A Complete Guide on Employee Engagement: What, Why, How and a lot more

Employee engagement is the emotional involvement and attachment that an employee has with her company. Organizations today are realizing this to be one of defining competitive advantages they could have.

7

min read

A major challenge faced by a majority of organizations these days is to create high levels of employee engagement and commitment. Employee Engagement works as a catalyst for HR Managers to ensure successful modern businesses, as it indicates how committed your workforce is to the organization. It refers to the kind of dynamics or relationship that the two share with each other. Employee engagement is when one feels totally included as a team member, being focused on clear goals, being trusted and empowered, having regular and constructive feedback, being supported in acquiring new abilities, and being praised and recognised for accomplishments.

Employee engagement cannot be achieved through a mechanistic method that manipulates employees' commitment and emotions. This is because employees can soon see through such methods and often tend to get  disappointed.

The more personally invested you are in something, the more it matters to you. Improving employee engagement necessitates equal efforts from all members of the leadership team. This combined with an effective engagement strategy necessitates careful preparation. Don't let this stop you, because a highly engaged  workforce would increase profitability, efficiency, and employee retention, taking your organization to the next level.

Table of Contents

What is employee engagement?

Employee Engagement is defined as the emotional involvement and attachment that employees have with their organization. Positive attitudes and behaviors lead to enhanced business outcomes in a way that triggers and reinforces one another. This is pretty much what employee engagement is all about. Employee involvement refers to company actions that are in line with the company's ideals. It is about promises that were kept or even an explanation for why they couldn't be maintained.

Let’s break this concept down a little into something simple. You become a bigger stakeholder in whatever it may be, be it your kids, your health, or your career. And you will be far more likely to put more into it if the result is worthwhile to you. Employee engagement is founded on an organization's members' trust, integrity, two-way commitment, and communication. It's a strategy that helps businesses succeed by improving organizational and individual performance, productivity, and well-being. It is quantifiable. It ranges from mediocre to excellent. The same goes for your employees as well. The more personally invested they are in their work, the more it matters to them and encourages them to keep contributing more. This is an amazing way to raise everyone's level of personal investment, paving the way for more and more positive contributions to the organization.

How important is employee engagement for your organization

Did you know that engaged employees outperform other employees by up to 202%

Pretty mind-boggling right! Well, it's true.

Effective Employee Engagement leads to the emotional investment of employees in your company, going above and beyond what is needed and thus, delivering exceptional results.‍

Employee engagement is so much more than just a  fancy foosball table in the break room or flashy perks like flexible work hours. Employees who are truly engaged are more likely to produce their best work every day and stay with a company that prioritizes employee engagement. 

Have you ever wondered why exactly is employee engagement so crucial for your workplace? 

Well, here’s why:

1. Boosts productivity:

Various studies have proven that employees who are invested in their jobs are more productive than those who are not. Apart from this, employees who are engaged are also said to be 21 percent more productive than those who are not. Finding ways to engage your employees, whether through a challenge or more responsibility, means you're also increasing the productivity of your company. In a nutshell, it benefits everyone involved.

2. Customer satisfaction at its best

Why and how is it that people who are passionate about their work are often the best people to interact with your customers. Well, that’s probably because passion is infectious and your customers can never go without taking notice. When your employees are engaged in the best possible manner, they tend to put in a lot more effort, translating into buzzing productivity levels at your organization, almost in no time! Those who believe in the importance of assisting customers and who believe they are respected by their employer are considerably more likely to provide a better customer experience and boost satisfaction.

3. A sign of success

This does not necessarily just mean business success. Rather, it is crucial to understand that engagement is usually the result of personal or team success.

In other words, engaged employees are engaged not because they’re productive or easy to work with, but because they feel valued and that their work matters. And when their successes are recognized by everyone else in the organization, your people will feel like they have succeeded in making a meaningful impact at work.

A fast-growing body of research demonstrates that employee engagement is a huge mover of fundamental metrics like retention and revenue. This is probably why senior executives and CEOs try their best to grasp and reap the bottom-line benefits of employee engagement to the organization.

4. Enhances culture

You would have noticed that people who are often engaged in what they do are, in general, easier to work with! Turns out, that’s true!

When you focus on the wrong things, not knowing how to consistently raise the level of personal investment by your employees is one humongous flaw that comes in the way and ends up ruining things for your organization.

In order to understand what motivates the personal investment of an employee, you will first need to understand how motivation even works, ie, what makes your employees feel good about work. This will lead to enhancing the culture of your organization even better.

How to measure employee engagement?

Some things are pretty easy to measure. This is because they are concrete. 

For example, the time it takes you to drive to your office or the number of red lights you can hit without being late! When it comes to employee engagement it is a bit more difficult. It isn’t concrete and is influenced by quite a few factors. An engagement survey would be just what you would need to know if you’re on the right track. 

However, keep in mind that it is not a place for random questions or curiosities. It is a designed measurement mechanism with several important components that represents the behaviors or feelings of an engaged employee. These questions typically measure several perceptions including organizational pride and advocacy. 

A survey question that depicts the behaviors or sentiments of an engaged employee is referred to as an engagement outcome. These questions are used to gauge feelings of organizational pride, commitment, and advocacy. The current status of employee involvement within your firm might be revealed through these outcomes. Keep in mind that these shouldn't just identify specific actions. Instead, they should be able to identify targets that your organization should maintain or improve.

