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UKCSI RESULTS
EMPLOYEE ENGAGEMENT
STAKEHOLDER ANALYSIS
SOCIAL INTELLIGENCE
UK CUSTOMER MANAGEMENT CONFERENCE
Deliveringresults on andoff the pitch at
Manchester Utd
HR AwardsEmployee Engagement
Emotional Intelligence
January 2009 4.50Creating value for customers, employees and shareholders
COMPANIESIN THIS ISSUE
Manchester United FCSouthern Housing Group
Hewlett PackardNorwich Union
O2McLaren
Innocent DrinksJohn Lewis
EMPLOYEE SPECIAL
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TheTogether
Company
I really enjoyed reading this book, the
topics of which will be of extreme interest to
H R practitioners and business leaders.
Topics are approached in a systematic and
balanced manner. I commend Raymond
Robertsons flexible attitude of recognisingthat one size does not fit all and that
different circumstances wi ll attract different
reward soluti ons.
Roberto PonteWorldwide Compensation and Benefits and NorthEU Human Resources ManagerInfineum International Ltd
Rewarding what matters most topeople and organisations
19.95inclP+P
Order your copy at www.leadershipfactor.comor call 0845 293 9480
Learn how reward and recognitionstrategies can help your organisationwork smarter, satisfy customers,generate profits and growth,
encourage people to think likeowners and create a great place towork. Learn how to become aTogether Company.
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6 Diary Dates
Training co urses and Conferencesfrom the UK and Am erica.
23 Case Study
Ray Robertson tells us whyconventional wisdom applies evenat an unc onventional tim e.
7 News
Tips for recession beating
8 Case Study
Manchester Uniteds Anthony Lawlertells us how the c lub d elivers resultsoff the pitch as well as on.
27 Conference
Sarah Stainthorpe reports backfrom this years UK Custom erManagem ent Conference.
29 Employee
Rachel Davies has po werfulthoughts on Emp loyee Engagement.
33 Latest thinking
Rachel Allen continues her look atnew techniques for deciding whoyour stakeholders are and how youshould treat them.
VOLUME 6 ISSUE 1 January 2009
Inthisiss
ue...
37 Fast Guide
Emotional Intelligence
38 Book Review
Social Intelligence by DanielGoleman.
12 Latest thinking
Mark McCall reveals more findingsof new research on employeeengagem ent across the UK.
18 Conference
Nigel Hill reports back from theLeaders in London Conference.
www.stak eholdermagazine. com | January 2009 Stakeholder 3
Employee
Engagement
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N igel H ill editor
Stakeholder Satisfaction
PO BOX 1426
Huddersfield
HD1 9AW
Tel: 0845 293 9480
N B: Stakeholder Satisfaction doesnot accept
responsibilityfor omissionsor errors. The pointsof
view expressed in the art iclesby contributing writers
and/or in advertisements included in thismagazine
do not necessarily represent those of the publisher.
W hilst every effort ismade to ensure the accuracy
of the information contained within thismagazine, no
legal responsibility will be accepted bythe
publishersfor lossarising from use of information
published. A ll rightsreserved. N o part of thispubli-cation maybe reproduced or stored in a retrievable
system or transmitted in anyform or by anymeans
without prior written consent of the publisher.
CopyrightSTAKEHO LDER SATISFACT IO N 2009
Editor:
Production Editor:
Designer:
Creative Director:
Advertising:
Nigel Hill
(Manchester United)
Chris Newbold
(Manchester United)
Rob Ward
(Ossett Town)!!
Rob Egan
(Liverpool)
Daniel Hodgso n
(Blackpool)
Stakeholder Satisfaction is the magazine
for people who want their organisation to
deliver results to employees, customersand any other stakeholders as part of a
coherent strategy to create value for
shareholders. We publish serious articles
designed to inform, stimulate debate and
sometimes to provoke. We aim to be
thought leaders in the field of managing
relationships with all stakeholder groups.
ISSN 1749-088X
In a recession you want to keep your top talent as well as your customers.
Thats why Jack Welch spent 75% of his time at G E helping his top peo-
ple to perform better, why R ichard R eed of Innocent Drinks advocates
recruiting the best people that match the values of the business, then do
all you can to engage them, and why Charlie M ayfield of John Lewis
Partnership enthuses about the Employee Value Proposition. For these
and the thoughts of other Leaders in London, see page 18.
Thats why Southern Housing G roup has its Brick P lan development and
reward scheme for employees in the Customer Service C entre, and why
several of them have progressed into more senior housing roles within the
G roup. See Ray Robertsons article on page 23 for more details.
Thats why M olson C oors invested in improving employee engagement
and as a result saved $1,721,760 in safety costs alone. R achel Davies
elaborates on page 29.
Thats why at O 2 all managers have an employee satisfaction measure as
part of their annual bonus. See Sarah Stainthorpes article on page 27.
You dont often associate football clubs with the latest business manage-
ment techniques, but M anchester United is one club that puts as much
effort into motivating its top talent off the pitch as it does on it. Thats why
it introduced the UN IT ED Vision and Values, the going the extra mile
award for outstanding performance on a specific project and the high
performance award for consistently strong contribution throughout the
year. T hats why the Club introduced its Performance and Development
Review P rocess and why all employees are rewarded with a free trip to
any C up Final that M anchester United reaches, even if its in M oscow. For
details see Head of H R , Anthony Lawlers article on page 8.
And to check out the football allegiances of all the contributors to this
magazine see their biographies along with each article!
Best wishes
Nigel Hill
www.stak eholdermagazine. com | January 2009 Stakeholder 5
Our people a nd their favourite footb all teams:
Printers of
Stakeholder Satisfaction
(Fabio C apellos Barmy Army)
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Strategic TalentManagement Summit9th 12th February Stockholm
The theme of the conference is D riving
Strategic C hange through Cutting Edge
Talent and the event covers topics such
as talent identification and assessment,
executive leadership development, proac-
tive succession planning and employer
branding. There are speakers from many
prominent organisations including R olls
R oyce, Siemens, H ilton, M arstons, and
Skanska.
For more information go to:
www.talent-management.se/
Improving EmployeeSatisfaction & Engagement22nd April London
Cost 325
This one day training course begins with
an explanation of how Harvards Value-
Profit Chain principles can be used to
drive employee satisfaction and its down-
line consequences of customer
satisfaction and profitability. To follow
Harvards advice and deliver results toemployees, organisations have to be
world class at using employee surveys to
understand what matters most to
employees, to monitor the extent to which
the company is meeting their require-
ments and to identify specific, actionable
priorities for improvement. The course
covers best practice employee surveys as
well as using the results to drive forward
employee satisfaction and engagement.
For more information call Ruth on
0845 293 9480 or chec k out:
w ww .lea de rshipfac tor.co .uk/products /d
eta ils/2030.htm l
People DevelopmentSummit 200911th 13th March M adrid
The People Development Summit offers
HR professionals from the UK a unique
opportunity for focused business net-
working. This is an event that is effectively
funded by suppliers, so HR professionals
go free. It comprises a series of short
meetings with suppliers, who you can
select beforehand, together with some
seminars plus entertainment, wining and
dining in the evenings.
For more information go to:
www.summit-events.com
Advancing the Service Culture5th March | 12th May London
2nd April M anchester
Cost 325
Without the right mindset, organisations will
never deliver a consistently flawless cus-
tomer experience. This is a highly
motivational 1 day training course to help
organisations build a genuinely customer-
focused culture. D elegates leave full of ideas
to build a service culture where staff auto-matically put themselves in the customers
shoes and turn customers into advocates.
For more information call Ruth on
0845 293 9480 or check out:
ww w.lead ershipfa cto r.co .uk/products /d
eta ils/7201.htm l
HRD 200921st 23rd April London
Aimed at people and organisational devel-
opment professionals, the conference
focuses on five key areas:
Organisational development
Coaching
Talent management
People development
Learning delivery
It features over 40 seminars delivered by
HR and business speakers.
