Chapter 7
Creating an Engagement and Retention Culture
Think of an organization you know that understands the direct relationship between employee engagement and business success. We work with an employer that commits to town hall–like meetings that formalize company communications and makes them more personal and impactful for leaders and employees at all levels. They hold receptions or dinners where executives speak to a given group about what is happening with the parent organization. At these meetings, the attendees are given the opportunity to ask questions, raise concerns, and make suggestions on how to improve the organization. Now we have a situation in which the groups operating in the field can put names and faces with the people leading the organization and making decisions that impact all employees.
This goal is possible in any organization, and it’s only one of many effective components of the engagement strategy Patti McEwen has helped put in place at Sheridan. “All of this has led us to schedule more opportunities for our senior leadership to visit site locations on a regular basis. They used to go once a year, or even never. Now they visit frequently. From the physician side, we’ve developed our ‘Emerging Leaders Program,’ which identifies up-and-coming physicians that could be leaders at the local or state level. These potential leaders enter an eighteen-month management training program which has been successful at so many levels that we’ve recently implemented similar programs for administrative, executive, and nursing staff.”
As a result of the corporate buy-in Sheridan pushed for, they’re seeing dramatic results from their first survey with TalentKeepers. They have created new and effective initiatives that help employees and leaders all across their remarkably diverse organization, and it has made their culture more cohesive overall. Just as McEwen once saw at DHL, the business results have been clear. Individual sales performance results are always highest with the leaders that score highest on the LEI. “Where I used to see that the best engaged tended to be the longest term and most successful salespeople, I’m seeing that same correlation at Sheridan. The practices with the most engaged leaders are the highest and best performing practices in the organization.”
To this point, we’ve been concentrating pretty much exclusively on how improving engagement and retention works on the individual level. But as Sheridan’s story shows, the results ramp up dramatically when you find ways to weave these measures into the organizational culture. In fact, improved engagement and retention always have a positive effect on people and teams, but when organizations embrace these values as part of their culture, the benefits become truly massive.
How massive? In our most recent Workplace America survey, when asked, “What part of your company is most impacted by low engagement and high turnover?” respondents placed “morale and culture” in the lead with an eye-opening 65%. The next most frequent response was productivity—seemingly an aspect that most organizations would think about chiefly when discussing workforce turnover—but that trailed culture by a considerable margin, checking in at 63%. Table 7.1 shows the top seven factors impacted by employee disengagement and turnover.
Table 7.1 Top Factors Affected by Employee Disengagement and Turnover
| 2018 | |
| Morale and culture | 65% |
| Productivity | 63% |
| Team performance | 56% |
| Service quality | 53% |
| Stress | 47% |
| Lost organizational knowledge | 45% |
| Profitability | 33% |
So here we have plain evidence that the majority of organizations are most concerned about how a lack of energy and commitment to the job can have a negative impact on their culture. The question becomes, how can an organization that understands the value of engagement and retention on employee and leadership levels make those same measures a part of their culture?
As is often the case, finding the answer to this question is a matter of looking to the best-in-class organizations. What are these organizations doing? They start with assessment and analysis. They ask themselves what the organizational climate is like on all levels. They examine how trust and communication might improve. They question whether they are doing enough to stir and embrace creativity and group problem solving. Interestingly, what we have found with these best-in-class organizations is that, after they perform this self-reflection, they report that morale and culture are not their top concerns. For the best in class, morale and culture placed third in the Workplace America survey, behind productivity and team performance.
How can that be? Are they somehow not placing the importance of culture on the same plane as everyone else? No, it’s that the focus on engagement and retention is so true and complete in these cases that the cultural component tends to stitch right in. For best-in-class organizations, the positive energy generated by high engagement and retention are woven into the fabric of the culture. When engagement falls in some areas, only those parts of the organization are affected. Like your body, if you’re healthy, even if you suffer the occasional bump or bruise, you still feel good overall. For best-in-class organizations, even with those few leaders or teams that don’t focus on engagement and retention as completely as they should, the organization as a whole continues fostering the kind of culture that energizes staff and drastically reduces turnover, and they remain healthy as a result.
