Catfight. Photo courtesy of Dennis Carr.Do you need to be engaged at work to be effective? Sure, maybe. But maybe not.
A provocative article by Alec Levenson from 2015 argues that Employee Engagement Does Not Cause Performance. Levenson says the notion that employee engagement causes performance “makes intuitive sense yet does not hold up empirically.” He argues that the link between engagement and performance is correlation, not causation. Or rather, if there is causation it is probably the reverse; better corporate performance probably causes higher employee engagement.
I think this interpretation is consistent with the idea that a thriving and growing organization will tend to be in hiring mode and have a larger number of new hires who are in a high-engagement honeymoon phase. Thriving businesses have newer machinery and newer buildings, and employees are subjected to endless compliments from family and friends for getting a good job at a winning company. These factors may drive engagement regardless of the work experience.
Levenson notes that the statistical models are troublesome as they can confirm causation in either direction. It’s a real problem in statistics. Sometimes the causation can go in both directions or in a circle. I exercise, so I sleep well, therefore I eat well, and – behold – I have energy to exercise. Hiring is down, so consumer confidence is down, thus consumer spending is down, and hiring drops further.
Often there is athird factor causing everything else to happen. Two major drivers of engagement are a collaborative workplace culture and pro-social front-line managers who make positive interventions. Yet those items can drive productivity directly and engagement directly, resulting in a spurious correlation.
Within the economics field, there is a dirty little secret that everything causes everything else. Economies are incredibly complex, and economic models often get more accurate as you add a larger number of variables. Usually the biggest drivers of the economy are things like oil prices, interest rates, housing starts in the US, and consumer spending in China. When you throw those major drivers into any cause-and-effect model, you usually discover that your personal project is not such a big deal.
However, I think the debate about the direction of causation is moot. The world is a big, hot mess of major forces driving success and failure, and every now and then someone is able to make the case that they themselves caused everything to happen. So what should you do? Give appropriate thanks and move on with your own contribution.
As for the statistical causation, just take your placebo. Take vitamins, drink that one glass of red wine per day, show up, answer the phone, and go with the flow. After all, it’s really about your personal engagement, isn’t it? And maybe the people working next to you. So help them out, too. Maybe you can help build team spirit and create a little spurious correlation while you’re at it.
Are the best leaders currently excellent? No, they are not. The best leaders are those who always strive to become a little bit stronger in the near future. In a recent article in the Harvard Business Review the authors identify that Good Leaders are Good Learners. Leaders who are in “learning mode” tend to develop stronger leadership skills than their peers.
This learning mode is exhibited through three behaviors:
“First, leaders set challenging learning goals in the form of ‘I need to learn how to…’”
“Next, they find ways to deliberately experiment with alternative strategies.”
“Finally, leaders who are in learning mode conduct fearless after-action reviews, determined to glean useful insights form the results of their experimentation.”
The authors identify several organizational indicators of the fixed-mindset mentality that are contrary to the idea of a “learning mode.” Consider psychometric testing that selects the most innately qualified leaders; how useful is this information if you can’t see an upward trend? If the rules in your business keep changing, what use do you have for a leader who was top-performing under last year’s rules? Surely the best leaders are the one who can move upward and onward from any new starting point, regardless of how excellent their performance is currently. You get to change the rules more often with these types of leaders.
Also consider the use of forced ranking performance appraisals and winner-take-all reward systems. Basically, these systems use backward-looking performance indicators and anoint those at a high performance level as those worthy of recognition. But with a learning mode mindset, those mitigating from a disadvantageous starting point might be your new heroes. Especially if they were learning and leading along the way.
Leadership Development, Workplace Engagement, and the Learning Organization
My personal interpretation is that the “learning mode” mindset is just the leadership-development element of an engaged workplace with a learning-organization mindset. That is, if you’re required to lead an engaged learning organization, only those with a growth mindset will excel. And when they excel, the business will perform better. So the leader, the culture, and organizational performance will move in synch.
Leaders cannot get fearless feedback unless they have fostered a workplace culture of high trust and two-way communication. Leaders cannot openly name the things they need to learn unless they have sense of humility and an absence of back-stabbing amongst leaders. Leaders cannot experiment with alternative strategies unless they have permission to fail; an onus of perfection would oblige leaders to stick to the tried-and-true.
