Employers seek an edge through engaged employees
Companies around the world and in Ireland now have the tools to establish how happy a work force is with their work and their employer. Once they have established this, they can then make improvements, increase employee engagement and boost performance says a new PricewaterhouseCoopers (PwC) report. This report was launched today at the firm’s HR Business Briefing event, attended by over 100 professionals at the firm’s offices at Spencer Dock.
The increasingly recognised link between high levels of employee commitment and bottom line results means business leaders around the world are exploring engagement metrics and measures. They can be used to enhance the image of the organisation as a responsible employer, or improve employee retention where staff turnover is high.
Rapid economic change and uncertainty in many markets makes such measures more relevant than ever. Levels of engagement are even beginning to be perceived by some investors as an important indicator of a company’s financial health and sustainability.
The report shows how organisations can plot levels of engagement for an entire work force by looking at data relating to resignation levels, absence rates, employee attitudes, training hours per full-time employee (FTE), performance related pay and incidence of grievance. These range from the high levels of engagement that produce positive behaviours such as flexibility and innovation to the other end of the scale where companies experience resignations, absence, pilfering, theft, oppositional solidarity, even sabotage.
Ellen Roche, Director, PwC HR Services Executive Resourcing, said:
“Our experience in Ireland shows that both employees and employers want higher levels of engagement – which means applying higher levels of discretionary effort in the work place. This metric is fast becoming one to watch. For example in an M&A context, research indicates that this metric demonstrating employee engagement is one that prospective purchasers watch carefully as an important indicator of the financial health of the organisation and its future viability.
Employees want their employers to show they care and employers want the same thing in return – when both parties are doing this the result is well motivated individuals, in high performing teams who develop good customer relationships. All of this impacts the bottom line positively and is a win-win situation”.
Siobhan O’Brien, Manager, PwC HR Services Reward Advisory, added:
“Part of upping the ante on engagement levels includes communicating the value of the reward package to employees. For example, a recent PwC Ireland Occupational Pension Schemes survey(a), found that employers need to work harder to communicate the message as this benefit is usually the most expensive one provided by employers, and, at the same time, the least appreciated by employees. That survey found that if employees understand the value of their pension arrangements they are twice as likely to significantly appreciate the company’s contribution.
Through increasing the levels of awareness around the total reward package amongst employees, our experience indicates this will have direct positive implications for motivation and retention of employees.
Looking at the broader issue of communications generally by HR departments, we believe that the HR function needs to become more effective at ‘HR PR’. CEO’s have never been so engaged with the people agenda – the talent management programmes, the effective deployment of skills globally, succession planning etc. More than two thirds of those recently polled in a global survey(b) claimed that their time is best spent on people issues. But only 43% of CEOs endorse their HR department’s ability to compete for talent. Thus more than ever HR managers need to gather evidence and promote the value of their contribution as central to business success”.
The report, ‘Managing People in a Changing World’, also looks in detail at financial performance, productivity, outsourcing, leadership, innovation, talent management, diversity, work/life balance and the growing concept of work place wellness, all through the lens of PricewaterhouseCoopers extensive human capital (HC) database, Saratoga. The report is published every two years.
ENDS
Notes to the Editor
1. New Concepts
The report also charts the rise of a new kind of offshoring - Knowledge Process Offshoring (KPO) - where traditionally sacrosanct knowledge or judgement services such as research and sales and marketing are run from other countries. The KPO market globally is predicted to grow to $16.7 billion by 2010-2011, implying an annual growth rate of 39% and employing some 390,000 professionals by March 2011. Here, countries such as India, China, Russia, Poland, Hungary and republics from the former Soviet Union provide high levels of skills at comparatively low cost for many western economies experiencing skills gaps.
A new concept of ‘connected sourcing’ is also emerging. This sees organisations increasingly focusing on what they do best and then orchestrating a portfolio of relationships for the rest. This requires a new approach and highly developed levels of collaboration, transparency, trust and relationship management.
A further development is found in the area of talent management. The traditional focus on high performers and ‘high flyers’ is shifting to include ‘pivotal employees’. These are segments of the workforce that are expected to create value and determine the success of the organisation. They can range from the receptionist to the sales director and the contribution of these core people has a disproportionate impact on determining both the success of an organisation and its sustainability.
2. How to obtain the report
Managing People in a Changing World: Key Trends in Human Capital – A Global Perspective 2008 can be viewed and downloaded at www.pwc.com/hrs. You can also email Johanna Dehaene at email: johanna.dehaene@ie.pwc.com
3. Other Reports Referred To:
(a) PricewaterhouseCoopers Ireland Occupational Pensions Scheme Survey 2007
(b) PricewaterhouseCoopers 11th Annual Global CEO Survey 2008
3. About PricewaterhouseCoopers
PricewaterhouseCoopers (www.pwc.com) provides industry-focused assurance, tax and advisory services to build public trust and enhance value for its clients and their stakeholders. More than 146,000 people in 150 countries across our network share their thinking, experience and solutions to develop fresh perspectives and practical advice.
“PricewaterhouseCoopers” refers to the network of member firms of PricewaterhouseCoopers International Limited, each of which is a separate and independent legal entity.
Human Resource Services:
PricewaterhouseCoopers Human Resources Services (www.pwc.com/ie/hrs) practice draws on the knowledge and skills of more than 6,000 people around the world to assist organisations to align their HR strategy with their overall business performance by managing the financial, tax, regulatory, operational, risk management, and strategic challenges associated with human resources.