Generational Drift
For both best-in-class organizations and those who fall outside that sphere, the chief difficulty expressed in our Workplace America research, as well as many other studies, is the challenge to build a high-performing, energized, and positive workplace culture (or culture of any kind) when the workforce is so uncommonly diverse in its wants and needs. The differences between boomers, gen Xers, and millennials is now common in most organizations.
As we have mentioned, millennials officially became the largest generation in the American workplace in 2015. Although they certainly aren’t the only ones glued to a smartphone or walking while texting, this tech-savvy talent pool is making waves in every aspect of the workplace, far from the world of start-ups and new-age organizations. This, largely, is good news.
But when it comes to culture building, there is evidence of chafing between the generations at work. Much like the geology of plate tectonics, where continental drift slowly grinds land masses together, this just-below-the-surface pressure may result in trembling or, occasionally, even an earthquake.
To some degree, there always has been and always will be tension between generations. In this year’s Workplace America study, 80% of all employers asserted that their leaders found challenge in the prospect of managing employees of multiple generations. Further data from our research confirm what many people have expressed about the generational differences. For instance, by and large, millennials seem to be losing patience with the claim that “that’s not how we do it around here” whenever they try to put new ideas on the table. Gen Xers and boomers may be wary (or even weary) of the pressure millennials put on the status quo with their heightened expectations and aspirations.
Here’s a quote by a study participant, slightly edited so as not to offend our readers. “Dealing with the younger generation is a pain in the [rear]. They want an explanation for all decisions to see if they agree, and if not, they want to argue. Being old school, I sometimes reply with, ‘Because I said so, damn it.’ But it doesn’t help much.”
Although this certainly isn’t the norm, that sentiment reflects the potential for tension when values, work styles, preferences, and life experiences clash at work. Training will help. The Workplace America study shows an encouraging and steady rise in the number of employers that provide formal training on managing multiple generations. Managing millennials is commonly the subject. But many millennials are now assuming leadership roles themselves, which means they are now faced with leading, coaching, and engaging a group of highly tenured boomers.
Technology is just one example of a potential area of discord. Virtual meeting tools and e-learning applications will see slight gains in use at work this year. The steady increase in the automation of many human resources processes, for example, performance management platforms, continues to grow. Even as this is happening, some study participants are wondering the best way to deliver company news to younger employees. One avenue is social networks, which are in use by only about 25% of employers today. We expect this to rise in the coming years. As technology continues to evolve and change, and as the workforce gets younger every day, the challenge most organizations face is determining how to stop those tectonic plates from shifting.
Can You Fix Culture?
The cover article of a 2016 issue of the Harvard Business Review takes a pretty hard stance on the question we used to title this section. In big orange letters, the periodical says, “You can’t fix culture.” Obviously, given the existence of this chapter, we take issue with that notion.
They’re working from a somewhat common sentiment as well. One participant in the Workplace America study said this about where she works, “Anger, fear, and blame dominate our organization’s culture.” This is a toxic blend of ineffective or wrongheaded leadership beliefs and practices. That’s the bad news. The good news is that it’s entirely possible to eliminate those toxins. We have seen it again and again at TalentKeepers.
The position taken by the Harvard Business Review author promotes the idea that organizational cultures change and evolve as a result of a rigorous and sole focus on executing core business and market strategies. Certainly a dedicated focus on business performance strategies can help get people aligned, see a vision, and understand how they fit into the bigger picture. But too many organizations have bruised and weakened their culture by failing to purposefully cultivate the people held responsible for delivering the business results, day in and day out. Cultures take time and sustained effort to evolve, and the commitment must start with top leadership and work its way down.
The top strategies among best-in-class organizations all revolve around the notion that you have to adapt your culture to grow. With the evolution of three generations reshaping the workplace, building your culture will require accommodation and change. Adapting how your workplace operates can reduce friction and enable millennials to contribute their energy and creativity. It’s why you hired them. You will need to actively manage and facilitate the process of reinforcing those elements of your culture that contribute to broad success, while introducing new and promising elements that keep your organization moving forward on a successful track.
To build and sustain an energizing and positive culture, engagement and retention must be viewed as a broad organizational and cultural strategy involving all levels of the organization. To combat employee disengagement and unwanted turnover, leaders at all levels must become trust builders. To do this, they must be equipped with the leadership competencies critical for creating committed workforces. Further, if leaders are to own the retention and engagement mission, they must be held accountable and be incentivized for this responsibility.
