10 Key factors to employee engagement

Guide

Learn the HR strategies to raise the baseline, wherever it’s at in your team, and boost engagement in your organization.

engagement-guide-cover-header
Written by: Officevibe | Edited by: Rachel Steben
Updated on: Published on: November 28, 2022 |  Reading time: 26m

It’s not enough these days to simply have cool perks in your office with no underlying values or mission. Similarly, engagement won’t be complete if you have a meaningful mission without offering employees the right incentives to motivate them. 

The term “engagement” has been used so often and in so many different situations that it’s become hard to define. Many people think it means happiness or satisfaction, but you’ll soon understand that it’s much more than that. 

According to Gallup, which has been collecting and measuring employee engagement data for nearly 20 years: 

Only 32% of U.S. employees are currently engaged at work, while an alarming 17% say that they’re actively disengaged from their daily tasks.

Millions of people are unhappy, unproductive, and not bringing their full value to your organization. As upsetting as this is, it can also be seen as an opportunity for organizations to go full throttle with employee engagement and completely outpace their competitors. 

What you’ll learn in this guide

  • What is employee engagement 
  • Why engagement matters to your organization 
  • The 10 key factors to employee engagement 
  • Where you should focus your efforts to get maximum results 
  • Quick and fun employee engagement ideas 

What is employee engagement?

One of the first definitions of employee engagement comes from Boston University Professor William Kahn’s 1990 paper, “Psychological Conditions of Personal Engagement and Disengagement at Work.” In it, he defines employee engagement as follows: 

The harnessing of organization members’ selves to their work roles; in engagement, people employ and express themselves physically, cognitively, and emotionally during role performances.

Gallup defines engaged employees as those who are “involved in, enthusiastic about, and committed to their work and workplace.”

Similarly, Deloitte defines employee engagement as “an employee’s job satisfaction, loyalty, and inclination to expend discretionary effort toward organizational goals.”

Notice the common themes with all three of these definitions: emotional commitment and attachment from employees. When employees are engaged, they’re “all-in” and want to see the organization succeed. They’re not just there for a paycheck, or because they have to be, they choose to be there because they want to be. 

Engaged employees are the ones that solve problems without you asking them to. They look for new solutions to processes and procedures. They innovate, collaborate, and inspire others around them. 

Officevibe defines employee engagement as:

The emotional commitment that an employee has to the organization.

When an employee is engaged, they use discretionary effort to go above and beyond their typical job requirements without being asked to do so. They do this because they’re emotionally invested and genuinely care about the company.

The results of happy, motivated employees? Happier customers, better business results, and a stronger employer brand.

Why is employee engagement important?

Imagine if every employee was passionate about seeing the company and its customers succeed.

The only true way to ensure that your customers are well taken care of is by taking care of your employees. This concept is known as the service-profit chain, first introduced by Harvard Business Review in 1998. It’s still as relevant today as it was then.

Profit and growth are stimulated primarily by customer loyalty. Loyalty is a direct result of customer satisfaction. Satisfaction is largely influenced by the value of services provided to customers. Value is created by satisfied, loyal, and productive employees. Employee satisfaction, in turn, results primarily from high-quality support services and policies that enable employees to deliver results to customers.

The service-profit chain is the flow from the culture you create to the profits you generate and every step in between. 

The key is to start internally. When you create an environment where employees are happy, productive, autonomous, and passionate about what they do, they’ll provide better customer service.  

That amazing service will create many loyal customers, leading to sustainable growth and profits. That’s why it’s important for every leader in an organization to understand the service-profit chain and how each step impacts the other. 

chart of service profit chain in employee engagement

The benefits of having engaged employees go beyond fueling customer loyalty and profit and include: 

  • A stronger employer brand, helping you recruit and retain the best talent.
  • Reduced stress at work, letting everyone be themselves and have fun. Psychological safety is so important.
  • Lowered employee turnover, helping you avoid the costs (time and money) of replacing someone.
  • Increased productivity, because employees that are engaged collaborate better.

Employee engagement statistics

If you’re still not convinced if engagement matters or not, here are a few  employee engagement statistics that prove how valuable it really is: 

According to theBureau of Labor Statistics, “working and related activities” account for the second largest portion of our day with the average being 8.28 hours spent on it, rivalled only by personal activities (including sleep) at 8.98 hours.  

