It’s hard to go past old fashioned values like integrity, honesty and trust. Sadly these are becoming increasingly hard to find in many organisations, and increasingly hard for employees to give.
The question you might reasonably ask is, is the concept of building trust within your organisation something you should even care about? The simple answer is yes, because simply put, it affects your bottom line. For example, Australasian research by the company JRA shows that ‘engaged’ employees generate a return on assets 95 per cent higher than their less engaged workforce counterparts, generate sales per employee 68 per cent higher and are 29 per cent more likely to stay with their organisation. These are staggering figures.
Other international research by organisations such as Towers Perrin has further demonstrated the link between employee engagement and sustainable improvement in bottom line performance. The research shows ‘engaged’ employees directly affect key business measures, such as lower absenteeism and staff turnover, and higher productivity, operating margins, profitability, customer engagement and growth in earnings per share.
Employees that don’t have trust in their manager and their organisation are not engaged employees. As a result, six in ten employees can be regarded as ‘ambivalent’, while one in ten can be described as ‘disengaged’, or detached from their work. They’re often demotivated and they’re only doing just enough work to get by.
An engaged employee is one who is willing and able to mentally, emotionally and physically apply themselves at work and contribute to organisational success. It is the extent to which employees put discretionary effort into their work, effort that goes beyond the required minimum to get the job done, in the form of extra time, brainpower or application.
For most employees, leadership in the workplace is the key to capturing their interest and involvement. In particular, the nature of the relationship an employee has with their direct frontline manager, and the nature of their day to day communication, is critical for both engagement and managing retention.
Many frontline managers are promoted because they were good performers in their work, not because they possessed effective leadership skills. Often little is done to address the leadership skills shortfall, so it isn’t surprising that the majority of frontline managers are identified as ineffective in the people leadership aspects of their role. Employees are looking to their managers for inspiration and motivation. Generally frontline managers are not delivering and not meeting expectations if the results of Towers Perrin research are anything to go by.
The trend of recent years has been to focus on senior management leadership. However, the senior management team’s overall impact is actually less than that of frontline leaders organisational performance.
Addressing the frontline leadership shortfall can have dramatic results. It is the ‘ambivalent’ group of employees, who make up about 60 per cent of the workforce, who offer your organisation the biggest potential source of performance gains. The opportunity is in moving this middle group into the ‘engaged’ category. Then, the possible impact on your key performance indicators is unlocked.