0

The Role of
Employee
Engagement at XYZ
Industries.
Amanda Mejia

December 13, 2020

 1

Abstract
Extensive research in the last thirty years has shown overwhelmingly positive and impactful
effects of employee engagement. This report includes an analysis of those conclusions as well as
the factors of employee engagement and how an employee engagement focus can impact XYZ
Industries. Human Resource practices and procedures can be manipulated to focus on
engagement and meeting our employees’ emotional, cognitive, and physiological needs. It can be
concluded that if XYZ Industries were to fully meet the needs of our employees, then the
company could have full advantage of labor force. Taking full advantage of the labor force
would result in lower absenteeism, defect rates, turnover, shrinkage, and safety incidents. Lower
rates in those areas would mean a better bottom line for the organization.
 2

Table of Contents

Contents

Executive Summary.........................................................................................................4

Introduction......................................................................................................................5

Method of Research.........................................................................................................6

Results..............................................................................................................................7

What is Employee Engagement?.................................................................................7

The Role of Human Resources....................................................................................7

Employee Engagement Matters...................................................................................7

What Drives Employee Engagement?.........................................................................8

Job Expectation and Job Clarity..................................................................................8

Organizational Culture.................................................................................................8

Career Development....................................................................................................8

The role of Communication.........................................................................................9

The cost of Disengaged Employees.............................................................................9

Conclusion.....................................................................................................................10

How Does it Affect Us and Our Organization?.........................................................10

Employee Engagement Policies, Procedures, and Programs.....................................10

Recommendation...........................................................................................................12
3

Gallup Survey............................................................................................................12

Employee of the Month.............................................................................................12

Employee Engagement Committee...........................................................................12

Appendix........................................................................................................................13

References......................................................................................................................15
 4

Executive Summary
With the creation of an official Human Resources Department and as the Human Resources
Manager I have seen area for improvement in our employee engagement efforts. This report
introduces the concept of employee engagement, the importance of engagement, and possible
solutions to improve employee engagement at XYZ industries.

The research of this report was discovered from academic journals, articles, periodicals, books,
and interviewing a Human Resources professional, Maurice Cayer, Ph.D.

Extensive research has shown the importance of employee engagement because it ultimately
means we as an organization care about the emotional, psychological, and cognitive needs of our
employees. Organizations pursuing engagement have seen significantly lower rates of
absenteeism, product defects, safety incidents, shrinkage, and turnover with higher rates of sale,
productivity, and customer ratings.

From the findings we can conclude that the integrating activities and programs that promote
engagement would be beneficial for the organization. It is important for us to be committed to
our employees and show them we care. That is why we should partake in the following activities:
 Gallup survey
 Employee of the Month
 Employee Engagement Committee.

These options are relatively simple to start and will have a positive impact on our employees.
The survey will help us gain a better understanding of our employee’s needs. Employee of the
Month will provide wanted recognition and incentive, and the Employee Engagement Committee
will allow for a longer lasting impact to show employees we care about their work, well-being,
and promote dedication to the organization.
 5

Introduction
As the Human Resources Manager, I have seen the incredible labor force this organization has to
offer. However, I have also seen gaps in the resources we provide to our employees. This report
examines the role of employee engagement, engagement in its relation to human resources, and
how engagement can positively impact an organization.

Employee engagement is cultivated through the actions of leadership, human resources, and the
employees themselves. Employee Engagement means meeting the emotional, phycological, and
cognitive needs of employees. The following concepts have an impact on the progress of
engagement:
1. Job expectation and clarity
2. Organization Culture
3. Career Development
4. Communication.

From the drivers of engagement, we can pursue actions and programs to learn more about our
employee’s thoughts and increase the promotion of engagement. Secondary research from
academic journals and periodicals have shown when employees are engaged in an organization
the company is likely to see significantly lower rates of absenteeism, product defects, safety
incidents, shrinkage, and turnover. Along with lower rates of unfavorable behavior, organizations
will also see higher rates of sales, productivity, and customer ratings.