That said, engagement and retention are not just the domain of the leaders. All employees, including frontline employees, need to be advocates for these missions. They must encourage colleagues to remain with the organization, communicate frustrations to their leaders, and help to build a strong climate of trust and performance.
How do we do that? The approach is multifaceted, and it all springs from that notion we mentioned earlier, about how generational differences and evolving technology create a complicated and moving target. Keeping ahead of demographic trends and generational differences will require new and imaginative ideas, as well as a strong commitment to making retention and engagement a top priority. In short, we must innovate. We cannot expect to continue to use the same methods with an adapting workforce and achieve the same positive results. The future will require creativity and inventiveness to combat the ever-present concerns of turnover and lack of engagement.
Communication Is Still the Key
Now that we have mentioned how important innovation and forward thinking are, let’s take a moment to talk about what is arguably the most important strategy—namely, communication. In all matters of organizational strategy, effective communication has to lead the way. If engagement within your organization is like an engine, then effective communication is like the lubricant. Silence is friction. So before we get into the more specific tools and strategies for building an engagement and retention culture, let’s discuss that all-important principle that keeps the whole engine running.
According to Bruce Belfiore, most organizations are not very good in the communication department. “Having leaders who excel at communicating with their people is a real sore spot for a lot of companies,” he told us. “One thing people don’t recognize is that, particularly when they have a multigenerational workforce, they need to tailor that communication so it resonates with the various groups with whom they’re trying to communicate.”
The focus for an organization attempting to build the right culture is to reshape any communications they receive from executives toward a message that will hook their specific audiences. Different generations perceive messages and respond to them in different ways. “A good leader can think about a communication that needs to be given to each member of the population of employees they have,” Belfiore says. “They may reread the communication three or four different times and add different communicative points for each of the target markets so that everyone coming away from that communication will feel the desired connection.”
We have found that gen Xers favor community involvement as a way to become more engaged with work. “Generation X likes to have employers who believe in things that they believe in,” Belfiore said. “Sponsorship of good causes that they can get involved in goes a long way.” It doesn’t tend to matter what the cause is, either, as long as it is supporting and advancing something good for the community. The annual run for cancer, bike riding for diabetes, food drives for impoverished youth, and so on—it all serves to help the employee feel more fulfilled in general and bonded to their companies overall. “It isn’t just about doing good in the community either,” Belfiore told us. “Leaders should also take the opportunity to show employees how their work makes a difference for the company as well.”
Whatever the strategy for driving communication and involvement, the top priority should be regular interaction between leaders and employees. Ideally, that interaction should be both personal and professional. Being able to talk to people appropriately about their passions and goals is critical. Belfiore put it best: “The only way you can show someone you care about them as a person is to know them as a person.”
Creating the Culture
You know the benefits of building a focus on engagement and retention into your organizational culture. We have also seen how leaders must drive this initiative if it’s ever going to work. The question then becomes, how exactly do leaders do that? At TalentKeepers, our experience with these measures has allowed us to identify a range of key strategies. The first step, once someone decides to join your organization, is onboarding.
Onboarding
We describe onboarding as the process that “welcomes a new employee into your culture.” The question here is whether you’re one of those companies that hires someone, trains them a little, and then throws them into the job, or an organization that strives to make a personal connection from day one and carries that connection throughout the employment life cycle … and beyond?
A client of ours is a major communications firm, and they face a stiff challenge with new hires, particularly on the retail side of their business. Turnover in retail is often higher than in any other department, so in this situation, they’re doing more hiring and training than everywhere else. They used to manage it this way: first the interview, then the hiring, then the employee immediately goes to training, and then once that’s complete, they go directly to the store to start working. One of our contacts with this client explained it like this: “What we were seeing was that it was kind of like going to a new high school. If you’re the new kid, you feel kind of lost. You have to get your information from a bunch of different sources, and those sources can be confusing at times.”
