune
Magazine. 14 March. Available at: http://money.cnn.com/magazines/fortune/fortune_
archive/2007/02/19/8400260/index.htm
xi
CD24949 prelims.indd 11
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
04/11/2010 09:16
referenCes
BUCKINGHAM, M. and COFFMAN, C. (1999) First, break all the rules: what the
world’s greatest managers do differently. New York: Simon & Schuster.
CAYE, J-M., STACK, P., ORLANDER, P., KILLMANN, J., ESPINOSA, E.G., FRANCOEUR,
F. and HAEN, P. (2010) Creating a new deal for middle managers: empowering a
neglected but critical group.- The Boston Consulting Group and World Federation of
People Management Associations July 2010
CIPD. (2010) Employee voice [online]. Factsheet. London: Chartered Institute of
Personnel and Development. Available at: http://www.cipd.co.uk/factsheets
CIPD. (2010) European works councils [online]. Factsheet. London: Chartered Institute
of Personnel and Development. Available at: http://www.cipd.co.uk/factsheets
CIPD. (2010) Voice and engagement: how does collective consultation contribute? Research
insight. London: Chartered Institute of Personnel and Development.
COLLINS, J.C. and PORRAS, J.I. (2005) Built to last: successful habits of visionary
companies. New York: Random House Business Books.
CORPORATE EXECUTIVE BOARD. (2007) The communication style quadrants.
Research from the Finance Leadership Academy. Arlington, VA: Corporate Executive
Board.
CORPORATE LEADERSHIP COUNCIL. (2004) Driving performance and retention
through employee engagement. Arlington, VA: Corporate Executive Board.
CSIKSZENTMIHALYI, M. (1990) Flow: the psychology of optimal experience. New York:
Harper Collins.
DEPARTMENT FOR BUSINESS, INNOVATIONS AND SKILLS. (2006) Information
and Consultation of Employees 2004, DTI guidance. London: The Stationery Office.
DEWHURST, M., GUTHRIDGE, M. and MOHR, E. (2009) Motivating people: getting
beyond money. McKinsey Quarterly: Organization Practice. November.
DUNDON, T. and GOLLAN, P. (2007) Re-conceptualizing voice in the non-union
workplace. International Journal of Human Resource Management. Vol 18, No 7, July.
pp1182–1198.
xii
CD24949 prelims.indd 12
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
04/11/2010 09:16
EEF/CPH. (2009) EEF/CPH consulting employment survey 2009: report on union recognition/membership and the employee relations climate. Gateshead: EEF.
referenCes
DUNDON, T., WILKINSON, A. and MARCHINGTON, M. (2004) The meanings
and purpose of employee voice. International Journal of Human Resource Management.
Vol 15, No 6, September. pp1149–1170.
ENGELS, F. (1881) A fair day’s work. Labour Standard.
GERACI, J., DOVER, M. and DA SILVA, I. (2008) Talent 2.0: insights from nGenera
proprietary survey research. Austin, TX: nGenera Corporation.
GIBBONS, J. (2006) Employee engagement: a review of current research and its implications. New York: The Conference Board.
HAY GROUP and WORLDATWORK. (2009) Reward next practices survey. Philadelphia:
Hay Group.
HERSHEY, P. (1985) The situational leader. New York: Warner Books.
HERSHEY, P. and BLANCHARD, K.H. (2007) Management of organizational behavior:
utilizing human resources (9th ed.). New Jersey: Prentice Hall.
HEWITT ASSOCIATES. (2009) Hewitt’s 2009 global HR study: managing HR on a global
scale. Lincolnshire, Illinois: Hewitt Associates.
JACKINS, H. (1970) Fundamentals of co-counselling manual. Seattle: Rational Island.
JENSEN, D., MCMULLEN, T. and STARK, M. (2007) The manager’s guide to reward.
Philadelphia: Hay Group.
KATZENBACH, J. and SMITH, D. (1993) The wisdom of teams. Boston: Harvard
Business School Press.
KIM, W-B. (2003) Economic crisis, downsizing and ‘layoff survivor’s syndrome’. Journal
of Contemporary Asia. Vol 33, No 4. pp449–464.
LENCIONI, P.M. (2002) Make your values mean something. Harvard Business Review.
1 July.
xiii
CD24949 prelims.indd 13
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
04/11/2010 09:16
referenCes
LOMBARDO, M.M. and EICHINGER, R.W. (2001) The leadership machine: architecture
to develop leaders for any future. 3rd ed. Minneapolis, MN: Lominger
MACEY, W.H. and SCHNEIDER, B. (2008) The meaning of employee engagement.
Industrial and Organizational Psychology. Vol 1, No 1. pp3–30.
MACLEOD, D. and CLARKE, N. (2009) Engaging for success: enhancing performance
through employee engagement. Report commissioned by the Department for Business,
Innovation and Skills. London: The Stationery Office.
MARITZ RESEARCH. (2005) Maritz poll: bosses not ‘on the same page’ as employees
regarding recognition. St Louis: Maritz Research.
MONE, M. and LONDON, M. (2009) Employee engagement through effective performance management. London: Routledge Academic.
SELIGMAN, M. (no date) Questionnaires on authentic happiness. Penn State University.
Available at: http://www.authentichappiness.sas.upenn.edu/Default.aspx
SENGE, P.M. (1990) The fifth discipline: the art and practice of the learning organization.
London: Random House.
SHAH, P.P. (2000) Network destruction: the cultural implications of downsizing. The
Academy of Management Journal. Vol 43, No 1. pp101–112.
SLOMAN, M. (2003) Training in the age of the learner. London: Chartered Institute of
Personnel and Development.
TAMKIN, P., PEARSON, G., HIRSH, W. and CONSTABLE, S. (2010) Exceeding expectations: the principles of outstanding leadership. London: The Work Foundation.
TOWERS PERRIN. (2009) Turbocharging employee engagement: the power of recognition
from managers. Part 2 – the circle of recognition. New York: Towers Perrin.
