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How would ‘Engaging and Retaining” help my business?

A lot of business owners have concerns about ‘engagement and retention’. It can seem a bit touchy-feely, it sounds as though they have to make their employees ‘happy’ all the time. Isn’t it only going to build expectations of pay rises? In this article, I’m going to help you look at the costs of poor […]


A lot of business owners have concerns about ‘engagement and retention’. It can seem a bit touchy-feely, it sounds as though they have to make their employees ‘happy’ all the time. Isn’t it only going to build expectations of pay rises?

In this article, I’m going to help you look at the costs of poor engagement.

What’s the use of engagement?

Talk of engagement (and retention, with which it is often paired) is a comparatively recent phenomenon. It started with Gallup research in the US which showed the vast majority of employees (up to 70%) are not fully engaged with their work. How does that affect your business?

It affects the bottom line

Let’s use the example of a company with 25 employees that makes a profit of 25% on its turnover each year. You could argue that each member of staff is responsible for 1% of that profit. But we all know that the level of effort and commitment varies from person to person.

In this company 10 of the staff are fully productive, 10 people are 50% committed and 5 people are only 10% engaged. The 25 employees are actually only delivering 15.5% of the profit – where is the rest of it coming from? It has to be the hard workers who are taking up the slack delivering almost four-fifths of the business’s profits.

By improving the performance of the less engaged 15 employees and motivating them to deliver their full share of work, there is a potential increase in profitability of 38%. Imagine what could be achieved if all of them were delivering at the same rate as those currently delivering almost double their share of the profits?

It affects the cost base of the company

Workload is seldom steady – there are peaks and troughs. And increased effort won’t necessarily deliver increased income until new business is secured. But in the business, we’re using as an example with almost 80% of the profit being delivered by 10 of the staff, how necessary are the other 15 employees?

I can almost feel the eyebrows being raised at that. ‘What business would pay people who weren’t pulling their weight?’ ‘Who would take on staff they don’t need?’ But the truth is that business does this all the time when things are going well. And when there is a dip in business all the focus tends to be on bringing in new contracts.

And if the dip results in having to make people redundant as often as not it’s ‘last in, first out’ which can mean it’s the most productive that go out with the bathwater.

It affects the productivity of the best employees

Have you ever worked somewhere where the people who did less than you earned the same or more? Where underperformance went unchecked and the same people were always being asked to do extra? How long do good people put up with that?

Engaging with your staff builds commitment which delivers productivity, lowers costs and encourages retention.

Your convinced – what do you do now?

There are many strategies to choose, mix and use.

The most important thing to accept is that each person that works for you may have different, individual needs and desires. And worryingly, these can change over time.

How do you know which one to use?

Tongue in cheek I would say ask them! But that may not be easy as your numbers grow or if work out of more than one site. Luckily there are IT-based systems that can help you identify what people are looking for.
That might sound impersonal but used properly these methods can help address performance issues AND tell you how fulfilled each individual’s need are over time. They can make your meetings with them focused, specific and productive.

If you’d like support to identify what motivates your staff and how to improve your engagement, retention AND performance please contact us on info@thirdphasecoaching.co.uk