What is the correlation between employee engagement and productivity?

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Wondering if there’s a correlation between employee engagement and productivity?

Most companies focus on boosting employee engagement, and for a good reason.

It’s a factor that is responsible for increasing profits, skyrocketing productivity, upgrading customer experiences, decreasing employee turnover, and a whole lot more.

In this article, we’ll explain the correlation between employee engagement and productivity. We’ll also discuss how to measure employee engagement and how you can better engage with your employees.

This article covers:

(Click on the links below to go to a specific section)

• What is employee engagement?
• How does employee engagement impact employee productivity?
• How to measure employee engagement?
• How to boost employee engagement?

Let’s get started.

What is employee engagement?

Employee engagement is the commitment, enthusiasm, and involvement of employees towards the organization’s goals and objectives. It’s the extent to which employees are devoted to their jobs and are inspired to give their best at work.

However, most businesses don’t make the most out of their HR leaders and employees. 

They mistake employee engagement for sporadic warm feelings the employees would have for the company and reasonable paychecks. But employee engagement is so much more.

Besides improving employee perspective towards workplace culture, it also helps you identify if employees are actually doing their tasks during office hours and if your team building practices positively influence your business.

Why is employee engagement important?

Employee engagement is essential because, for the majority of the workforce, money isn’t everything. A recent Gallup employee survey of 1.4 million employees shows that employee respondents are willing to give up 29% of their salaries to find the job they love. 

Workplace culture and ethics are primary influencers in attracting top talents and retaining them.

Additionally, employee engagement is also crucial for the overall growth of the company, as engaged workers are more productive. 

In fact, the Gallup employee engagement survey shows that the work of one highly engaged employee is equivalent to that of ten disengaged employees!

What differentiates engaged and disengaged employees?

Engaged employees understand their job and know how their work contributes to the growth and success of their company. They are enthusiastic about the results of their work and go the extra mile to perform their job better. 

Some signs of engaged employee behavior may include:

• Lower absenteeism.
• Consistent good performance.
• Readiness to accept new challenges.

In contrast, a disengaged employee doesn’t feel connected to their job in any way and only performs the bare minimum. They don’t feel emotionally connected to their work and as a result, they might also lower the morale of other team members.

How do you spot a disengaged employee?

Some signs of employee disengagement include:

• Nine-to-five mentality.
• Browsing social media excessively during work hours.
• Unwillingness to socialize outside the office.

How is employee engagement different from employee satisfaction?

Employee satisfaction is about the employee being happy with their current job and organization. A satisfied employee feels content and gratified about their job and has a sense of pride in their work.

On the other hand, employee engagement is about the employee being invested in their work and the organization’s goals and missions. Engaged workers show proactivity and diligence in their job roles, and focus on achieving excellence in their work. 

However, employee engagement is not an occasional attempt at making employees happy. 

If you solely focus on keeping employees happy, rather than boosting employee engagement, you might fail to improve their work performance in the log run.

How does employee engagement impact employee productivity?

Let’s now get to the heart of the matter: the impact of employee engagement on employee productivity.

Employee engagement is not the cure for every workplace challenge. 

But it does offer some significant benefits for your organization — the most prominent one being increased employee productivity. 

A meta-analysis of 1.4 million US employees by the Gallup organization revealed a correlation between employee engagement and productivity — engaged workers are 22% more productive than disengaged employees. 

Here are some key benefits of having engaged and productive employees: 

1. Better employee health

As they’re more productive, engaged employees get more work done in less time. 

This gives them more time to relax, rejuvenate their energies, and work with better focus. Consequently, engaged employees have better health.

2. Greater profitability

Engaged and productive employees focus on achieving excellence in every task they perform. They can get more work done, improve business outcomes, and increase the bottom line of the company exponentially.

3. Employee retention

Engaged employees are likely to stay longer with their company and contribute to its growth and success. 

Disengaged employees, on the other hand, are more likely to leave the position. When employee engagement scores are low, and the employees can’t make full use of their potential or don’t feel challenged enough, they quit. 

4. Decreased absenteeism 

Engaged and productive employees like their work and make an emotional commitment to it. They care about what they do and how their efforts contribute to business success. This means that they consistently turn up for work and perform their best in their jobs and roles. 

5. Strong employee brand 

Employee brand refers to the culture, values, and goals of the company presented to the public. 

By focusing on employee experience, employees send out a positive brand message of the company, which further attracts top talent.

6. Improved customer experience 

Engaged and productive employees serve customers better and focus on customer satisfaction. With a better customer experience, entrepreneurs can grow their business at a quicker pace.  

7. Reduced safety incidents 

An employee with a high engagement level is more mentally and emotionally connected to their workplace. They are naturally more aware of their surroundings. This results in fewer safety incidents. 

How do you measure employee engagement?

Knowing what to measure is the starting point of an effective employee engagement strategy.  

