PROJECT REPORT

ON

EMPLOYEE ENGAGEMENT PRACTICES IN

GLOBAL AND INDIAN COMPANIES

Submitted By

SEEMA VETAL

(18106B1044)

UNDER THE GUIDANCE OF

PROF. SMITA MUKHERJEE

A PROJECT SUBMITTED IN PARTIAL FULFILMENT OF MMS TO

VIDYALANKAR INSTITUTE OF TECHNOLOGY

Wadala (East), Mumbai 400 037

Signature of Faculty Guide Head of Department

 DECLARATION

This is to declare that the study presented by me to Vidyalankar Institute of

Technology, in completion of the Master in Management Studies (MMS) under the
project title “Employee Engagement Practices in Global and Indian Companies”
has been accomplished under the guidance of Prof. Smita Mukherjee.

Seema Vetal
 ACKNOWLEDGEMENT

My project on Employee Engagement Practices in Global and Indian Companies

has been a great learning experience. I was exposed to the different areas of research
in Human Resource and gained valuable experience, which I will always recall with a
sense of satisfaction and pride.

This is to acknowledge Ms. Smita Mukherjee under whose guidance I have been
able to successfully complete this project and effectively come to a very successful
conclusion.

To all my colleagues who have helped me either directly or indirectly, I am grateful

for their valuable inputs. This project would not have been possible without their help.
 FLOW OF CONTENT

TITLE PAGE NO.

1. Executive Summary

2. Scope, objective
3. Objective
4. Introduction

5. What is Employee Engagement ?

6. Employee engagement in global companies
7. HR Value Chain

8. Employee Engagement in the Best Places to Work

9. Employee Engagement Corporate Practices – Indian

10. Employee Effectiveness Framework – Common

Drivers (Source Hay Group Insight’s)
11. Can Engagement really create a difference?

12. Conclusion

13. References

14.

15.
16.
 1. EXECUTIVE SUMMARY

The concept of human capital is being recognised by employers all over the world.
They are shifting their focus from processesto people to get ahead in theworld of
competition. Human resource management is now endorsed with responsibilities like
employee empowerment, employee commitment and employee growth. Efforts are
being made to ensure proper engagement of employees to support the company
objectives.
Engaged employees are passionately involved with what is happening at the
companies. Many researches made in the past decade have indicated that “only one in
every five workers is highly engaged in their work”. This poses a challenge for
employers across the globe to take measures to help employees identify, be passionate
about and feel motivated to work. According to Aon Hewitt, “the companies that have
highly engaged workforce have risen to the challenge of maintaining and improving
engage-ment levels. They proactively respond to environment, competition and
changing needs of the workforce. They progress but stay true to the values which has
made them successful as well as positioned for continued success in
the future”.
 2. SCOPE OF THE STUDY

The study corves in depth review about employee’s customer service and their
engagement. The study also covers the relationship between employee engagement
and employee retention. The study shows what are the various employee engagement
practices among global and Indian companies

3. OBJECTIVE OF THE STUDY

 To identify the changing and evolving measures of employee engagement

adopted by Indian and global companies
 To understand how these measures are used to curb attrition.
 To understand Indian and global trends, their approaches towards employee
engagement vary.
 4. INTRODUCTION

The concept of human capital is being recognised by employers all over the world.
They are shifting their focus from processes to people to get ahead in the world of
com-
petition. Human resource management is now endorsed with responsibilities like
employee empowerment, employee commitment and employee growth. Efforts are
being made to ensure proper engagement of employees to support the company
objectives. Engaged employees are passionately involved with what is happening at
the companies. Many researches made in the past decade have indicated that “only
one in
every five workers is highly engaged in their work”. This poses a challenge for
employers across the globe to take measures to help employees identify, be passionate
about and feel motivated to work. According to Aon Hewitt, “the
companies that have highly engaged workforce have risen to the challenge of
maintaining and improving engagement levels. They proactively respond to
environment, competition and changing needs of the workforce. They progress but
stay true to the values which has made them successful as well as positioned for
continued success in the future”.
Engaging employees on a continuous basis is a very valuable investment for any
company irrespective of its scale of operation. There are different practices that
organisation adopts to engage employees as employee gives different priorities to
different variables. People are the biggest asset and their commitment ensures long-
term growth and profitability of an organisation. “Involving employees in overcoming
the challenges the company is facing generates a sense of worth and accomplishment
that will not only grow the company, but it will grow your people as well. Once
established, this becomes an upward spiralling cycle: involved employees become
engaged in overcoming a challenge, which leads to superior results, a stronger bond
with the organization, and a building passion for continuing to grow the business”.
Hence, a detailed analysis of the trends in this sunrise concept is vital in the field of
human resources. This paper aims to consolidate various researches done on this
concept and bring out clear definitive patterns followed by companies in India and
abroad.