TOWERS WATSON. (2010) The new employment deal: how far, how fast and how
enduring: insights from Towers Watson’s 2010 global workforce study. New York: Towers
Watson.
xiv
CD24949 prelims.indd 14
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
04/11/2010 09:16
VENTRICE, C. (2009) Make their day! Employee Recognition that works. 2nd ed. San
Francisco, CA: Berrett-Koehler.
referenCes
TRUSS, C., SOANE, E., EDWARDS, C., WISDOM, K., CROLL, A., and BURNETT,
J. (2006) Working life: employee attitudes and engagement. Research report. London:
Chartered Institute of Personnel and Development.
WALTON, S. (1993) Made in America: my story. New York: Random House.
WATSON WYATT. (2006–07) WorkUSA survey. Washington, DC: Watson Wyatt.
WATSON WYATT. (2004) Connecting organisational communication to financial performance – 2003/2004 communication ROI study . Washington, DC: Watson Wyatt.
WYSOCKI, A.F. and KEPNE, K.W. (2001) EDIS document HR 009. A publication
of the Department of Food and Resource Economics, Florida Cooperative
Extension Service, Institute of Food and Agricultural Sciences, University of Florida,
Gainesville, FL.
xv
CD24949 prelims.indd 15
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
04/11/2010 09:16
CD24949 prelims.indd 16
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
04/11/2010 09:16
‘People are like electricity, of no use unless switched on.’
Professor Peter Drucker
While preparing to write this Toolkit, many people gave us very helpful advice. It
was apparent that everyone has their own view about what makes for a high level
of employee engagement. The one point they all agreed on, however, was: we know
employee engagement is vital to competitive advantage; it is for the most part excruciatingly difficult to get all of the pieces in place at once. On the face of it, it is not
complex, since we all seem to recognise it when it exists, so why is it so hard to
achieve?
It seems that there has to be a set of basic ‘building blocks’ before any kind of interventions can be made to enhance engagement. The Tools in this section focus on
these building blocks.
The foundaTions for engagemenT
Section 1:
The foundations for
engagement
The first building block (Section 1.1) is to make the case for engagement. You know
that engagement is important; we know that because you have purchased this Toolkit.
The tools in the first step are to help you make the business case to others.
The second building block (Section 1.2) is then to assess where you are starting from.
We include some assessment tools that will help you to identify where your organisation is now in relation to some of the key aspects of engagement.
The third building block (Section 1.3) is to lay some foundations for building
engagement. Here we consider organisational purpose and values and explain how
these can help or hinder the engagement process.
Finally, we then turn to the tricky issue of clarifying expectations – yours of the
employees and the employees’ expectations of the organisation. Often there is a
gap between these two perspectives, which can be a major barrier for addressing
concerns about employee engagement.
1
CD24949 section1.indd 1
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
02/11/2010 13:46
The foundaTions for engagemenT
What are the benefits of making changes?
‘Great companies consistently outperform the FTSE All Share. Over the past
five years the best companies would have earned an investor a compounded
annual return of 12.1 percent, compared with 5.8 percent decline in the FTSE
All Share index as a whole.’
Source: Sunday Times 100 Best Companies to Work For list, 2003, Statistics by Frank
Russell Company.
2
CD24949 section1.indd 2
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
02/11/2010 13:46
Tool 1
How others are making the
case for engagement
Facilitator’s notes
Introduction
We have gathered a few examples here of research into employee engagement. These
will date, so you will need to seek new and updated versions over time. This Tool is
therefore an overview of current thinking, with the PowerPoint slides provided for
you to make presentations to your organisation. There is also a summary of important
research and where to find it so that you can build a tailored presentation. You can
also use the sources to keep yourself up to date with current thinking.
Aim of the Tool
To provide a source of current business cases for employee engagement with access
to an online forum.
Materials needed
Your own data on employee engagement, which, when combined with our slides, can
be used to create a tailored business case.
Building Block 1 – exploring The Business case for engagemenT
Section 1.1
Building block 1 – Exploring
the business case for
engagement
3
CD24949 section1.indd 3
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
02/11/2010 13:46
Building Block 1 – exploring The Business case for engagemenT
Procedure
Working on your own or with a small group, consider the data presented below.
You may want to explore:
• how this compares to your own situation
• the potential benefits to you or your organisation of making a positive change
• what data you still need to gather.
Create your own presentation to make the case for engagement.
Evaluating its use
Have you been able to convince your organisation to make changes? How have you
impacted commitment, engagement, retention, profit?
4
CD24949 section1.indd 4
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
02/11/2010 13:46
Business case 1
Lousy bosses can kill you
The research
We start with the most extreme case, which was presented in a McKinsey company
newsletter in August 2010.
Lousy bosses can kill you – literally •  A 2009 Swedish study tracking 3,122 men for ten years found that those with bad bosses suffered 20–40% more heart aQacks than those with good bosses. •  Bosses maQer: more than 95% of all people in the workforce have bosses, are bosses, or both. The Business case for employee engagemenT
The Tool
The business case for
employee engagement
•  Source: McKinsey 5
This document can be downloaded as a Word document from http://www.cipd.co.uk/tsm, copyright © CIPD. Please use or
adapt this document in line with our terms of use: http://www.cipd.co.uk/Bookstore/onlineresources/termsofuse.
CD24949 section1.indd 5
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
02/11/2010 13:46
Building Block 1 – exploring The Business case for engagemenT
Notes
This then leads us to a particularly tricky issue: line managers are critical to employee
engagement. They can derail your work if they are not capable. In fact, a Swedish
study found that they can actually be much more harmful. The following extract was
reported by McKinsey (2010):
Bosses matter. They matter because more than 95 percent of all people in the
workforce have bosses, are bosses, or both. They matter because they set the tone for
their followers and organisations. And they matter because many studies show that
for more than 75 percent of employees, dealing with their immediate boss is the most
stressful part of the job.
Bosses matter to everyone they oversee, but they matter most to those just beneath
them in the pecking order: the people they guide at close range, who constantly tangle
with the boss’s virtues, foibles, and quirks. Whether you are the CEO of a Fortune
500 company or the head chef at a restaurant, your success depends on staying in
tune with the people you interact with most frequently and intensely.
