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Resources > Blog > Employee Engagement

What is employee engagement and why is it important?

Employee engagement is an essential part of an organization, learn what is employee engagement and how it can increase productivity and retain employees.

20 Apr, 2022

4 min

Employee Engagement
Krishan Patel image

Krishan Patel

Associate Marketing Manager

Your employees are one of the most important assets your business will ever have, and engaged employees are key to its success. A business with a highly engaged workforce is likely to be more profitable, more productive, and have a good record of employee retention.

Up to71% of business leaders believe employee engagement is critical to the success of their company. Employee engagement is not the only factor in achieving great results, but it can have an incredible effect on your business.

Read on to learn more about employee engagement, why your organisation needs it, and what you can do to create more of it to drive your company’s success.

What is employee engagement?

Employee engagement refers to the emotional attachment between a staff member and the organisation they work for. It is a function of the relationship between employees and an organisation. It’s about improving the workplace and culture so that employees feel better connected and committed to the company’s values and goals. It’s based on communication, integrity, and trust between employers and employees.

Engaged employees are not merely satisfied with their jobs. They are committed to the company’s development. An engaged employee is:

  • A motivated and active participant in their work
  • Aware of where the company is heading
  • Content and happy but doesn’t rest on their laurels
  • Committed to their work and acts positively within their role to help further the success of the company
  • Enthusiastic about the work although this doesn’t mean they have to be exuberant or extroverted.

Employee engagement is often confused with employee satisfaction, but the two are very different. Employee satisfaction only tells you how happy and content your employees are. It doesn’t tell you anything about their motivation, involvement, and emotional commitment to their work and your company.

For some employees, satisfaction is about getting paid for doing minimum work. Improving employee satisfaction doesn’t necessarily mean you’ll see increased performance and productivity. However, an engaged employee is more likely to go the extra mile, and their job is much more important to them than merely a platform to generate a salary.

Why is employee engagement important?

Employee engagement is vital for companies of all sizes. Effective employee engagement strategies help create a more dynamic work culture. It can increase productivity, reduce absenteeism and staff turnover, build better work and customer relationships, turn employees into brand advocates, and ultimately, can help to boost company profits.

Employee engagement can also help employers better understand employee needs and which areas will help improve employee morale. It also helps managers better understand how to manage their teams more effectively and create a better work environment.

But it’s not only the company that benefits from strong employee engagement. For employees, feeling engaged with their work and team plays a crucial role in their overall employee experience and satisfaction. Engaged employees generally feel more energised and want to go beyond what is expected or required of them. This can have a positive impact on their mental health and a positive impact on their colleagues and even customers.

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Benefits of employee engagement

When your employees feel truly engaged, your workforce goes from good performance to great. Challenges become opportunities, and outcomes become achievements as your team gives it their all, consistently. There are many benefits to employee engagement for the employee, their team, managers, and the company as a whole.

High employee retention

When staff feel unhappy, frustrated, or disengaged with their work, they are more likely to look for a job elsewhere. For the company they leave behind, recruiting new staff, training them, and waiting for them to reach full productivity all comes at a considerable cost. Employee turnover can also affect morale across the rest of the team. Employees who are not engaged may think about jobs, and for some employersretaining staff is a huge challenge.

High employee satisfaction

High employee engagement means people are more likely to feel happy and satisfied in their job, helping to enrich the workplace culture. While satisfaction is different from engagement, it’s still important for staff retention, low absenteeism, and productivity.

Improved productivity

Employers often try out different creative ways to boost employee productivity, from filling the office with plants to encouraging staff to wear activity devices. But the most effective way to boost productivity is with employee engagement. Engaged employees tend to be17% more productive than their non-engaged counterparts.

Better quality Work

Engaged employees are generally more focused, responsible, and diligent, which means they are more likely to achieve excellence in the quality of their work and less likely to make mistakes. Highly engaged employees pay more attention to their work and sawmake fewer errors.

Better customer experience

When your team is more engaged, it affects performance and customer service delivery. This can lead to a20% boost to sales, a 10% rise in customer ratings, and improved customer loyalty and retention. Engaged employees care much more about their work and their customers, which is great for business.

Improved employee safety

As engaged employees feel more connected to their team and workplace, they are more aware of and concerned with their surroundings. Rather than worrying about whether their manager likes them or opportunities for advancement, engaged employees are focused on the task at hand, resulting in up to70% fewer workplace safety incidents.

Better employee health and well-being

When companies prioritise employee engagement, they are more likely to show respect for their workforce’s needs and encourage them to take care of their health. As a result, engaged employees are usually:

  • More likely to exercise
  • More likely to eat well
  • Less likely to suffer from chronic disease

Lower absenteeism

Engaged employees tend to feel invested in their work and genuinely care about their team’s success. It makes sense then companies with highly engaged employees experience up to41% lower absenteeism than non-engaged workplaces.

Increased revenue

Given that high employee engagement leads to increased productivity, better product quality, greater levels of customer service, and increased customer spending, perhaps it’s not surprising that a highly engaged workforce canmake a company up to 22% more profitable.

How to improve employee engagement

When staff feel disengaged, it can seriously affect your company’s productivity and profitability. But improving employee engagement doesn’t need to be complicated or even costly. For example, during the pandemic, many organisations discovered how facilitating user-generated videos could improve employee engagement by bringing people together when they couldn’t physically be together.

Even though workplaces were closed, employees could continue working together on projects, socially interact and maintain team morale. There are many ways to improve employee engagement. Here are six drivers of employee engagement you should consider.

1. Regular employee engagement surveys

Employee engagement surveys are a valuable research tool that can help you learn crucial information about your employees. A well-designed employee engagement survey can help you identify employee weaknesses and training requirements, gaps in employee knowledge, and how they feel about their work, team, and company. Above all, employee engagement surveys help you understand what makes your employees tick and what you can do to keep them engaged.

2. Encourage and prioritise feedback

Feedback can play an important role in boosting workplace engagement. Rather than giving employees feedback about their work, ask them for feedback instead. Ask them for their input on a certain product idea or their thoughts on workload, the office environment, or working styles. Encouraging feedback from your employees makes them feel valued, and that their opinions matter. But don’t just ask for feedback. Act on it. Show your workers that you are listening to them.

3. Communicate effectively and regularly

Communicating regularly with your employees helps establish an effective two-way flow of information between managers and staff and is an integral element of employee engagement. While it helps ensure employees can fulfil their tasks more effectively, it also helps remind employees of the importance and value of their role within the organisation.

4. Share purpose and future plans

Making sure employees understand the organisation’s purpose and goals can help ensure that they understand their role and feel part of something bigger. When employees see the link between the work they do and the organisation’s achievements, it helps them see the value in what they are doing and its impact on colleagues, customers, and the company.

5. Highlight and reward good work

Recognising and rewarding employees’ good work can go a long way in making your workforce feel valued and engaged. It can also make a huge difference to employee retention. While highlighting and rewarding employees increases motivation, others will feel inspired to work for that same recognition.

6. Constantly seek improvement

Even if you believe you have plenty of mechanisms already in place to strengthen employee engagement, you mustn’t rest on your laurels. It’s crucial that organisations regularly measure employee engagement to understand the current motivation levels. It’s vital to continuously adapt employee engagement strategies and processes to reflect a growing business and changing workforce needs and culture.

Every business should prioritise employee engagement, and not just because it plays a key role in reducing absenteeism and staff turnover. Employee engagement is a powerful tool in boosting employee well-being, increasing morale, driving job satisfaction, raising productivity, and ultimately improving the company’s bottom line.


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