5. WHAT IS EMPLOYEE ENGAGEMENT ?

Various researchers have defined employee engagement in different ways. They all
point out to one basic idea that it is a positive state of mind that enhances productivity
and efficiency. The concept of employee engagement was introduced by William
Kahn in 1990. He did not use the term employee engagement in his article, instead
used ‘personal engagement’ and ‘personal disengagement’. His theory was not widely
accepted for many years, but the concept was institutionalised by many authors later
on. He defined employee engagement as “the harnessing of organisation members’
selves to their work roles; in engagement, people employ and express themselves
physically, cognitively, and emotionally during role performances”.
define employee engagement as “a positive attitude held by the employee towards the
organization and its value. An engaged employee is aware of business context, and
works with colleagues to improve performance within the job for the benefit of the
organization. The organization must work to develop and nurture engagement, which
requires a two-way relationship between employer and employee”.
defined, employee engagement as the amount of discretionary effort exhibited by
employees in their job.
According to the study in Drivers of Employee Engagement conducted by researchers
for Institute of Employment Studies (IES), engaged employees have the following
characteristics:-
 Belief in their organisation
 Desire to work to make things better
 Understand the business context and the ‘bigger picture’
 Are respectful and helpful to colleagues
 Are willing to go ‘the extra mile’
A research done by Blessing White Global in 2013 suggests that employee
engagement is the alignment of the goals and aspirations of the organisation with that
of individual employees. Employee engagement not only ensures full commitment
from the employees but also creates passionate and enthused workers who strive hard
to work towards the organisation’s vision and their personal goals.
Many researchers have pointed out the lack of employee engagement practices in
organisations across the globe. There is still a vast gap between the employees and the
organisations that needs to be bridged. Since it is a very subjective concept,
developing a comprehensive method of measuring employee engagement is difficult.
These definitions therefore help companies to understand what activities fall under the
umbrella of employee engagement.
5.1 Rules of Employee Engagement

Every HR is bound to follow a set of rules in order to maintain the ethics and justify
the role of HR. The following rules must be followed to engage the employees in an
organization.
Don't Sweat Over Reviews
Don’t judge people on the basis of what others say about them. Instead, judge a
person on his/her abilities and performance.

Discover Your Company's Purpose

Invent the purpose or object of the company, discover the new objectives or target
points that can be set for the company.

Survey, But Keep It Short and Follow Up

When asked about an update, try to keep it to the point and short; be specific. There is
no point in explaining unnecessary details, which are not relevant to the topic.

There Is Only So Much You Can Do

Give yourself a break. Don’t try to complete all the work at the same time; analyze
your potential and work accordingly.

Don't Worry About Engagement

Don’t worry about always fitting into the group; show what you are. Rules are fine,
but simply having actual conversations and asking employees what we can do better
is much more valuable.
If employees can't sit down with their boss and talk about things, then it can be
detrimental for the company in the long run — doesn't matter how many stringent
rules are put in place
5.2 Need of Employee Engagement

The general principles of employee engagement have been around for decades.
During the past five years, though, there has been a surge in the popularity of
employee engagement. There are four primary drivers.
1. People have become the primary source of competitive advantage. The Brookings
Institute (2003) examined the primary source of market value in today’s organizations
and how it has changed over time. In 1982, 62 percent of an organization’s market
value came from tangible assets and 38 percent from intangible assets. Tangible assets
include things like machinery, products, facilities, etc. Intangible assets, on the other
hand, include factors such as brand, intellectual property, and, most important, the
quality of the workforce. By 2002, 20 years later, the source of value had almost
totally flipped. Almost 80 percent of market value today comes from the intangible
with a scant 20 percent coming from tangible assets. As we all have heard before,
products can easily be copied, a technological edge can prove fleeting, and more
facilities can be built, but the quality of an organization’s talent, its passion and
commitment, is nearly impossible to replicate. Engagement is the fuel that drives the
value of intangible assets.

2. Retention and the war for talent. The landmark 1998 McKinsey study, The War for
Talent, was among the first to talk about the potential for workforce shortages due to
the aging population. The study’s authors called upon organizations to take more
seriously their efforts to attract and retain talent, to assure that they would be able to
survive and thrive in the future. In the late 1990s and early 2000s, the slump in the
global economy quickly took the spotlight off of the anticipated talent shortage. And
some predict that a portion of today’s aging workers will delay their retirements out of
necessity, attenuating the expected talent shortage. Since 2003 the picture is once
again changing, albeit not as quickly as expected. For example, the Society for
Human Resources Management reported that 48 percent of the employees it polled
are actively seeking new jobs. Additionally, the workforce is getting older, with many
of the baby boomers hitting 60 in 2006 and ready to retire. Over and above the
workforce cost of increased retirements, companies are beginning to take heed of the
enormous financial costs of turnover and increasingly viewing employee engagement
as an imperative for keeping their key employees— and attracting new ones—as the
war for talent heats up once again.

3. Popular appeal. Remember the reengineering wave? Even those who used it as
more than just a guise for massive layoffs found it painful. Six Sigma
implementations are invaluable to business performance, but most companies are
finding them too complex to implement well. Engagement is a different matter
altogether. While it still takes patience to implement, engagement gets to the “hard
stuff” by focusing on the “softer stuff.” As one manager said: “It’s about appealing to
the head and the heart.” Engagement is about creating passion, it’s about focusing on
what people do well, and it’s about development and recognition. Some have called
employee engagement a form of positive psychology which, on the whole, is an easy
pill for organizations and their employees to swallow.

