The Role of the Manager in Impacting Employee Engagement Presented by: Kerry Liberman, President People Perspectives LLC 1
What is Employee Engagement? Willingness of employees to exert discretionary effort towards their work Employees consistently think about ways to do their job better Employees feel they will be recognized for doing a good job Characteristics of engaged employees: Feel a strong emotional bond to their credit union and care about its future Are willing to invest extra effort Are fully involved in and enthusiastic about their work Will act in a way that furthers their credit union s interests 2
U.S. Levels of Engagement (Gallup) 1. Engaged Employees (29%) Feel a true connection to the company Drive motivation & move the organization forward 2. Non Engaged Employees (53%) Checked out Putting in time, but not energy or passion 3. Actively Disengaged Employees (18%) Unhappy and unproductive at work Liable to spread negativity to coworkers Can undermine what engaged employees accomplish Levels of Engagement 18% 29% 53% Engaged Not Engaged Actively Disengaged 3
Engaged vs. Disengaged Employee Differences Companies with Engaged Employees have HIGHER Customer Ratings 10% Profitability 22% Productivity 21% Quality of Products 41% Companies with Engaged Employees have LOWER Turnover 25 65% Safety Issues 48% Theft 28% Absenteeism 37% 4
Engagement Influence on Company Profitability HayGroup: Top engaging companies achieve revenue growth 4.5 times greater than companies with the lowest engagement Gallup: $300 Billion over 5 year period is lost in productivity due to disengagement Engagement, being one of the few determinants of profitability within a company s control, is one of the most crucial imperatives of any successful company 5
Engagement Demographics Study by Quantum (500,000 employees; 4,000 organizations) No significant differences with engagement across: Age Tenure Position Organization size did show significant engagement differences As organizations grow, engagement becomes more challenging With smaller organizations, there aren t as many steps between senior leaders and employees 6
Credit Union Data on Engagement Demographics People Perspectives LLC, 2010 2015 Asset Group: Smaller sized CUs (<$500M) have highest engagement levels Engagement decreases as asset size increases Employee Size: Medium sized employee groups (100 249) have highest engagement levels US Region: Central region (WY, MI, CO, KS, OH, IN) has highest engagement levels 7
Credit Union Data on Engagement Demographics (con t) People Perspectives LLC, 2010 2015 Tenure: Newest employees (0 12 months) have highest engagement levels consistently, followed by most tenured group (7+ years) Tenure groups between 1 & 7 years have lower engagement averages Supervisory: Supervisors consistently have higher engagement levels than nonsupervisors 8
What Drives Engagement? 3. Having confidence/belief in Leadership Belief that senior leaders are capable and trustworthy Lead the company in the right direction 2. Pride in working with the Organization Employee feels trusted by and trusts in the organization Employee agrees with and lives the organization s values 1. Relationship with the Manager Type and amount of supervision and direction leaders give Being treated fairly Having a strong working relationship based on mutual respect Getting to know employees as individuals 9
Significant Influences of Manager Effectiveness on Employees Job satisfaction Understanding company direction & employee s influence Team cohesiveness Employee s desire to grow and develop Trust in the workplace & with colleagues Employee turnover Employees join companies but leave managers 10
Credit Union Assumptions 1. The right managers are in place Effective management succession Promoting producers who develop others Strong selection system for outside candidates 2. Clear expectations for appropriate management behaviors have been established and communicated 3. Managers are provided with learning opportunities and coaching to develop these competencies Provide support on an ongoing basis Mentorship opportunities in house Coaching with outside facilitator 11
Credit Union Assumptions (con t) 4. The organization is willing to initiate both positive & negative consequences for management behaviors Recognition is rarely in place for management levels When present, focuses mostly on the bottom line rather than supervisory success 5. The organization is willing to replace or correct those managers without the necessary competence or appropriate attitude for enhancing employee engagement 12
How Can Managers Improve Employee Engagement? COMMUNICATION Communicate in a timely manner Share important CU information with staff Hold regular meetings (formal and informal) Solicit employee input and act on it 37% of respondents in a Kelly Global Workforce study reported that more transparency in communication by their manager would improve their engagement 13
How Can Managers Improve Employee Engagement? (con t) PERFORMANCE MANAGEMENT Empowerment Fostering participative & facilitative management leads to higher engagement Micro managing & controlling work leads to disengagement Communicate clear goals & expectations Encourage staff to take responsibility of issues themselves Delegate assignments effectively Ensure that workload is manageable Delegate work that is meaningful to subordinates Identify and manage problem employees 14