In order to see how successful the organization is in meeting the needs of our employees, I
recommend we survey our employees using the highly rated Gallup Survey. The survey is just
twelve questions that will assess our employees’ satisfaction in their work and the attitudes
toward the organization. Once we obtain that information, we can pursue actions, programs, or
policies that promote the drivers of engagement. As well as a survey, the organization should
introduce an Employee of the Month and Engagement Committee to better meet the emotional,
psychological, and cognitive needs of our employees.
 6

Method of Research
This report was conducted through reading a plethora of academic journals, articles, periodicals,
books, and interviewing a Human Resources professional. There was an interview conducted on
November 21, 2020 with Mo Cayer, Ph.D. Dr. Cayer is a Professor at the University of New
Haven and teaches human resources and business management classes. Dr. Cayer has decades of
human resources experience in different multinational companies, such as Macy’s, JC Pennies,
and Bayer. He also has years of experience as a researcher in the field of organizational
psychology.
 7

Results

What is Employee Engagement?

The concept of employee engagement was first introduced by William A. Kahn, a professor and
researcher of organizational behavior at Boston University, in 1990 titled Psychological
Conditions of Personal Engagement and Disengagement at Work (Rheem, Don.). Khan’s
definition of personal engagement, what we now call employee engagement, is “the harnessing
of organization members to their work role; engagement people employ and express themselves
physically, cognitively, and emotionally during role performances” (Khan, W.A.). Since 1990
there have been many definitions for the term employee engagement, but to settle on one would
be, “the extent that employees are satisfied, committed to and prepared to support what is
important to the organization” (Tadesse, W.M.). It is through different Human Resources
practices such as recruitment, performance management, compensation and benefits, training and
development, policies and compliance, and employee relations that employee engagement can be
unlocked.

The Role of Human Resources

It is through Human Resource Management (HRM) that employee engagement is crafted. HRM
is a future oriented perspective of manipulating recruitment and selection, training and
development, performance management, compensation and benefits, and labor relations to align
with the business strategy of an organization.

An academic journal described and discussed the following HRM practices. Recruitment and
selection is the process of staffing an organization with labor. The employee experience is shaped
before the employee even starts working for an organization through the recruitment process. If
the recruitment process does not adequately meet the needs of both the potential employee and
organization than turnover is more likely to occur (Cayer, Maurice). Training and development
can be manipulated to help employees improve their knowledge, skills, or abilities resulting in a
better employee for the organization. Training and development can also make an employee
more committed to an organization. Performance management is an opportunity or employees to
receive constructive criticism or rewards for their performance, this practice increases
attentiveness and understanding for the employee. Compensation and benefits is a well-known
influential part of human resources. It can provide security and motivation for employees. HR
can influence labor relations with certain policies and procedures that can have an effect on how
workers are treated, also effecting the employee’s experience (Aktar, A., & Pangil, F.). HRM
practices are intended to meet the emotional, cognitive, and psychological needs of employees.

Employee Engagement Matters

Through various studies and research, the results are clear that employee engagement matters.
Employee engagement encompasses many aspects of employees’ opinions about their
relationship to their job and employer. At the end of the day, employees’ opinions and feelings
toward their work effects a firm’s productivity and overall bottom line (see Figure 1) (Gallup,
Lavigna, B., & Basso P.). Similar to Khan original definition of employee engagement, one
study defined engagement as, “…one's emotional commitment towards the organization, being
psychologically involved and willingness and ability to walk that extra mile in achieving the
organizational goals and objectives” (Iyer, S., & Israel, D.). Going the extra mile, academically
 8

called organizational citizenship behavior (OCB), is an important result of employee

engagement. OCB translates into higher rates of organizational effectiveness and better
interpersonal relationships between employees. This kind of behavior is completely voluntary
from the employees. Areas of research suggest OCB is sought after because it has the ability to
become a competitive advantage for a firm (Jnaneswar, K.). Employee engagement also has a
positive relationship with employees’ experiences with an organization and the, “…
organizational benefits of [employee experience] include brand promotion, better retention,
lower turnover, and better customer experience” (Jackson, E.). Progressing employee experience
through engagement can support growth for an organization.