4. Overwhelming impact. The human resources function has been under pressure for
decades to prove that it makes a difference. While CEOs may espouse the importance
of their workforces in their annual reports, when times get tough, HR is among the
first to get the budget axe. Why? A lack of convincing evidence on the value of HR
initiatives. HR professionals are scrambling, according to a recent Conference Board
report, to prove that their activities and investments are both efficient and positively
influential to business strategy. The positive relationship between engagement and
performance (documented in hundreds of studies, with the evidence mounting every
day) provides a way for HR to prove its contribution. It’s a fact: The higher the level
of engagement, the higher the performance of the business. The research is not
inconclusive, not limited to one country or industry, and not contained to a few
hundred people—it’s overwhelming.
5.3 How to Make Employees Engage

Growth and development - An exciting position, with plenty of opportunity for

growth, learning, and advancement for employees is always helpful in retaining
employees.

Support and recognition - Giving those rewards and recognition. In many instances,
employee retention starts just as soon as an employee is hired. If a company sees an
unusual amount of potential in a new hire, management could make them feel
appreciated right off the bat. In a way, this practice can be considered a combination
of recruitment and retention tools. Employee Participation in decision making is also
a very effective engagement activity in the organization.

Aligning effort with strategy - Engagement begins with employees’ clear

understanding of what they should be doing on the job. Each employee needs a solid
job description and a clear set of performance expectations.

Empowerment - Empowerment is a feeling of job ownership and commitment

brought about through the ability to make decisions, be responsible, be measured by
results, and be recognized as a thoughtful, contributing human being rather than a pair
of hands doing what others say.

Teamwork and Collaboration - In the context of engagement, teamwork and

collaboration require good relationships both within the work group and across work
groups. Many organizations have strong teams with members who work well with
each other.
5.4 The Benefits of Employee Engagement

The power of employee engagement is that it is closely connected to business results.

When employees work in an environment in which they can focus their attention on
their work and have a drive to do their best, organizations experience higher levels of
productivity and profitability. Engaged employees look for better ways to do their
work, spend less time on wasted activities, and make effective use of resources. In the
end, companies deliver better products or services and have more resources left to
invest in further improvements. Although it is an important consideration, high
financial compensation is not the only driver of increased employee retention. As
addressed previously, employees decide to stay with organizations for other reasons,
such as growth and development opportunities, strong leadership, and meaningful
work. Turnover costs organizations millions of dollars each year, and engagement has
a proven relationship to employee retention. No one likes going into a store where the
sales clerks are sullen, absent, or uncooperative. It’s easy to see why customers notice
engaged employees and are more satisfied and willing to purchase again. E.g., Tom
Labadie, director of training and development at CompUSA states, “When you walk
into a store with high engagement scores, you can sense the positive tone. Employees
whistle and smile, they approach customers, and the store gives off that elusive
approachable feeling that customers appreciate.” Organizations with engaged
employees have more satisfied customers, but it’s not just because employees have
better interactions with customers. Engaged employees are more likely to improve
other critical factors affecting customer satisfaction, such as responsiveness, product
quality, thought leadership, innovation, etc. Finally, higher engagement translates into
higher and faster revenue growth. Engaged employees are more innovative and place
more emphasis on meeting customer needs. The “what can I do better or differently”
attitude of engaged employees versus the “it’s not in my job description” attitude of
the unengaged simply leads to better financial performance.
5.4 Assessing Engagement

Over the past eight years, The Gallup Organization has been conducting exhaustive
studies of employee engagement to try and answer these fundamental questions. One
of a handful of engagement evangelists, Gallup has promoted the value of measuring
employee engagement through a series of books, seminars and programmers; it has
also taken the lead in identifying and managing the factors that impact engagement
levels.

In order to rate the engagement of a workforce, first Gallup assesses employees to

determine whether they are engaged, not engaged or actively disengaged.

Engaged employees: are the stars in a company. Passionate about what they do, they
feel a strong connection to their company and perform at high levels every day while
looking for ways to improve themselves and the company as a whole.

Not engaged employees, according to Gallup, are the company zombies who show up
every day and put in just enough effort to meet the basic requirements of their jobs.
Without passion or innovation, these employees neither commit to the company’s
direction, nor do they work against it.

Actively disengaged employees are those who present a big problem for businesses.
Negative by nature, these people are unhappy in their work and they compound their
lack of productivity by sharing this unhappiness with those around them. They are the
proverbial bad apples who revel in their discontent while undermining the
accomplishments of others; as a result, not only do they achieve little themselves, they
also prevent others from being productive too.
5.5 Historical background of Employee Engagement

Over the past decade, the way in which people are managed and developed at work
has come to be recognized as one of the primary factors in achieving improvement in
organizational performance. This is reflected by popular idioms such as “people are
our most important assets”.

Back in the good old days of corporate world, things were pretty simple. Companies
put people on career tracks straight out of college; they gave employees a job for life
and waved them goodbye with a gold watch at retirement. The promise of the stable
life as a company employee kept both morale and productivity high.

Then things changed. Competition increased, margins shrank and shareholders got
more demanding. Suddenly, company staff were finding the very job security they’d
counted on was disappearing, and at speed. This upheaval meant companies had to
find new ways to motivate their employees in order to make them more productive
since, without stability, employees were looking for something else from their
employers. And thus, Engagement was born.