Top 20 survey employee engagement survey questions 

1. How likely are you to recommend our company to your friends and family?

2. Do you plan to continue at this company in the next two years?

3. Do you feel comfortable contributing your ideas and opinions in our workplace?

4. Do you feel comfortable asking for help if you do not have the skills required to meet your day-to-day goals?

5. Do you feel like coworkers give each other respect here?

6. Do you feel aligned with the goals of the company?

7. Do you feel that the vibe of the workplace is positive and motivating for you?

8. Do you have the basic amenities to feel comfortable at work?

9. Do you think your organization operates in a socially responsible manner?

10. Are you recognized fairly for your contribution to team efforts?

11. Do you feel like this is a good place for you to develop your career?

12. Do you understand how exactly your role correlates to the company’s success?

13. Are you satisfied with the current benefits that the company offers?

14. Do you find your job role fun and challenging?

15. How prominent is office politics in your workplace?

16. Do you think that your company’s wellness policies are enough?

17. Do you receive meaningful rewards on special days like Work Anniversary, Birthdays,etc?

18. Are you provided enough time and the right resources to do your job well?

19. Do you have fun at your workplace?

20. Do you often find yourself working on weekends and holidays?

When should an organization measure employee engagement?

There is no such thing as the perfect time when it comes to measuring employee engagement. An employee engagement survey can be conducted at any time. While the timing of an engagement survey has an impact on survey outcomes, it always helps to discover the rate of engagement of your employees.

It's time to move past contentment and start talking about how to cultivate an engaged workforce. Staff happiness does not always equate to employee engagement. Employee pulse surveys are often conducted on a monthly or weekly basis. These are simpler, more routine employee opinion surveys, usually consisting of 10-15 questions and taking no more than a few minutes to complete. 

The easiest way to follow up and monitor progress from your baseline engagement survey results is to conduct a pulse survey.

A long survey often tends to repeat a question which is why daily surveys are considered to be the most effective when it comes to surveys and measurement of employee engagement. By simply asking a single question  every single day, consistently you can get valuable, accurate feedback that will boost your engagement levels even with a time constraint.

Key benefits of measuring Employee Engagement

1. Tackle obstacles

Measuring engagement on a regular basis will help you tackle obstacles before they become problems. Engagement data can be used to showcase what’s going well and connect weaker departments to stronger ones. Always remember that problems only get big when you let them. There’s no point wondering why your employee retention and sales suddenly plummet if you don’t put in the effort to take care of it.

2. Build trust

It also helps to build trust, for the plain reason being -asking for feedback from employees shows that you care about their opinions and how they feel at work. The data can be further shared with everyone in your organization -leaders, managers, and employees, giving each individual an opportunity to help contribute to a better culture. Trusted employees feel more valued which in turn helps them feel more engaged. A survey conducted by PwC showed that trusted employees are 76% more engaged than those who work in a low trust workplace.

3. Opportunity for Improvement

Surveys provide a clear picture of employee activity and thinking, in a single moment in time, as they struggle to think up thorough answers and complete the questionnaire to get back to work. It is important to encourage employees to keep track of their thoughts and feelings weekly and make sure they speak up. 

Employee engagement surveys are used to determine how motivated and engaged your staff are to give their best at work every day. You can learn about employees' ideas and opinions on their jobs and the entire environment by conducting these questionnaires.

Switch to better measurement tools whenever needed, especially employee-preferred ones. This will help to increase opportunities for improvement and engagement.

4. Helps to create morale

In order to reap benefits, it is important that you make employee morale a top priority in your company. As employee morale rises, productivity rises, enabling you to keep your employees for a longer period of time. Keep in mind to engage workers in constructive dialogue as they become disengaged. This doesn't even have to last the whole lunch hour; even a quick check-in would demonstrate that you care. This way you will be able to gain a better understanding of your employees' concerns as well.

Main Components of employee engagement

Employee engagement consists of elements that an organization needs to support in order to have a truly engaged team. People often believe that engagement is only about organizing team-building activities and providing their workforce a generous compensation. While this may promote short-term engagement, at the end of the day, the truth is that it just isn’t enough. If you wish to build highly engaged global teams, here are a few of the key components of employee engagement that should not be overlooked.

1. Leadership 

Employees yearn for meaningful relationships with their supervisors. 

Did you know that receiving praise from a direct boss is nearly twice as successful as offering workers stock options in terms of empowering them? And it's all for free! 

Achieving employee engagement is a commitment that starts with leadership. In order to get every individual to contribute their best efforts, leaders must have the ability to recognize the factors that cause employees to participate and those that cause them to disengage.

2. Employee Incentives and recognition

Employee recognition, also known as Social Recognition is nothing but the act of publicly acknowledging your employees for who they are and what they do. With employee recognition, workers recognize each other and make the workplace feel more inclusive and human. More than three-quarters of employees stated in a survey that if they were noticed and recognized more, they would work harder. This can be done even in a formal manner, such as years of service or employee-of-the-month schemes, or informal practices, such as business "points" or even small thank-you cards.

3. Culture and communication

It is a given, that employees who want to come to work every morning, have a good workplace culture. Always keep in mind that, the more prosperous the business is, the greater the atmosphere is.

Do you want to know what makes a good manager? 

Well, you can begin with effective communication. Ensure that you interact with your employees in a transparent, frank, and frequent manner.

4. Vision and Values

Employees who are deeply engaged in what they do are aware of the larger picture and how they fit into it. Employees should unite around a clearly communicated vision and declaration of core values. They are also much more likely to go above and beyond and contribute to a larger cause if they feel like they are a part of something bigger than themselves.

How to Improve Employee Engagement?

In today’s digital era, monitoring and improving employee engagement is easier than ever before. There is a plethora of employee engagement tools, software, and platforms that you can implement to keep tabs on your workforce engagement. 

Surveys show that employees who are supervised by Highly Engaged managers are 59% more likely to be engaged than those supervised by Actively Disengaged managers.