How did this organization overcome? They followed the example of one great frontline leader and made the onboarding process more personal. One manager would reach out to a new hire and meet him at the store before he went to training. In that meeting, he would get the new hire’s contact information, introduce him to everyone in the store, and try to connect on a personal level even before that new hire was exposed to any form of training. Then, on that first day of training, that great leader would text the new hire, saying something like, “Good luck. You’re going to knock it out of the park. We’re here if you need anything or have any questions.”
That kind of strategy is powerful enough, but this leader also liked to get everyone else on the team involved in the process. Once that new hire got through training, he would have everyone in the store send him an email of congratulations that also welcomed him to the store and offered any help necessary. In this way, the new hire almost always feels more welcome and connected to the organization—and that’s all happening before his first real day on the job.
If that seems like a simple measure, that’s because it is. And the best part? It’s free. The cost of an email is just a minute or two of a leader’s time. When that communications firm started sharing this as a best practice, they quickly discovered that most markets and almost all levels of the organization saw similar results: new employees were becoming committed and dedicated to the organization quicker and more deeply.
Many organizations have something similar in place for their HR staff to manage, but it is far more important that leaders take an active part of this process. “Handshake” conversations similar to the one our client promotes are an excellent way for leaders and new employees to connect as people and not only as coworkers. Those conversations ideally center on the new employee’s career aspirations, leader relationship preferences, engagement and communication, and recognition preferences.
Measuring and Monitoring
One of our discovery exercises when working with organizations interested in increasing retention was to plot all their retention tools on an employee life-cycle timeline. Most of the time, we would see a flurry of activities in an employee’s early stages with the organization: recruiting tactics, selection assessments, onboarding processes, initial training tools, and so on. However, most of the time, these tools would diminish or disappear completely after the employee’s first sixty to ninety days on the job. We would then plot when new hires were leaving the organization. Not surprisingly, the bulk of the departures came after the retention tactics ended. Creating a culture of engagement and retention is like any other process you are trying to manage; you need frequent measurements to monitor your progress and make adjustments.
Today, 75% of organizations are utilizing some form of survey to measure employee sentiment, whether it’s an engagement survey, satisfaction survey, pulse survey, or some other sort of survey. Regularly gathering this data and utilizing the results to measure and monitor how you’re doing is essential for sustained execution and success. Following is a partial list of elements this data can help you manage:
- Measure the effectiveness of each driver of engagement (our research uncovered four engagement drivers illustrated in Figure 2.2) so you can leverage strengths and align resources to opportunities.
- Monitor progress of initiatives targeting specific engagement elements.
- Hold leaders accountable for improving opportunity areas.
- Link engagement metrics to performance measures to build the business case and calculate return on investment.
Action Planning
Once your survey data has been gathered, analyzed, and presented to leadership, the next step is to have concrete, documented action plans based on priorities formed from the results. It’s not enough to simply say that you want your leaders and employees to be more focused on engagement and retention. You have to build specific strategies that help weave it into the culture. We have devised a few strategies to maximize the effectiveness of the action planning process. They include the following.
Gifts, Affirmations, and Surprises
Survey results will fall into one of three categories: (1) Gifts are results that are better than leaders expected. Everyone likes gifts, and these can identify strengths that would not otherwise be leveraged. (2) Affirmations are results that are about what leaders expected. They can be strengths or opportunities for improvement, and should be appropriately managed. (3) Surprises are results that are worse than leaders expected. Surprises are often the most valuable, because they can identify “blind spots” leaders would not otherwise identify as opportunities for improvement. As part of the action-planning process, leaders must be prepared for these three types of outcomes, and to expect and value surprises.
Groups, Issues, and People
Action planning should take place at least at two levels: for organizational groups and individual leaders. Senior leaders will want to consider survey results from a group, issues, and people perspective. There will be variance in how different groups performed, and they should be managed differently from an action-planning standpoint. Higher-performing groups can be recognized and studied to see if the practices that led to their higher results may be leveraged as “best practices” and shared with other groups.
Senior leaders should also analyze issues that emerge from the results. Some will be common issues of strength or opportunity across the organization. For these common issues, organizational action plans should be created to identify improvement strategies. Other issues will be unique to certain facets of the organization, and they should be appropriately included in the action plans for these specific areas.