6
This document can be downloaded as a Word document from http://www.cipd.co.uk/tsm, copyright © CIPD. Please use or
adapt this document in line with our terms of use: http://www.cipd.co.uk/Bookstore/onlineresources/termsofuse.
CD24949 section1.indd 6
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
02/11/2010 13:46
The recession’s impact on engagement
The research
There are conflicting sources of data on this subject and both were produced in
2010. The earlier research in February indicated that the recession had not impacted
engagement and we refer to this in the Introduction.
The later research, which was presented in November, indicates a different picture. As
with all data, consider it and then use it to help you determine what to look for in your
sector to see what the real picture is for your organisation. This Tool includes the later
research by the Boston Consulting Group in association with the World Federation of
People Management Associations (WFPMA) and the European Association for People
Management (EAPM) (Caye et al 2010).
When we consider the conflicting reports, it may be worth remembering the two
types of engagement expressed in the Introduction: emotional engagement – the
extent to which employees derive pride, enjoyment, inspiration, or meaning from
something or someone in the organisation; and rational engagement – the extent to
which employees feel that someone or something within their organisation provides
financial, developmental or professional rewards that are in their best interests. The
CIPD research that indicated no change to engagement is more focused on rational
engagement. The BCG research included below seems to focus more on emotional
engagement.
The Business case for employee engagemenT
Business case 2
7
This document can be downloaded as a Word document from http://www.cipd.co.uk/tsm, copyright © CIPD. Please use or
adapt this document in line with our terms of use: http://www.cipd.co.uk/Bookstore/onlineresources/termsofuse.
CD24949 section1.indd 7
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
02/11/2010 13:46
Building Block 1 – exploring The Business case for engagemenT
One-­‐third of companies troubled by low employee engagement (BCG & WFPMA) •  Employee engagement – the willingness of workers to go the extra mile at work – took a big hit during the recession and has not bounced back. Research conducted by the Boston Consul>ng Group (BCG) and World Federa>on of People Management Associa>ons (WFPMA)/European Associa>on for People Management (EAPM) (2010) Six areas of disengagement 1.  structured career management that recognises appropriate behaviours 2.  clear consequences for individuals not living the company values 3.  performance linked to compensa\on 4.  managers ac\ng as ‘resources’ or coaches 5.  training and development for people management prac\ces 6.  recogni\on beyond compensa\on BCG-­‐WFPMA/EAPM (2010) 8
This document can be downloaded as a Word document from http://www.cipd.co.uk/tsm, copyright © CIPD. Please use or
adapt this document in line with our terms of use: http://www.cipd.co.uk/Bookstore/onlineresources/termsofuse.
CD24949 section1.indd 8
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
02/11/2010 13:46
First: The recession damaged engagement in three areas closely related to the six problem spots: –  performance management: the processes and systems that set targets, collect feedback, and link ac\ons to results –  recogni\on: formalised ways of acknowledging and rewarding strong performance –  people manager capabili\es: people skills and leadership behaviours through the organisa\on BCG-­‐WFPMA/EAPM (2010) Two overarching conclusions Second: The decline in scores was most drama\c among middle managers: –  Between 2007 and 2009, their engagement as it relates to performance management and recogni\on dropped by 14%, and by 10% in the people-­‐manager dimension. The Business case for employee engagemenT
Two overarching conclusions BCG-­‐WFPMA/EAPM (2010) 9
This document can be downloaded as a Word document from http://www.cipd.co.uk/tsm, copyright © CIPD. Please use or
adapt this document in line with our terms of use: http://www.cipd.co.uk/Bookstore/onlineresources/termsofuse.
CD24949 section1.indd 9
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
02/11/2010 13:46
Building Block 1 – exploring The Business case for engagemenT
Business case 3
Engagement differs amongst industries
The research
The third case relates to engagement levels by sector and industry. We were trying
to understand if engagement levels differed by profession and this is the research that
came nearest to our requirement. It makes for very interesting reading – particularly
when we consider that most employee engagement projects will be initiated by HR or
external consulting firms.
Blessing White research 2008 •  Sectors with the largest number of engaged employees are: –  HR consulDng and training (46%) –  Energy/uDliDes (40%) –  Legal and business services (34%) –  AssociaDon/not-­‐for-­‐profit (34%) 10
This document can be downloaded as a Word document from http://www.cipd.co.uk/tsm, copyright © CIPD. Please use or
adapt this document in line with our terms of use: http://www.cipd.co.uk/Bookstore/onlineresources/termsofuse.
CD24949 section1.indd 10
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
02/11/2010 13:46
•  Industries with the fewest number of engaged staff are: –  Academia or higher educaDon (23%) –  High technology (24%) –  Chemicals (24%) –  Retail (24%) –  Government (25%) The Business case for employee engagemenT
Blessing White research 2008 11
This document can be downloaded as a Word document from http://www.cipd.co.uk/tsm, copyright © CIPD. Please use or
adapt this document in line with our terms of use: http://www.cipd.co.uk/Bookstore/onlineresources/termsofuse.
CD24949 section1.indd 11
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
02/11/2010 13:46
Building Block 1 – exploring The Business case for engagemenT
Business case 4
Every engaged employee is worth about $5,000 in
additional profit
The research
Hewitt Associates (2009) estimates that every ‘engaged’ employee is worth about
$5,000 each year in additional profit. Its research shows that companies that score 60%
or higher have an average five-year shareholder return of 20.2%.
Of the key levers that determine employee engagement, 22 of the top 25 directly
involve manager-led activities. Overall, these manager-led activities have the potential
to impact employee discretionary effort by 20% or more.
These manager-led activities fall into two major categories: managing employee
job performance and managing an employee’s relationship with the organisation.