It’s reassuring to know that a variety of broader truths are coming out of the evidence. Engagement, learning, leadership, and change are all built on a foundation of focus, collaboration, curiosity, and trust.
Now if only we could make sure those types of people are actually put in charge, I think we would be set. But that doesn’t always happen, does it? It’s a warning-shot to those who think they are already awesome. Excellence is in knowing your next step.
Skydiving. Photo courtesy of Joshua M. This activity is only fun when voluntary.
Why don’t we all just quit our jobs and go freelance? Good question. There’s not a really good reason why we should not. Gig work improves job satisfaction, opens up work opportunities that might have normally been unavailable, and appears to have few negative impacts.
In this October 2016 report, McKinsey Global Institute finds that about 20 to 30% of the working-age population in Europe and the US engage in some form of independent work. The report explores whether gig work is truly a voluntary arrangement, and whether the work is lucrative or satisfying.
What is the Gig Economy?
McKinsey defines independent workers as having a high degree of autonomy, payment by assignment (not hours), and a short-term relationship with their employer. Independent work connects a large pool of workers with a large pool of customers, on a scale that can be global. The workers and customers link up for efficient matches via the internet and cell phones. Only 15% of independent workers are using online marketplaces, implying there is potential for significant growth.
In my opinion, if the arrangement is truly independent, gig workers are businesses and not employees. This is a complication because independent business operators tend to be dropped from formal labour market statistics. This makes the gig economy bewildering to the human resources field. Also, these businesses are often too small to be measured by those tracking major corporations, such as stock markets or auditing firms. That means that independent workers are also not fully understood by experts in finance and accounting.
All the cool stuff happens at the boundary between categories, and nowhere is this more true than in the gig economy.
Is Temporary Work Truly Voluntary? Is it Satisfying Work?
In conversations about the gig economy, there is a recurring question: how is this work any different from the contingent workforce of under-paid service employees? McKinsey overcomes this confusion by placing independent workers into four segments:
Free Agents do independent work by choice and get most of their income from this work.
Casual Earners choose this life but their gigs are supplemental income.
Reluctants get their primary income from independent work but would prefer a permanent job.
The Financially Strapped get supplemental income from gigs and do so out of necessity.
The free agents in the top tier “report greater satisfaction with their work lives than those who do it out of necessity.” The fact that they could choose independent work had a greater impact on job satisfaction than geography, age, income bracket, or education level.
The higher job satisfaction of free agents reflects several dimensions of their work lives including satisfaction with their choice of their type of work, creativity, opportunity, independence and empowerment, hours of work (amount and flexibility), and atmosphere. Independent workers like their boss more, that is to say, yes they do like themselves. Some satisfaction indicators are equal to regular employment, but there were no job dimensions where free agents were less satisfied.
Free agents perceive that they make about as much money as they would in a permanent job.
Amongst the Reluctants and Financially Strapped, temporary work does not drive low job satisfaction. Those who do any work out of necessity report a similar level of job dissatisfaction, regardless of whether they are independent or have traditional jobs. It’s an important distinction: people who are forced into temporary work are dissatisfied, but the main driver of dissatisfaction is the phrase “forced into,” not the word “temporary.” It sounds about right to me, considering how strong the human spirit is in resisting coercion. And some of the temporary-ness is circumstantial and not attributable to a specific negative entity.
While it is notable that some people are “stuck” in these precarious roles, I personally think it is open to debate whether workers would be better-off with the absence of such arrangements. That is, the supplemental income might truly make a difference, with no adverse impact on job satisfaction. And it is not entirely clear whether the gigs can be converted into permanent jobs. There may be cases where the elimination of gigs would simply result in the elimination of an income stream.
Opportunities and Threats in the Gig Economy
Digital links between workers and customers can be global in reach, and since only 15% of gig workers are connected to a digital platform, things could open up and grow substantially. For the economy on the whole McKinsey notes that a growing gig economy “…could have tangible economic benefits, such as raising labor-force participation, providing opportunities for the unemployed, or even boosting productivity.” There is the additional advantage that some services could be provided in a more flexible manner, improving the buyer or consumer experience.
I think there is a trade-off for the common citizen, that sometimes a less secure employment situation can be mitigated by a more beneficial arrangement for that same person acting as a consumer.