People will also vary in their ability to engage and retain talent. Pay attention to senior leaders and how their teams vary on key engagement metrics. Many times, trends in results within a group can be traced back to the senior leaders who may or may not be aware of the influence they’re having through their own behavior and/or messages they’re sending down their chains of command. Finally, expect engagement results for individual leaders to vary the most, often using the entire range for the metric. Be sure to recognize those leaders who perform well on both the engagement and performance metrics. Show how their ability to engage and retain talent is facilitating better performance. Support those who perform poorly on both by ensuring that they understand where they have opportunities to improve and ensuring these opportunities are appropriately included in their action plans.
Accountability
As we have been emphasizing from the beginning, the most important goal is to hold your leaders accountable for the engagement and retention of valued and contributing employees on their team.
When I was an executive at Walt Disney Company, a woman we’ll call Mindy worked on my team. She was a high-performing professional and a valued member of the group. One day, to my surprise, she came to my office and submitted her resignation to join a small but growing consulting firm in the area. The next day, I walked into my boss’s office to share the news, expecting the perfunctory dialogue—the usual, “too bad we lost her; send the requisition form to HR and move on” chat. That’s not how it went.
After a thoughtful pause, my boss began with, “What? Mindy quit? How could you let that happen? Why didn’t you see this coming? What did you do to try and save her? Who else on your team might be at risk?”
That was just the beginning. Needless to say, I learned an invaluable lesson in leadership that day: I was directly accountable for keeping valued team members who might voluntarily resign. I made sure that was the last time I was surprised by a resignation. Every leader in your organization would do well to feel the same way. Engagement and retention only works if the leader holds herself accountable.
Market What You’re Doing
Many organizations’ wonderful and effective efforts to boost engagement often go unnoticed. Sometimes that’s appropriate, but other times, you need to market the engagement actions where you work. Individual recognition goes a long way, but so does recognizing whole teams that meet particularly fantastic goals. Promoting department initiatives is also effective, as is the community involvement we mentioned earlier in the chapter. Whatever the initiative, if you don’t promote it a little, it runs the risk of falling flat.
Exit Surveys
At the opposite end of the employee life cycle, exit surveys can be extremely valuable for gathering important data about why people leave. The key point to note here is that exit surveys shouldn’t be the only kind of survey you ever give to your employees. Later in this chapter and into the next, we’ll discuss some specific surveys that have worked extremely well for our clients, but for now, keep in mind that exit surveys are valuable primarily because they sometimes represent the outgoing employee’s first real opportunity to feel like she can open up about what went right and what went wrong without having to worry about backlash from a leader or the organization in general. You get the most open and honest answers possible during an exit interview, in other words. Don’t let that opportunity go to waste.
You Can’t Boil the Ocean
Senior leader support is absolutely essential to the process of building an engagement and retention culture. “What we’re finding is that if leaders just give it lip service, people pick up on that and it falls to the wayside,” said a client of ours. “So a leader that says and makes a statement that employee engagement is important and backs it up with their actions, we find that’s a lot more successful.” This might seem obvious, but it’s really an important driver of success. You can have everyone from the top down supporting a program, but if the frontline leader is saying, “Engagement is nice, but do whatever you can to make those sales,” then the engagement culture isn’t going to stick.
A retail client of ours recently had a leader suggest that engagement was his top priority over sales. That kind of statement is a little more dramatic in a sales setting, but the results have been equally dramatic. At a kickoff meeting with all of the organization’s frontline managers, that engagement-focused manager shared some of his best practices for how and why engagement was such a critical issue for driving sales and customer satisfaction.
As we mentioned earlier, text messaging is often the simplest and cheapest way to make the kind of connection necessary. That great manager with our retail client told everyone in the kickoff meeting to look at their phones and pick out one employee that reports to them. “Right now, everyone in the room, text that person and tell them thank you for something they’ve done for you recently,” he said, adding an important caveat: “Don’t do that for the person who’s the top performer that you always recognize. Do it for someone who might be struggling and needs to be recognized.” Over two hundred heads in the room looked down at their phones and did exactly that. As the meeting progressed, the surprise and excitement about all the positive feedback these leaders were getting kept building and building.
The central message here is that the connection we’re striving for needs to be fostered, and it can’t happen only with top performers. If you reach out to people who are struggling, then you build them up and give them the kind of confidence they need to improve. It shouldn’t be difficult, because everyone does something right. And even with those performers who frequently make mistakes, this strategy opens up the opportunity to coach them on the things that need to be improved. Without that positive connection, coaching only goes so far.