In case you’re still not convinced, here are a few practices you can adopt at your workplace, to watch your employee engagement rate reach the skies. Here’s how you can achieve this at your workplace. 

1. Prioritize feedback

Positive manager reviews are associated with optimal levels of feedback. It is always a given that managers who offer too much input to their direct reports are scored higher by their team than those who do not provide enough. 

So what exactly is the bottom line then? Well, employees thrive on feedback, and it does have a significant impact on their level of commitment to the organization.

Many successful leaders consider employee feedback to be one of the most important techniques for professional development – claiming that companies who take a strategic approach to employee feedback can build employee confidence, increase employee satisfaction, and even improve organizational inefficiencies.

2. Create volunteering opportunities

Employees deserve to realize that they work for an organization that is concerned with having a positive impact on society. Volunteering brings employees together for the greater good and allows them to engage on a deeper level. Indeed, workers agree that service events increase productivity more than happy hours and that businesses that support voluntary efforts have a healthier work climate.

3. Provide flexibility

Employee involvement can be boosted by flexible work schedules and remote work opportunities. This level of adaptability satisfies workers' need for a work-life balance. Employees expect their employers to help them balance job and personal obligations, so make sure you do your bit to keep them happy.

4. Evaluate processes

Unnecessary activities and incomplete processes can cost your company a lot of money. Employees, on the other hand, find it quite aggravating. Employees turn on cruise control as a result of the extra measures. This is a sign that they are not engaged with their jobs and a sign that cannot be ignored. Analyze each team's processes carefully and search for ways to improve them for long-term success.

Top 5 Employee Engagement Platforms 

1. SuperBeings

SuperBeings allows an individual to measure, analyze, act and even learn with a set of carefully curated, easy-to-use tools that provide the best results when it comes to keeping a track of employee engagement in your organization. This platform takes daily employee feedback on the organization culture, manager’s leadership skills, and the nature of the employee’s role over existing chat systems such as Slack and MS Teams. Using this feedback, it identifies gaps and recommends personalized learning content and the best possible practices to each manager to close the loop from feedback to action. 

With SuperBeings, managers can even set and track priorities and run custom polls to get additional feedback. They can also automate their recurring stand-ups, 1:1 agenda gathering, and more with the help of this platform. This AI-powered solution for companies helps them drive Employee Engagement, building a high-performing culture. The Pro version is for $5 per employee per month.

Pros:

  • Easy to use interface
  • Amazing Customer Service
  • Highly affordable
  • Continuous and Real-Time 
  • Holistic approach

Cons:

  • Being a young platform with a high potential to understand human behavior, it is on the move to update features to meet customer demands and you will have to expect continuous changes.

2. CultureAmp

Culture Amp creates the forum that enables companies to prioritize culture. It aims to provide people with not only a tool, but also the education, network, and other resources they need to do it for themselves in their own business. Also provides top-quality community content such as the blog, whitepapers, webinars, etc. These are great and can help managers and employees improve their skills.

Culture Amp also offers comparable company metrics to show you how you're doing. It also provides benchmarks from similar organizations to show you how you're doing and allows you to track your progress toward company culture develops over time. 

Pricing starts at $4,500 per year for 50 to 200 employees and $10,500 per year for 201 to 2,000 employees.

Pros:

  • In-depth reporting.
  • Amazing clarity in action for surveys

Cons:

  • Does not allow collaborators to complete performance reviews together with ease.
  • Admin functionality is not robust.
  • Expensive.

3. Glint

Glint is a People Success Platform that helps global companies increase employee engagement, grow their people, and optimize business performance by leveraging real-time people data. Glint surveys enable your company to elicit your feedback on a regular basis, listen to your concerns, and turn that information into timely, meaningful action. Employees select an answer from an 11-point scale, 0 to 10. Glint pricing starts at $0.01. They do not provide a free version. 

It is a really simple tool to launch and gain insight into your entire company's satisfaction; along with easy actions to address concerns or weaknesses identified. It allows organizations to take a holistic approach when it comes to engaging talent, developing people, and inspiring them to do their best work. Glint gathers more frequent feedback through pulses, surveys, and anytime channels and then applies cutting-edge analytics to deliver personalized insights and AI-powered recommendations for action to HR teams, leaders, and managers.

Pros:

  • Easy and intuitive interface. 
  • The dashboards and reports are clear, with the graphs being the best feature.
  • Frequent pulse surveys let you provide feedback on an ongoing basis.

Cons:

  • One cannot get access to past survey responses.
  • Survey responses are not integrated with a company's primary HR platform.
  • A little expensive.

4. OfficeVibe

Officevibe is a simple and highly effective forum for team growth. It gives managers the tools they need to improve trust, collaboration, and team performance. The platform helps managers get to know their teams by sending out weekly Pulse Surveys that provide confidential, written feedback options. The platform lets managers understand their teams by distributing weekly Pulse Surveys that include opportunities for anonymous, written feedback. It compiles comprehensive Survey Reports and provides tools for making improvements.

Officevibe also supports managers in mastering 1-on-1s by creating a collaborative structure for tough conversations while providing concrete ways to take action on individual and team goals. 

Officevibe pricing starts at $4.00 per user, per month. The software does offer a free version for users to try out as well. 

Pros:

  • Provides a good platform for employees to provide anonymous feedback periodically.
  • Keeps track of your team engagement continuously, having a zoomed-in approach to different metrics of engagement

Cons:

  • Lack of clarity when it comes to the time span for the metrics.
  • Lack of depth and variety in the questions.