For more information go to:
w w w.c ipd .c o.uk/ca nde /hrd
Employee Engagement Surveys16th JuneLondon
This half day intensive briefing will cover
leading edge thinking on how to develop,
implement and action an effective employee
engagement survey. The briefing will explain
how to collect information on emotional
engagement, cognitive engagement,
physical engagement and vocal engage-
ment as well as calculating and
benchmarking a net engagement index and
identifying specific priorities for improve-
ment. The findings of original research into
employee engagement in the UK will also be
shared. With only 33% of UK employees
engaged, this is a must attend event.
For more information call Ruth on
0845 293 9480 or check out:
www.leadershipfactor.com
CIPD Recruitment andRetention Conference17th 18th June London
G iven the current economic climate it is
essential to recruit the right candidates
and improve retention across the organi-
sation. Expert speakers and leading
organisations will provide practical advice
and share how they manage their recruit-
ment and retention. Issues covered
include the latest challenges and trends,
enhancing your online presence, employ-
er branding, flexible working and creating
cultures of engagement.
For more information go to:
w w w.c ipd .c o.uk/ca nde /a rrc/
Diary
dates
Diary Dates
C O M ING UP IN 2009
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News
www.stak eholdermagazine. com | January 2009 Stakeholder 7
news
Tips for re cess ion beating
Heres advice from M ark Tucker, C EO of
P rudential, C arolyn M cCall, C EO ofG uardian M edia Group, P hilip Rosedale,
Founder and C EO of Second Life and
Steve Tappin, author of Secrets of CEO s.
1) Be very customer-focused, mak ing
sure above all that you keep and devel-
op your existing customers since
winning new ones will be more difficult
and costly than usual.
2) Have a team of leaders at the top who
work together, not just a lone C EO .
3) H ave some non-financial goals such as
customer satisfaction, employee
engagement and market share so that
everyone can get behind an achievable
goal even if sales are falling.
4) Cash is king so conserve it. O ne great
way of doing that is to travel less. U se
conference calls or video conferencing
to save the environment as well as time
and money. (See next note on this
page).
5) C ombat the gloom by introducing
some extra things to have fun at work,
e.g. celebrating the achievement ofnon-financial goals.
6) Be innovative, perhaps by giving
employees a percentage of their time to
work on innovation or improvement
projects. This can provide some good
non-financial goals such as number of
new products launched or percentage
of sales from new products. It can also
help with the next point.
7) Have a plan for how you will come out
of the recession stronger. If you have
cash its a great time to buy a struggling
competitor. If not, you could aim for
stronger customer loyalty, a better
website or new reward strategies for
motivating and retaining top talent.
Travel les s a nd s ave your ma rriag e
According to a survey from The Business
Travel Show, 37% of business travellers
cheat on their partners while they are on
work trips, with 8% claiming to have
joined the mile high club but not with their
regular partner. In terms of travelling less,
only 20% said they would be cutting
down on business trips though 42% now
have tighter spending controls while away.
Luckily theyre a frugal lot. 56% of busi-
ness travellers never leave a hotel room
without removing the complimentary toi-
letries and 23% have accidentally'
packed guest towels or dressing gowns.
20 08 P ersonnel Today Awards
Trophies were awarded at a glittering cere-
mony on London's Park Lane at the end of
November with McDonald's scooping the
overall award, H elen G iles, of charity
Broadway Homelessness & Support, named
HR Director of the Year and Thorntons win-
ning two awards.
The full list of winners is:
Employee Engagement Award:
Heart of England NHS Foundation Trust
Talent Management Award:
M ouchel
Reward & Recognition Award:
Thorntons
Employer Branding Award
IHG
Business Partnering Award
Pfizer UK
HR Through Technology AwardNHS Employers
Diversity in the Workplace Award
British Gas Services
Business Improvement Through
People Award
Harrods
Health at Work Award
C horley Borough C ouncil
HR Impact Award
Thorntons
Innovation in Recruitment &
Retention
Paul UK
Excellence in Training Award
B&Q
HR Director of the Year Award
Helen G iles - Broadway Homelessness
& Support
Best HR Strategy
M cDonald's Restaurants
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Case Study
Being successful off the pitch as well as on it requires Manchester United
to have employees who are as committed to the success of the compa-
ny as the players are to winning the Premier League or a major Trophy. To
generate this level of motivation, the business has to make sure that
employees feel valued. They need to know that their efforts to deliver
results for the company will be reciprocated in the companys efforts to
deliver results to them. The starting point is the companys willingness to
listen to employees, to take their views seriously and to take action, where
necessary to improve employee satisfaction.
Delivering results on
and off the pitchAnthony LawlerM anchester United FC
Anthony is Head of Human R esources at
M anchester United. He has worked there for
11 years, experiencing the company as a PLC
and now back in private ownership. He is
responsible for HR across M UFC 's commer-
cial functions, corporate services, venue
operations and M UTV as well as the football
club. When not on a busman's holiday watch-
ing the Reds, Anthony is partial to a bit of golf.
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Case Study
www.stak eholdermagazine. com | January 2009 Stakeholder 9
Listening to employees
M anchester United is currently organising
its fourth employee satisfaction survey.
C onducted by specialists in satisfaction
measurement, The Leadership Factor, the
survey is based on employees 24 most
important requirements. T hese includesoft factors such as friendly working envi-
ronment, approachability of my
manager and being proud of my job as
well as more obvious employee require-
ments such as pay, pension scheme
and Job security . A fter each survey The
Leadership Factor has made clear recom-
mendations for improving employee
satisfaction and because it has acted on
these, M anchester United has improved
its employee satisfaction index each year
and is well up in the top quartile of UK
organisations on employee satisfaction.
To see how this has been achieved, lets
look at things through the eyes of a new
employee.
Induction
Like most organisations, starting work at
M anchester United begins with an induc-
tion to make new recruits feel part of the
family and to make sure they understand
a few key things:
How employees behave, based on theUNITED values
How they are rewarded; pay and benefits
How they are judged and how they can
increase their performance.
Just to make sure they havent forgotten that
theyre actually working at M anchester United,
the newcomers are now taken on a tour of the
stadium to admire the museum and trophy
room, inspect the changing rooms and sit in the
dugout to experience Sir Alexs view of the pitch.
Coming gently back down to earth, the induc-
tion now continues at departmental level. Here
they meet their line manager and are introduced
to their colleagues, have an explanation of how
the department works and taken to lunch in the
staff restaurant.
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Case Study
How emp loyees be have
A past employee satisfaction surveyasked employees for feedback on the
Vision and Values. Two thirds of the per-
manent staff stated that the Vision and
Values do help them to understand the
companys goals and priorities.
How emp loyees are rewarded : p ay
This is a key part of our new employees
induction and has been one of the main
areas addressed by M anchester United
as a result of the employee satisfaction
survey, which demonstrated that many
staff didnt understand how their annual
salary review was determined. As well as
detailed explanations of the reward sys-
tem in the R edLines employeenewsletter, two new elements were
added to the pay review process. In
addition to the basic pay review (all
employees receiving the same percent-
age increase to base salary) and the
profit share bonus (2.5% of all operating
profit above budget EBIT DA is distrib-
uted to all eligible permanent employees
as a percentage of salary), employees
can now earn additional increases to
basic pay for outstanding performance
or extra responsibility. Awarded at their
managers discretion, extra responsibility
includes changes in the employees role
or responsibilities but also takes into
account staff who have developed their
skills, knowledge or behaviours to such
an extent that their contribution to the
business has now significantly improved.
O ur new employee would hopefully also
be motivated by the fact that outstanding
performance can now be recognised by
a going the extra mile award of up to
5,000 for achievement in a specific
project or activity or a 1,000 net high
performance award for consistent out-
standing performance throughout the
year. N ominations for performance
bonuses are made by the relevant
Executive M anagers and approved by a
R emuneration P anel including the C hief
O perating O fficer, H ead of H R and
chaired by the C hief Executive.