What Drives Employee Engagement?

The academic concept of Employee Engagement was created just thirty years ago. There is still
more research to be done in certain areas such as the real drivers of employee engagement. So
far, the research suggests that job expectation and clarity, organizational culture, career
development, and communication are among the biggest drivers of employee engagement
(Tadesse, W.M.). These aspects can be manipulated to affect their experience with the
organization and make employees more committed.

Job Expectation and Job Clarity

Job expectation focuses on setting goals aligned with the company for employees to help the
organization and make employees feel accomplished; ultimately adding more feelings of job
importance (Tadesse, W.M.). However, job expectation is hard to achieve without job clarity. Job
clarity is effectively communicating those expectations and goals to the employee. These two
factors influence the meaningfulness of an employee’s work. Meaningfulness does not mean
one-sided value for the employer, rather it is a mutual beneficial relationship an employee has
with their job (Krishnaveni, R., & Monica, R.). In that, the employee gains intrinsic value from
their job and is motivated to keep working because it brings a sense of purpose. If an employee
does not understand their role or does not see where their work adds value, they are less likely to
be motivated.

Organizational Culture
Organizational culture as defined by the well-respected Society of Human Resources
Management, “consists of shared beliefs and values established by leaders and then
communicated and reinforced through various methods, ultimately shaping employee
perceptions, behaviors and understanding” (Practicing Strategic Human Resources). Derived
from organizational culture are employees’ attitudes and behaviors toward other peer employees,
managers, customers, and vendors. If an organization builds a climate that is focused on meeting
the emotional, cognitive, and psychological needs of employees they are more likely to see
higher rates of engagement (Sarangi, S. & Srivastava, R.).

Career Development
Employee engagement is influenced by motivation and many employees derive motivation from
career development (Understanding and Developing Organizational Culture). Employees are
more likely to stay committed to an organization when the organization is committed to them and
their career because it satisfies employees’ psychological and cognitive needs (Khan, W.A.). The
average person enjoys challenge and development because it can be rewarding. Career
 9

development is a prospect for the employee to learn new skills and be a better performer for the
organization.

The role of Communication

The following concepts that have been expressed in this report so far do not mean anything if
they are not properly communicated to all employees. Communication is a defining factor in
fostering employee engagement, as a lack of communication can contribute to distrust,
dissatisfaction, skepticism, and unwanted employee turnover within an organization (Shields,
A.C.). Communication does not mean management telling employees what to do; but rather
management and employees working together to provide feedback on what is going right and
what is going wrong.

The cost of Disengaged Employees

There can be real consequences of disengaged employees. There are two categories of
disengaged employees, “not engaged” and “actively disengaged”. Both categories promote poor
behavior and attitudes from employees, such as higher absenteeism and lower quality of work.
The first level of disengaged employees, “not engaged” employees, are ones who have
unsatisfied psychological needs. These employees may put time into their work, but they have no
passion or energy to go above and beyond. The more serve level is “actively disengaged”
employees, these employees are resentful their needs are being satisfied and they are more likely
to act out detrimental behavior and undermine employees who are engaged (Gallup). Disengaged
employees are evident and can cause harm to an organization (Cayer, Maurice).
 10

Conclusion

How Does it Affect Us and Our Organization?

With all that has been learned through research of employee engagement it is clear to see the
impact it can have on an organization. Equipped with this knowledge we can now look to our
own organization and compare possible areas for improvement.

Employee Engagement Policies, Procedures, and Programs

There are many policies, procedures, and programs that can be created to increase employee
engagement. For example, we can partake in the following actions:
 Survey
 Recognition system
 Employee Engagement Committee
 Employee of the Month.