When you think about how much of our time is spent at work (about 8 times more than “caring for others”) it’s only fair to hope that it can be pleasant. No one should have to spend that much of their life stressed, unhappy, overworked, or under-appreciated. 

As leaders, we need to do more for employees and ourselves, to ensure that we’re all living a happy, healthy, and productive life. 

10 Key factors of employee engagement 

personal growth puzzle piece

At Officevibe, we take employee engagement very seriously (so much we built a tool for it). Our solution measures employee engagement across teams by sending automated surveys to employees and gathering anonymous feedback. Insights from these regular surveys help spot disengagement across a company, helping leaders address areas of concern with their teams.  
 
These pulse surveys measure 10 key metrics of employee engagement:  

  • Personal growth 
  • Feedback 
  • Recognition 
  • Relationship with manager 
  • Relationship with peers 
  • Happiness 
  • Ambassadorship 
  • Wellness 
  • Alignment 
  • Satisfaction 

Together, these metrics portray how your employees feel and how invested they are in their roles within your organization. 

Let’s deep dive into each and examine why and how you can support these contributing factors to enrich engagement levels on your team.

Personal growth: a deal breaker

When employees stop growing, they plateau, get bored, and will eventually start looking elsewhere for career opportunities. 

Research from Gallup  found that younger generations, like millennials and Gen Z, are 17% more likely to prioritize professional development opportunities when seeking a new career than their older counterparts.  

Intellectual growth should commence at birth and cease only at death.

Albert Einstein

Personal growth is made up of three components:

  1. Autonomy
  2. Mastery
  3. Purpose

Daniel Pink, in his book, Drive, talks about these three components as the things that truly motivate us to do our best work.

Autonomy

We all have an inner drive that makes us curious to discover and learn new things. Our self-direction is a part of who we are. At work, we need to feel like we have control over our work and our day-to-day. 

This emphasis is important for engagement, and companies should be actively looking for ways to give their employees more autonomy over their work – whether it’s deciding what to work on or when to do it.

Mastery

Mastery is the concept of getting better at something and the feeling we get from progress. 

Sometimes, this is easier said than done because we can quickly become overwhelmed if a task is too difficult. On the other hand, we become bored if a job is too easy. 

Pink recommends working on what he calls Goldilocks tasks — tasks that are just right. For a task to be stimulating enough for you, it needs to challenge you and push you outside your comfort zone, but not too much. 

When a task is too challenging, performance declines. 

This is also known as the Yerkes-Dodson Law:

chart of the Yerkes-Dodson law

Leaders need to have frequent, open discussions with their employees about the difficulty of their work and find ways to support their learning and development. 

Purpose

Purpose is when you connect with and believe in the mission and purpose of the organization. According to Pink, that is the highest level of motivation you can achieve. It can’t be faked. If you’re truly passionate about what the organization is doing, you’ll come to work each day excited and motivated. 

Managers can help their employees achieve purpose by connecting their work to the bigger picture. Instead of focusing exclusively on numbers and metrics, highlight the real change you’re making in customers’ lives by giving them a voice. 

For example, one study found that showing photos of patients to radiologists (who rarely get to see the patients) helped them improve their performance because they could appreciate their purpose more. 

Three quick tips to improve personal growth 

  1. Invest in learning. Give employees the opportunity to continuously grow and encourage them to learn. 
  2. Promote autonomy by giving employees the space they need, and avoid micromanaging
  3. Have (and promote) a clear mission that everyone can get behind.

 

Feedback: continuous communication

feedback puzzle image

Employees need a clear understanding of their performance and whether their managers believe they’re doing good work. Any ambiguity will lead to confusion for the employee, which isn’t helpful and can be demotivating. 
 
Too often, employees have to wait until an annual review to get any sense of how they’re doing, but that’s way too long of a timeframe. Feedback has a short shelf life. It’s tough to remember the details of a project that happened last quarter, so maybe it gets overlooked. And positive reinforcement works best when addressed immediately, not after the fact. 

Employees are craving feedback. And they want it often.