In itself, engagement isn’t really a new idea; owners and managers have been talking
about engagement, in one form or another, for centuries… they just used different
words to express it. In former times, engagement focused more on productivity and
achieving results through threat of punishment or by means of reward. But common
sense - and good communication - eventually won out and, today, organizations
everywhere are spending serious money on all forms of employee engagement. Boiled
down, it simply means ‘developing a happy and loyal workforce’. Enlightened
managers now realize that any company as a whole will benefit when its employees
know what’s going on and they feel part of the team. The tricky part is in defining
what makes a workforce happy, and in understanding how this good will translates
into company success.

From the extant literature review, it is acknowledged that successful organizations

share a fundamental philosophy of valuing and investing in their employees. In fact
many research studies have described human resource management as a means of
achieving competitive advantage. Consistent with this it is an equally important issue
for the organization to retain their critical (core) employees. Most organization today
continues to struggle with retention because they are relying on salary increases and
bonuses to prevent turnover. Essentially more organizations are now realizing that
retention is a strategic issue and continues to be a competitive advantage.

The term “engagement” stems from the work of Kahn (1990) who distinguished
between being engaged and disengaged at work. Putting the humanistic factors
together, Beer, Specter, Lawrence, Quinn-Mills and Walton (1984) created the
‘Harvard Business School’ model of HRM which focused on people in an
organization to be the key resource. In light of such critical emphasis being placed on
human capital, Paula Katter has aptly noted, “Engagement is all about creating a
culture where people do not feel misused, overused, underused or abused.”

At a very basic level, employee engagement draws from the tenets of the ‘Hierarchy
of Needs’ as conceptualized by Maslow, the highest stage of which is self-
actualization; the pinnacle of an individual’s fulfillment of talent and potential. This
theory of ‘higher order needs’ was largely overlooked in the heydays of scientific
‘assembly line’ manufacturing.
5.6 Understanding Employee Engagement

Employee engagement can be defined as an employee putting forth extra

discretionary effort, as well as the likelihood of the employee being loyal and
remaining with the organization over the long haul. Research shows that engaged
employees: perform better, put in extra efforts to help get the job done, show a strong
level of commitment to the organization, and are more motivated and optimistic about
their work goals. Employers with engaged employees tend to experience low
employee turnover and more impressive business outcomes. Employee engagement is
more than just the current HR 'buzzword'; it is essential. In order for organizations to
meet and surpass organizational objectives, employees must be engaged. Research has
proven that wholly engaged employees exhibit, Higher self-motivation. Confidence to
express new ideas. Higher productivity. Higher levels of customer approval and
service quality. Reliability. Organizational loyalty; less employee turnover. Lower
absenteeism. Current studies show that organizations are focusing on the meaning of
employee engagement and how to make employees more engaged. Employees feel
engaged when they find personal meaning and motivation in their work, receive
positive interpersonal support, and operate in an efficient work environment. What
brought engagement to the forefront and why is everyone interested in it? Most likely,
the tight economy has refocused attention on maximizing employee output and
making the most of organizational resources. When organizations focus attention on
their people, they are making an investment in their most important resource. You can
cut all the costs you want, but if you neglect your people, cutting costs won’t make
much of a difference. Engagement is all about getting employees to “give it their all.”
Some of the most successful organizations are known for their unique work
environments in which employees are motivated to do their very best. These great
places to work have been recognized in such lists as Fortune’s 100 Best Companies to
Work For. The concept of engagement is a natural evolution of past research on
highinvolvement, empowerment, job motivation, organizational commitment, and
trust. All of these research streams focus on the perceptions and attitudes of
employees about the work environment. In some ways, there are variations on the
same fundamental issue. What predicts employees “giving their all?” Obviously, all
organizations want their employees to be engaged in their work.
5.7 Hierarchy Of Engagement

Employee Engagement at Each Level

In addition, employee segmentation is an important method to utilize when evaluating
employee engagement at each level. For instance, the factors that engage the most
productive employees in an organization may not be the same as the factors that
engage the least productive employees. Those employees who receive the highest
rankings on their performance reviews may tend to express higher levels of job
satisfaction when they are presented with challenging opportunities that allow them to
grow and learn. Those that receive the lowest rankings might be more focused on
issues surrounding work/life balance and job security. While some factors, such as
good communication, are important among all employees, the attempt to focus on the
full spectrum of factors that engage the entire workforce may cause an organization to
omit some of the factors that are the most important to the company's most productive
people.

Employee Satisfaction Does Not Equal Engagement

While organizations may be aware "through the grapevine" that employees are
unsatisfied, it's the reasons for the dissatisfaction that elude them. While employee
satisfaction is important, it's not the end game — it is only one piece of employee
engagement. Satisfaction is imperative in that, for those individuals who are top
performers, satisfaction may be derived from their achievement orientation, their
ambition, or their sense of responsibility. On the other hand, the attempt to satisfy an
under-performer who will only be content with a lightened workload may not be a
worthy cause. Again, the focus is on ensuring that those individuals who have been
identified as top performers and high potentials are engaged in the organization. As
stated, employee engagement incorporates employee satisfaction, but also includes
the essential elements of pride, commitment and loyalty in the organization. Engaged
employees aren't concerned with meeting the minimum requirements to complete a
task, they are focused on what they can do to better the company. Essentially, they
take ownership in the company despite whether or not they actually own a share of
stock.
Drivers of engagement