5. Amber by Infeedo

Amber by Infeedo is a smart AI-enabled bot that assists in real-time management of employee engagement, predicting turnover, and measuring company culture. Amber connects with employees across organizations to gather actionable information for HR in order to improve employee engagement, reduce potential attrition, and get a real-time sense of general sentiment. Communications here are more timely, personalized, and tailored to key milestones in an employee's career, with an emphasis on not only asking questions but also listening and reacting appropriately.

Amber partners with workers from various companies to gather actionable feedback for HR in order to improve employee engagement, reduce future turnover, and get a real-time sense of overall sentiment. The communications are timely, personalized, and tailored.

With Amber, one can now deliver a seamless experience to their employees for every moment that matters to them in the employee lifecycle and remain human at heart. To use Amber's services, inFeedo has an annual pricing structure and the average cost is $25 per user per annum.

Pros:

  • The software’s timely reach outs are personalized on a specific milestone in an employee's tenure, making the conversation even more interesting.
  • Outstanding reports and insights.

Cons:

  • Less satisfactory when it comes to customization.
  • Only suitable for lifecycle surveys.

Never underestimate the power of understanding what’s going on between your employees and their peers as only this can help you identify opportunities to align and motivate teams and individuals.

Like Doug Conant rightly said, 

To win in the marketplace you must first win in the workplace

-it is now time to get ready for some major wins. 

Suggested reading:

Are your Employee Engagement Practices Really Working?

Conducting an Employee Engagement Survey

If you’re looking for a single platform to satisfy all your organizational needs and make the right decisions, SuperBeings would be your one-stop destination to help you shape the right culture for your organization. Book a free demo today!

Garima Shukla

Marketing, SuperBeings

Hello world! I am Garima and I research and write on everything we are doing to make the world of work a better place at SuperBeings

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Performance
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x
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How to strategically align compensation and performance management?

The right compensation management practices and policies can make or break your employee experience. Of course, there is merit in linking compensation and performance to drive organizational success, it can lead to several questions and implementation problems as well. 

Read on to get all your compensation management related questions answered.

Why is fair compensation important?

Let’s start with the very basic question of why fair compensation is important and the merits it brings along. It is no surprise that if you are paid more and are compensated according to your efforts, you are likely to give in your 100% and stay with an organization longer. However, there are other factors that support fair compensation:

  • Reduce the risk of turnover: 50% employees are more likely to leave if they believe they are paid below market
  • Retain high-potential performers: High-potential talent brings 91% more value to an organization
  • Increase job satisfaction: Compensation/pay and benefits are 2 of the top 3 drivers of job satisfaction 

Thus, fair compensation as a part of compensation linked performance management has the potential to facilitate better employee outcomes such as engagement, experience and performance. 

Should compensation be tied to performance reviews?

To make compensation fair and inclusive in all aspects, it needs to have a clear foundation. Most organizations have relied on performance reviews as a way of reflecting on performance as a means of compensation decisions. However, there are several competing views both for and against tying compensation to performance reviews. 

Benefits of tying compensation and performance reviews

  • Compensation can act as a great motivator for employees to perform well, which can be reflected in their performance reviews
  • Enable employees to get a clear understanding of what rewards or recognition they get with an increasing level of performance
  • Give employees the opportunity to see the direct value of their performance in tangible ways
  • At an organizational level, it helps to align inputs (compensation) with outputs (performance), enabling efficient resource allocation
  • Ensure that compensation hikes and appraisals are seen as transparent and not arbitrary

Pitfalls of tying compensation and performance reviews

  • It focuses on only those aspects of performance which are under review and not the overall and subtler forms of organizational contribution for employees
  • Performance linked compensation system leads to employees giving themselves  more lenient ratings during self reflection during 360 performance review. Thus, driving the focus away from self reflection as a development practice
  • Biased peer review can also prevent fair compensation, especially when the departmental budgets are limited
  • Sometimes, it creates a blame oriented workplace culture and discourages collaborative problem resolution

Clearly, there are both sides to the story.

The most favorable outcome will be to keep performance as one of the parameters for compensation, but not the sole foundation.

Additionally, as one of the best practices, performance reviews can be conducted on a regular basis, where some are only developmental in nature and others can be tied to compensation management. 

5 compensation best practices today

As discussed, focusing only on performance reviews for compensation management needs a relook. Working with growing organizations, we have curated a list of the top five performance and compensation management practices you can leverage:

1. Keep up with market trends

Ensure that your compensation structure aligns with the market trends so your employees don’t feel underpaid and leave.

  • Conduct a dipstick survey to understand appropriate pay scales
  • Keep your pay structures updated based on market corrections
  • Leverage custom employee pulse surveys to regularly to check their perception on compensation according to market trends

2. Be clear about relationship between performance and compensation

Provide complete transparency and clarity to your employees on what constitutes high levels of performance and what it will take to earn a raise or appraisal.

  • Highlight specific job competencies that link compensation and performance management
  • Don’t rely completely on performance reviews as a means to determine compensation, let them be developmental in nature
  • Gauge performance against pre defined competencies over time

3. Have well defined criteria

Have specific, well defined and measurable criteria for the compensation strategy to ensure that there is complete transparency. 

  • Develop or choose metrics which are easy to comprehend
  • Try to quantify the value for each criteria, including years of experience, education, etc.
  • Account for difference in compensation based on skills, performance levels, among others

4. Communicate benefits effectively

Salary in hand or the pay check your employees receive is accompanied by a range of benefits that are a part of the compensation structure and cost to the company, but are often overlooked by employees. Make sure they are widely communicated.