Specifically, the top ten management-led activities that leverage engagement are:
Management activity
Percent impact on
discretionary effort
Employees understand the connection between work and
organisational strategy
32.8
Employees understand the importance of their jobs to
organisational success
30.3
Internal communication
29.2
Manager demonstrates strong commitment to diversity
28.5
Manager demonstrates honesty and integrity
27.9
Manager adapts to changing circumstances
27.6
Manager clearly articulates organisational goals
27.6
Manager possesses needed job skills
27.2
Manager sets realistic performance expectations
27.1
Manager puts the right people in the right roles at the right time
26.9
12
This document can be downloaded as a Word document from http://www.cipd.co.uk/tsm, copyright © CIPD. Please use or
adapt this document in line with our terms of use: http://www.cipd.co.uk/Bookstore/onlineresources/termsofuse.
CD24949 section1.indd 12
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
02/11/2010 13:46
The 10:6:2 and the 10:9 rules
The research
Employee commitment has a positive impact on discretionary effort, performance and
retention (Corporate Leadership Council 2006).
Highly engaged employees provide as much as 57% more discretionary effort than the
disengaged.
Highly committed employees will seek ways to improve the effectiveness of their work.
Increasing employee discretionary effort from the lowest level to a high level improves
performance by as much as 20%. Remember the 10:6:2 rule: a 10% improvement in
engagement results in a 6% improvement in discretionary effort, which delivers a 2%
improvement in performance.
Survey data and analysis from the CLC suggests that employee commitment directly
impacts retention. This is captured as the 10:9 ‘rule’: every 10% improvement in
commitment will decrease the probability of departure by 9%.
The Business case for employee engagemenT
Business case 5
13
This document can be downloaded as a Word document from http://www.cipd.co.uk/tsm, copyright © CIPD. Please use or
adapt this document in line with our terms of use: http://www.cipd.co.uk/Bookstore/onlineresources/termsofuse.
CD24949 section1.indd 13
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
02/11/2010 13:46
Building Block 1 – exploring The Business case for engagemenT
Business case 6
There must be alignment between business strategy and
engagement to achieve performance improvements
The research
Engagement correlates with business
Top 25%
27.6%
Alignment
index
Middle 50%
14.9%
15.9%
21%
Three year
performance
differentials
6.7%
Bottom 25%
Bottom 25%
Middle 50%
Commitment index
Top 25%
Vicky Wright
Figure 1.1: Engagement correlates with business strategy
Engagement without alignment will not result in higher performance. You need a
combination of the two. This London Business School research indicated that if you
had both alignment and commitment you could expect to see a 27.6% performance
differential over three years. This data was presented to the CIPD Annual Conference
in October 2006 by Vicky Wright of the London Business School (and Honorary
Chair of the CIPD until November 2010).
On the face of it, this is a very simple finding. However, many engagement projects fail
to deliver performance improvements. This failure is most likely to be because of a
lack of alignment with the business strategy (see Tool 9).
14
This document can be downloaded as a Word document from http://www.cipd.co.uk/tsm, copyright © CIPD. Please use or
adapt this document in line with our terms of use: http://www.cipd.co.uk/Bookstore/onlineresources/termsofuse.
CD24949 section1.indd 14
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
02/11/2010 13:46
The meTrics
Tool 2
The metrics
Facilitator’s notes
Introduction
How do you measure your success in building engagement (which is, in essence, an intangible asset)? Well, it is difficult but it is not impossible. This Tool will provide you with some
tools to help you do just that. It starts with an overview of the key areas for the collection
of data. It also provides a document to help you track your performance over time.
It is important to identify a few key measures that are pivotal in your context. If
you try to measure too many variables, energy will be dissipated into measurement
rather than delivery. In one organisation, we found that if they stopped measuring for
a year they would free up the equivalent of ten full-time employees. It is crucial for
your credibility and that of the engagement work that you are selective about what
to measure and how to report. We offer two methods here. The first is a straight
multiple-choice tool – we offer you suggestions but you select ones that will work
in your environment. The second tool may at first look like you are justifying your
existence (or the existence of the engagement working party); don’t be deterred by
this. The tool is intended to show the opportunity cost and is helpful for you when
making your business case, as mentioned earlier.
Selecting the right metric is important. Communicating the metrics can be a fraught
affair. Think about how and what you will communicate to key stakeholders. When we
visit organisations, we look to see if they have posted their metrics and their progress
against them. We also do a reality check: how does the metric compare with our
experience?
There is an airport we both frequent and sometimes we have an exceptional
experience. Many times, the experience is less than satisfactory either because the
queues are lengthy, staff are unhelpful or there may be inadequate areas for us to be
able to use our laptops. None of these things appear on the airport’s key performance
indicator list. Two of them are linked to employee engagement and if improved would
really enhance the flying experience.
15
CD24949 section1.indd 15
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
02/11/2010 13:46
Building Block 1 – exploring The Business case for engagemenT
Metrics you may wish to consider include:
• absence
• strikes or other industrial action
• participation rates
• health and safety issues
• return on investment
• profit
• turnover
• customer satisfaction
• goal achievement
• market segmentation
• output rates
• quality rates
• cost-effectiveness
• additional metrics for the public sector in particular include: response rates, cost
savings, sustainability and particular key targets, such as beds filled in hospitals,
levels of education achieved, and so on.
A word of caution
Best practice in one organisation is not necessarily best practice. Look for good
practices and adapt what others use to your context. Look for analogous organisations
with which to compare yourselves. You do not always need to benchmark against your
competitors. Best practice adopted unskilfully may end up being worst practice in your
organisation.
Aim of the Tool
To provide you with a starting point for identifying the key metrics for your organisation. We provide a series of metrics you can use, as appropriate. For a number of
the more complex ones, we offer some methods for calculating them.
16
CD24949 section1.indd 16
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
02/11/2010 13:46
You will need outputs from the assessment section below and other data on key areas
of organisational activity or experience.
Procedure
With a group of key stakeholders, identify the key metrics that would indicate you are
making progress. Consider involving your customers in the selection of key metrics. Be
sure you measure what is important to them.
The meTrics
Materials needed
Assess your current situation and identify where you are in relation to the external
data.
Try to put a value on an improvement in any metric selected. This may be an estimate
at first, but over time you will be more able to pinpoint actual cost or benefit as your
measurement techniques improve.
Communicate the metrics to key stakeholders in a way that engages each of them.