These options are among the most popular in organizations to boost engagement. They range in
cost, ease of set up, and their overall impact on the business. The survey option would include
the distribution of the Gallup Q12 survey (see List 1). The questions focus on four levels of
performance needs, these levels are labeled as basic, individual, teamwork, and growth. Meeting
the needs of employees at these different levels allows for an environment of trust and support
for employees to feel secure, and with that security comes their best performance. The survey
would be easy to set up and there would be no cost. The second option is buying a recognition
system. A recognition system is a private online program specially designed for the organization.
This program allows for recognition badges, messages, and feedback to be continuously
provided to all employees. This is a more costly option, as we will have to buy a service. On
average the cost for each employee to partake in the service is $3.50 per employee, and with 200
employees that will be about $8,400.00 per year. The third option is setting up an Employee
Engagement Committee. The committee would be made up of employees and they would be able
to run events such as appreciation lunches, holiday parties, or donation drives. For the committee
to run event they would need a budget of $10,000.00. The fourth option is nominating an
employee of the month. The employee of the month is a way for peer recognition to take control.
This is a simple program, where each employee can nominate another employee by writing in
why they think a certain employee deserves the reward for employee of the month. The reward
for employee of the can include a $50 gift card and the closest parking spot to the front door; this
would cost $600 a year. The decision matrix below considers cost, ease of set up, and impact.

The scores for each option are based on a ranking system, 1 being the worst option and 4 being
the best option when compared to each other. The weights placed on the scores are based on the
 11

importance of the category the options are being scored against. The higher the score the better
the option. The heaviest weight is placed on impact. The impact category relates to how closely
the option influences the various drivers of employee engagement. Impact is the most important
aspect because it means the option will have a real effect on employees’ behavior and attitudes at
work. The cost is the second highest weighted category because we want to choose an option that
economically works for us. The third category relates to the ease of setting up each option. From
the decision matrix we can conclude the best option is a tie between the survey and employee of
the month, the second-best option as Employee Engagement Committee, and the least favorable
option being the recognition system.
 12

Recommendation
To build employee engagement and progress our labor force, a one time solution will not have a
large enough impact we will need a culmination of tactics to further our engagement, continue
incentive for higher productivity, and lower detrimental behavior. The following
recommendations will improve some of the drivers for engagement, but to improve all of those
drivers will take time and an extensive reorganization of the many different facets an employee
goes through during the their time with the organization.

Gallup Survey
It is recommended the organization take part in the Gallup Q12 survey. The survey will provide
much needed data on engagement, organization loyalty, and overall happiness of our employees.
Based on the cost analysis and impact it would have on the organization it is logical choice to
make. It is important for this information to be gathered, as it will give us insight gaps that that
need to be met for employees. The survey would be the first part in understanding our employees
and it will be easy to implement with no cost. However, the survey is just a snapshot of
employee engagement. When analyzed we will have a better idea of what actions to take for the
future. This is an essential step of to learn where we are falling short on the drivers of
engagement.

Employee of the Month

This is a simple program that will provide employees with incentive and recognition. The
incentive would be a $50 gift card and the closest parking spot to the front door. We want
employees to emphasize certain values such as teamwork, commitment, loyalty, productivity, and
communication. An employee of the month ballet could be created, and employees could be
scored against that criteria (see figure 2). A program like this is a good start for our longer-term
commitment to engagement.