Using the right metrics is essential for creating high employee engagement at various employee engagement levels. Employee engagement can be measured in three ways:

1. Statistics and data

Business performance data can directly assess employee engagement. Statistics like, customer ratings, profitability, turnover, safety incidents, and absenteeism can help you decide your company’s employee engagement levels. 

While this method is useful in evaluating the overall productivity of your workforce, it can’t tell you anything about how individual employees perform and engage in the workplace.

2. Direct employee feedback 

Regular ongoing peer feedback and check-ins can be used to assess employee engagement. This is the traditional way of measuring employee engagement. 

Unfortunately, engagement surveys and feedback are often subjective and contingent on individual employee experience with other employees.

3. Employee productivity software

Using third party software is the most effective way to keep a tab on employee engagement status.

Productivity software can give you a detailed report of individual employee engagement every day. This helps you make data-driven decisions about worker performance. 

Time Doctor is one such productivity software. From large corporations to small and medium businesses, Time Doctor helps increase employee productivity with ease.

Using Time Doctor, you can:

• Track the time employees spend on tasks, projects, and clients, and automatically create timesheets.
• Measure productivity and obtain detailed reports regarding employee performance.
• Keep track of applications, and websites employees access during work hours. 
• Choose which websites and applications you want to restrict access during work hours.
• Access an efficient integrated payroll management system alongside your timesheet. 

How do you improve employee engagement?

Building a successful employee engagement strategy requires thoughtful planning.

There’s no one-size-fits-all set of engagement initiatives you can take. You have to examine the bigger picture before you make employee engagement investments. 

Here are some helpful tips to boost employee engagement:

1. Effective communication

The importance of internal communication runs deep in any organization. Effective employee communication is essential for strong workplace relationships. 

Think about the most productive and efficient employees of your organization.

It is highly likely that they are the ones you have communicated with and engaged the most. 

Employers who spend time and effort to open employee communication lines eventually build trust with their employees.

Set clear expectations from your employees. Make them aware of the company’s goals and missions and have regular meetings. Discuss ideas, business strategy and have one-on-one meetings with employees who have been targeted for high performance.

2. Performance management

To become an organization with higher levels of engagement, you must have a robust performance management system for your employees. Performance management and employee recognition work on the simple principle that what gets measured gets done. 

A good business manager creates a cascade of targets, from top-level goals to everyday activities for frontline employees. Excellent performance is rewarded, and problems that lead to underperformance are addressed.

3. Have a people-first culture

Strategies don’t run your business. People do. 

Make your employees feel valued to spike up your engagement scores. 

How do you do this?

Consider investing in their career development. Monitor their progress, and determine if they need more training and assistance. Offer skill development programs and recognize additional voluntary contributions.

Additionally, ensure that you recruit people whose values align with your company, and who see their tasks as interesting and challenging. 

4. Focus on work-life balance

Work-life balance is critical for employee wellbeing. 

Employees who have the space to fulfill their personal commitments, take out some time for leisure, get enough sleep, show higher engagement levels, higher productivity, and perform better.

Conduct workshops on stress management and resilience-building for your employees and keep a tab on the work hours. Give employees regular off time and conduct team-building exercises, like office pictionary or remote true lies, where employees are not allowed to talk about work. 

Give space to failures and allow room for errors. Blend technological prowess with a more compassionate outlook and focus on the ‘human’ in human resources to have an engaged workforce.

5. Create transparency

A transparent work environment and an open company culture facilitate a better search for candidates and encourage thoughtful innovations from everywhere. It also helps create a flatter hierarchy and make goal-setting far easier. 

Encouraging an open organizational culture also tells an employee that they are working for a company that has high ethical standards.

6. Focus on organizational improvement 

Employee engagement is about the individual as well as organizational performance. 

Organizations are also key employee engagement drivers. To optimize employee productivity and for higher employee engagement levels, companies should overhaul the organizational drivers of employee engagement.

At the organizational level, employers should communicate the goals and missions of the organization to their employees. 

Additionally, employees should:  

• Trust their HR leaders to set the right plan and course of action.
• Believe that the leaders are committed to the growth of the organization. 
• Understand and believe in the future plans and goals of the organization.
• Have confidence that the organization values their work.

7. Invest in training your managers

Business managers often fail to communicate, motivate, and build a team with their employees. This is one of the main reasons for employee disengagement. 

Managers need to understand that the command and control leadership is not as effective as it used to be in the past. They have to see employees as partners in what they do. 

Moreover, companies should have leadership development goals to train managers. 

To drive employee engagement, managers should have:

• A positive relationship with supervisors.
• The resources required to fulfill their job expectations.
• The authority to accomplish their goals.
• Autonomy in their work-related decisions.

Final thoughts

Employee engagement can have several benefits for your organization. 

An effective employee engagement strategy is imperative for success in today’s globally disruptive business environment. 

However, employee engagement strategies have to be effectively communicated to the employees. Companies should then execute the planned actions to address employee engagement results and formulate effective plans to sustain this over time.