Securing Employee Engagement: More Vital than Ever

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Camron Paul
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2 Introductions Ruth Hunt Principal, Communication including listening, change management, and engagement in health consumerism Scot Marcotte Managing Director, Talent & HR Solutions including innovative use of current Marketing theory to drive appreciation and behavior change 1 Copyright All rights reserved.

3 Overview What do we mean by engagement and why is it important? Achieving engagement Organizationally Health and wellness Communicating effectively to engage: Good, Better, Best Applying Marketing concepts: Personalizing to maximize engagement Actionable steps to revitalize the workforce Questions? 2 Copyright All rights reserved.

What Do We Mean by Engagement? Capital E Engagement An outcome a # of key factors The discretionary effort an employee is willing to contribute Organizational alignment with Culture desired vs.

4 What Do We Mean by Engagement? Capital E Engagement An outcome a # of key factors The discretionary effort an employee is willing to contribute Organizational alignment with Culture desired vs. gap (as evidenced in behaviors) Business model, operating philosophy, strategy and goals Priority initiatives and programs Supported by a strong EVP, for more satisfied and productive workers, whose efforts drive success and shareholder value We also need engagement: 3 Copyright All rights reserved.

State of the Recovering Workplace Organizations Challenges 82%: morale and engagement 72%: health care costs 71%: understaffing 62%: productivity, presenteeism 49%: pent-up turnover 39%: other 34%:

5 State of the Recovering Workplace Organizations Challenges 82%: morale and engagement 72%: health care costs 71%: understaffing 62%: productivity, presenteeism 49%: pent-up turnover 39%: other 34%: absenteeism 24%: safety, accidents Employee Challenges 94%: high stress 85%: pressure to work harder 80%: work/life imbalance 77%: managing health care costs 75%: limited career growth 71%: financial management making ends meet 58% long-term job security WorldatWork annual conference, The Recovering Workplace Survey, Buck Consultants, June Copyright All rights reserved.

6 Many Reasons for Concern on Engagement Average engagement has dropped by 4% from 2009 Only 29% are actively engaged in their jobs (BlessingWhite 2010) Just 20% of workers are fully engaged in their work (Towers Watson) 45% are satisfied with their jobs (Conference Board 2011 survey) 54% are ready to jump (Herman Group 2010 poll) One-third plan to look for new jobs; 48% cite loss of trust and 46% cite lack of transparent communication (Deloitte 2010 survey) 84% of highly engaged feel they affect product quality vs. 31% of non 46% hadn t taken all their vacation: fear, overwork (Right Management poll) 65% of Fortune 100 executives are concerned about turnover, mistrust 5 Copyright All rights reserved.

What Factors Help Employee Engagement Rise?

10 Why Care about Engagement? It Drives Results Understand Drivers of Engagement Measure Engagement and its Dimensions Loyalty Commitment Creativity Productivity Customer Satisfaction Shareholder Value Revenue Growth 9 Copyright All rights reserved.

Measure Engagement by Listening to Employees 8 Drivers of Engagement Leadership confidence, trust, direction, concern Rewards equity, linked to performance Communication and Involvement web of

11 Measure Engagement by Listening to Employees 8 Drivers of Engagement Leadership confidence, trust, direction, concern Rewards equity, linked to performance Communication and Involvement web of information Advancement/Development Focus opportunities Immediate Supervision supportive relationships Co-Worker Relations competence, collaboration, fun Job Characteristics challenge, accomplishment, skill HR Policies/Practices balance employer/employee needs Evidence of Engagement Emotional Commitment having pride in and emotionally identifying with the organization Behavioral Commitment being willing to exert extra effort on behalf of the organization Continuance/Normative Commitment wanting to remain a part of the organization Performance Accountability feeling responsible for work product and outcomes Motivation being inspired by the organization to do one s best work Goal Alignment understanding the impact of individual performance on business goals and results. 10 Copyright All rights reserved.