  • Create a list of all benefits offered to employees and communicate to them via different ways, email, discussion sessions, etc.
  • Be vocal about the value these benefits are able to add over and above their monetary value
  • Illustrate how these benefits also act as tax saving options at times, leading to a more efficient compensation structure

5. Have a standard pay range

Ensure that there is a base pay range for every role and profile with variable additions based on candidate competencies.

  • Have clear guidelines and pay range for each position to set the right expectations
  • Illustrate the competencies/parameters based on which deviation from standard pay range will be acceptable
  • Have a well defined strategy to evolve the pay range and support employee transition from one range to another

How to ensure distributive justice?

The idea of fair compensation and linking compensation and performance management, leads to a very interesting concept of distributive justice. On a broad level, distributive justice essentially focuses on ensuring that the compensation received by employees is fair and equitable and is based on objective and rational grounds which are uniform for all. Here are a few ways to ensure distributive justice:

  • Be transparent about the criteria for compensation and what constitutes as parameters for raise
  • Ensure that measuring of performance/ other criteria for performance is bias free and doesn’t fall prey to halo, horns or recency effect
Measure potential and market value of the employee in addition to experience and expertise to ensure distributive justice for high potential employees 
  • Be fair in your compensation and appraisal assessment

Pay transparency: Merits and demerits

Another interesting component of compensation and performance management that you must acquaint yourself with is pay transparency. Essentially pay transparency refers to how openly or freely employees within an organization can discuss their compensation with others. 

This is not only limited to the check they take home but other perks and benefits they are entitled to. Invariably, many platforms today also enable individuals to anonymously share their salaries online and get insights from others doing the same. However, there are diverse views on when it comes to pay transparency for an organization. 

Merits of pay transparency

Those who advocate for pay transparency believe that it can enable large scale impact for the organization across performance management.

  • Meet employee expectations, build greater trust and augment engagement and overall experience
  • Attract the best talent by showcasing competitive compensation at market standards
  • Reduce chances of biases in salary negotiations and increments
  • Ensure fair compensation and distributive justice among employees
  • Greater employee motivation leading to better organizational outcomes
  • Fewer negotiations allowing employees to focus on adding value to their work

Demerits of pay transparency

However, there is a flip side to pay transparency too with some common pitfalls that need to be addressed proactively.

  • Risk of resentment and conflict if pay scale is not uniform and balanced
  • May lead to comparison of pay scales among peers in the organization with possible backfire
  • Requires strategic planning and meticulous implementation
  • May lead to high levels of turnover in case employees feel they are paid less than what they deserve, in comparison to others
  • Employees might have privacy concerns about their salary being shared with others

How to guide managers to have better compensation conversations?

In the last section of this article, we will focus on how managers play an integral role in compensation and performance management and the best practices to guide managers to have effective compensation conversations with their team members.

Almost 58% organizations do not train managers on pay communications 

This startling statistic clearly highlights how despite the apparent importance of compensation management, the focus on ensuring a seamless process is rather limited. However, organizations today can play a leading role in enabling their managers to have better pay communication and conversations by following these tips:

  • Create a communication toolkit with all the resources including compensation structure, criteria, performance linkage, etc. and share it with all the managers 
  • Conduct regular surveys to gauge employee pulse and data from employees on their compensation and share insights with managers to help create a conversation flow
  • Leverage tools for NLP led sentiment analysis of open ended responses and share guided 1:1 conversation templates for effective compensation conversations
  • Encourage managers to keep compensation conversations and performance reviews as separate
  • Give proper context, especially during an appraisal or raise, with both internal and external factors that led to the compensation decision
  • Communicate the value and importance of the employee to the organization, don’t rely on numbers and monetary increase do all the talking
  • Prepare for the conversation and be prepared for response, be an active listener and patiently address grievances, if any

Final Thoughts

It is quite evident that compensation and performance management are intrinsically interlinked and if leveraged well, compensation has great potential to not only drive performance, but also facilitate engagement, retention and much more.

However, to ensure the same, you need to have a very structured, transparent and fair compensation strategy and policy. Furthermore, you must, don’t forget to invest in training your managers to bridge any gaps and constantly gauge and address employee pulse — to ensure fair compensation for all.

Suggested Reading

10 tips for managers to effectively conduct performance reviews

How often should you conduct performance reviews?

How to use competency framework as a talent management strategy

Performance
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x
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How to Use Competency Framework for Talent Development

Talent development is critical for growing organizations which see the workforce as their biggest asset. Focus on developing their talent stack not only leads to a pleasant employee experience, it also augments the overall performance and productivity for an organization. 

While you may come across many ways to facilitate talent development, leveraging the competency framework can help you move the needle very quickly. 

Let's see how.

5 Stages in talent development

Before moving directly to how you can implement the competency framework, let’s quickly understand the 5 stages of talent development.

1. Planning

The first stage involves planning for your talent needs based on your organizational priorities and creating the position profile based on the skills, attitudes and other competencies. 

2. Identifying

Based on the position profile, you need to start attracting talent for the position. You can do so by spreading the word in the right networks, through job portal platforms, etc. The objective is to ensure that you are reaching out to the right network. You can also explore the right candidate for the position internally to considerably save hiring and training costs. 

3. Onboarding

Once you have identified the right person, the next stage of talent development is extending the offer to the person after a thorough background check as well as a competency and expectation match. It also requires creating personalized onboarding plans for the first 30-60-90 days of the candidate’s journey within the organization. Read our guide to employee onboarding to learn more about onboarding do’s and don’ts.

4. Developing

The main focus of talent development starts with providing the right development and learning opportunities to your workforce. This can involve upskilling for both technical and soft skills, leadership building or any development intervention based on the need of the role and position. 

Read: How to create employee development plan based on performance history

5. Retaining

Finally, talent development involves undertaking initiatives to retain your talent. While learning opportunities are important, facilitating engagement, wellness, motivation, etc. all contribute to employee retention. 