How employees are rewarded:
benefits
All permanent employees are entitled to
an impressive range of benefits including
a contributory defined contribution group
pension scheme, life cover of four times
basic salary, income protection, sick pay
and holiday entitlement. M anchester
United has also stayed true to its paternal-
istic heritage by retaining its fully
subsidised staff restaurant. Employee sat-
isfaction with the pension scheme has
shown one of the biggest increases
across the 24 requirements. O ur new
employee could also take advantage of
perks such as free access to M UTV and
various discounts offered via C lub
Sponsors/P artners.
How employees are rewarded:
recognition
H eres the exciting bit for any new
employee at M anchester United - recog-
nition. Some recognition measures, suchas company events to celebrate success,
have been part of employees total
reward package for many years. If the
team enjoys success it is good for rev-
enue but places more demands on staff
as more matches will be accommodated
at O ld Trafford. To recognise their extra
efforts, all employees plus their guest
have been invited to company events in
celebration of this success. N ewly intro-
duced recognition schemes include the
C hristmas P arty and the end of season
P arty on the Pitch , which our new
employee can enjoy with his whole fami-
ly. T here is also the established V IP
Employees of the M onth scheme for liv-
ing the UNITED values. All monthly
winners attend a premier league match
as guests of the Directors, dining in the
VIP suite and watching the game from the
Directors B ox. Nominated by employees
from the m onthly winners, the first
Employee of the Season, Tony Sinclair,
received his trophy on the pitch at the
Tottenham home game in front of a
capacity crowd and millions of viewers on
Sky T V. Tony, who works as H ead
G roundsman received his award for con-
TO BE THE BESTFOOTBALL CLUB INTHE WORLD BOTHON AND OFF THEPITCH.
United with our fans in our com-mitment and passion for the club
Non-discriminatory in makingM anchester United accessible to all,
irrespective of age, race, gender,
creed or physical ability
Innovative in our ambition to befirst to the ball at all times
Team-orientated in our desire towork together with the same dedi-
cation displayed in every game by
our first team squad
Excelling in our aim to be worldclass in everything we do
Determined in our pursuit of suc-cess while being accountable for
our actions.
The UNITED Vision and Values
Vision: To be the best foo tball club i n
the world both on and off the
pitch.
Values: Incorporate how we intend to
operate on a day to day
basis, they are at th e heart of
everyth ing w e do, they are a
mix of the traditiona l behav-
iours that have buil t
Manchester United into wha t
it is today, a successful and
professionally run football
club.
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sistently displaying excellent levels of per-
formance and L iving the United Values
day in, day out. T here is also the newSA S (Sports and Social C lub, named by
the staff), which the company subsidises.
Amongst other staff events it organises
staff football matches at the end of the
season on the O ld Trafford pitch, 5-a-side
football, mixed netball, badminton, circuit
training and legs, bums and tums ses-
sions. If our new employee is less worried
about health and fitness, there are quiz
and curry nights, trips to the races etc!
How emp loyees are judge d
Following the first employee satisfaction
survey, M anchester United introduced its
P DR (P erformance and D evelopment
R eview) Process. All permanent employ-
ees received training on the process and
managers were trained on how to con-
duct annual reviews. T he first goal of the
PDR process is to link individuals objec-
tives to their departments objectives
which, in turn, are aligned to the compa-
nys strategic objectives. T he second
purpose is to enrich employees working
life by encouraging them to identify per-
sonal development goals and by providing
the necessary training or guidance to helpthem achieve their goals.
The PDR process has been a great suc-
cess. O ver the years, the biggest increase
in employee satisfaction has been with
regular review of my performance.
Personal development
In most SM Es the opportunities for promo-
tion are necessarily limited compared with
those in large companies with thousands
of employees. T his is exacerbated at
M anchester United by the very low
employee turnover rate. Whilst the compa-
ny mak es every effort to promote from
within whenever possible, most employees
recognise the limited opportunities for for-
mal promotion as a fact of life if they
choose to stay at the C lub. T his is why it
has been so important for M anchester
United to maximise employees opportuni-
ties for personal development and to
introduce the performance-related reward
and recognition schemes referred to earlier.
Caring and Com munity
All employees everywhere want to feelthat they work for a caring organisation:
one that cares for them and for its local
community. M anchester United provides
its employees with specialist counselling
and support where necessary, it has a
qualified counsellor in its HR Team, a C lub
C haplain, a health and fitness scheme,
and, as we have already seen, a great
induction scheme to make our new
employee feel welcome.
T he M anchester United Foundationssupport for charity and the local commu-
nity is legendary. O ur new employee
would soon get to hear about the C lubs
strong links with UN IC EF. At the Players
P layer events in recent years, for exam-
ple, all proceeds went to charity. P layers
often make personal appearances for
charity and signed merchandise is fre-
quently donated to charities. All charity
work is co-ordinated by the M anchester
United Foundation, which also organises
an extensive Football in the C ommunity
scheme to give thousands of local young-
sters the opportunity to develop their
footballing potential. M UDSA (M anchester
United Disabled Supporters Association)
organises free match tickets for its mem-
bers and their carers, all housed in the
recently refurbished disabled section of
the stadium. The C lub also fosters exten-
sive educational links, investing in its own
C urriculum M anager in the C lubs muse-
um, plus a second Educational O fficer
employed by the local authority but
based at O ld Trafford. Both work full timeon using football and M anchester United
to increase local childrens engagement
with the educational system.
As well as realising that M anchester
United is a caring organisation, our new
employee would hopefully soon realise
that the company consults and listens to
its employees and takes action to
address areas of concern. A t least thats
what the rest of the workforce think. In
the last employee satisfaction survey,
84.1% were satisfied that M anchester
U nited had taken positive steps in
addressing feedback from the previous
survey.
Case Study
www.stak eholdermagazine. com | January 2009 Stakeholder 11
S
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Last Septembers StakeholderSatisfaction article explained why
engaged employees (those who desire
to work to make things better and per-
form at consistently high levels) should be
valued above all others, and emphasised
the importance of being able to see what
motivates and drives these employees. It
explained how employee engagement
can be measured, and in doing so how
we can gain the knowledge required to
get those who are less engaged to
change their ways.
The drivers of engagement
Its absolutely vital to remember that differ-
ent factors work for different people so
every company should aim to discover
what drives engagement in its own organi-
zation. For example, in some organisations,
such as the caring professions, staff may
already identify closely and feel emotionally
attached with what they are doing and see
their work as having a much broader pur-
pose and value. For many other
organisations emotional attachment to the
purpose and value of their work will be
harder to achieve, so good communica-
tions from senior management aboutvision, values and strategy will be essential.
For other organisations pay may be viewed
as a motivator, although this usually only
works up to a point. M ost people become
concerned only if their pay is not competi-
tive with that of others doing similar work.
O ther factors that drive engagement
include training and development and pro-
motion opportunities but these can be
undermined if employees perceive things
are not fair or there is a lack of even-hand-
edness in the way managers behave.
Variations in engagement drivers
O bviously each individual business has to
treat its own employees as unique and
conduct a bespoke survey to identify its
own engagement drivers. H owever, it is
interesting to explore the differences in
employee engagement that can be found
at R egion/Industry/G ender/Job level etc.
The original research conducted by The
Leadership Factor last August using our
own representative panel of employees
provides considerable insight into varia-
tions in employee engagement.
Mark McCallThe Leadership Factor
C lient Manager
Drilling down intoemployee engagement
Secretary of State for Work and Pensions, John Hutton said recently that The most suc-cessful companies recognise that their employees are their m ost valuable asset. Employee
engagement is not just a b uzzword it has a clear link to increased business success. Andthere is growing evidence that business leaders are not simply paying lip service, theyreactually walking the talk. Nowadays, most companies do agree that engaged employees those willing to go the extra mile can have a very strong effect on the success of a busi-ness and so are seeking effective techniques that will allow them to build engagement.
The most successfulcompanies recognise thattheir employees are theirmost valuable asset.Employee engagement isnot just a buzzword ithas a clear link toincreased business success.