McKinsey rightfully identifies that there are challenges posed by the gig economy, including needs for training, credentials, income security, and benefits. That is, if we are shifting towards a touch-and-go economy it will be harder to ensure everyone can be a winner, or even be able to get by. There’s an increased demand for social supports coming from all quarters, including consultants at McKinsey.
CROWD S U R F E R. Photo courtesy of Keami Hepburn.
Strategy is not superior to tactics. At best, strategy and tactics can be integrated as equals. In this day and age it is looking increasingly unlikely that a senior leader will come up with one brilliant idea from the top of the organization and cascade it downward through the chain of command. Rather, we live in a world where ground-level employees determine business success; information is diffused through friends and cube-mates; and the best ideas move diagonally through the organization’s subject-matter experts with minimal regard for the org chart.
A classic example of the disputed importance of strategy is the difference between Workforce Analytics and Strategic Workforce Planning. I routinely use Workforce Analytics to help a variety of managers and professionals adapt to an unpredictable array of questions. Workforce Analytics has a kind of “older sister” business practice called Strategic Workforce Planning which has been around for a little longer. Strategic Workforce Planning is the practice of using analytics in the formal process or organizational re-design. The re-design is intended to align human resources to internal and external context, a forecast about the future, and organizational strategy. It makes perfect sense on paper.
In my opinion, there are three major frustrations with strategic alignment. First, it makes a presumption that organizational strategy in your organization is in its prime. If your org strategy is in its final approval stage or a complete re-write of that strategy is about to begin, then alignment to that strategy is a dubious effort. Second, if any of the organization’s major leaders are in transition (both incoming and outgoing) their personal enthusiasm for the formal strategy could be in play. To some extent, strategy is a debate amongst executives, and that debate can shift as the players are in flux.
Third, forecasting is a moving target. In the middle of the Strategic Workforce Planning process there is an attempt to identify a future state and assess scenarios where a different staff composition would prepare the organization for that future. However, society is changing so quickly and in so many ways that speculation about any likely future state has the shelf life of about a month. Try writing down your predictions about the future on a piece of paper and then come back to it in 30 days. With the passage of time you will either be humbled, or you will assert that it’s been doctored and you couldn’t have written something so clueless. As such, alignment to strategy is brief, making the overall process less tangible and less relevant.
A good example of the struggles of strategic alignment is Uber. Uber appears to have been built around a culture of rules-breaking on taxi licensing, grey-ethics exploitation of private information about a customer’s physical location, and a backroom culture of dot-com, locker-talk bravado. With just a little bit of blowback from the public, Uber has been obliged to change senior leaders and reverse elements of the very organizational culture that made it great. Good luck identifying what their sector will look like in two months, what this week’s executive team is going to do about it, and calibrating staff accordingly. They might be fine in the near future, but we won’t really know until after the fact.
Consider by contrast an impactful tactical change which adapts to emerging evidence. There is evidence that an equitable and inclusive work environment fosters better commitment and idea sharing. There is evidence that workplace incivility has a dramatic impact on general productivity. There is evidence that customer engagement is hyper-sensitive to employee engagement. It is possible to develop a supposition that millennials are quitting at a higher rate, only to discover evidence that this is more nuanced and is really about career advancement at all ages. These insights can have a dramatic impact on an organization’s opinion about what their core function should be, how managers should treat employees, and what kinds of employees and managers you should be hiring or promoting.
Then you would need to double-down and anticipate that even more disruptive evidence will continue to arrive at an even faster rate. And if you did not adapt in this manner, you can bank on the fact that this adaptation is happening at rival organizations. This brings us back to the possibility of even more leadership change and yet another re-vamp of organizational strategy.
If you are a manager, a human resource leader, or an analyst you might need to abandon all delusions that you can chart a clear path. Rather, you are in the mosh pit of life, and your prime directive is to keep moving and not get hurt. Keep your tempo, have fun, and follow the mood. You cannot simply obey the directives of those with money or rank. You must arrive at work fresh and rested, and play hard. Every day.
Neanderthal Museum. Photo courtesy of Clemens Vasters.
How important is good manners? Really, really important. And it extends much further than knowing what an oyster fork looks like.
Incivility weakens health in areas such as cardiovascular disease, cancer, diabetes, ulcers, and of course mental health. For reasons of reducing health care claims alone, mistreatment of staff should be curtailed. However, preventing workplace incivility is actually a bigger deal than originally thought.