Officevibe survey data shows that 26% of respondents don’t feel like the feedback they receive is frequent enough to understand how they can improve. 

Feedback is a very delicate thing, though: it’s tough to get right. The words you use, your tone of voice, and even your body language all influence feedback delivery. Unsurprisingly, how feedback is delivered affects whether an employee wants corrective feedback or not. 
 
A Zenger/Folkman study on feedback found that virtually all (94%) feedback recipients stated that corrective feedback improves their performance when it’s presented well.  

So the question for managers becomes: how do we give better feedback? 

Here are a few tips to help you: 

Give feedback frequently

When a basketball player does something wrong, do you think the coach waits until the end of the season to tell them about it? Of course not. You can’t wait until the end of the year to give someone feedback, it’s already long forgotten. The same goes for off the court.  

Employees are 3.6 times more likely to strongly agree that they are motivated to do outstanding work when their manager provides daily (vs. annual) feedback.

Gallup 

Feedback is about changing behaviors, so giving feedback quickly after the behavior you want to change makes them more likely to change it. Give feedback in as near real-time as possible, and make sure to have frequent meetings (like one-on-ones) with your employees.

Tie a goal to your feedback

The best way to ensure that feedback gets listened to is to tie it to a goal. That way, you can measure the employee’s progress for performance, and they can use that metric to measure their personal growth. 
 
With a specific outcome defined, it becomes easier to see what effect the feedback had.

Focus on the behavior, not the person

Feedback can be sensitive for employees, so your job is to make it as neutral as possible. You don’t want your input to come off as a personal attack, so it’s better to focus on the behavior rather than the person. 

For example, instead of making your feedback about the person (“you’re always late!”), you can make it about the behavior (“when you showed up late, it delayed the whole team…”). 

And one more important tip…

💡 Be weary of the feedback sandwich (where you hide feedback between two positive statements). It’s easy for the listener to miss the negative or constructive feedback as it can get buried in the speech and is often less specific.

Three simple tips to improve feedback

  1. Have a continuous feedback process that includes one-on-ones, OKRs, 360 reviews, etc.
  2. Ask an employee permission to give them feedback. It will help make it easier for them to handle.
  3. Be honest and straightforward with your feedback instead of trying to hide it.

Recognition: the power of props

recognition puzzle piece

Recognition is the acknowledgment of a job well done. It sounds simple, but many leaders should brush up on it.  

Why? 

  1. Managers are busy, sometimes too busy to notice what’s going on 
  2. Managers can overcomplicate the way they think recognition needs to be given

Luckily, both these points are easy to solve. The first place for a leader to start is by understanding the value of recognition. 

According to the book How Full Is Your Bucket, the number one reason people leave their jobs is that they don’t feel appreciated.

When we look at our Employee Pulse Survey data, the strongest correlation between any 2 of our 26 Engagement Sub-Metrics is between Recognition Frequency and Happiness at Work. People want to feel appreciated for their efforts, and the frequency at which they receive this recognition is directly tied to their levels of happiness and motivation. 

The right recognition program can  have a measurable business impact: 

 
Employee engagement, productivity, and performance are 14% higher than in organizations without recognition programs.

Deloitte

Receiving recognition instills a sense of pride and purpose in people and helps fulfill our most basic human need to feel valued. Modern employees bring their whole selves to work, their technical skills, passion, and creativity. Simply put, work matters to people, and they want to feel they matter to their team and company. 
 
As a leader, take a step back and be mindful of your employees’ actions. Just telling them that you notice can make quite the impression.  

Learn how to make your team feel more valued with our guide to creating a culture of recognition in the workplace.

Relationship with manager: building trust

Three quick tips to improve recognition 

  1. At the beginning of your next team meeting, take time to highlight either a team member’s accomplishment or one of the collective. 
  2. Create a dedicated space for peer recognition, whether that’s an IRL whiteboard to write on, a virtual one, or starting a new Slack/Teams/Yammer channel. We suggest including company values, team principles and goals, and current projects to orient everyone around what binds the team. 
  3. Do something personal (like a handwritten card) to show that you’re going the extra mile. 
relationship with manager puzzle piece

The employee-manager relationship is crucial when you think about how much a manager can affect an employee’s life. Managers determine everything from what employees work on daily, provide career guidance, affect promotions, approve time off, and much more. It’s a position of power and responsibility, and some employees may feel intimidated about developing this relationship.