Mark works with a varied group of clients such
as Visa, Tarmac, Ferrero, William Jackson andJohnsons.
When not helping his clients to improve employ-ee or customer satisfaction, he spends his time
watching Manchester United win football match-
es.
Stakeholder January 2009 | www.stakeholdermagazine.com12
Latest Thinking
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As already reported in the previous issueof Stakeholder Satisfaction, the main fac-
tors at the overall level that differentiated
engaged employees from indifferent
employees were:
C ommunication from S enior M anagers
R ecognition of your performance
Pay and benefits
Promotion opportunities
Training and development
Interestingly, when cross-checked against
overall employee satisfaction these are
also the five lowest scoring factors, sug-
gesting that there is lots of work to be
done.
Differences by Sector
To demonstrate the need to treat your
employees as unique, lets now start
drilling down by segment. Firstly, lets take
a look by sector. As can be seen in chart
1 there is a significant difference in the
satisfaction indexes, between the top per-
forming industries (education and service
industry) and those near the bottom (gov-
ernment and transport).
There is much support in C hart 1
for Harvards Customer-Employee
Satisfaction M irror theory. Education is not
covered by the UK C ustomer Satisfaction
Index (U K C SI) but the service industry is in
the top 2 for both customer and employ-
ee satisfaction. O thers in the top half for
employee satisfaction are also, if covered,
in the top half on the UK C SI and ditto for
the bottom half. T he only exception is
food retailing, which manages to generate
good levels of customer satisfaction
despite lower than average employee sat-
isfaction. For the latest UK C SI results see
page 31 in this issue of Stakeholder
Satisfaction.
Chart 1: Variationsb y sector (industrieswith sampleslessthan 50 excluded)
60% 70%
SEC TOR
Overall
Education
Service
Financial services
Leisure a nd Tourism
Retail-non food
Health
Telecom munica tions
Manufacturing
Local Government
Retail-food
Government
Tra nsport
80%
67.9%
69.5%
69.4%
69.4%
69.1%
68.5%
68.3%
68.0%
67.2%
66.0%
65.7%
65.7%
62.8%
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Its enlightening to look at some key fac-
tors that are driving these sector
differences. C hart 2 shows the satisfac-tion scores of those who work in the top
performing sector, education, against
those in the bottom performing sector,
transport. Those working in education are
more satisfied with all aspects of their
employment, but the biggest differences
in satisfaction are recorded for training
and development, your line manager lis-
tens to you and being treated fairly.
Taking a step further, we can look at the
number of people engaged in those
industries. Shown in Chart 3, the gap
looks much bigger now that we look at
engagement. Education has a net
engagement index (Engaged minus
Disengaged) of 32.7% , whilst Transport
has a negative net engagement index of
2.3% , meaning that they have more
people who are actively disengaged than
engaged.
To improve any index, you need to under-
stand whats driving it. T his can be done
by comparing the scores for each factor
given by the engaged and the less
engaged employees. If there is little or no
difference in the scores, the factor is obvi-
ously not making much difference to
engagement. A big difference in scores
makes it a key driver of employee
engagement.
As education has so few disengaged
staff their priority would be to try and
move employees from their indifferent
status towards active engagement andwe can see from chart 4 that they need to
prioritise pay and benefits and commu-
nication from senior managers to do this.
Cha rt 4: Improving employee eng a ge ment in educ ation
3 4 5 6 7 8 9
Pa y and benefits
Promotion opportunities
Being treated fairly
Recog nition of your performanc e
Relationship with colleagues
Training a nd d evelopment
P hysical working environme nt
Your line m an ag er liste nsto you
Relationship with your line manager
Having the resourcesto d o your job
Work/life ba lanc e
Communication from senior managers
Engaged
Indifferent
Cha rt 2: Driversof enga gement by sector
4 5 6 7 8 9
Your line m a na ger liste nsto you
Training a nd d evelopmen t
Being treated fairly
Recog nition o f your performance
Comm unica tion from senior managers
Relationship with your line manager
Promotion opportunities
P hysical working environmen t
Relationship with colleagues
Work/life ba lanc e
Having the resourcesto d o your job
Pa y and benefits
Education (101)
Tra nsport (88)
Cha rt 3: Net enga gement by sector
0%
Education
Tra nsport
10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
EngagedIndifferent
Disengaged
5.9%
25.0% 47.7% 27.3%
55.4%38.6%
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Transport meanwhile needs to explore
why so many staff are disengaged, and
needs to make totally different factorstheir priority, especially being treated fair-
ly, communication from senior
managers training and development
and recognition of your performance as
these show the biggest gaps for the sec-
tor.
Differences by job role
As might be expected, managers in gen-
eral are more satisfied than
non-managers. This is important as an
organisation is represented at all levels by
its management, and an employees
sense of what the company is like will
usually be heavily influenced by the way
immediate managers and senior man-
agers behave.
Senior M anagers (defined here as manag-
ing over 100 people) are much more
satisfied than all other roles, especially
with promotion opportunities, training
and development and recognition of your
performance . Not surprisingly, senior
managers are also far more engaged,
with a net engagement index of 48.9% .
Indeed, any other result would be very
worrying, since engagement starts at the
top. If Senior M anagers are not engaged
there is little chance that they will inspire
engagement amongst those working for
them. It must therefore be of some con-
cern that 38% of senior managers are
indifferent and a further 6% actively disen-
gaged!
C lerical employees record a negative
engagement index of -4.5% . To improve
this situation, organisations need to
address recognition of performance ,
training and development and being
treated fairly .
Cha rt 5: Improving e mployee enga gem ent in tra nsport
3 4 5 6 7 8 9
Engaged
Disengaged
Being treated fairly
Communication from senior manag ers
Recog nition of your performanc e
Training and deve lopment
P hysical working environme nt
Relationship with colleagues
P romotion opportunities
Having the resourcesto d o your job
Your line m an ag er liste nsto you
Relationship with your line manager
Pa y and benefits
Work/life ba lanc e
Chart 6: S atisfac tion b y job role
60%
Overall
P OS ITION
Mana ger - Of more tha n 100 people
Manag er - Of between 1-9 people
Mana ger - Of between 10-100 people
Non mana ger - professional
Non manager - manual
Non mana ger - clerical
70% 80%
67.9%
75.4%
70.7%
69.2%
67.2%
67.0%
66.8%
Cha rt 7: Net enga ge ment by job role
0%
Manager - Of more
than 100 people
Non manag er
- Clerica l
10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Engaged
Indifferent
Disengaged
6.4%
21.9% 51.7% 26.4%
38.3%55.3%
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Differences by gender
G ender differences are not large, but
women are more engaged than men,
showing a net employee engagement index
of 17.2% compared with the mens 11.2% .
However, when we dig deeper, the picture
becomes more complex. A s shown in
C hart 9, part-time employees are more sat-
isfied than full time employees, and more
women work part time than men. It is clear
that female part timers are more satisfied
than male part timers (partially down to
work/life balance, are they mak ing the
choice to work part time?) whilst there is lit-
tle difference between gender satisfaction if
comparing full time employees only.
Having established that part time staff are
more satisfied than full time, it is interesting
to note that the reverse is the case when
comparing engagement. Shown in Chart10, we can see that the net engagement
index for full time employees is 16.3% but
that its only 11.3% for part time staff.
C learly part time staff are happy with their
work-life balance choice, but are often not
particularly engaged in driving the success
of their company or their own career.
Two of the top three drivers of engage-
ment for full time employees are
recognition of your performance and
promotion opportunities. The third is
communication from senior managers ,
which is also important to part timers.
However, the key driver of engagement for
part time employees is pay and benefits.
What have we learnt?
M ost importantly, that you must treat your
own employees as unique and that any
generic study of employees is unlikely to
be transferable to a specific organisation.
Not only do you need to treat your own
staff as different from other organisations,
but its very likely that you also need to
explore what is driving different groups of
people within your organisation, because
managers have different needs from staff,
and that age, gender, full time/part time
workers may all have differing needs and
expectations that need to be met.