Evaluating its use
Are you better informed about the progress your organisation is making? What are
the trends or patterns and are these improving?
17
CD24949 section1.indd 17
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
02/11/2010 13:46
Building Block 1 – exploring The Business case for engagemenT
The metrics – selection grid
Metrics
A standard (with some
examples)
Absence
6.4 days per annum (2009)
down from 6.7 (2008)
Why use this?
Your
current
measures
Target
for this
year with
the cost
benefit of
achieving it
It may be an indicator
of disengagement,
Cost per employee per annum particularly if you have
high absence of one or
£595 (2009)
two days’ duration.
Absence cost varies
Loss of productivity
considerably by
is seen as the single
sector, with direct costs in the
most important cost
public sector 50% higher on
of absence, followed
average than in
by the cost of sick pay
the private sector.
itself and the cost of
The indirect costs of absence staff to cover for those
are harder for organisations to who are absent.
measure
Make sure you have
but they are substantial, on
average totalling £465 per
employee (see Source 4).
identified the number
of days on average
per employee per
annum, the actual cost
plus the indirect costs
of absence and any
changes to productivity
levels.
A one-day change
can mean a significant
improvement in
cost management.
Triangulate your
absence rates with
your engagement
rates to see if you can
identify a relationship.
18
CD24949 section1.indd 18
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
02/11/2010 13:46
A standard (with some
examples)
Why use this?
Absence
– Bradford
Indicator
Bradford Indicator
Use this tool to help
you pinpoint the
impact of short-term
absence. If you attach
a cost to the ratio, you
will start to see that
short-term absence
is a major cost to the
organisation. Any steps
taken to improve it and
reduce it will have an
exponential impact.
This is a formula, devised by
the University of Bradford to
take account of the disruptive
effect of frequent short
absences as well as long-term
absence.
The Bradford Index formula is:
S 3 S 3 D 5 (INDEX)
Where:
S is the number of occasions
(spells) of absence and
Your
current
measures
Target
for this
year with
the cost
benefit of
achieving it
The meTrics
Metrics
D is the total number of days
absent.
For example:
Five absences of one or two
days (211121211) gives
S 5 5, and D 5 8.
Thus (5 3 5 3 8) 5 200
A single long absence of six
weeks (30 days) scores
1 3 1 3 30 5 30
But if that person had another
absence of three days, the new
calculation would show:
2 3 2 3 33 5 132
Cost savings
19
CD24949 section1.indd 19
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
02/11/2010 13:46
Building Block 1 – exploring The Business case for engagemenT
Metrics
A standard (with some
examples)
Why use this?
Cost of
recruitment
Identify the average cost of
recruitment per employee.
Customer
loyalty
Customer appraisal key
performance indicator
(KPI)
As engagement
increases so does
retention, which should
mean your costs
for recruitment will
decrease over time.
Identify the cost to
your business to attract
one new customer.
1 % sales turnover of new
customers:
• this rate 5 turnover from
new customers / total sales
• The rate indicates what
percentage of increased
sales of the company is
from new customers.
Your
current
measures
Target
for this
year with
the cost
benefit of
achieving it
Consider the cost
to build a strong
relationship.
Now estimate the cost
of losing that customer
and replacing them.
Employee engagement
should result in
higher customer
2 Number of new
engagement, loyalty
customers
and satisfaction. This
• this rate 5 number of new
should then result in
customers / total customers
higher sales over time.
3 The average sales per
If your organisation
customer per year
does not focus on
• this rate 5 total sales / total sales or revenue, you
customers
may want to consider
• The rate lets you know how the impact a new
customer has on your
much sales turnover you
gained from each customer. business – pinpoint the
cost and identify other
• Do you have any methods
indicators that do
to increase revenue per
apply, such as return
customer or not?
visits.
20
CD24949 section1.indd 20
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
02/11/2010 13:46
A standard (with some
examples)
Why use this?
Your
current
measures
4 Average sale per VIP
customer
• this rate 5 total VIP sales /
total VIP customers
Target
for this
year with
the cost
benefit of
achieving it
The meTrics
Metrics
• Compare this ratio to
average sales per customer.
5 The rate of profit of a
customer
• this rate 5 net profit / total
customers
• The rate lets you know
the average profit that is
created by a customer.
Goals
achieved
Health and
safety issues
• This makes customer care
policies more relevant, once
you know better which
customers bring you more
profits.
Establish a priority list and
Publish these goals and
monitor achievement rates
progress against them
over time.
in prominent places for
employees and clients
to see.
Number of workplace
Employee commitment
fatalities: Q1 2010 total
(both rational and
employees 5 31 and members emotional) is required
of public 5 15
if you wish to create
Average days lost per worker a safe working
environment.
for illness and injury 5 1.24
Average days lost per case
5 15.9 (refers to persons
suffering from a workplace
injury or a particular type
of work-related illness) (see
Source 7).
High levels of
disengagement can
relate to misconduct,
which could result in
negligence (intentional
or otherwise).
21
CD24949 section1.indd 21
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
02/11/2010 13:46
Building Block 1 – exploring The Business case for engagemenT
Metrics
A standard (with some
examples)
Human
capital
Human capital return on
investment (ROI)
Inventory
and delivery
ratios
Why use this?
Your
current
measures
Target
for this
year with
the cost
benefit of
achieving it
Revenue 5 (operating
expense – [compensation
cost 1 benefit costs 1 other
related employee costs) /
(compensation cost 1 benefit
cost)
Lead time
Engagement is about
commitment and
Lead time is the amount of
time from when the product is energy. Higher levels
ordered to when it is delivered of commitment
should result in better
to the customer. Shortening
inventory and delivery
lead times can improve sales
ratios, which in turn
by increasing the number
will result in higher
of total available selling days
customer loyalty.
within the product’s selling
season.
Variability (customer
order fill rate & cycle
times)
Cost of goods sold (COGS) /
average Inventory during the
period
The optimal inventory
turnover is a fine balance
between fulfilling customer
service commitments and
minimising inventory carrying
costs.
Sales / average inventory
during the period
The inventory turnover ratio
is often calculated by dividing
sales (rather than cost of
goods sold) by the average
inventory for the period (see
Source 5).