What is the competency framework?

If you are wondering how the competency framework aligns with talent development, you need to start by decoding what the framework actually stands for. 

Put simply, a competency framework is a set of behaviors, skills, abilities and attributes that an organization considers imperative for creating a high performance culture. 

The competency framework can be implemented at all stages of the talent development or the employee lifecycle within an organization. The idea is to ensure that certain core competencies are kept at the heart of the decision making that in any way impact the workforce. 

Importance of talent development for employee retention

Competency framework based talent development is very important for employee retention. Talent development practices when undertaken effectively have the potential to encourage team members to stay with the organization for long and at the same time become ambassadors to help attract high quality peers. 

Here are the top reasons why competency framework based talent development matters:

  • Recruit the right person for the right job
  • Provide the right learning and development opportunities
  • Be an active participant in professional growth for employees
  • Train and develop employees for professional obstacles
  • Enable employees to navigate through challenges with mentoring support
  • Enable employees to see a clear career growth path within the organization

Implementing the competency framework: Process, steps and ownership

Now that we have covered the basics of talent development and competency framework, let’s understand how leveraging the latter to advance the former can create a far reaching impact for organizations. 

Step I: Create a competency framework

The first step is to create a competency framework which involves identifying the key competencies which will be instrumental in guiding all decisions around talent development. Depending on the nature of your organization, there can be categories within the competency framework that you seek to focus on. Your competency framework should focus on behaviors, skills and attributes which are critical for performance and overall success. The following steps can help you create a competency framework for talent development:

1. Identify key competencies

  • Establish core competencies that are required to be possessed by everyone in the organization, for instance, teamwork or collaboration
  • Highlight the functional competencies that are required for specific roles and positions, for instance, situational awareness and the ability to think on one’s feet for those in business development roles
  • Identify competencies that align with your core values and are non negotiable, for instance, if your core value revolves around innovation and experimentation, a key competency will be a risk taking attitude

2. Determine behaviors and attributes

  • Define the key parameters for each identified competency i.e. what are the factors that collectively contribute to presence or absence of that competency
  • Establish metrics to judge the level of competency alignment across the workforce and identify the gaps

3. Link to organizational goals

  • Create a business statement of how the competencies can advance overarching organizational goals
  • Focus on the value add they bring along for organizational success
The responsibility of creating the competency framework is collective. It starts with involving the executive leadership to ensure alignment with the vision, people managers to ensure they are ideal for the culture you are trying to build and functional managers to ensure inclusion of right competencies for each role and position. Furthermore, involving those on the ground can be fruitful as they have the best idea of what competencies are critical and others which are good to have. 

Step II: Align the competency framework with recruitment

Once the competency framework for talent development is ready, the next step is to align it with your recruitment process to ensure precise and effective hiring. There are a few steps along the way:

  • Mention the keywords from the competency framework in your position profile or job description
  • Specifically identify 5-7 key competencies for each role important for high level of performance
  • Identify behaviors for each competency to look out for during the selection process
  • Leverage psychometric assessments customized with your competency framework to test your candidates
  • Conduct competency based interviews and assignments for a comprehensive view
  • If there is a significant competency match, identify gaps if any for competency based development later
  • Document results to align performance management for selected candidates
The onus of implementing the competency framework during selection lies primarily with the HR team and recruiters who assess the candidates with different tests and assessments. Team managers and leaders also play a role in assessing functional competencies and fit. 

Step III: Facilitate competency based performance management and development opportunities

Irrespective of whether an employee is onboarded before or after you have implemented the competency framework for recruitment, you need to ensure competency based performance management and development opportunities. 

Performance management

  • Align OKRs and goals with competencies; focus on behaviors that can help drive the key results. For instance if a key result is expand to 5 new markets, a key competency can be adaptability
  • Conduct competency based 360 feedback review; encourage your managers to review performance not just on outcomes but presence or absence of competencies that made the outcomes possible
  • Encourage competency based self reflection for employees to assess their performance based on the competency framework
  • Identify development areas based on competency needs for particular roles as well as the next career path in the trajectory
  • Reward competency based performance and outcomes
  • Measure competencies on an ongoing basis and compare results with recruitment analysis

Talent development interventions

  • Define competency gaps for each position and identify talent development interventions to bridge the same. For instance, if communication is a key competency for a sales role, learning can be oriented towards better communication skills
  • Align developmental interventions with competency based OKRs
  • Identify learning objectives for each role and position and determine how they connect with the competency framework

From a talent development perspective, the focus of the competency framework should equally be on developing employees for their next or subsequent role based on the specific competencies for the same. 

The onus of aligning performance and development with the competency framework lies with team managers as they are best able to determine the performance gaps. Furthermore, employees with their managers can identify competency gaps for better performance and focus on the right learning and development interventions to bridge the same. 

Step IV: Leverage competency framework for succession planning

Finally, the competency framework must also impact the subsequent rungs of talent development where an employee moves up the ladder from one position to the next. Based on the organizational matrix and competencies for each level, you need to identify key attributes that differentiate one level from another and ensure the same is communicated to your employees. 

You should:

  • Help you employees create a career development plan based on your competency framework to help them understand which competencies will enable them to grow
  • Make succession planning a key organizational priority and focus on talent development from that lens

Final Thoughts

In a nutshell, it is quite evident that the competency framework can inform and advance every stage of talent development for fast growing organizations. If you implement such a framework across the employee lifecycle, you will significantly reduce your chances of a wrong hire and will be able to nurture a workforce that aligns on the vision, goals and overall organizational culture. 