Another key learning point is just how
important in driving engagement, com-
munication from senior managers is to
most employees. When measuring satis-faction alone, this factor is rarely top of the
list of priorities, but it has emerged as a
vital factor in turning indifferent employ-
ees into fully engaged staff.
As the credit crunch bites, and companies
need their employees to work smarter and
better to differentiate them from the rest,
employee engagement continues to become
ever more vital to long-term success.
After a decade that has seen employee
engagement levels staying at much the
same level right across the globe, perhaps
we are finally going to see employees treat-
ed as companies most valuable asset.
Cha rt 8: Employee enga gement by g ender
0%
Female
Male
10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Engaged
Indifferent
Disengaged
30.2% 50.8% 19.0%
17.4%47.9%34.6%
Chart 9: Sa tisfac tion by hoursof workand g ender
50% 60% 70% 80%
Fema le P art time (458)
Female Full time (742)
Male P art t ime (144)
Male Full time (656)
70.8%
67.1%
68.7%
66.8%
Cha rt 10: Enga gement by hoursof work
0%
Part time
Full time
10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
34.0% 48.3% 17.7%
19.0%50.7%30.3%
Engaged
Indifferent
Disengaged
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The Thinkers
M any people attend conferences to get
new ideas and / or to provide thinking
time so you would expect full time
thinkers to be just what the doctor
ordered. Especially if theyre in at No. 11
on the T hinkers 50 (the list of the worlds
top business thinkers). Although it seems
like an age ago, I remember sweating
blood over K otlers massive textbook and
always admired his customer-centric view
of marketing, not to mention the millions
of books he must have sold. Imagine my
disappointment when he treated us to a
lecture he could have delivered to his first
year students a few days ago, or worse, a
few years ago. We sat through a thorough
text book account of the evolution of mar-
keting and encouragement to fight the
recession with paradigm shifts but no new
insights as to what these might be.
Surely G ary Hamel would be better. After
all, he co-authored C ompeting for the
Future, the best selling strategy book of
all time and wrote 2007s Best Business
Book (as voted by editors of Amazon),
T he Future of M anagement. Both titles
sound very apt in current times. Well he
was certainly more animated than K otler
and a lot noisier, and much more scathing
about the complete failure of modern
management, which, according to Hamel,
has not really progressed since the 50s or
60s. However, he did suggest some spe-
cific ideas for how to do the paradigmshifting and become 21st century leaders.
O ne idea was to ask thousands of out-
siders to help develop your company
strategy. I think he meant customers. An
interesting idea, and one that was devel-
oped later and far more tangibly, by one of
the doers. M ost of his ideas were focused
internally on employees and culture and
were drawn from his favourite companies
like W L G ore and Semler C orp. For the
latter see the book review in a very early
edition of Stakeholder Satisfaction(December 2003), but there are many
parallels between the two companies.
Both are supreme examples of employee
managed, in fact, employee led organisa-
tions. Work units are self-managed teams
who appoint their own leader and can
do whatever they think appropriate to
achieve agreed revenue targets. No-one
can tell anyone else what to do, but peer
appraisal determines pay, so contributing
is a sensible career strategy. A ll employ-
ees can spend 10% of their time on
whatever they find personally interesting.
As well as helping employee engagement,
this policy generates most of the compa-
nys new products and growth. H amels
Philip KotlerP rofessor
K ellogg School of M anagement
Aspiring leaders gathered in December in the interesting venue of the
Central Hall Westminster. 800 of them, occupying only the lower of the
two tiers of seating in the Grand Hall belt tightening presumably hav-ing a bigger impact on bookings than any belief that leadership is the
way out of the recession. The venue was an interesting choice.
Convenient yes, historic certainly, with the Victorian features from the
ceiling roses to the plumbing still aesthetically pleasing and fully func-
tioning. Interesting and historic but in sharp contrast to the many voices
promoting the need to throw out the old management paradigms and
bring in the new to have any hope of fighting the recession. Apart, that
is, from one very well known, rather crustaceous but very persuasive
voice. More about him later. Im going to start this review of Leaders in
London with the thoughts of the thinkers, the speaker category with the
biggest membership.
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fundamental point is engaging, empower-
ing and therefore harnessing the creative
potential of all employees. Not a new ideabut certainly a good one. He encourages
organisations to develop a thoughtocra-
cy of ideas. Like the 540,000
suggestions generated last year just by
Toyotas Japanese employees. D ell have
an IdeaStorm. The interesting thing here
is that its on the intranet for all employees
to see and to comment on, like a blog,
often generating many comments for
each suggestion. Now that is a good way
to harness the creative power of the work-
force.
Vijay G ovindarajan is G Es C hief
Innovation C onsultant as well as an aca-
demic. Another paradigm shifter,
G ovindarajan uses an interesting high
jump analogy to illustrate the view that
successful innovation requires outside
the box thinking. In the early days of the
last century the prevailing technique was
the scissors, just like we all did at junior
school, but over the years the much more
efficient techniques of the straddle and
then the Fosbury flop were developed. It
is the completely new techniques that
resulted in advances in the world record.
Its very unlikely that men would be jump-ing almost 2.5 metres and women over 2
metres using the scissors! G ovindarajans
five barriers to innovation are
1.Too much focus on current operations
2.Lack of tolerance for failure
3.Not embedding innovation as an
important responsibility for every
employee
4.Too much silo mentality
5.Lack of a global mindset.
G ovindarajan thinks that overcoming the
first barrier is the biggest challenge for
most organisations, saying: The problem
is not so much getting new ideas in as
getting some of the old ideas out. You
need to forget some of what has made
your core business successful.
Author of M icrotrends: the small forces
behind tomorrows big changes, M ark
Penn was a valued advisor to both Tony
Blair and Bill C linton, helping them to
identify and respond to consumer trends
and voting patterns. P enns key trend is
the transition from the Ford economy to
the Starbucks economy a world of
mass customisation and fast emerging
niche markets. In the Ford economy see-
ing new patterns was less important than
creating them, marketers seeking to cre-
ate markets and manipulate consumer
choices. O f course, you could debate this.
I ve always agreed with P eter Drucker that
the most profitable business model has
always been to sell products that cus-
tomers want to buy rather than persuade
them to buy the products you want to sell.
Where Penn and I would agree, however,
is that burgeoning information and com-
munication channels in the internet age
have made it much more feasible to iden-
tify and respond to niche trends and
needs. N ot just feasible but essential,
since growing consumer confidence
together with widely available informationon niche products and services means
that consumers are no longer prepared to
settle for second best. M icrotrends might
not be a quick fix to battling your way out
of the recession but will surely be a key
element of all good companies innovation
strategies in the 21st century.
The Doers
Some of the doers are technically ex-doers (or is that didders?), but if they run,
or have run proper businesses, theyre in
this section. That doesnt mean they were
all great contributors to the conference.
The one I was most looking forward to as
a champion of entrepreneurs, was the
most disappointing. Luke Johnson, best
known for P izza Express but also suc-
cessful owner of businesses across many
other sectors was a strict verbatim reader
of a speech, much of which was quotes
from other people.
C harlie M ayfield is C hairman of John
Lewis P artnership ( including Waitrose),
clearly admirable businesses. H e
acknowledged that theyre suffering in the
recession, especially on higher tick et
durables, but he isnt changing his strate-
gy. B ased on Harvards Service-P rofit
C hain principles, his key management
beliefs such as the C ustomer Value
P roposition and the Employee Value
Proposition have been widely covered in
earlier editions of Stakeholder
Satisfaction. For details go to www.stake-
holdermagazine.com and see the
December 2003 issue for the C ustomerValue Proposition and the M arch 2004
issue for the Employee Value Proposition.
With the recent withdrawal of Honda,
Formula 1 is not currently a comfortable
place to be, but listening to boss Ron
Dennis, one team thats not quitting is
Gary HamelVisiting Professor
London Business School
Vijay GovindarajanP rofessor
Tuck S chool of Business
Mark PennAuthor and Consultant.