22
CD24949 section1.indd 22
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
02/11/2010 13:46
A standard (with some
examples)
Labour
costs to net
income
Labour cost to net income 5
(salaries, wages and benefits) /
net income
Why use this?
Your
current
measures
This can be used as a
starting point for you.
What are the levels
This ratio measures the extent you currently achieve
to which labour costs (number and what is the impact
of employees 3 average wage over time?
The intention is to
and benefit per employee)
increase net income to
affect net income.
labour costs.
This ratio indicates the
Target
for this
year with
the cost
benefit of
achieving it
The meTrics
Metrics
extent to which a reduction
in unproductive labour (as
a percentage of total labour
costs) may increase net
income.
Labour
turnover
How many people leave your
organisation in the:
• first six months
• first year
• first two years
• or, after three years?
Market
segmentation
Output rates
Participation (See Source 3.)
rates
See Bank of England report.
Pay
Average weekly rate £431
(excl. bonus)
1.8% increase (2009–10)
How does your weekly
or hourly rate compare
with the average?
Is there a difference
between the rates
Women’s hourly rate is £11.39
of men and women?
and men’s is £12.97 (2009)
What action are you
(See Source 2.)
taking to close the gap?
(See Source 1.)
A perception of
unfairness in pay rates
is a major source of
disengagement.
Profit
Quality rates
23
CD24949 section1.indd 23
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
02/11/2010 13:46
Building Block 1 – exploring The Business case for engagemenT
Metrics
A standard (with some
examples)
Response
rates
This can include both response
rates to surveys, marketing
campaigns and viewer ‘hits’ on
an organisation’s website; also,
in a different sense, response
rates in answering customer
queries or responding to
complaints or problems.
Redundancy intentions are
highest in local government
(63%) and education (45%).
Manufacturing and production
employers are least likely to
make redundancies (23%),
in line with the spring survey
findings and well below
the trends reported during
the recession. Redundancy
intentions are highest in the
north of England (35%),
London (28%), the south-east
of England (42%) and Scotland
(38%).
Redundancy
Why use this?
Your
current
measures
Target
for this
year with
the cost
benefit of
achieving it
Redundancy has a
negative impact on
employee engagement.
If you are planning to
make redundancies
at the same time
as working on
engagement, you must
ensure you initiate
survivor workshops
and engage as many
employees as possible
in the consultation
about the future
state. One deep cut is
better than many small
Those organisations that are
planning to make redundancies (salami-type) slices.
expect to make 5.5% of their
workforce redundant on
average, up from 3.6% in the
spring report. This is, however,
still lower than the 6.2%
average recorded in the winter
report (see Source 6).
24
CD24949 section1.indd 24
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
02/11/2010 13:46
A standard (with some
examples)
Return on
investment
(ROI)
ROI is a performance
measure used to evaluate the
efficiency of any investment
or to compare investments.
To calculate ROI, the benefit
(return) of an investment
is divided by the cost of
the investment; the result is
expressed as a percentage or
a ratio. Why use this?
Your
current
measures
Target
for this
year with
the cost
benefit of
achieving it
The meTrics
Metrics
The return on investment
formula:
ROI 5 gain from investment
– cost of the investment / cost
of the investment
Return on investment is a very
popular metric because of its
versatility and simplicity
(see Source 8).
Sales/revenue If you measure this over time, The reason you are
per employee you would hope to see an
embarking on work
ratio
increase in sales per employee. on engagement is to
improve revenue (if
The formula is:
in the private sector
Revenue ratio 5 sales /
and some parts of the
number of people employed
public sector). Use this
In organisations that are
ratio to ensure you are
labour-intensive, the ratio will making a difference.
be smaller than in less labour- You should use this as
intensive organisations.
a long-term metric –
things may get worse
before they get better
– it’s called the lag
effect and is very real.
So longer-term studies
will help you to make
the case.
25
CD24949 section1.indd 25
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
02/11/2010 13:46
Building Block 1 – exploring The Business case for engagemenT
Metrics
A standard (with some
examples)
Span of
control
Average span of control within When a span of
the organisation/department.
control becomes
Span of control is the number too large, it can limit
of people directly reporting to the growth of an
organisation. Even the
one manager.
best managers tend to
lose their effectiveness
when they spend all
of their time managing
people and their issues
and will be unable to
focus on long-term
plans and competitive
positioning for the
business as a whole.
Employee engagement
can suffer if employees
do not have regular
access to managers
who don’t have time
for them because of
the wide spans of
control.
In the UK in 2009, 435,000
days were lost to industrial
action, which equates to 19
days per 1,000 employees.
Strikes
or other
industrial
action
Why use this?
Your
current
measures
Target
for this
year with
the cost
benefit of
achieving it
Average cost per day of a
strike varies by sector: British
Airways estimate the cost to
be £7 million per day.
Rail strikes cost the economy
of the UK an estimated £600
million per day.
26
CD24949 section1.indd 26
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
02/11/2010 13:46
A standard (with some
examples)
Why use this?
Social
responsibility
This is increasingly important.
What percentage of your
income is spent in the
community? How much time
do you allow for staff to
pursue their interests in this
field?
The latest generation
to join the workforce
are increasingly
interested in defining
how their work serves
a greater purpose.
Tenure
Turnover
Your
current
measures
Target
for this
year with
the cost
benefit of
achieving it
The meTrics
Metrics
If you wish to increase
engagement rates,
you may need to take
action to ensure you
are at the leading
edge on this metric.
Review the work
undertaken by some
of the best companies
or employer of choice
organisations.
Total tenure of employees (for
example, in years) divided by
the number of employees
Employee turnover
Note that direct costs
might include the costs
Example:
of recruitment, training,
• Number of employees:
cost of supervision and
1,000
administration, salary
• Annual turnover: 30%
and benefits, plus
• Number of employees
the costs of any exit
turning over: 300
package.
