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Employee Engagement

A Leading Indicator of Financial Performance

The world's top-performing organizations understand that employee engagement is a force that drives performance outcomes. In the best organizations, engagement is more than a human resources initiative -- it is a strategic foundation for the way they do business.

Research by Gallup and others shows that engaged employees are more productive. They are more profitable, more customer-focused, safer, and more likely to withstand temptations to leave. The best-performing companies know that an employee engagement improvement strategy linked to the achievement of corporate goals will help them win in the marketplace.

Our Value
A Proven Approach and Interventions

Gallup supports organizations to systematically improve employee engagement using proven interventions at the local and enterprise level. Beyond setting the proper strategy, this process includes finding the right performance metrics that drive accountability, creating a comprehensive communication strategy, and designing development opportunities for every employee, manager, and leader.

What is your organization's ratio of engaged to not engaged employees?

Gallup's engagement ratio is a macro-level indicator of an organization's health that allows executives to track the proportion of engaged to actively disengaged employees.

  • In world-class organizations, the ratio of engaged to actively disengaged employees is 9.57:1.
  • In average organizations, the ratio of engaged to actively disengaged employees is 1.83:1.

Actively disengaged employees erode an organization's bottom line while breaking the spirits of colleagues in the process. Within the U.S. workforce, Gallup estimates this cost to be more than $300 billion in lost productivity alone. In stark contrast, world-class organizations with an engagement ratio near 8:1 have built a sustainable model using our approach. As organizations move toward this benchmark, they greatly reduce the negative impact of actively disengaged employees while unleashing the organization's potential for rapid growth.

Gallup's Research-Based Approach

Gallup's employee engagement work is based on more than 30 years of in-depth behavioral economic research involving more than 17 million employees. This research has appeared in prestigious business and scientific publications, including the Journal of Applied Psychology and the Harvard Business Review, and in our bestselling books First, Break All the Rules and 12: The Elements of Great Managing. Through rigorous research, we have identified 12 core elements -- the Q12 -- that link powerfully to key business outcomes. These 12 statements emerged as those that best predict employee and workgroup performance.

Linking Employee Engagement to Critical Business Outcomes

Gallup's latest meta-analysis (an analysis of data from more than 152 organizations) shows dramatic differences between top- and bottom-quartile workgroups on key business outcomes. Beyond the significant differences engaged workgroups show in productivity, profitability, safety incidents, and absenteeism versus disengaged workgroups, we have proven that engaged organizations have 3.9 times the earnings per share (EPS) growth rate compared to organizations with lower engagement in their same industry.

Proven Return on Investment

Increasing employee engagement correlates directly with a positive impact on key business metrics. A partnership with Gallup enables your organization to design, implement, and execute an employee engagement strategy. At the same time, your organization will gain concrete evidence of the impact of this strategy on the bottom line. Gallup's proof of ROI goes beyond the case-study level. By continually validating the effect of increasing employee engagement through meta-analyses and business impact studies, we can observe trends across hundreds of clients. The observed net gain in key business outcomes for work units that grow employee engagement provides a direct linkage to ROI.

Gallup's approach blends strategic analysis with practical steps and advice to change how leaders view their work, their employees, and their customers.

To learn more about how your organization can engage employees, optimize performance, and improve financial performance, download the brochure Employee Engagement: What's Your Engagement Ratio? brochure (PDF) or contact us.

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