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Satisfaction, Productivity, and Employee Engagement

Are Satisfied Employees More Productive?

Satisfaction, Productivity, and Employee Engagement
Managers would like to know the answer to two very important questions: (1) Are satisfied (happy) employees more productive than unsatisfied (unhappy) employees?; (2) How important is employee engagement in generating satisfaction and productivity?


Are Satisfied Employees More Productive?

There is a “chicken and egg” element to this question, so we have to ask what comes first: employee satisfaction or employee productivity? Some managers think that satisfied employees are more productive because they are satisfied (i.e., satisfaction ? productivity), while others think that employees are satisfied because they are productive (i.e., productivity ? satisfaction). Managers who believe the former argue that employees who are happy in their work will be very productive because they work better with others, make better decisions, complain less, take less sick time, and are more optimistic. By contrast, managers who believe the latter argue that when people are highly productive, they are satisfied because they feel intrinsically good about themselves.


How Important Is Employee Engagement?
Because the relationship between happiness and productivity is complicated, we need to consider another factor that might help to clarify the situation. This is where engagement comes in. Workers who have more positive work experiences than negative ones will be more engaged in their work, and the key to increasing positive experiences is playing to an employee’s strengths. Thus, engagement is not about making employees happy. Rather, it’s about having employees who are committed to being highly productive.

Surveys have shown that businesses that score in the top half of an employee-engagement ranking system are nearly twice as likely to be successful than companies that are in the bottom half of the ranking. Telus Corp.’s experience is illustrative. Its score increased from 53 percent in 2007 to 85 percent in 2014. The increase in the score was accompanied by lower turnover rates among its employees, higher customer satisfaction, and a boost in the company’s stock price. Engaged employees are also a great source of ideas for improving company productivity.
Consider these examples:
• At Algoma Steel, a shop floor employee came up with a more efficient process for producing heat-treated steel plates that resulted in $90 million in additional revenue for the company.
• At ISL Engineering and Land Services, a senior urban designer was interested in making the company “greener,” but he didn’t want to force the idea on employees from the top down. Rather, he wanted them to help develop ideas. So 25 employees known to be particularly keen about sustainability were named “green champions.” They were encouraged to spend up to 10 percent of their time every day working on environmental issues.
• Coast Capital Savings, which is based in Surrey, British Columbia, has focused on increasing employee engagement by improving the physical space where people work. Employee input was important in determining the kinds of design changes that would be implemented. The design changes that were eventually made include an expansive lookout patio space with barbecues and a fire pit, themed cafes, chat rooms, and an
open work concept (no offices, even for top executives). These interior design changes have done more than just create pleasant surroundings; they have also increased employee engagement.

How Important Is Employee Engagement?

In a Psychometrics Canada poll of 368 Canadian HR managers, 69 percent of respondents said that low employee engagement was a problem in their organization, and 82 percent felt that company management should be doing more to increase employee engagement. The respondents also expressed the opinion that managers should give employees more recognition and praise (58 percent), should listen more to employee opinions (71 percent), and should provide employees with more learning and development opportunities (57 percent).

Another study—this one involving 30 000 workers in 17 different countries—was conducted by the global consulting firm Mercer. It found that there has been a decline in employee engagement over the past decade. Declines were evident in (1) the sense of commitment employees felt to their organization, (2) the pride they had in their organization, (3) employee willingness to go beyond stated job requirements, and (4) the feeling of accomplishment that employees got from their job.

Brad Hams, an organizational change expert, says that employee engagement is typically low because business owners and employees have different perspectives. Owners are concerned about things like profit, cash flow, and cost control, while employees are concerned about things like pay, benefits, and job security. Employee engagement can be increased by giving employees the right incentives (so that they benefit when company performance improves), providing the right education for employees (so that they understand how the business works), and adopting the right performance measures (to help employees accurately monitor their performance).

Another way to increase employee engagement is to use social media, and many companies are taking very specific actions to capitalize on the employee engagement characteristics of social media. At Toronto-Dominion bank, the company’s internal website has been made into a social 
media platform that includes blogs, chat forums, surveys, and a feature that allows employees to leave comments on blog pages, news items, and memos. Sun Life Financial Inc. also uses social media—blogs, online communities, and wikis—to get ideas from employees, and the
company has pilot-tested a social media feature that allows employees to respond to the ideas of colleagues. Managers have also noticed that the more casual nature of social media encourages timid employees to speak up and become engaged, whereas they often wouldn’t do so in formal meetings.

Questions for Discussion
1. How do you think happiness and productivity relate to one another? Defend your answer.
2. What factors influence your happiness on the job?
3. Consider the following statement: “The use of social media by employees is harmful to productivity because employees are distracted from their work and spend too much time on personal matters instead. Do you agree or disagree? Support your position.

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