A two-way relationship between the employer and employee The importance of the
individual being able to align themselves to the products, Services and values of the
organization The ability of the organization to communicate its vision, strategy,
objectives and values to its staff so that they are clearly understood Management give
staff sufficient ‘elbow room’ and autonomy to let them fulfill their potential
The employer is highly effective at engaging in two-way communication with its
staff, in particular encouraging upward communication. Lastly, that management from
the top to the bottom of the organization is ‘Committed leaders’ and that the key role
of the immediate line Manager/supervisor is recognized as one of the most important
conduits to achieving effective employee engagement
Elements of Engagement

Some researchers conclude that personal impact, focused work, and interpersonal
harmony comprise engagement. Each of these three components has sub-components
that further define the meaning of engagement. Personal Impact-Employees feel more
engaged when they are able to make a unique contribution, experience empowerment,
and have opportunities for personal growth. Past research concurs that issues such as
the ability to impact the work environment and making meaningful choices in the
workplace are critical components of employee empowerment. Some research on
retaining talent found that the perception of meaningful work is one of the most
influential factors determining employees’ willingness to stay with the organization.
Focused Work-Employees feel more engaged when they have clear direction,
performance accountability, and an efficient work environment. Aside from the
personal drive and motivation to make a contribution, employees need to understand
where to focus their efforts. Without a clear strategy and direction from senior
leadership, employees will waste their time on the activities that do not make a
difference for the organization’s success. Additionally, even when direction is in
place, employees must receive feedback to ensure that they are on track and being
held accountable for their progress. In particular, employees need to feel that low
performance is not acceptable and that there are consequences for poor performance.
Finally, employees want to work in an environment that is efficient in terms of its
time, resources, and budget. Employees lose faith in the organization when they see
excessive waste. For example, employees become frustrated when they are asked to
operate without the necessary resources or waste time in unnecessary meetings.
Interpersonal Harmony-Employees feel more engaged when they work in a safe and
cooperative environment. By safety, we mean that employee trust one another and
quickly resolve conflicts when they arise. Employees want to be able to rely on each
other and focus their attention on the tasks that really matter. Conflict wastes time and
energy and needs to be dealt with quickly. Some researchers also find that trust and
interpersonal harmony is a fundamental underlying principle in the best organizations.
Employees also need to cooperate to get the job done. Partnerships across
departments and within the work group ensure that employees stay informed and get
the support they need to do their jobs.
Making Use of Engagement

Measurement of employee engagement can have many applications in the

organization. Earlier, it is mentioned that engagement could serve as a general index
of HR effectiveness in an HR scorecard. Also, engagement measures serve as an easy
way to benchmark the work climate against other organizations.

Other uses include:

Needs Analysis-The fundamental issues measured in engagement provide a quick

index of what leaders and HR need to do to make things better. In addition, items in
engagement surveys tend to be very actionable. This means that leaders or others in
the organization can take action that will affect the score on a single item. Evaluation-
Many learning and performance interventions are designed to impact some aspect of
engagement. When an engagement measure is used as a pre-implementation baseline,
the impact of the intervention can be gauged by measuring post-implementation
changes in engagement. Climate Survey-Some organizations like to use engagement
measures as simple indexes of the workplace culture. While more extensive surveys
are valuable, sometimes it’s easier to focus attention on a few simple and proven
factors. Leader or Department Feedback-Depending on the demographic information
collected when the engagement measure is implemented, one can create breakout
reports by department or leader. This means departments and leaders can gain a better
understanding of how engagement in their groups differs from the rest of the
organization. This information can be used to create development plans or plans for
larger-scale interventions.
 6. EMPLOYEE ENGAGEMENT IN GLOBAL COMPANIES

6.1 Employee Engagement leads to better Customer Service

8classifies employees into Engaged, Disengaged and Actively Disengaged wherein

each class of employees exhibit a set of specific characteristics. He also points out
that according to the Gallup organization; the cost for keeping actively disengaged
workers over a five-year period was approximately $300 billion in lost productivity
and employee performance. There are many studies conducted in this area that show
that low employee engagement not only affects performance, but also lowers
customer service satisfaction increases absenteeism and increases employee turnover.
An example of Southwest Airlines will highlight how employee engagement and
empowerment can lead to better customer service. The senior management at
Southwest believe in complete empowerment to the employees at every level. To
empower their employees, Southwest got rid of strict work rules and inflexible job
descriptions so their employees could assume ownership to get the job done and get
their planes out on time, regardless of whose “official” responsibility it is. The airline
also gives employees the flexibility to “bend” company policy if they think it would
be in the best interest of its customer. This level of engagement comes through
building complete trust in the employees. An efficient training system helps them to
handle situations as best as they can a great customer experience.