Luke J ohnsonEntrepreneur and Chairman,
C hannel 4
Charlie MayfieldC hairman
John Lewis Partnership
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M cLaren, home of newly crowned world
champion Lewis Hamilton. S ince their
mission is that they exist to win, youwouldnt expect them to be quitters, but
Dennis had some very interesting mes-
sages of great relevance to business in
the 21st century, especially on the need to
increase the speed of making and imple-
menting decisions without reducing the
quality of outcomes.
Dennis pointed out that over a lap of
almost three miles the difference between
the fastest and slowest car on the grid in
the Brazilian G rand Prix was 1.74 sec-
onds. To maintain an edge in such a
competitive environment, a M cLaren car
will be 2 seconds quicker at the end of the
season than it was at the beginning. To
achieve this, a change to the design of the
car will be made every 20 minutes! To
maintain this pace of change, decisions
about design improvements must be
debated, adopted and implemented at
breakneck speed, but without compromis-ing quality. The cars must obviously remain
safe, thats just a given, but the design
changes, or at least the vast majority of
them also need to work. To give a couple
of examples, it takes a volume car maker
five years to conceive, develop, test and
build a new car. It takes M cLaren ten
months. It takes Ford up to two years to
design and develop a new suspension
system. M cLaren have done it in two
weeks. Dennis emphasised that to suc-
ceed in this pressurised environment,
everyone on the team must be highly
ambitious and totally engaged, so employ-
ees are highly incentivised, but rewards
are not automatic, they follow results and
reward success not mediocrity.
O ne of the most interesting speakers,
and certainly one of the most engaging,
was R ichard R eed, co-founder of
Innocent Drink s, B ritains fastest growing
food and drink company, achieving a
turnover of 100 million in less than 10
years. R eed had 5 messages based on
the lessons hes learned over this period.
First, keep the main thing the main
thing. M aintain focus on a clear product
offering that is designed to match pre-
cisely the needs of a target customer
group. Second, its all about the peop le.
Like Dennis, R eed advises recruiting the
best people that match the values of the
business, then do all you can to engage
them. As an example, on day 1, new
Innocent employees are given a mug and
a bowl with their name on, for the free
drinks and breakfast. T hird, make
money, but only if you can do it ethicallyand sustainably. Fourth, and again echo-
ing Dennis, take care of the details
because if theres parity in a market, its
the little details that make the difference.
Last but not least, open up, listen up.
C ustomer feedback is essential. T he
business needs to know at all times how
customers see it and that they are satis-
fied with what theyre getting.
G ary Hamel suggested that you should
ask thousands of outsiders to help devel-
op your company strategy just what
C arly Fiorina did when she became the
first (and still only) female leader of a
Fortune 20 company in 1999. H ewlett
Packard had just missed its 9th consecu-
tive quarterly forecast. For a technology
company at the height of the dotcom
boom, that was not a good performance.
In the next issue of Stakeholder
Satisfaction well look in detail at the
strategic changes that resulted from this
customer consultation, but in this article
I ll outline her approach to changing the
culture at H P.
Fiorina inherited a very conservative culture
where people were very thorough, took few
risks and were rewarded for beating inter-
nally generated (conservative) targets. T he
first thing she did was to reward people for
satisfying customers before developing
and communicating the companys new
strategy and vision. Although HPs strate-
gic direction was changed massively by
Fiorina, she was at pains to emphasise thatas long as a vision is only the leaders, it
wont succeed. You have to communicate
the vision sufficiently well to motivate some
employees (change warriors) to lead the
others into the new land. There are some
very senior people who dont lead (which is
a big problem) and others lower down who
can be highly motivated and very influential.
To successfully drive through change, you
dont need unanimity but you do need crit-
ical mass. You must therefore identify the
change warriors, recognise and reward
them and celebrate success. O ther people
will be watching this and, apart from the
most diehard change resisters, most will
join the winning team sooner or later.
Ron DennisC hairman and CEO
M cLaren G roup
Richard ReedC o-founder
Innocent D rinks
Conference
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Fiorina also had some very relevant tips
for beating the recession. She pointed out
that people always like comfort zones, butnever more than in tough times, when
theyre inclined to dig down into the
trenches and protect what theyve got. In
fact, its in the tough times that you most
need to change. Darwin explained that
the survivors are not necessarily the
biggest, strongest or even cleverest
species, but the most adaptable. Its the
same for companies, but their leaders
must show the way, above all striking the
right balance between realism and opti-
mism. Leaders must have the ability to
recognise all the threats, obstacles and
challenges with clear eyes and they must
be truthful to employees about these. But
they must also be optimistic, and succeed
in communicating a genuine belief that the
organisation can meet the challenges and
build a better tomorrow.
Someone who never had any difficulty
being truthful with employees was Jack
Welch, who worked for G E for 40 years,
as CEO and C hairman for half of that time,
during which time the companys market
capitalisation surged from $13 billion to
$400 billion. T his earned him Fortune
M agazines accolade of M anager of theC entury. O pinionated, cantankerous but
infinitely wise and with both feet firmly on
the ground, Welch has no time for too
much academic theorising. H e says that
good managers have to be able to eat
while they dream. In other words, they
must continue to produce short term
results whilst looking after the long term
future of the business. The ability to do
this is the hallmark of great companies.
Anybody can do one but not the other.
G reat leadership is the ability to make the
right judgement calls between the two. So
how did Welch allocate his time at GE. He
claims that 75% of it was spent helping
his people to perform better. H e evaluated
his direct reports every three months,
along the simple lines of: Heres what I
like. Heres what you can do to improve.He was very strong on the need to be
candid with your people. T hey should
never get any surprises.
Rather than hiding away in his office,
Welch spent much more time out and
about, talking to employees of all levels
and to customers, saying; Your job is to
touch everyone and get into their soul.
Welchs top 10 tips for creating corporate
momentum are:
1. The right measures
If he had to run the company
on only three numbers they
would be customer satisfaction,
employee satisfaction and cash
flow.
2. Build confidence
Build self-confidence in your
people.
3. Set your people free
Lik e Harvard, Welch believes
that employees have to operate
within a clearly agreed set of
parameters, but youve go t to
have more freedom than you
ever dreamed of.4. Shout when you win
You must celebrate all the victo-
ries, even the little ones.
5. Numbers arent enough
Sales and profit targets are not
the vision. T hey are the product
of the right vision and strategy
successfully implemented.
6. Talent development
At GE, Jack Welch and his top
two HR people visited each divi-
sion for a day and personally
reviewed the top 20 to 50 people.
7. Fair doesnt mean the same
To treat every person fairly you
have to treat them differently.
8. Make people share good ideas
At quarterly divisional head
meetings Welch insisted that allmanagers shared the ideas and
practices most responsible for
their divisions success that
period. We take the best of
diversity and use it.
9. Meet customers more often
Welch made a point of person-
ally meeting all GEs major
customers twice a year.
10. Dont dither. Jump
Ive learned in a hund red ways
that I rarely regretted act ing but
often regretted NOT acting fast
enough.
Carly FiorinaDi rector of several companies
ex-CEO HP
J ack WelchFortune M anager of
the Century
Nigel Hill
Founder of The
Leadership Factor
and editor of
Stakeholder
Satisfaction.
Football highs -
meeting Bobby Charlton twice, the last 3
minutes of the 1999 Champions Leaguefinal and R yan G iggs wonder goal against
Arsenal.
Stakeholder January 2009 | www.stakeholdermagazine.com22
Customer
S
EMPLOYEE SURVEYS
Do you want an average employee
survey based on standard questions
for the typical organisation?
O r would you prefer questionsbased on what's important to your
employees with actionable
outcomes to improve the
engagement of targeted employee
groups.