A clear competency based talent development approach can help you achieve high levels of performance which is observable and measurable.

OKRs
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Should Your Business Invest in OKR Software? See the ROI

While most people managers are able to create a business case for setting OKRs as well as for the adoption of an OKR software by leveraging industry benchmarks and best practices, there is a need to explicitly decode the return on investment of using an OKR tool as well.

Unless they are able to clearly illustrate how the return achieved using a goal management software is greater than the investment, it becomes difficult to sustain the adoption and get long-term leadership buy-in. 

Continue reading to strengthen your business case on the same.

What’s the ROI of Goal Management using OKRs?

Let’s quickly understand how the OKR framework is integral for an organization, especially high growth companies. Most fast growing organizations have competing priorities they need to focus on with limited resources at hand. 

Therefore, simply setting goals by adopting a top-down approach without supporting parameters can lead to confusion and incompetence. OKRs help drive away this ambiguity by linking measurable key results for each objective and facilitating a collaborative approach to achieving goals.  

Here are the top three benefits of implementing OKRs in an effective manner:

1. Better focus and more clarity

OKRs enable employees and leadership to have a very clear focus on what needs to be accomplished and what work is out of scope. The idea is to have complete clarity on — 

  • what each goal or objective means, 
  • its purpose for the overall success of the organization, and
  • what achieving it will look like. 

The last part is extremely important as it helps create a sharp focus and set priorities straight. 

93% of employees don’t really understand what their organization is trying to accomplish in order to align with their own work.

This illustrates that there is a big absence of clarity and focus amongst employees when it comes to what needs to be accomplished, which stands in the way of creating a high performance culture. Therefore, OKRs can help reduce such uncertainty and ambiguity, making it easy for the workforce to concentrate on what matters. 

2. Strategic alignment

Taking cue from the first point, the second benefit or purpose of implementing OKRs foris a need for clarity of expectations and overall team and organizational alignment. In case of fast growing organizations, there is an overlapping of roles and responsibilities and a lack of clarity on expectations from each employee. This leads to lower than average outcomes, productivity and revenue growth and data backs the same. 

97% of employees and executives believe lack of alignment within a team impacts the outcome of a task or project. Whereas, companies that regularly exceeded revenue goals were 2.3X more likely to report high levels of alignment.

By ensuring organization-wide goal visibility, OKRs help teams to decode what is expected out of each team member and their respective contribution towards achievement of the shared goals. Thus, increasing alignment and collaboration. 

3. Greater engagement

Finally, setting and implementing OKRs is often a collaborative process. Employees get involved in and participate during the entire OKR process and feel engaged in the same. This greater involvement and participation leads to deeper levels of engagement and ownership of key results which drive impact. 

OKRs also enable employees to also gauge their performance and measure their progress in an effective manner. This motivates them to get more involved in achieving the common weekly, quarterly and annual goals. This higher level of engagement directly impacts key organizational parameters such as retention, productivity, profitability, etc. 

How does an OKR software make a difference? 

The business case for OKRs is very clear. However, for companies that are scaling up, with limited bandwidth and competing priorities, often setting OKRs itself gets left behind due to other business priorities.

If an organization focuses on a manual approach to the OKR system, there are several steps which require a lot of time and effort including setting and writing, implementing, tracking, grading, evaluating and modifying OKRs.

Fortunately, today there are OKR tools in the market, which can help automate all of these aspects to help simplify the OKR journey. The right goal management software can help you maximize the realization of the return on investment for your OKRs. Following are the top five ways in which an OKR software makes a measurable difference on the bottomline — 

1. It allows you to document goals

First, an OKR tool can help organizations document or record the OKRs in a way that is visible and accessible to all. There is supporting evidence to show that what gets documented has a higher chance of being achieved, as what is out of sight is often out of mind. 

Individuals are 42% more likely to achieve goals when they are physically recorded.

Therefore, the OKR tool can enable organizations to clearly define the business and team OKRs in a written manner which can be reflected on, seen again and again to create instant recall for employees. 

2. It drives accountability and alignment

OKR tools are great for creating alignment and accountability. On the alignment front, the OKR software can help achieve high levels of strategic alignment on what is the responsibility of each team member across organizations towards the key business goal achievement. 

Highly aligned companies grow revenue 58% faster and are 72% more profitable than their misaligned counterparts.

The dashboard of a good OKR software can help you constantly gauge the level of goal achievement, ensure that team members are aligned on different phases as well as keep a track of when their responsibility is due. It creates high levels of transparency. 

Moreover, greater alignment leads to high levels of accountability. Generally, since there is a lack of alignment on responsibilities, there is an accompanying lack of ownership and accountability, and most employees shirk away from taking accountability. 

84% of the workforce describes itself as “trying but failing” or “avoiding” accountability, even when employees know what to fix.

A goal management software like SuperBeings allows you to integrate OKRs with regular meetings and check-ins to keep track of progress. Thus, driving a culture of accountability.

3. It enables real-time OKR progress and goal tracking

It is very common for companies to set OKRs and then evaluate them only at the end of the quarter/year. There is a lack of mid-term tracking which makes it difficult to gauge whether the progress is aligned with the key results or not. 

40% of people that write down goals don’t check whether they’ve achieved them. Moreover, only 5.9% of companies communicate goals daily. 

An OKR software can help you address this concern by facilitating day-to-day OKR progress tracking. A daily dashboard and history of 1:1 and team check-ins on OKRs, can help organizations track developments over time. 

ROI of OKR software
SuperBeings OKR dashboard helps you get a quick overview on all primary goals

It can also help identify and resolve any performance issues that stand in the way of goal achievement preemptively. At the same time, even if organizations are tracking and monitoring OKR progress, doing so with a manual process is inefficient. An OKR tool can automate most of these processes to enable HR and people managers to spend more time on driving results. 