6.2 HR Value Chain can help Build

the Engagement Factor in an Organisation

The engagement factor: building a high-commitment organisation in a low-
commitment world put forth an integrative model for employee engagement focusing
on the organisational practices at the micro as well as at the macro level9. This model
integrates the HR value chain and organisational strategy at the macro level with
employee engagement at the micro level.
 7. HR VALUE CHAIN

Sridhar Balasubramanian, Professor and Associate Dean of UNC Kenan-Flagler’s

MBA program, notes that this linkage has helped the company to be true to its values,
and to execute on its customer promise flawlessly. “Southwest is a fun brand that
delivers focused value,” he said, “and the flight attendants and pilots who crack jokes
and entertain the passenger are not just putting on a show. They have been hired at
Southwest because that sense of humour comes naturally to them”.
The HR value chain is an integrated set of human resource management practices –
from the sourcing and recruiting of talent, through training and development and
engagement, to employee separation and exit. It engages employees to work towards a
common strategy and core values of the organisation.
The process of creating engaged workforce begins with the founders of the
organisation coming up with a vision and strategy that can be percolated down to all
the levels in the organisation. Next step is to find and recruit people who fit the
desired strategy. Finding a person, who is the ‘best fit’ in the organisation, is the most
critical step in the value chain.
For example, to gain employee commitment early, Proctor and Gamble developed a
well-structured college intern program. This process assigns interns to work on high
profile projects. These projects help them interact with the senior management. While
most of the companies believe that an extensive intern program can drain
management resources and waste a lot of managers’ time spent in mentoring,
coaching and monitoring interns, Proctor and Gamble feels this is time well spent
because the conversion rate of these interns into full-time employees in the company
is much above the industry average. Once new hires are brought on board, a process
of continuous employee development begins.
 8. EMPLOYEE ENGAGEMENT IN THE BEST PLACES TO
WORK

Employee satisfaction is not dependent on salary and monetary benefits only.

Psychological and social contentment is equally important to engage employees and
keep them motivated to work. Forbes conducted a research on how the best employers
around the world indulge in employee engagement. They “motivate high performance
and align talent with their business strategy by focusing on what matters most to the
employees”
These were the few practices followed by these companies in order to ensure
maximum employee commitment and retention:
1. Understanding what employees are thinking. – Companies like Recreational
Equipment (REI) use social media as a source of employee engagement surveys.
Their “online campfire” allows associates and executives to share their thoughts
and experiences in the company and helps the company in getting a pulse of the
employees.

2. Creating an intentional culture – A very good example of this practice is Google.

It is known for its informal and playful culture wherein all employees are given
the freedom to work with their own style. It offers recreational facilities like gym,
meditation centres and gaming areas where employees can “blow off steam” and
get back to work later.

3. Appreciating even for small contributions – DHL Express is known for thanking
its employees for their good performance in the form of either monetary rewards
or an appreciation pin on the company corkboard.

4. Honest and open communication – SAP believes in adopting an effective two-

way communication channel. The employees are made to understand the strategic
reasons behind their work and are free to give feedback to their leaders at any
time.
5. Supporting a defined career path – M.D. Anderson Cancer Centre has a
formal mentorship program that allows employees to connect with the leaders
and their colleagues and work on their professional goals.

6. Social interactions outside work – Participating in social development

initiatives is a great way of getting all the employees together and improving
productivity. Cummins employees work on community service projects that in
turn help in building stronger relationships at work.

7. Communicate organisation’s stories – A company well known for its employer

branding is Southwest Airlines. The company’s fun, friendly and innovative
culture is acknowledged and appreciated across the globe. A strong employer
brand ensures that right people are attracted to the organisation and majority of
them are motivated to stay in the organisation for long.
 9. EMPLOYEE ENGAGEMENT CORPORATE PRACTICES –
INDIAN

The number of disengaged employees in Indian companies is the lowest in the world.
It has the highest number of engaged employees that are as much as those in countries
like Australia and New Zealand. China leads in the level of disengagement. When a
survey was done a question was put to the employees that what would make them stay
longer in an organisation and the answers were – work a belief in the organisational
goal and career opportunities, turned out to be the most significant reasons to continue
their stay in the organisation.
The survey showed that Indian managers are one of the best in the world when it
comes to motivate employees, to employ their talent, to take suggestions and inputs
from them and take actions on their ideas. It is respectively 9% and 7% higher than
the global average. However, Indian managers should lay more emphasis on
rewarding the achievements and giving recognition. Organizations should help
employees in redefining career success to encompass skill development, lateral
moves, and special projects and stretch assignments - not just advancement or
promotions. “Organisations need to focus on providing career development options to
help their younger employees. They need to set their own standards of success, which
would help them achieve their targets in the organisation. It would in turn prevent
attrition as they would not be misguided by vague career development opportunities”.

At the Tata Consultancy Services (TCS), the senior executives guide their team
members who come up with innovative solutions in their work related
problems/issues. This has ultimately resulted in the development of a large number of
useful products that have added to the success of the business13.

At Bharti Airtel Ltd, the best performers of the month and the new joiners are
rewarded by the way of a special dinner / lunch with the Chief Operations Officer.
The levels of employee engagement across all levels and groups are monitored at
Aditya Birla Group, who carries out a biennial Organisational Health Study (OHS),
led by the chairman It gives the employees an opportunity to express their own
opinions on a range of issues without fear of broadcasting their identity. Another key
engagement factor has been ‘The Aditya Birla Awards for Outstanding Achievement’.
The Birla Group have conducted competition such as “Oh! Not so smart”, “Vision
2015”etc for all employees. It has also created a portal where in one can find job
opportunities across all the horizontals and verticals of Birla across all geographic
locations. It also has opened up many learning opportunities like:
a) Gyanodaya for management learning: In that the managers participate in strategy
and managerial programs conducted by many leading academics.
b) The virtual campus for the ‘E-learners’. Over 250 online courses covering areas
like engineering, leadership, marketing and sales are available on their learning
network.