From this lone manager’s insight, the company designed a new program that focused on four specific drivers of engagement. The idea was to make every message (1) personal, (2) cool, (3) meaningful, and (4) shaped in a way that improved the employee’s chances of success.
“We tell our managers that you can’t boil the ocean,” our client said. “There’s just too much water for you to be able to make that kind of change. But if you focus on these four drivers in everything you do, then you will find success in engaging and retaining more of your people.”
The four drivers program has been in place with this client for over a year now, and the data they are picking up has been nothing short of amazing. Engagement and retention measures are at an all-time high. These days, making that personal connection between leadership and frontline employees is a big hallmark of their program, and the results have been tremendous in every measure.
Beyond the organizational philosophies we have covered to this point, other tools can help drive the initiative as well. We will offer more of the specifics about each tool in the appendix, but for now, keep these measures in mind:
The Retention Roadmap
This tool provides a structure with key touchpoints for leaders and other stakeholders in your organization that shows how leadership can connect with new employees at critical points in their early tenure with the organization, such as during week one, upon the completion of new hire training, sixty days in, ninety days in, and so on to build bonds, create comfort, and accelerate productivity.
Assessing for Engagement and Retention Competencies
For new and aspiring leaders, one assessment that we offer is called the Retention Quotient (RQ, for short). RQ is a tool that assesses a leader’s knowledge of the elements that drive engagement and retention, as well as their ability to discern what behaviors would lead to higher engagement and retention. It’s a “can-do” measurement. If a current or aspiring leader “can” identify better engagement and retention behaviors, then they might “do” right on the job when faced with these decisions. If they can’t recognize what “right” looks like, they usually won’t exhibit the most effective behavior when presented with the situation.
Using a tool like this to select/promote individual contributors into leadership roles has a dual benefit. By choosing new leaders who recognize effective engagement and retention behaviors, we increase the odds they’ll be better stewards of the talent they lead. The second benefit is that we are clearly communicating what it’s like to be a leader and the myriad decisions, often in gray areas, they’ll have to make. Indeed, some leadership candidates ask, “Are these really the types of situations I’ll face in this job?” When affirmed, some will withdraw from consideration, which is far better than being promoted only to learn they are not interested in or suited for the job.
For existing leaders who have been in their roles for three months or more, we offer a survey called Insight. This is a multirater assessment of the ten leadership skills we described in Chapter 2 and have been referencing throughout. The survey provides every leader feedback on how effective they are in applying each of the ten skills from four perspectives: their own self-rating, their manager’s, their peers’, and their team members’. The results will illustrate areas of strength and opportunity across all rater groups, as well as within and between the raters. Insight is a powerful way to build a leader’s awareness and capabilities in engaging and retaining talent.
Of course these tools are only the start. They are only a piece of the puzzle that is creating and sustaining an engagement and retention culture. Surveys are wonderful tools, but what matters most is that your organization does something with the data. The best-in-class organizations will have regular meetings with every leader in the business. In those meetings, they will pore over the readouts of data and use that information to drive best practices for the leader, moving forward. These organizations proactively look for groups and managers who are struggling in specific areas of leadership skills and try to help them. They also follow these strategies regularly, so they can use multiple surveys and years’ worth of data to identify trends and use them to find solutions.
Also important is that the best organizations don’t look at these meetings as punitive. For those continuously showing low LEI scores or otherwise languishing in the lower categories of engagement, the idea is to use this information as a springboard to help them rather than punish them. This data doesn’t reveal shortcomings; it reveals opportunities to coach and train toward greater success. Organizations that do this find that often just one or two factors prevent a leader from becoming great.
No matter how your organization approaches the situation, culture plays a starring role in an employer’s success. A vibrant and energized workplace culture does not take root and flourish on its own. Leaders, from the top down, must establish, sustain, and shape high-performance cultures. Above all, these leaders must remember the lessons that trust is the glue that holds a strong culture together, and communication is the lubricant that keeps a high-performing culture growing, supporting creativity, collaborating, competing in a healthy way, and stimulating and promoting individual growth.