12 Example: Engagement Drives Competitive Advantage Drivers of Engagement Leadership Rewards Communication Involvement Advancement and development focus Immediate supervision Co-worker relations Job characteristics HR practices showing concern for employees Example Company: Hallmarks of Our Culture Outcome: Employee Engagement Focusing on customers first Promoting teamwork Communicating effectively Being accountable to each other Embracing and managing change Educating, training, and developing employees Sharing the benefits of our success Pride in the company Willingness to go the extra mile Desire to remain in the company Feeling responsible for work products and outcomes Being inspired to do one s best Aligning personal goals with organizational goals Your Company s Competitive Advantage 11 Copyright All rights reserved.

13 Engagement: A Compelling EVP is a Two-Way Street The Employee Value Proposition (EVP) It s the handshake deal between an employee and employer the value employees get in return for their contributions and performance An effective EVP clearly articulates what the organization expects from employees and what employees can expect in return The key to defining value is recognizing it s what the employee defines as value, embracing the possibilities, and making it uniquely yours A strong EVP enhances the ability to attract, retain and motivate the high caliber people needed to achieve business objectives it engages 12 Copyright All rights reserved.

Example: EVP Approach and Methodology 1 2 3 4 Review Look at culture, total rewards and work experience. Define a compelling and comprehensive package.

14 Example: EVP Approach and Methodology Review Look at culture, total rewards and work experience. Define a compelling and comprehensive package. Gather Input Discover what employees perceive as valuable about their employment experience. Solicit input from key stakeholders. Develop & Test Given listening findings, develop the EVP brand and messaging. Test ideas with key stakeholders for credibility and value. Revise. Launch Communicate the EVP in cascaded communication. Weave it into the organization fabric. Hold leaders and all accountable to live it. 13 Copyright All rights reserved.

16 Engagement is Also Vital to Health & Productivity, But Corporations do not have enough money to buy engagement. Dr. Dee Edington Director, Health Management Research Center, University of Michigan 15 Copyright All rights reserved.

17 Health Issues Intertwine with Overall Engagement Gallup Study Results My employer does things to help improve my health Only 8% strongly agree 67% disagree or strongly disagree My overall well-being is higher because of my employer Only 8% strongly agree Most see job as detriment to well-being Disengaged workers: Almost 2X the depression, stress Greater risk of heart disease Sense of financial security has 3X the impact of income on well-being; increases turnover risk Overcoming the Challenges 2010 Midwest Business Group on Health study identified top barriers to employee health engagement Trust was far and away 1 st Closely tied for 2 nd : Time, Money, Convenience and Stress Key to maximizing engagement: Listen for the barriers Set a strategy to build readiness Craft the value proposition Deliver support to make it easier 16 Copyright All rights reserved.

18 Where are You? Spectrum of Employment Relationships Paternalism Consumerism Individualism Essence of Contract We ll take care of it for you We support each other and share responsibility You re on your own Employer Role Architect/custodian providing at a minimum, adequate benefits, fair policies Partner, enabling employees to make informed decisions for their well-being Limited obligation or involvement in the individual s choices Employee Role Passive, entitled; waits for employer to make decisions; little concern about costs or impact Engaged consumer; seeks information, weighs alternatives, considers cost and outcomes Like an independent contractor; simply minimizes cost and maximizes personal outcomes 17 Copyright All rights reserved.

4 I s: Levers to Drive Accountability and Engagement I understand (knowledge) My personal responsibility for health How my health plan works and my potential out-of-pocket costs My health risk

19 4 I s: Levers to Drive Accountability and Engagement I understand (knowledge) My personal responsibility for health How my health plan works and my potential out-of-pocket costs My health risk numbers and action steps I must take Available incentives Available resources I want to (motivators) Earn rewards for my actions (e.g., get incentives for health screenings Make healthier lifestyle choices Contribute to my HSA or FSA Get regular preventive care Help get my family on board Complete training I must (expectations) Be compliant in my care Not smoke; not smoke on site Achieve certain health metrics Engage with a health coach for help Make decisions that manage costs: generic drugs, alternative treatments, preventive care I can (skill building) Shop and make purchasing decisions on cost and quality Use available resources to stop smoking, lose weight, exercise, etc. Use online tools for plan selection and health decision support Measure my risks and my progress 18 Copyright All rights reserved.