Employee Engagement Committee

For the long term an Employee Engagement Committee will have tremendous impact on our
employees. With a healthy budget, the committee could run events that would build organization
pride, such as a Thanksgiving Food Drive, a Giving Tree, or an Employee Appreciation Day. The
Committee would be responsible for picking the Employee of the Month as well as continuously
brainstorm, plan, and organize events for all employees to feel heard, appreciated, and engaged.
The Committee can also act as a forum for employees to share their thoughts, concerns, and
improvements for the organization. Choosing these three options will improve the organizations
understanding our engagement rates, cultivate incentive, and have a better flow of
communication between employees and leadership.
 13

Appendix
Figure 1

Employee Engagement Eff ects

Sales 20%

Productivity 17%

Customer Ratings 10%

-40% Defects

-70% Safet Incidents

-28% Shrinkage

-59% Turnover

-48% Absenteesim

-80% -60% -40% -20% 0% 20% 40%

List 1 Gallup Survey Questions

1. I know what is expected of me at work.
2. I have the materials and equipment I needs to do my work right.
3. At work, I have the opportunity to do what I do best every day.
4. In the last seven days, I have received recognition or praise for doing good work.
5. My supervisor, or someone at work, seems to care about me as a person.
6. There is someone at work who encourages my development.
7. At work, my opinions seem to count.
8. The mission or purpose of my company makes me feel my job is important
9. My associates or fellow employees are committed to doing quality work.
10. I have a best friend at work.
11. In the last six months, someone at work has talked to me about my progress.
12. This last year, I have had opportunities at work to learn and grow.
 14

Figure 2
 15

References

1. \. “Practicing Strategic Human Resources.” SHRM, SHRM, 29 June 2018,

www.shrm.org/resourcesandtools/tools-and-
samples/toolkits/pages/practicingstrategichumanresources.aspx.
2. \. “Understanding and Developing Organizational Culture.” SHRM, SHRM, 29 July
2020, www.shrm.org/resourcesandtools/tools-and-
samples/toolkits/pages/understandinganddevelopingorganizationalculture.aspx.
3. Aktar, A., & Pangil, F. (2018). The Relationship between Human Resources
Management Practices and Employee Engagement: The Moderating Role of
Organizational Culture. Journal of Knowledge Globalization, 10(1), 55.
4. Gallup. “How to Improve Employee Engagement in the Workplace.” Gallup.com,
Gallup, 23 Nov. 2020, www.gallup.com/workplace/285674/improve-employee-
engagement-workplace.aspx?utm_source=paper.
5. Iyer, S., & Israel, D. (2012). Structural Equation Modeling for Testing the Impact of
Organization Communication Satisfaction on Employee Engagement. South Asian
Journal of Management, 19(1), 51.
6. Jackson, E. (2020). Employee Experience or Employee Engagement? TD: Talent
Development, 74(9), 18.
7. Jnaneswar, K. (2020). Impact of Employee Engagement on Organizational Citizenship
Behavior: Evidence from Indian Retail Industry. Indian Journal of Industrial Relations,
55(3), 460.
8. Khan, W.A. (1990), “Psychological Conditions of Personal Engagement and
Disengagement at Work”, Academy of Management Journal, 33 (4): 692-724.
9. Krishnaveni, R., & Monica, R. (2016). Identifying the Drivers for Developing and
Sustaining Engagement Among Employees. IUP Journal of Organizational Behavior,
15(3), 7.
10. Lavigna, B., & Basso P. (2020). Employee Engagement: Why It Matters (Part 1). Policy
& Practice (194226828), 78(6).
11. Cayer, Maurice (2020). Personal Interview.
12. Rheem, Don. “William Kahn: Father of Employee Engagement.” Don Rheem, 12 Jan.
2018, donrheem.com/william-kahn-father-of-employee-engagement/.
13. Sarangi, S. & Srivastava, R. (2012). Impact of Organizational Culture and
Communication on Employee Engagement: An investigation of Indian Private Banks.
South Asian Journal of Management, 19(3), 18.
14. Shields, A.C. (2018). Improving Communication to Increase Employee Engagement.
Law Practice: The Business of Practicing Law, 44(3), 14.
15. Tadesse, W.M. (2019) Driver of Employee Engagement: Case study of Private Banks in
Ethiopia. Indian Journal of Industrial Relations, 54(4), 720.