Here’s something they’ll probably never teach you in business school: The single biggest decision you make in your job — bigger than all of the rest – is who you name manager. When you name the wrong person manager, nothing fixes that bad decision. Not compensation, not benefits — nothing.

Gallup CEO Jim Clifton

Managers account for 70% of the variance in employee satisfaction scores. As satisfaction drops, so does engagement.  

26 percent of those planning to leave their jobs in the next year cited a key factor of lack of trust in leadership. - Deloitte 

Gallup’s State of the American Manager: Analytics and Advice for Leaders asked employees to rate their managers on behaviors linked to employee happiness. 

There were three behaviors that they focused on:

  1. Communication
  2. Performance management
  3. Focusing on strengths

They recommend leaders communicate with their team frequently and create a safe and open environment for employees. Everyone should be comfortable enough to approach their leaders with their concerns. 
 
Performance management should also be frequent, and leaders who only use annual reviews miss out on opportunities to develop their employees throughout the year.  

They also say that too many managers focus on weaknesses. If you focus on helping employees recognize and develop their strengths, you’ll have a much more engaged and productive workforce. 

Three quick tips to improve relationships with managers

  1. Collect feedback from your employees. That vulnerability and growth mindset will show employees you’re trying to improve.
  2. Use your one-on-ones as a way to connect with employees on a personal level.
  3. Organize (and attend) informal gatherings like happy hours or team lunches.

Relationship with peers: friends matter

relationship with peers puzzle piece

A study in the Journal of Personality and Social Psychology  wanted to examine the effects of friendships at work on team performance. The researchers divided up the participants into groups of three, consisting of either three friends or three acquaintances, and assigned them projects to work on. 

The groups of friends performed better on every project because they communicated better, were more honest with each other and were more committed to the team. The groups of acquaintances tended to work alone, didn’t offer each other feedback, and weren’t comfortable enough to ask for help. 

This is a valuable lesson for all leaders. Considering how much time we spend each day at work with our peers, organizations should focus efforts on fostering friendships in the workplace. Something as simple as a happy hour or a team lunch can have a huge impact on those connections. 

Three quick tips to improve relationships with peers

  1. Social events are a great way to form genuine connections and don’t need to be formal. Often the less formal, the better! Fun activities that are interest-based and creative allow employees to let their true selves shine. 
  2. Encourage group projects and create time for employees to work together. 
  3. Team lunches are a nice way to get everyone together, and don’t demand extra outside of the workday. 

Happiness: the secret to productivity

happiness puzzle image

Many people make the mistake of thinking that employee engagement and employee happiness are the same things – they’re not. You can be happy at work without being fully engaged, as NYT bestselling author and CEO of LEADx, a Professional Training and Coaching platform, Kevin Kruse puts it: 

Engagement is not happiness. You can have a happy employee who is not productive, who is happy goofing off or playing games […] An engaged employee is committed to their organization and their organization’s goals. […] They’re fighting for the company. They care. 

Kevin Kruse

Happy employees are putting in the work. 

An  Oxford study  indicates that happy employees are 13% more productive than their “unhappy” counterparts.  
 
As a leader, you can’t “make” everyone happy, but you can do your best to create conditions that foster motivation and joy. Encouraging healthy work-life balance through meditation and fitness incentives is an excellent way for leadership to set a supportive example across the organization.

Three quick tips to improve happiness

  1. Encourage fun in the workplace. Be a good role model and create a relaxed environment.
  2. Be flexible with your team. Tell them not to worry about working from home or taking time off as long as they reach their goals.
  3. Focus on small wins and continuously remind the team of the good things they’re doing.

Ambassadorship: nurturing promoters

ambassadorship puzzle piece

Are the employees in your organization ambassadors of your brand? If there was a job opening and they knew someone that would be a good fit, would they recommend it to them? 

Attracting and retaining employees is getting more challenging than ever. Organizations must work twice as hard to create and maintain a meaningful employer brand. 

The best way for an organization to promote a powerful employer brand is by starting from inside their organization and improving the company culture. 