Indian Hotels, the group which operates the Taj chain of hotels, has successfully
been able to create a culture wherein the performance of their employees is measured
on the guidance given by senior leaders and customer Orientation efforts.

Tata club at Jamshedpur is a prime example of Tata Motors’s employee engagement,

which is a get together for employees and employees’ families as they come together
and have fun. The Community Development Centres (CDCs) have been established
all across India so as to merge family values into

Tata Motors organizational culture. To promote education and to bring to notice the
achievements of employee’s children, awards are given in sports, academics and
extracurricular activities. Kalasagar and Kalasangam is a way to nurture the artistic
talents of the employees – Tata Motors Cultural group. They usually arrange cultural
events on drama, dance, music and other activities to promote creativity among
employees and their families.
HUL soon realized that a cyclical feedback system is a must for its sales managers
and their salespeople that come under the managers. HUL believes that “Ownership
of engagement really goes to the manager”. Recently the HUL managers were made
to go through intense engagement training under the Gallup consultants and each
individual’s follow up action plan was reviewed. They also went to different locations
so as to talk to their salespeople, individually.
Vodafone has introduced a new model called the Vodafone Way which is a customer
centric model for achieving high customer and employee satisfaction. The model is
based on three pillars: Trust, speed and simplicity. Line managers are held
accountable for their team engagement and providing them plans and tools to drive
performance by giving the employees a clear goal and client focus - and thus
achieving an increase in the level of innovation and productivity even in a downturn.

In Godrej the motto is ‘take yourself lightly and take your job and your
responsibilities seriously’. They believe that real fun at work should imply that ‘Work
itself is fun’. At Godrej and Boyce the head of each division is responsible for
organizing some fun activities for employees in division. These include Attendance /
Retirement functions, Birthday celebrations, Department picnics, Annual get-.,
Festive dress codes, Saturday casual dressing, Dusserah or Diwali celebrations,
Learning & Sharing day, online quizzes, announcing Employee of the Quarter/Month,
Team Lunches/ Movies, Lights Off Day, Sense of Humour (try to laugh at ourselves
rather than others).

Tata AIG General Insurance Co. Ltd honour team and individual achievements by
organizing a fun filled evening for its employees. There is an event called the
Employee Town Hall where the head of the organization interacts and addresses all
employees about the organisation’s progress and gives an insight into its future.
Thereis interdepartmental football and cricket matches organized yearly for sports
enthusiasts which helps foster esprit de corp. World of Work (WOW) is another event
where the employees’ children are invited to come and spend some time at their
parents’ place of work.
 NEED OF THE HOUR

1. Day one: Almost all organizations have ways of acquiring new talent but what
they lack is an innovative /good strategy for retention for the same. For the first
day it is important to keep a well-planned orientation programme for the new
employee. A manager must be able to extract the potential qualities by means of
efficient recruitment methods. After the decision of hiring is taken, the manager
should ensure that the talent obtained is fit for the role and then all efforts should
be made to retain such a talent within the organization.

2. Top to bottom approach : Employee engagement is such that it requires to be led

by example. Until the top management doesn’t believe in it and encourage their
managers and further to their employees, it will not get imbibed into the culture of
the organization.

3. Encourage two-way communication: What managers must encourage is a two

way communication process. The employees should be given the opportunity to
express their ideas as it’s their job that gets affected the most. A clear and steady
communication is what keeps the employees engaged. Sharing the power of
making/giving ideas for work will create a sense of belongingness and thus
increase their engagement level.

4. Give opportunity and freedom: Providing job autonomy will encourage them to
think independently. The employees will also get a chance to freely choose the
best possible method of doing the job and as long as they are producing the
desired results, the management should not object. Managing the results should be
the aim and not the process in itself.
5. Ensuring availability of resources : All resources such as material or monetary
or information related resources must be provided to the employees by the
manager. The manager needs to be doubly sure that the employees are getting all
resources in order to complete their jobs efficiently.
6. Train the employees : Provide training to the employees to keep their knowledge
updated. When an employee knows his job thoroughly, his confidence level
increases as he is able to complete his task without any supervision. This builds
the employees ‘commitment and self-worth.

7. Encourage Feedback : Organisations ought to keep a track of the level of

engagement shown by the managers and their employees not only will this help in
increasing the initiatives taken in this field but also help zeroing down to the
factors that engage an employee.

8. Incentives/Benefits : Many management theories have proved that when an

employee gets any kind of recognition either by praise or payment, he tends to put
in more effort into his job. Thus certifying a link between incentives and
performance .Managers must come up with ways to provide financial and non-
financial benefits to those employees who show more progress at work.

9. Create a distinctive culture : Creating a strong working culture is an integral part

of ensuring that the engaged employees become an example to the rest of the work
force and the new employees who join also understand the standard of work that
the organization maintains.