If youre trying to differentiate rather than
follow the pack, contact Jim Alexander on:
01484 467 [email protected]
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Employee
Engagement- The key tobusiness success
In a recent survey of large UK employers conducted by
Strategic Reward, we asked HR Directors What are
your top three issues, in order of priority, over the next
6 to 12 months? The 150 respondents placed
Employee Engagement in top spot, closely followed by
Leadership Development. Is this what we would have
expected? According to conventional wisdom the
financial crisis, decline in manufacturing output, tough
times on the high street and plenty of negative press
mass redundancies and major restructuring of the
workforce would be nearer the mark. But, why should
conventional wisdom apply when times are definitely
unconventional?
A POSITIVEATTITUDEHELD BY THEEM PLOYEETOWARDS THEORGANISATION
AND ITS VALUES
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Employee engagement is now widely
recognised to be at the heart of business
success in good times and not-so-good. If youre restructuring, engaging
survivors is going to be a tough challenge,
but its far from impossible; I f youre
standing still and in batten down the
hatches mode, motivating, encouraging
and supporting employees who feel inse-
cure about their future is crucial. If parts of
your business are expanding (yes, its not
all doom and gloom out there), having a
compelling proposition about why people
should join your organisation (and stay) is
essential too.
Engagement defined
Not surprisingly, definitions of employee
engagement differ. T he Institute of
Employment Studies2
definition includes
the words a positive attitude held by the
employee towards the organisation and
its values. An engaged employee is
aware of business context, and works
with co lleagues to imp rove performance
within the job for the benefit of the
organisation. Heskett, Sasser and
Schlesinger3
talk about .the frequen-
cy w ith which an employee refers others
for emp loyment with the organisation .
Ask a group of HR D irectors and they
will typically say
Employees showing high organisation-
al commitment, job satisfaction, and
who embrace the brand
A happy, motivated, productive and
loyal workforce
Employees feel valued and that theircontribution has an impact on the
business
Employees regularly work to exceed
expectations, are willing to challenge
the sta tus q uo and ta ke informed risks.
While organisations may have different
definitions of employee engagement, the
end result is the same: desired behaviour,
in particular the extent to which employ-
ees engage in the sort of discretionary
behaviour which is right for customers,
other stakeholders and long term growth.
This behaviour is often referred to as
going the extra mile. For me, this is
about
Customer focus: understands the cus-
tomer; solves their problems
Innovation: challenges assumptions;proposes new wa ys
Tea mwo rk: w orks a cross bounda ries ;
shares knowledge; encourages col-
leagues
Open communications: creates clear
communications and feedback
Recommending the organisation: as a
plac e to work; as a place to do business.
Why is behaviour so important? Surely,
results are what matter most. We have to
look no further than our own experience
for the answer. How do we feel when we
stay at a hotel where employees treat us
like a VIP? G reat, we book again and we
tell our friends. C ontrast that with a retail
store where the sales assistant is interest-
ed only in pushing a specific product,
probably because they have been finan-
cially incentivised to do so, and treats us
like an inconvenience. We are dissatisfied,
we tell our friends and we never shop
there again.
Barriers to engagementand overcoming them
O ur experience raises two important
questions. What are the barriers to
employee engagement and how can we
engender it? T here are lots of organisa-
tions where employees dont understand
how their day-to-day work affects busi-
ness performance. P hilip Addison,
Human Resources Director, Accor UK &
Ireland Hotels, puts it this way: Business
Leaders often take some of the basics forgranted and assume that employees
know whats important if the business is
to succeed, whats expected of them and
what they can receive in return. But , if we,
the Business Leaders, don t set out clear-
ly whats expected of employees and
what well provide in return, how can we
possibly expect employees to know
whats important to our business?
Developing our vision and values with
them really helped us clarify our own
thinking.
O ther, more potentially damaging, rea-
sons are lack of fairness and consistency
in the way HR practices are implemented.
O ur research tells us that this is a big con-
cern. Among the most frequently made
comments at focus groups that I facilitatefor clients are
Pay review isnt transparent
We only get neg a tive feedba ck abo ut
customer satisfaction
Recognition! Whats that?
My manager pays lip service to my
tra ining needs
According to research by the Corporate
Executive Board1
, employees percep-
tions of pay process fairness, that is the
procedures used to evaluate and allocate
pay, not the level of pay, is a 25 times
stronger predictor of employee commit-
ment than is pay satisfaction. Without
fairness and consistency, emotional con-
nections will not exist.
But not dealing with malingerers, people
who go out of their way to upset working
relationships and cynics who criticise the
motives of the organisation, whatever it
does, sets an incredibly bad example to
the majority of employees and is bad for
business.
This is in stark contrast to organisations
where people feel valued and work
together towards common objectives with
which they all understand and agree.
Here, business leaders work tirelessly to
build and retain the trust and confidence
of employees, to create a culture where
employees feel engaged because their
personal success and that of the organi-
sation are tied together. These businessleaders are the role model for the way we
do things around here.
A compelling employee proposition
A truly compelling employee proposition,
which attracts, engages and retains the tal-
ented people the organisation needs, must
be based on everything employees value in
the workplace. Thats a lot to do with intan-
gible factors such as job challenge and
interest, freedom and autonomy, employ-
ees needs at different stages of their life
and reputation of the organisation. T he two-
way nature of the employee proposition can
be set out quite simply, as shown overleaf:
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Case Study
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We expect you to .
Put guests at the centre of our
company Help create a positive and engaging
work environment for everybody
Live our company values
Enga ge with performa nce review
Develop yo ur skills a nd w a nt to learn
Work tog ethe r, co ntribute idea s a nd
sha re knowledge
Be o pen and respectful
We provide ..
Very co mpet itive rewa rds in the hos pi-
tality sector
A benefits pac kage that is relevant a nd
of value to you and your dependents
The oppo rtunity to ea rn rew a rds ba sed
on contribution both results and
behaviour
Opportunities for learning, develop-
ment, personal growth and career
progression
A great work environment that recog-
nises excellence and teamwork, and
provides respect and support for the
individual.
While this generic proposition communi-
cates the key principles which underpin
employment, what one type of employee
group finds interesting and engaging,
another may find boring and de-motiva-
tional. So, variations in employee
proposition may be appropriate.
Segmenting the workforce can reveal
powerful insights about what employees
value, and consequently the drivers of
engagement. C ategories include
Employment arrangement full-time,
part-time, fixed term contract,
telecommuter
High performers do they ha ve uniq ue
needs and expectations?
High potential employees those
whom the organisation believes have
the capability to become top leaders
and the vision to take the organisation
to greater success in the future. What
engages them?
Critica l groups do groups o f employ-
ees , such as g r adua tes ,
customer-facing or product develop-
ment have different views about the
wo rkpla ce experience ?
The case study describes how one organ-
isation, Southern Housing Group, delivers
three key aspects of its employee propo-sition providing a talent pipeline,
encouraging and rewarding learning, and
giving employees the opportunity to work
flexibly.
Change Blueprint
C ontrary to much conventional wisdom in
HR , the drivers of engagement are specific
to individual organisations, so general pre-
scriptive actions to improve engagement
levels are of limited use. Actions should
focus on the specific results of the engage-
ment survey. The following five-point plan is
a good way to get things started:
1. Co mmunica te key results of your
engagement survey openly, via team
talk, round tables and business
forums, and say what action will be
ta ken with an indica tion of timesc ale
2. Build on your employee proposition:
what does it really mean for your
brand and employee engagement?
3. Ensure you und erstand employeesperceptions and the importance they
attach to them
4. Recog nise a nd celebrate s ucces s a t
individua l, tea m a nd organisational lev-
els, es pecially in non-moneta ry wa ys
5. Invest in mana gers a nd tea m lead ers.
Help them delega te, trust, coa ch a nd
reward.
Employee engagement is not an end in
itself. It is worthwhile only if translated into
business results, such as increased cus-tomer or stakeholder satisfaction
(ultimately leading to their loyalty), sales
growth, higher productivity, lower cost-
income ratio or higher profits. Will your
organisation take up the challenge?