• Average turnover cost per
employee: £2,000
• Total annual cost: £600,000
• Savings from reducing
turnover by 10% to 20% is:
£100,000
27
CD24949 section1.indd 27
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
02/11/2010 13:46
Building Block 1 – exploring The Business case for engagemenT
Metrics
A standard (with some
examples)
Why use this?
Labour turnover
For a more
sophisticated
calculation, and one that
links more closely to
employee engagement,
you can also add in
‘indirect’ costs – more
difficult to calculate,
but these can add up
to as much as two to
six times the cost of
direct costs, and could
include the additional
costs of disruption,
cost of reduced morale
and productivity, and
the administration
involved in managing
a non-performing
employee out of the
organisation.
How many people leave your
organisation in the:
• first six months
• first year
• first two years
• or, after three years?
Your
current
measures
Target
for this
year with
the cost
benefit of
achieving it
Source notes
1 http://www.statistics.gov.uk/StatBase/Product.asp?vlnk51944
2 http://www.statistics.gov.uk/cci/article.asp?ID52370
3 http://www.bankofengland.co.uk/publications/inflationreport/irlatest.htm
4 http://www.cbi.org.uk/searchresults.shtml?cx5007280629144655152682%3A32gtai0mswu&cof5F
ORID%3A11&q5absence1survey#1040
5 Microsoft business solutions
6 CIPD survey reports Labour Market Outlook http://www.cipd.co.uk/subjects/hrpract/hrtrends/_
qtrends.htm?vanity5/labourmarketoutlook
7 http://www.hse.gov.uk/statistics/lfs/0809/swit1.htm
8 http://www.investopedia.com/terms/r/returnoninvestment.asp
28
CD24949 section1.indd 28
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
02/11/2010 13:46
The impact of HR tasks and their financial value to the
organisation
Key tasks/
activities
Impact if taken away/put on hold
Estimated
financial value to
the organisation
(an example)
HR strategic input
• lack of strategic alignment between the
organisation’s people management practices
and investment in L&D with achievement of
organisational goals and ambitions; relegation
of HR to a primarily transactional and reactive
function
Savings on
external
consultancy
projects and legal
fees per year
estimated at
£15,000
• inability to read, network, benchmark to
assess current performance against future
potential
• loss of the strategic direction and
co-ordination of all aspects of HR and staff
development to facilitate effective talent
management
• impaired ability to measure the organisation’s
performance in people management terms
and relate all measures of performance to
improved practice
• loss of one of organisation’s major unique
selling points and sources of positive profile
and reputation
• inability to deliver against key contracts as
these depend on flexibility of HR director
and deputy director interchanging roles
internally where necessary to backfill for high
peak demands of these contracts
• dependence on consultants to design,
implement and review key processes, for
example job evaluation scheme, competency
frameworks and 360-degree feedback systems
an example of using meTrics in your hr communicaTions
The Tool
An example of using metrics
in your HR communications
29
This document can be downloaded as a Word document from http://www.cipd.co.uk/tsm, copyright © CIPD. Please use or
adapt this document in line with our terms of use: http://www.cipd.co.uk/Bookstore/onlineresources/termsofuse.
CD24949 section1.indd 29
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
02/11/2010 13:46
Building Block 1 – exploring The Business case for engagemenT
Key tasks/
activities
Impact if taken away/put on hold
Estimated
financial value to
the organisation
(an example)
• dependence on costly solicitor or external
expert advice for changes or transactions
with complex legal ramifications, for example
TUPE, negotiations to changes in terms
Management
of in-house
recruitment
service
• increase in recruitment costs because
nobody to co-ordinate most cost-effective,
just-in-time solutions to all recruitment needs
• increase in agency costs if nobody keeps
relationships with agencies and costs under
ongoing review
Estimated
saving in direct
recruitment costs
5 £80,000 per
annum
• bungling of internal secondments and internal
transfers
• insufficient in-house capacity and expertise to
interpret psychometric test centre results
Business
partnering role
with all managers:
• management
induction of all
new managers
• joint problemsolving to solve
business-critical
issues, for
example staffing
models
• lack of timely and thorough induction of all
line managers in practice and expectations
• greater decentralisation of HR responsibilities
so managers dragged into this and away from
service development work
• less consistency of management practice
across the organisation with corresponding
dips in staff satisfaction with line management
and greater risks of employee relations issues
being protracted and ultimately going to
employment tribunal
OPP/CIPD statistics
(2008) suggest
that workplace
conflict is costing an
average of 12 days
per employee per
year in lost time.
An example of
the average wage
per employee with
on-costs for an
organisation 5 £130.
£130 3 160 staff 5
£20,800 per day
• high-level
employee
relations advice
If 12 days lost overall,
cost 5 £249,600 per
annum
• quarterly HR
surgeries with
all managers to
assess needs
and progress
in people
management
practices
Assuming
organisation loses
no more than 3 days
per person, cost 5
£62,400
Difference
(saving) 5
£187,200
30
This document can be downloaded as a Word document from http://www.cipd.co.uk/tsm, copyright © CIPD. Please use or
adapt this document in line with our terms of use: http://www.cipd.co.uk/Bookstore/onlineresources/termsofuse.
CD24949 section1.indd 30
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
02/11/2010 13:46
Impact if taken away/put on hold
Estimated
financial value to
the organisation
(an example)
Management of
attendance
• loss of money through failure to pick up
level of mis-recording currently picked up
(estimated at 2 days per employee per year)
• For timesheet
reconciliations:
our figures
show an average
potential loss to
the organisation of
320 3 £130
Total saving 5
£41,600
• reconciliation
of timesheets
(shared
with HR &
recruitment
assistant)
• increase in sickness absence
• prompting and
monitoring of
formal sickness
meetings
• Our sickness
absence is 3%
below sector
average. 3% of
payroll gives:
Total saving 5
£195,000
• co-ordination
of occupational
health referrals
Regulation and
monitoring of
employee relations
issues, including:
• induction of
all staff into
contracts, code
of conduct
and key
expectations
• failure to maintain the high levels of accuracy
in regulation and recording of all aspects of
the employment relationship
• breakdown of consistency of early
intervention in any problem areas
• lack of clear records and audit trails in the
event of disputes
• estimated increase in employment tribunal
claims to 3 per year
• maintenance
and updating of
computerised
records on all
staff
• helpline
response to
day-to-day
employee
queries on all
employmentrelated issues
• Estimated saving
on ET insurance
premium through
low rate 5
£5,000 per
annum
• Estimated savings
on management
time in dealing
with 3 ETs
per year 5 4
managers per case
@ 10 days each at
£130 per day.