How Can Managers Improve Employee Engagement? (con t) EMPLOYEE DEVELOPMENT Gallup study on performance feedback: Employees receiving predominantly negative feedback (10% of employees) are 20 times more likely to be engaged than employees who are ignored Employees receiving predominantly positive feedback are 30 times more likely to be engaged than employees who are ignored Managers who focus on employee strengths are 33% more likely to manage actively engaged employees compared to those who focus mostly on weaknesses 15
How Can Managers Improve Employee Engagement? (con t) EMPLOYEE DEVELOPMENT (con t) Give immediate feedback Provide training, growth opportunities when possible Ask what they need to perform their jobs better 53% of respondents in KGW study indicated that more training and development would improve their engagement Encourage innovation & initiative The role of leaders is not to create followers, but to create more leaders. Tom Peters 16
How Can Managers Improve Employee Engagement? (con t) FOSTERING TEAMWORK Meet frequently and consistently with department/group Discuss what staff is working on, what has gone well, what has been challenging, how to improve further Foster good working relationships; no negativity about coworkers to peers Recognize and reward employee and group achievements Encourage peer recognition and set an example for them to follow Create opportunities for team to connect in ways besides work projects 17
How Can Managers Improve Employee Engagement? (con t) MANAGEMENT EFFECTIVENESS Provide flextime and flexplace when possible Be available; having an open door policy for staff Manager s support and guidance directly link to high engagement. Includes: Sharing ideas Creating opportunities for exposure and connection with others in the company Managers know who the employees are, not just what they do Effective managers connect with staff as people, not just employees 18
How Can Managers Improve Employee Engagement? (con t) LEADERSHIP EFFECTIVENESS Actively promote the CU s effectiveness, reputation, values & ethics Employees want to feel good about where they work Celebrate successes both financial and non financial Lead by example 19
How Can Managers Be Held Accountable for Staff Engagement? Check management participation level in company wide morale programs Recognition budget CU wide nomination for awards, recognitions Hold managers accountable for voluntary turnover Hold managers accountable for engagement levels of staff (if measured) 20
How Can Managers Be Held Accountable for Staff Engagement? (con t) Hold managers accountable for service levels of staff (if measured) Audit performance evaluations for content prior to administration Have meeting minutes forwarded from department meetings Check timeliness of communication provided by supervisors Conduct leadership assessment Difficult to determine effectiveness without a baseline measurement 21
Areas to Evaluate on Leadership Assessments Questions to be considered by organizations that want to measure & develop their managers effectiveness Look at both effectiveness and importance 6 dimensions: 1. Communication 2. Managing Performance 3. Employee Development 4. Teamwork 5. Management Effectiveness 6. Leadership Effectiveness 22
Areas to Evaluate on Leadership Assessments (con t) COMMUNICATION Listening to ideas & concerns Considering subordinate opinions in decisions Sharing pertinent information with staff MANAGING PERFORMANCE Reviewing goals periodically Seeking input about workload before assigning more Empowering subordinates to accomplish work with minimum interruptions 23
Areas to Evaluate on Leadership Assessments (con t) EMPLOYEE DEVELOPMENT Discussing strengths and weaknesses regularly Ensuring subordinates have resources & training for position Encouraging self development TEAMWORK Resolving conflicts as they occur Treating all reports fairly Encouraging cooperation amongst group 24
Areas to Evaluate on Leadership Assessments (con t) MANAGEMENT EFFECTIVENESS Consistently supporting the CU s values Providing work/life balance Maintaining a professional demeanor with others LEADERSHIP EFFECTIVENESS Leading by example Leading the department to be an example for others Putting the needs of others ahead of his/her own 25
A Few Words about Senior Management 5 senior level practices most strongly correlated with high employee engagement (BlessingWhite): 1. Creating a high performance environment Also has one of the lowest levels of agreement 2. Communicating honestly 3. Acting in alignment with the organization s core values/guiding principles 4. Linking the work of the organization to a larger purpose 5. Developing & engaging the direct supervisors within the company Company supervisors, in turn, become ambassadors of the senior leaders & their initiatives 26
Concluding Remarks Less than one third of US workers are engaged Impact of employee engagement is huge! Directly impacts company performance & employee productivity One of the most controllable variables for companies Nothing impacts engagement more than the direct supervisor Impacts job satisfaction, teamwork, employee turnover 27
Concluding Remarks (con t) Credit Union must play an active role in managing managers Select the right people for the job Provide them with the tools to be successful Hold them accountable Determine baseline of effectiveness so that improvements & enhancements can be made 28
Kerry Liberman, President People Perspectives LLC 206 451 4218 kliberman@peopleperspectives.com www.peopleperspectives.com 29