Edinger - Building employee commitment

Building Employee Commitment

During Turbulent Times

Scott EdingerVice President of SalesZenger Folkman

January 28, 2010

© 2010 Zenger Folkman Company. All Rights Reserved. 2

What is Employee Commitment?

Employee Commitment

= Satisfaction Engagement Confidence+ +

With thethe organization

Would recommendto a friend

Rarely think about quitting

Willing to go theextra mile

Confidentthis organizationwill be successful


Poll #1

• In your opinion, how much impact does employee commitment have on business results in your organization?

– No impact

– A small impact

– Moderate impact

– Substantial Impact


Employee, Customer Satisfaction, Profit Connection

EmployeeSatisfaction

StoreProfits

CustomerSatisfaction

For every 5-point improvement in employee satisfaction,customer satisfaction goes up 1.3%, which in turn

increases revenue growth .5%.

Sears Study


What is the Impact of Employee Commitment?

344139.95

252774.97

112709.56

0

50000

100000

150000

200000

250000

300000

350000

Low Medium High

Employee CommitmentForest Products Company

*Ex

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*Length of time employees are exposed to an unsafe working condition


Profitability by Employee Commitment

28

43

59

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Low Moderate High

Employee CommitmentResults from a Mortgage Bank

Me

an

*N

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*Net Profit Index shows the range in profitability with 0 being no profit


Turnover by Employee Commitment

21

16

13

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5

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15

20

25

Low Moderate High

Employee CommitmentResults from an Insurance Company

Vo

lun

tary

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Strong Relationship Between Employee Commitment and Bottom Line Results


What Factor Influences Employee Commitment Most?

• Effective Communication and Listening• Clear Strategy• High Ethics & Integrity• Leadership Effectiveness• Effective Collaboration and Teamwork• Clear Feedback on Performance• Learning and Development• High Productivity/Efficiency• Innovation• Ability to Change• Strong Sense of Individual Accountability• Effective Customer Service


Poll # 2

• Which of the factors listed below have the greatest influence on employee commitment?

– Effective Communication and Listening

– Clear Strategy

– High Ethics & Integrity

– Leadership Effectiveness

– Effective Collaboration and Teamwork

– Clear Feedback on Performance

– Learning and Development

– High Productivity/Efficiency

– Innovation

– Ability to Change

– Strong Sense of Individual Accountability

– Effective Customer Service


The # 1 Factor is…

The Effectiveness of Individual Leaders


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1st -9th

10th -19th

20th -29th

30th -39th

40th -49th

50th -59th

60th -69th

70th -79th

80th -89th

90th -100th

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Leadership Effectiveness Percentile

Leadership Effectiveness vs. Employee Satisfaction/Commitment

Based on 7391 Leaders

Poor LeadersCreate

Dissatisfaction

Good Leaders Have an

Adequate Impact

Great LeadersMake a Great

Difference


Leadership Effectiveness vs. Employee Commitment / Engagement

0

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90

Bottom 10% Next 25% Middle 30% Next 25% Top 10%

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Results from a large US Bank



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Results from 361 managers in Spain



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Results from 727 managers in the UK



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1st - 19th 20th - 39th 40th - 59th 60th - 79th 80th - 100th

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Results from the United Arab Emirates



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1st - 19th 20th - 39th 40th - 59th 60th - 79th 80th - 100th

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Results from a Financial Services Company in India


Do some leadership behaviors have more impact on employee

commitment than others?


Cluster A• Is trusted by all members of the

work group.

• Stays in touch with issues and concerns of individuals in the work group.

• Provides coaching and acts as a mentor to others.

• Balances getting results with a concern for others needs.

• Is careful to honor commitments and keep promises.

Cluster B• Inspires others to high levels of

effort and performance.

• Energizes people to achieve exceptional results.

• Creates an atmosphere of continual improvement in which self and others push to exceed the expected results.

• Provides others with a definite sense of direction and purpose.

• Is skillful at getting people to stretch for goals that go beyond what they originally thought possible.

Poll # 3

Which cluster of leadership behaviors would have the greatest impact on improving Employee Commitment?


Poll # 4

• How many of you feel overwhelmed in your current job?

– I am not overwhelmed

– I am a little bit overwhelmed

– I am very overwhelmed


The Paradox of Employee Commitment

• But, the experiences that do the most to build satisfaction, engagement and confidence in an organization are:– Challenging assignments

– Accomplishing difficult tasks

– Making significant contributions

– Making the impossible – possible

• If you ask people what would be most beneficial to them personally, they frequently choose: – A break

– Less work

– A vacation

– A little beach time


Inspires and Motivates Others

What employees need• Clear direction

• A distinctive strategy

• Targeted goals and objectives

• Rewards and recognition

• Respect/fair treatment

• Involvement in decisions

• Effective training

• Opportunities for development

• Efficient processes

• Communication

• …

What makes a big difference• Inspiring them to high levels of

effort and performance

• Energizing them to achieve significant results

What is the # 1 Behavior that Leverages Employee Commitment?

How does a person do that?


5257 59 60

6467 67 67 66 67

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Year 1 Year 2 Year 3 Year 4 Year 5

Actual Desired

Building Employee Commitment in Your Organization


Key 1—Regular Assessments of Progress

• Establish a rhythm– Every year

– Every 18 months

– Every two years

• Never cancel the assessment because of difficult circumstances– Often the assessment is a key factor in a

turnaround

– Employees are much more resilient that most people believe


Key 2—Measure the Right Things

• If there is a clear connection between the assessment and day-to-day problems faced by both senior managers and supervisors, then they see how responding to the assessment will help them solve problems.

Not the Shopping Cart Clear Focus


Key 3—Manage Expectations

• Asking employees for their opinions generates expectations

Assessment Item Expectation

I am able to balance my work and personal life.

Management is willing to help me to balance my work life.

I am satisfied with my pay. If I say I’m dissatisfied, then you will give me more pay.


Poll #5

• Which demographic is the best predictor of employee commitment?

– Age

– Gender

– Position

– Tenure

– Work Group


Key 4—All Politics Are Local

Crime is DownIn my Neighborhood

In order to change employee commitment, in addition to some broad organizational changes,

there needs to be a focus at the grass roots – each work group.

Crime is DownIn the Nation


What Makes an Organization Successful?

A

SuperiorExecution

B

Avoiding Mistakes

C

Both areCritical


Key 5—Focus on Building Strengths as well as Fixing Weaknesses

39

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Number of Strengths

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* Results from a Forest Products Company


Summary

• Highly committed employees can have a substantial impact on organizational success

• The number 1 factor that drives the commitment of employees is the effectiveness of leaders

• Challenging assignments and accomplishing difficult tasks increases the commitment of employees

• Inspiring and motivating others is the number 1 leadership behavior that impacts employee commitment

• Remember – all politics are local – work from the grass roots to improve the commitment of employees


Thank You for Joining Us!

• For more on this topic, complete the brief survey at the end of the webinar and we’ll send you a copy of the white paper entitled Leadership Development 6.0.

• If you’d like more from Zenger Folkman, sign up for our Leadership Resource Center at www.zengerfolkman.com/login.html.

• For the latest on Zenger Folkman, don’t forget to follow us on Facebook, Twitter or on our blog! You can find links on our home page at www.zengerfolkman.com.

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