20 Good Communications: Brief, Easy to Read, Enticing, Participative Posters as teasers Postcards home, engaging the family Employee cookbook contest Leader talking points Customized branding; CEO video endorsement 19 Copyright All rights reserved.

21 Better Communications: Multi-channel, Easy to Access, Social Online training with rewards QR codes linking to testimonials Tablet versions: for optimized viewing Virtual benefit fair for ongoing education Social networking 20 Copyright All rights reserved.

22 Best Communications: Highly Convenient, Personalized to ME Mobile apps for instant info: virtual insurance card & more Personalized portal with MY data, MY action steps 21 Copyright All rights reserved.

Reaching an Audience of One Old Model Accommodate them Focus on the activity Hit them once a year at enrollment Wait for them to do something The portal will cover what they need One size fits all

23 Reaching an Audience of One Old Model Accommodate them Focus on the activity Hit them once a year at enrollment Wait for them to do something The portal will cover what they need One size fits all New Model Engage them Focus on the outcome Create an ongoing dialogue with push & pull Motivate actions through predictive analytics Right media at the right time An audience of one Why Engagement = Productivity Outcomes drive savings Continuously influence behaviors If we don t encourage, they won t act People engage through different channels People have unique motivators 22 Copyright All rights reserved.

A good recommendation engine is worth a lot of money.

24 Recommendation Engines Drive Results Recommendation engines account for: 40% of Amazon s sales 60% of Netflix s volume What We Can Learn from Netflix, Business Week, September 30, A good recommendation engine is worth a lot of money. According to a report by industry analyst Forrester, one-third of customers who notice recommendations on an e-commerce site wind up buying something based on them. Time, June 7, Copyright All rights reserved.

Getting to Personalization in HR Segmented HR Customers

Defaulters Over- Insureds Under- Insureds Intelligent Routing

Contact Frequencies Channel Combinations Stated Preferences

Retirees Tier 1 Rep Interaction and Contact History

Engine Data Management Reporting Past Participation Modeling

26 Getting to Personalization in HR Segmented HR Customers Channels Differentiated Treatments New Hires Chronic Defaulters Over- Insureds Under- Insureds Intelligent Routing Direct Mail Voice Blast Targeting Engine Timing Options Contact Frequencies Channel Combinations Stated Preferences Language Tone of Messages Behavioral Economics Optimals Retirees Tier 1 Rep Interaction and Contact History Participation Data Demographics Contact History Analytics Engine Data Management Reporting Past Participation Modeling Executives Highly Skilled Rep Segment Data Constraints Optimization 25 Copyright All rights reserved.

27 A Platform for Personal Relevance Portal Employees Dependents Retirees HR Right message/offers at right time using right media, from predictive analytics Action Item Database & Customer Relationship Management Master Recommendations Engine Defines action items Defines how and when it will be messaged Determines how often action item database is refreshed Data Mining Demographic Data & Ethnographic Analysis Career Data & Rules Engine Health Data & Rules Engine Wealth Data & Rules Engine Benchmark & Corporate Data 26 Copyright All rights reserved.

28 The ROI Impact of Engaged Employees Engaged Participants Optimal Participation: Career, Health & Wealth Strategic Alignment Appropriate Choices Better Life Planning (Financial Wellness) Understanding & Appreciation Better Lifestyle (Health & Wellness) Recruitment & Retention Lower Absenteeism & Presenteeism ROI 27 Copyright All rights reserved.

29 Actionable Steps to Revitalize Your Workforce Near Term Define or refine your Employee Value Proposition Review desired outcomes against your EVP Use the 4 I s to assess your current state Build an engagement strategy that addresses prioritized outcomes Assure the right measurement tools are in place Implement near term engagement tactics Longer Term Make the participant experience increasingly relevant Evaluate and measure celebrate successes; refine where needed 28 Copyright All rights reserved.