One of the most popular ways to measure whether your employees are ambassadors is by using the Net Promoter score (eNPS), a concept originally developed by Bain & Co. to measure customer loyalty. 

employee net promoter score scale
The eNPS question in Officevibe 

The way it works is you ask employees, “on a scale from 0-10, how likely are you to recommend this organization as a good place to work?” and then follow up with a “why?” The qualitative responses (the why) that give you the most value. You’ll be able to see exactly where the issues are in your culture. 

Want to learn more about how eNPS works? Check out this free guide to learn how to calculate your score, what to do with your results, and how to improve them.

The goal is to continuously improve your organization’s score and have a team full of ambassadors, spreading your mission’s message for you. It’s like amplifying your recruiting team by 10, 20, or 100.

Three quick tips to improve ambassadorship

  1. Measure eNPS and focus on that metric.
  2. Find out why people would hesitate to promote your brand. Do things like stay interviews or focus groups to get feedback. 
  3. Involve employees as much as possible in defining how to improve your employer brand.

Wellness: don’t skip a beat

wellness puzzle piece

Employees need work-life balance to stay happy, productive, and engaged.  

It’s unfair to assume that employees will always be available for you and to not even consider their lives outside of work. Everyone needs time to recharge and refuel; as leaders, we must be more mindful of that.

Our data shows that people are stressed: 

More than a quarter of employees report an unhealthy balance between their work and personal life. 

Can you relate? How do you find a balance between the two? Are you leading by example? Reflecting on your answers is a great place to start because, as a leader, your team often mirrors you. 

💡 Learn more about how can you improve your own work-life balance as a manager. 

The cost of poor well-being is steep. 

Gallup estimates: 

  • On average, a loss of 15% to 20% of total payroll in voluntary turnover costs is due to burnout. 
  • 75% of medical costs accrued are mostly due to preventable conditions 
  • Employee burnout costs $322 billion of turnover and lost productivity globally.  

In contrast, perks like subsidized gym memberships and health budgets are minimal, and the return on investment can be huge.  

Three quick tips to improve workplace wellness

  1. Offer healthy lunch and snack plans. Keeping your people fueled throughout the day keeps them sharp, and also shows that you care about their well-being. 
  2. Subsidize gym memberships or other sporting activities to help employees stay fit. 
  3. Promote mindfulness and a calm workplace, to reduce as much stress as possible. 

Alignment: connection to values

alignment puzzle piece

Many organizations look at culture fit during the hiring process, but they should focus on value fit. 

For an employee to feel connected to the organization, their personal values need to align well with the organization’s values. The key to making this process work for you is, to be honest about your values. 

When creating your core values, write things that you believe in and that you will use to run your organization. It starts with having a meaningful mission that employees can get behind. Then, ensure everyone in the organization spreads that message as much as possible. Through words and actions. You want employees to be continuously connecting with that mission. 

The best path to success for your organization is when everyone works together towards a common goal. 

Try to incorporate your core values into different areas of your organization, like through your performance reviews or team recognition. The more you can tie their behaviors to core values, the more likely they will live them each day. 

Three quick tips to improve alignment

  1. Use events like Town Halls to update everyone on what’s happening inside the organization. 
  2. Promote your core values as much as possible. Put them on the wall if you need to. Find a way to repeat them. 
  3. Use employee onboarding to enforce the mission, values, and purpose of your brand. 

Satisfaction: more than money

satisfaction puzzle piece

For an employee to be satisfied at work, you need to think about two key elements. 

  1. Total compensation (salary + benefits)
  2. A satisfying work experience

Regarding compensation, remember that money isn’t the only thing that motivates people at work. Once salary is considered, you can make a real difference through benefits. People want work-life balance, extra support, and the ability to work some days remotely. As leaders, we all need to be more mindful of this. 

To ensure employees are satisfied with their work experience, provide things like:  

  • A comfortable workspace
  • Clarity in their job role
  • Tools they need to work properly
  • Resources and support they need to do good work 

Help them feel at ease at work. Set goals with your employees to ensure you’re all on the same page, and then measure success based on the plans. Too often, work is measured by time spent at an office desk, but it should be measured by looking at the results. 