In fact, there is significant research that shows being outright rude to colleagues is a major killer of workplace productivity.
In my jurisdiction, there was legislation brought in a few years ago that obliged employers to curtail bullying and harassment. The legislation goes beyond the long-standing human rights legislation preventing harassment on prohibited grounds, such as sexism or racism. The new rules say that if we are to compel others to action we must not be aggressive, humiliating, or intimidating.
According to her research, Christine Porath found that for those treated rudely by their colleagues:
47% intentionally decrease the time spent at work
38% deliberately decrease the quality of their work
66% report that their performance declined
78% said their commitment to the organization declined
80% lost time worrying about the uncivil incident
63% lost work time in their effort to avoid the offender
In addition to the reduced productivity of those who stick around, there is also the consideration of those who quit. Twelve percent of those treated poorly leave the job because of the incident and, by contrast, those who are treated well by their manager are more likely to stick around. What is interesting from an analytics perspective is that those treated poorly don’t tell their employers why, making it a blind spot in the data. We know this from other sources; it’s always okay to say that you’re leaving for a better opportunity elsewhere. But employees usually quit because of their manager and refuse to talk about it in exit interviews.
In addition to those directly treated in an uncivil manner, those who observesomeone else being treated in such a manner are also affected. “You may get pulled off track thinking about the incident, how you should respond, or whether you’re in the line of fire.” Those who witness incivility see their performance halved and they “weren’t nearly as creative on brainstorming tasks.” It makes sense that behavior is social and contagious, and that we feel for those around us. That includes emotional pain.
The impact is not just contagious between employees, but it also spreads to customers. In research conducted with two colleagues form the University of Southern California, Porath found that “…many customers are less likely to buy from a company they perceive is uncivil, whether the rudeness is directed at them or other employees.” When customers witness an uncivil episode between employees, that customer makes generalizations about the company. This has happened with Uber; customers who perceive a toxic environment have turned to competitors.
It’s more evidence of an emerging business model I refer to as double engagement. That is, that it is engaged employees who attract and retain engaged customers, causing the revenue flow that marketing and finance want so desperately. The days of investors and marketing teams driving a product or service into the hands of witless customers is long gone. We live in a world where being human dictates business strength.
But before we put this all in the hands of the worker, we should note that the main source of an organization’s emotional tone comes from its leadership. Simply put, when leaders treat their team fairly and well, they are more productive. The team goes above and beyond. They have more focus, better engagement, more health and well-being, more trust and safety, and greater job satisfaction.
For leaders, the new bottom line must also now include compassion, emotional sensitivity, and engagement. You must step away from individual heroics and reverse your sense of who is important. Why? Because way down at the bottom of the pecking order there may be someone who is not treated so well. Whether you’re a caveman or a gentleman, if you are stronger and more powerful it is your job to carry them.
Are we still living in the information age? Maybe not. Here’s an interesting article from Harvard Business Review on the Human Economy, from November 2014. Societies have evolved from agrarian economies to industrial economies to service economies to knowledge economies. At this point, there’s such a glut of food and goods and services and information, the next bottleneck is humans. Businesses that do well in this new era will be those with a greater sense of humanity. Those that have a poor sense of humanity shall be sunk!
“In the human economy, the most valuable workers will be hired hearts.” It is what makes us different from robots and artificial intelligence (i.e. emotions) that will make us special as employees. Many of the examples in the article are from the perspective of a customer whose heart was won over. Noticeably there’s always and employee whose empathy and enthusiasm closed the deal (so to speak). The article cites several studies where CEOs place a higher priority on social skills than analytics.
This is what it feels like at my desk. I spend half of my time getting the formulas right, and the rest of the time helping people become happy about the numbers. They can’t use workforce analytics unless they trust us. The analytics influence the decision making. Clients get better because we help them develop patience. They come back for more the data is addictive. We persevere through inevitable errors and mistakes, being honest about having made best efforts.
Beyond customer engagement, employee engagement is increasingly recognized as having a major impact on productivity behind closed doors. People are not monkeys at a keyboard sending customer service complaints in circles. Or rather, sometimes it seems that way but it sure looks bad in the news.
At their best, people are the embodiment of the discretionary effort that dictates if a service or product gets to market, and they make every capital investment matter (or not).
Stuart Murray Speaks 