10. Top-performing employees : A study conducted by Watson Wyatt Worldwide in

2004/05 on HR practices of 50 large USA firms shows that high-performing
organizations are focusing on engaging their top (performing) employees by
providing with the resources that they require, by helping them modifying the
processes according to their needs and thus being able to reduce the turnover rate
of their high performers
 10. EMPLOYEE EFFECTIVENESS FRAMEWORK – COMMON
DRIVERS
(SOURCE HAY GROUP INSIGHT’S)

There is a significant association between engagement and justice perceptions. The

correlations suggest that individuals who reported that they were more engaged in
their jobs also reported higher levels of justice15.
India’s EEI increased in 2007 and steadily rose till 2008. From 2008 to 2009 there
was drastic increment in the employee engagement index but then again it started to
decline in 2009-2010.Two distinct trend patterns were observed across job types. An
upward trend was found for management, professional and sales job types where as a
downward trend was found for transportation and production, administrative support,
crafts/skilled trades and service job types. According to Rena, organizational leaders
and HR professionals should compare their company’s engagement levels to the
normative levels shown in their research, as well as to previous levels within one’s
company. This will help organizations interpret their own organizations’ engagement
trends by determining the extent to which engagement changes are due to specific
practices within their organization. The study conducted by Blessing White and HR
Anexi also found out that just over 34% employees in India are fully engaged and
13% are actually disengaged.
Though Indian firms have benefited from rapid growth and healthy profitability, HR
processes have to keeping up with the growth and dynamic nature of India’s
workforce. Right Management showed that organizations that seek to improve
engagement measures experience significant differences country wise in engagement
levels from 45% in India to only 11% in Japan.
 11.CAN ENGAGEMENT REALLY CREATE A DIFFERENCE?

Employee engagement does make a huge difference in the overall performance of the
organisation. There are many research conducted on the same and the following were
the results:
“Teams with high engagement performance zone had a 37% net promoter score
(NPS) as against those teams with outside the engagement performance zones with
10% NPS”16.

It is noticed that in many department stores, the customers had a higher satisfaction
level in sections where the level of employee engagement was the highest17.
Executives in organisations should pay heed to such findings. It has been proved very
predominantly that there is a strong correlation between productivity and engagement.
According to a research published in the Journal of Applied Psychology, “employee
satisfaction and engagement are essential to achieve business targets and should be
the focus of all the companies.” One interesting question is this: What is the
difference in the productivity of engaged employees when compared to non-engaged
workforce?
Employee engagement plays a very prominent part in affecting the attitude of
employees towards their work and the organisation. They are motivated to make a
difference in the organisation. They possess the right amount of knowledge and
abilities and are confident to use it in their work. This frames their present behaviour
and also marks their future loyalty to the organisation.

Therefore, it is important to consider some of the results of the Towers Perrin survey:

 84% of the highly engaged employees are confident that they can contribute
positively in improving their products and services, as compared to the 31% of
the disengaged employees who lack it.
 72% of the highly engaged employees can positively affect customer service,
versus 27 percent of the disengaged.
 68% of highly engaged employees know that they can help in cost reduction in
their job or unit, compared with just 19 percent of the disengaged.
SFrom the above statistics it is clear that organisations that invest their time and
money in employee engagement have a better chance of beating the competition
as against those who do not. Employee engagement practices set a benchmark of
good practices in the industry that can make or break the reputation of an
employer.
 12. CONCLUSION

Employee engagement has always been one of the most worrisome issues for most
organisations. Training program peddlers and event managers are back in action again
carrying out classes in managing retention and engagement. The employee
engagement fever has once again become epidemic in the corporate circuits. The most
recent has been the news of Google losing a good enough number of people to its
rival, i.e., Facebook and others is making people ask themselves that if this could be
the fate of Google, where do the other companies stand?
Employee engagement and a better talent management and retention strategy may
imply the identification of an engaged workforce at all level, for the BPO/ITES sector
in India.
If employee engagement is practised in isolation and without examining what it does
to help organisation to deliver results, it becomes a sheer waste of effort. The
challenge, therefore lies, for companies and its leaders is to keep a track which of the
engagement drivers support the organisational results and which of them do not.
Many Organisations are coming up with innovative monetary and non-monetary ways
of keeping their staff engaged all throughout the year. Line managers are being
coached on the same so that they can make a difference starting at the grass root level
itself. Organisations have realised the three main reasons why an employee would
want to be loyal to an organisation-work, career opportunities and a strong belief in
what the organization is aiming to achieve and these are the factors upon which the
organizations of today are primarily focusing on.
 14. REFERENCES

 http://www.aon.com/attachments/thought-
leadership/Trends_Global_Employee_Engagement

 http://worldclassbenchmarking.com/resources_section/employee-engagement-n-
difficult-times.html

 http://www.employment-studies.co.uk/system/files/resources/files/408

 https://www.kenan-flagler.unc.edu/executive-
development/about/~/media/E93A57C2D74F4E578A8B1012E70A56FD.ashx

 http://www.forbes.com/sites/sylviavorhausersmith/2013/08/14/how-the-best-
places-to-work-are-nailing-employee-engagement/#69cc1d6d38aa

 http://www.shrm.org/publications/hrmagazine/editorialcontent/pages/0204covstor
y.aspx