xviii) Staff & Customer Engagement

Underestimating the importance of having staff and customers engaged.

"...research of nearly 2000 business units has shown that if companies......had customer and staff both engaged, the advantage can be stunning. These companies outpaced their competitors by 26 percent in gross margin and 95 percent in sales growth..."

John Fleming and Jim Asplund's book (Human Sigma, 2007) as quoted by Fiona Smith, 2007g

. Not realising that engaged workers are more likely to show up for work, stay at the organisation longer and be more productive. Remember: high staff turnover is very expensive.

"...On the average, replacing an hourly worker costs an organisation 50% of that worker's annual salary. Replacing a professional worker costs 150% of annual salary..."

Linda Babcock and Sara Laschever, 2008

The major costs include screening and hiring costs, opportunity costs for the period covering hiring until the replacement settles in and lost productivity during this time. Furthermore, there is the cost of low morale of staff who have to handle the situation until the replacement is found.

NB Replacing high potential talent can cost up to 3 times their annual salary (Natasha Boddy, 2021). This estimate is based on the cost of hiring a replacement, lost productivity, time (up to 12 months) it takes the replacement to settle in and be productive, etc. Also, a top performer leaving can have a negative impact on other staff, ie ripple effect (other staff think about leaving as well)

NB High performers are approximately 4 times more productive than the average employee.

The key to retaining good staff is training and development.

In hiring staff,
"...need to consider cultural add, rather than cultural fit...
Natasha Boddy, 2021

Also, need to be careful about hiring for likeness
...If companies are looking for innovation and breakthrough, we need to be looking for the cultural add, we need to be looking for talent who are different, rather than the same..."
Natasha Boddy, 2021

Examples of outsiders creating organisational value include

- Airb&b was not created by someone in the hospitality industry
- Netflix was not created by someo ne in the  entertainment industry
- Uber was not created somebody in the transport industry

Furthermore, research has shown

"...it takes 5 fully engaged workers to cancel out the impact of 1 actively disengaged colleague..."

Dan Olson (Gallup) as quoted by Fiona Smith, 2009a

Also, it is claimed that low levels of engagement are due to the delaying impact of organisations, with managers being too busy to talk with staff, having too many staff reporting to a manager, etc.

"...managers shouldn't have more than about seven direct reports if they are to have the time to talk to them, mentor and develop them..."

Fiona Smith 2009a

. Not appreciating the link between happy staff and performance, ie happy staff perform better than unhappy staff.

. Not understanding the warning signs or symptoms of disengagement, ie

"...- tend to be less productive

- less loyal to their job

- more stressed and less secure in their work

- high rates of absenteeism

- bored with job and have very little enthusiasm

- lack attention to detail

- had poor planning and job scheduling skills

- don't meet deadlines

- conflict with management and other workers

- appear to have an excessive workload

- fear job security

- no longer contribute in meetings or offer view

- generally sit on the sidelines

- take long lunches, are disinterested, uncommunicative and careless......

They are every manager's nightmare - the bored, disengaged employees who are present but far from accountable. These are the workers who tend to sleepwalk through the day, putting time, but not much passion, into their jobs. They've checked out but are happy to cash in their paycheck ..."

Brad Hatch, 2004

. One of the problems of disengagement is that it has a negative impact on other employees, ie contagious, negative role model