References
1. C orpora te Exec utive B oa rd: Driving
P erformance Through P ay-J anua ry
2006
2. Institute of Employment Stud ies, The
Drivers of Employee Engagement,
Report 408
3. The Va lue-P rofit C ha in, Hes kett,
Sass er &Schles inge r, The Free P res s
CASE STUDY: Southern Housing Group
Southern Housing G roup is one of south-
ern Englands largest housing
associations. Founded over 100 years
ago, Southern Housing Group owns and
manages 24,000 homes with more than
66,000 residents, employs 900 people
and works with 80 local authorities.
Southern Housing G roup believes that
building communities is as important as
building homes. So as well as developing
and managing quality affordable housing
for rent and ownership, Southern Housing
G roup invests considerable resources to
provide an environment where people
really want to live. Southern Housing
G roup also invests in HR practices which
are designed to encourage high levels of
customer service and meet the needs and
aspirations of employees. T his case study
looks at three aspects of its HR approach.
1. Providing a talent pipeline
The Graduate Development Programme
(G DP), which has been running for seven
years and is recognised to be one of best in
the Housing sector by the National Council
for Work Experience, provides a successful
talent pipeline for Southern Housing G roup.
The G DP is a three-year programme whichfast-tracks graduates into established jobs
in Southern Housing G roup and gives them
the opportunity to continue with specialised
postgraduate studies.
During years 1 and 2 graduates gain
experience in all areas of Southern
Housing G roup. T hey start their training in
the Customer Service Centre and move
onto frontline housing management, poli-
cy work at head office, housing
development projects and group depart-
ments, such as community regeneration,
finance, IT, human resources, and sales
and marketing. In year 3, graduates take
on a specialist job.
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Case Study
Throughout the G DP, graduates have a
personalised career development plan
and attend well-established in-housetraining courses and management devel-
opment workshops. Each graduate has a
mentor (a director or senior manager) who
acts as a sounding board and helps them
achieve their full potential.
According to K aren Harvey, Head of HR
and Employee Development: Southern
Housing G roup has a 100 per cent suc-
cess rate for graduates passing their
professional examinations and several of
them now hold key jobs in Southern
Housing G roup.
2. Rewarding learning
Southern Housing G roups approach to
reward includes three schemes which are
designed to encourage learning. First, The
Brick P lan is a structured six month devel-
opment and reward scheme for all
employees starting work in the C ustomer
Service C entre. The scheme gives finan-
cial rewards to employees on successful
completion of each stage of the scheme.
T hese rewards are designed to give
employees a personal development
incentive to gain a good, foundation
knowledge of Southern Housing G roup
and the Housing sector. K aren Harvey
says: Southern Housing G roups recent
successful Investors in P eople review
found that employees working in the
C ustomer Service Centre said that, com-
pared to some call centre environments,
the Brick P lan offered them a better career
path and had a strong learning focus.
Several employees have progressed from
the Customer Service C entre into other
more senior housing roles in Southern
Housing G roup. Since introducing the
Brick P lan, employee retention rates in the
C ustomer Service Centre have improved.
Second, Southern Housing G roup have
recently introduced a new reward scheme
providing employees with Learning
Vouchers which can be used for any learn-
ing activity, work or non-work related. Thescheme enables employees to learn some-
thing new, for example a language or
cooking which may not be work related, but
could bring additional personal benefits.
Third, S outhern Housing Group are
required to have a certain number of quali-
fied employees working in their care
schemes and services, so it offers financial
rewards to employees undertaking an NVQ
in Care. K aren Harvey again: T he extra
financial incentive can encourage employ-ees to take on the extra challenge of
studying and developing, especially as
some of them havent studied for a number
of years. Since introducing this incentive,
we have seen an increase in the number of
employees taking up NVQ qualifications.
3. Working flexibly
Southern Housing G roups Flexitime
scheme gives all employees the opportu-
nity to apply for flexible working. The
scheme is designed to enable employees
to work hours that are more sympathetic
to their lifestyle and personal commit-
ments. As long as their manager
considers there is no adverse business
impact, employees are able to accrue
additional hours to allow them to take up
to one day off every 4 week period, with
prior agreement from their line manager.
In addition to Flexitime, Southern Housing
G roup offer all employees the option to
apply for compressed working. This is
where employees work 70 hours (2 x 35
hour full-time equivalent weeks) over 9
rather than 10 days.
C urrently approximately one third of
employees across Southern H ousing
G roup take advantage of flexible working
opportunities, with around two thirds on
flexitime and a third work on compressed
hours. According to a recent employee
opinion survey, 76% of employees felt
Southern Housing G roup allows them to
adopt working patterns which help them
balance their work and home life and 70%
felt that overall, their terms and conditionsof employment were good.
Raymond RobertsonDirector
Strategic Reward
Ray can be contacted at:
email: [email protected]
Tel: 01666 511347
S
Ray is author of the widely accliamed book ,
T he Together Company and one of the UK s
leading experts on reward. He has worked
with companies such as Porsche, Wildlife
Trust, B&Q , A BB and Whitbread.
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Bob Downie (Founder, UK C ustomer
M anagement C onference and C hief
Executive, T he Royal Yacht Britannia)
opened the conference, reminding us of
the need to deal with internal customer
service before external, maintaining that agenuine customer philosophy comes from
the inside. Staff need to be engaged in
order to deliver good customer service.
He felt it was imperative that staff are
involved in customer service improve-
ments because they are closest to
customers and are therefore more aware
of the problems and their potential solu-
tions. We will see an example of this later
from Norwich Union. Shaun Smith (inter-
nationally-acclaimed business speaker
and best-selling author) also underlined
the interconnectedness between employ-
ees and customers, claiming an 85%
correlation between the way employees
feel and the way customers feel.
Norwich Union employee blogs
Darren C ornish (D irector of Customer
Experience, Aviva, formerly N orwich
Union) gave us an interesting insight into
his unique way of engaging with staff; H ecreated a blog on the intranet to commu-
nicate with staff. He felt strongly that
listening, acting and improving upon the
experience creates engaged and motivat-
ed people. The success of the blog was
supported by the fact that it gets 4,000
unique hits a day and each person
spends an average of eight minutes on
there.
O ne example Cornish gave of listening
and acting on what staff say was where a
new employee at the company posted a
message on the intranet about a problem
with the direct debit form that was sent
out to customers. T he information
This years UK Customer Management Conference strongly featured customer
management in the current economic climate. We will look at this in the next
issue of Stakeholder Satisfaction, as well as the importance of defining the expe-
rience you want your customers to have. Here, we will pick up on another theme
from the conference, that of employee engagement, and in particular its intrinsic
link to customer experience. We will also see some of the examples of best prac-
tice outlined f rom organisations such as Norwich Union and O2.
Conference
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required on this form was not clear,
causing hassle for both staff and cus-
tomers. After the message was posted,the staff member was enlisted to help
change the form to be clearer and the
problem was rectified quick ly.
M ore crucially, his story demonstrated the
importance of senior management in
motivating staff and defining the internal
culture. O ne excellent example of this is
shown in an extract from the blog below
Hard to swallow
In NUI I was the Head of C ustomer
Experience. O ne of the things we did was
regular customer listening forums where
complaint customers came and told the
Exec D irectors what it felt like trying to get
a service.
As Head of C ustomer Experience these
sessions helped me no end in getting sen-
ior management attention and action on
what needed to be better. Almost without
fail, the customers would say how badly
we treated them until the complaint teamstepped in and helped sort it out.
Last night I facilitated the NUL Exec team
listening to 6 complaints customers. This
time I had no place to hide. N o other
director to ask to sort it out.
We had one customer in tears, we had
another very angry with us. Another who
said he would do pretty much anything
NO T to put anymore business with us. Id
normally share in detail what was said but
I cant bring myself to.
Apart from one thing. It was said by one
of the customers that they were told it is
company policy for customers not to be
put through to D irectors (or their secre-
taries).
Let me be clear. M y number is 07800
690217. M y email is darren.cornish@ nor-