4. An effective software offers OKR training for success

Another major concern that organizations face when it comes to OKRs is being prepared and ready for the same. Many line managers and others struggle with writing effective OKRs. Many organizations believe setting OKRs once is enough. However, that is far from the truth. 

Research says, companies that set performance goals quarterly can generate 31% more returns than those reassessing annually.

Using an OKR software can help eliminate all these challenges. 

  • First, the right tool will offer OKR coaching and onboarding support to train managers to write OKRs which are effective and result oriented.
  • Second, it can help reflect on OKRs at regular intervals to realign on them and adjust according to changing market conditions. 
  • Third, the OKR tool can help managers have meaningful 1:1 conversations with team members to link OKR with performance and facilitate high levels of goal achievement. This is a direct return on investment which can create value across the organizational verticals.  

5. It facilitates greater collaboration

Finally, an OKR software can promote high levels of collaboration for goal achievement. For many organizations, the inability to collaborate leads to low levels of results, diminishing the ROI for OKRs.

86% of employees and executives cite lack of collaboration or ineffective communication for workplace failures.

Using a good OKR software makes collaboration seamless by aligning cross-functional projects and tracking cumulative progress. Invariably, an increase in degree of collaboration is a direct ROI of an OKR tool which can create far reaching impact.

How to calculate the ROI of an OKR software?

In this final section of the article, we will talk about the key parameters that can help you gauge the ROI of an OKR software. While the above mentioned are primary impact areas, most of them have a qualitative aspect to them. 

Gauging the ROI requires backing of data points from employee experience and business results, which the following parameters can help explain.

1. Level of transparency

Organizations should start by gauging whether or not transparency and alignment on goals has increased. This can be measured using employee pulse surveys to understand their opinion on how well they have visibility of goals and clarity on what they need to work towards. Therefore, the first ROI parameter for an OKR software is to identify the increase in level of transparency to ensure everyone is working in the same direction and there are no gaps or overlap in efforts. 

2. Degree and time period of goal achievement

The main purpose of an OKR tool is to facilitate the effective and efficient achievement of the goals set by an organization. Thus, the next parameter to measure ROI should revolve around the degree and time period of goal achievement. 

You can start by comparing the degree of goal achievement by leveraging OKR grading to see if there is a significant improvement in percentage terms as compared to pre-OKR tool period. Second, it is important to gauge whether or not the goals/key results have been achieved in a shorter period of time or not. Since the OKR platform facilitates better alignment, collaboration, tracking, etc., it can help organizations achieve or realize the goals faster. 

3. Reduced administrative overheads

Third, there are several administrative overheads that accompany the setting and implementation of goals/OKRs. These include tracking, grading, etc. for managers and providing inputs on the part of employees. The ROI of an OKR software can be gauged by mapping whether or not these overheads come down. 

  • For the managers, ROI can be calculated in terms of time saved which can be invested in other value add tasks. 
  • For employees, the ROI comes in the form of reduced time and effort spent in juggling between platforms to work on goals and projects. The right tool will provide organizations with integrations across top productivity tools like Slack, Jira, etc. which reduce administrative overheads for all organizational stakeholders. 

4. Increased revenue

The next parameter for ROI calculation is to measure the change or increase in revenue after the adoption of an OKR software. Since an OKR tool seeks to enable organizations to achieve their goals faster, cost effectively and to a greater extent, there should be an increase in the revenue realized. 

According to Larry Page, co-founder, Google claims that “OKRs have helped lead us to 10X growth, many times over.” 

5. Better employee experience

Finally, gauging the value of employee parameters like retention/turnover, productivity, engagement, etc, can cumulatively be leveraged to capture the ROI of an OKR tool. There are several ways to gauge these workforce parameters, along with factors like eNPS, etc. which have a direct business impact. Calculating them can help measure the ROI of the OKR tool for an organization. 

Final Thoughts

It is evident that adoption of an intelligent OKR software is not only good to have, but integral for organizational success. Using the right tool has a direct business impact which can be measured in numbers using the ROI parameters mentioned in this article. 

There are both qualitative and quantitative aspects to measuring the ROI and a balanced approach to both can empower organizations to align individual performance with business goals.

If you are considering implementing the right OKR software in your business, try out SuperBeings free 21 day trial. Book today. (No credit card or commitment required)

Suggested Reading

How to find the best OKR tool

Master OKRs in 10 days: Free OKR email course

References

https://www.forbes.com/sites/johnhall/2019/10/06/why-accountability-is-vital-to-your-company/?sh=4297f3cb6580

https://www.salesforce.com/in/work/?sfdc-redirect=219

https://www.minsilo.com/resources/strategic-alignment/why-is-alignment-important

https://www.cnbc.com/2019/09/13/self-made-millionaire-how-to-increase-your-odds-of-success-by-42-percent-marie-forleo.html#:~:text=The%20results%20were%20clear%3A%20Participants,down%20on%20a%20daily%20basis

https://lsaglobal.com/insights/proprietary-methodology/lsa-3x-organizational-alignment-model/#:~:text=Based%20upon%20research%20of%20410,Effectively%20leading%208.71%2Dto%2D1

http://www.cedma-europe.org/newsletter%20articles/Clomedia/Want%20Results%20-%20Fix%20Accountability%20(Feb%2015).pdf

https://www.asuresoftware.com/

https://fierceinc.com/employees-cite-lack-of-collaboration-for-workplace-failures/#:~:text=Key%20survey%20finds%20include%3A,will%20impact%20bottom%20line%20results.

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