You should be continuously looking for ways to improve this (hint: ask your employees) to make sure employees stay satisfied. 

Three quick tips to improve satisfaction

  1. Make sure employees are clear on their job roles. Any confusion will lead to dissatisfaction. 
  2. In addition to a fair salary, make sure to offer good benefits like flexible schedules. 
  3. Listen to employees. Ask for their feedback regularly and make sure they have what they need to do good work.

Measuring and improving engagement

You can’t manage what you can’t measure.

Peter Drucker

The first step to measuring and improving engagement is to use surveys. You need a baseline to understand where you are and where you need to improve. When creating your survey, there are a few things you need to keep in mind.

Keep them short

Survey fatigue is real; the longer your survey is, the more chance you have of your data being incomplete or biased. Take the time to ensure that you’re only asking what matters.

Ask the right questions

Creating survey questions is tough. You need to understand how to phrase your questions, which words to use/not use, and how to order the questions. Check out these sample question lists you can use for various contexts in your next employee survey. Or, use one of our expert-made  employee survey templates.

Get into the right mindset

Before starting surveys, ensure you’re in the right frame of mind. There’s nothing worse than asking employees for their feedback and not acting on it. Be open to hearing anything (including negative comments), express gratitude for their openness to share, and be ready to take action. 

It’s important to note that measuring is only the first step.

Taking employees through a set of survey questions does not lead to improved engagement. Organizations have to approach employee engagement as an ongoing human capital strategy and consider all of the elements that matter in performance management — from leadership accountability and manager education to clear role expectations and employee development opportunities. 

Gallup

Managers significantly affect employee engagement, so what tools can support their growth?  

Training in emotional intelligence is a great place for managers to start because a lot of the soft skills needed to be a better leader come from being more emotionally intelligent. Make sure to hold managers accountable by setting clear goals for how they will improve. If the entire organization is committed to improving engagement, you should focus on helping managers become better and more compassionate leaders. 

Another focus should be career development. Professional development is at the root of employee satisfaction. Do your employees have clear goals set? Are they clear on their opportunities for advancement? These are essential questions that every successful leader should have an answer to.  

From big-picture thinking to what you can action right now 

At the root of all of this are trust and respect. Without that genuine respect, you won’t be able to truly connect with your employees and improve employee engagement. Here are a few ideas you can use right now to start engaging your team. 

Make work fun

People spend way too much time at work for it to be bland and serious all the time. While work and being productive is important, make time for social interactions and a bit of fun. 

It can be simple, like a team lunch at a restaurant every once in a while or watching a sports match together to help build team spirit.

Encourage flexibility

As a leader, one of the best things you can do for your employees is to be flexible with them. 

Establishing flexible work hours and environment, or encouraging them not to stay too late is essential for creating a healthy and sustainable workplace. 

Don’t look at how much time an employee spends at their desk as a measure of productivity. It’s not. 

Set clear, realistic goals

First, be sure to set goals. Second, too often, teams set unrealistic goals that lead to unnecessary stress. For your team’s overall health and well-being, be realistic about your expectations.  
 
Encourage employees to speak up if they feel like they’re overworked. An anonymous feedback tool like Officevibe can help facilitate conversation even amongst the shyest. 

Make sure that the goals are clear for all team members. Don’t hesitate to check in with them everyone once in a while to keep things transparent.  

Hungry for more ideas on how to engage your team?  Check out these 14 employee engagement ideas your team will love.

Only up from here 

Improving takes time, so be patient; the more you involve employees, the better. The more involved they are in defining that strategy, the more likely it is to work. They’ll take it more seriously and be more emotionally invested in it because they had a part in creating it. 

Including your team in creating the strategy also takes much of the load off your back, making it easier to start. 

Ideally, you want to have an engagement strategy defined with many members of your organization that includes the 10 key metrics we went through in this guide.  

The best way to maintain high employee engagement is to continually track it and quickly address any areas where employees are struggling. Officevibe makes it easy to maintain employee engagement by combining anonymous employee feedback with data-driven insights. Check out our employee engagement survey guide to learn how to measure engagement, and understand how to create engaged employees. 

Over time, you’ll foster a culture of happy, healthy, and productive employees working together to bring the organization to new heights.