Total saving 5
£15,600
an example of using meTrics in your hr communicaTions
Key tasks/
activities
31
This document can be downloaded as a Word document from http://www.cipd.co.uk/tsm, copyright © CIPD. Please use or
adapt this document in line with our terms of use: http://www.cipd.co.uk/Bookstore/onlineresources/termsofuse.
CD24949 section1.indd 31
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
02/11/2010 13:46
Building Block 1 – exploring The Business case for engagemenT
Key tasks/
activities
Impact if taken away/put on hold
Estimated
financial value to
the organisation
(an example)
• inability to administer the recruitment process
after the point of response-handling – that
is, distribution of packs, co-ordination of
test and interview schedules, pre- and
post-recruitment correspondence and
telephone query-handling with candidates,
referencing
• Total savings 5
80 for in-house
test centres per
year at £600
per centre 5
£48,000
• employee
relations advice
and guidance to
managers
• attending and
minuting formal
investigations
and hearings
Administration of
the recruitment
process, test
centres and
pre-employment
screening
• either inability to carry out test centres, with
huge increase in wrong appointments (up to
30%, or 14 wrong appointments each year)
or need to contract out test centres
• inability to meet legal and best practice
requirements in relation to criminal record
checking and confirmation of right to work in
UK (with £5,000 fine for each failure against
the latter)
• failure to pick up current 10% of applicants
currently turned down on references per
year
• Savings on wrong
appointments:
costs of conflict
already accounted
for above, but add
to this the costs
of training and
under-productivity
of 14 wrong
appointments per
year.
Estimated saving
5 £6,000 3 14
employees
Total saving 5
£84,000
32
This document can be downloaded as a Word document from http://www.cipd.co.uk/tsm, copyright © CIPD. Please use or
adapt this document in line with our terms of use: http://www.cipd.co.uk/Bookstore/onlineresources/termsofuse.
CD24949 section1.indd 32
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
02/11/2010 13:46
Impact if taken away/put on hold
Estimated
financial value to
the organisation
(an example)
Design and
delivery of the
organisation’s
management
development
training
100% of our people management training is
delivered internally and 75% of our strategiclevel management training is delivered internally.
Savings on
delivering
management training
internally 5 £9,775
Postponing the delivery of the programme or
running on a less regular basis would result in:
• lack of skilled managers and reduction in
leadership capability
• more reliance from managers on HR support
as they will not be trained to effectively
operate
• potential increase in staff absence
• inability to deal with performance issues –
lack of morale within staff teams
• decline in staff satisfaction and impact on
future syndicate surveys and Sunday Times
Top 100 survey, and so on
• decline in the organisation’s reputation within
the sector as an ‘employer of choice’
Co-ordination and
management of
service delivery
trainee scheme
• lack of succession planning, inability to ‘grow
our own’, decline in our internal talent pool
• increase in staff costs – external recruitment
costs – filling project worker posts by going
into the external market or by using more
agency staff
Re-recruitment costs
at £2,000 per post
for 5 unfilled service
delivery posts per
year 5 £10,000
• potential lack of quality staff – potential
applicants may go to work for our
competitors who do run trainee schemes; use
of more agency staff/locums may also result in
less quality and a poor service for our clients
• increased knowledge gap in new starters
(through external recruitment) and greater
need for training and development/support
from managers and colleagues
• unable to continue to run the mentoring
scheme for trainee mentors – this would be
one less route for aspiring managers to gain
skills and knowledge to be able to apply for
management roles in the future
an example of using meTrics in your hr communicaTions
Key tasks/
activities
33
This document can be downloaded as a Word document from http://www.cipd.co.uk/tsm, copyright © CIPD. Please use or
adapt this document in line with our terms of use: http://www.cipd.co.uk/Bookstore/onlineresources/termsofuse.
CD24949 section1.indd 33
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
02/11/2010 13:46
Building Block 1 – exploring The Business case for engagemenT
Key tasks/
activities
Impact if taken away/put on hold
Estimated
financial value to
the organisation
(an example)
• potentially unable to move forward with
the development of our client employment
options programme
• dip in the organisation’s profile within the
sector and the external labour market
• co-ordination of the scheme passes to area
managers (AMs): breakdown of consistency
and continuous improvement in running of
the scheme; AMs distracted from main duties
and new bids
Co-ordination of
the organisation’s
training
programme for
service delivery
staff
• learning and development considered to be
part of an employee’s total reward package
and in this organisation L&D forms a very
large part of this package; lack of opportunity
for training will inhibit us from recruiting
and retaining good staff, particularly when
reducing other terms; failure to be able to
deliver on our revised employee proposition
when market is dictating that, superior
development opportunities will be our main
source of competitive advantage in still being
able to recruit and retain good people
Saving on
co-ordination of
delivery of training by
front-line staff
5 £3,000
• staff unable to reach their potential and fulfil
the duties of their role – consequent costs of
underperformance against potential
• dip in employee morale and engagement
• increased turnover – staff leaving within 12
months
• unable to provide a good-quality service –
audits, unable to remain competitive with
bids/tenders
• one-third of our core service delivery training
currently delivered internally by front-line
staff; this saves approximately £3,000 per year
34
This document can be downloaded as a Word document from http://www.cipd.co.uk/tsm, copyright © CIPD. Please use or
adapt this document in line with our terms of use: http://www.cipd.co.uk/Bookstore/onlineresources/termsofuse.
CD24949 section1.indd 34
A sample from Employee Engagement by Rita McGee and Ann Rennie. Published by the CIPD.
Copyright CIPD © 2010. All rights reserved. No part of this excerpt may be reproduced, stored
in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise. www.cipd.co.uk/Bookstore
02/11/2010 13:46