Engagement for action Chris Roebuck Visiting Professor of Transformational Leadership, Cass Business School, London

Common views on engagement “What’s the cost benefit ?” “Its an HR initiative so not my problem” “It’s a nice to have not a need to have” “Well we are doing ok so why bother ?” “Well we have an engagement survey.” These show a fundamental misunderstanding of engagement Education is vital plus a compelling business case & road map.

UBS Engagement Project Business focused on a new strategy, culture & brand Creation of “One UBS” an “aligned in integrated firm”. First phase - Creation of one aligned, networked and engaged senior team of 500 across 5 business divisions spread through over 100 countries. Success through compelling business and personal case, clarity of role & responsibility, alignment of effort on to critical deliverables – leveraging the whole organisation, world class customer service and world class leadership. Including leadership development, communication, performance management. Result : 15 % + increased market capitalisation, 14% higher output per employee with 10% lower wage bill. Best Company for Leaders 2005, Harvard Case study, Best Corporate University 2005.

It’s nothing new ! We have know for over 30 years that people want to be able to Deliver the best work they can Grow and develop Contribute to the bigger picture Gain the respect of their boss and colleagues Be treated fairly, honestly and with integrity Be asked for their views when they could contribute Be praised when they have done well If this happens you could get up to 30% better performance through extra effort ! The key driver of this is the line manager responsible for about 80% of the engagement.

GOOD LEADERS PRODUCE GOOD ENGAGEMENT PRODUCES GOOD BOTTOM LINE

What does engagement deliver ? Better individual performance Better organisational performance Better customer service Better cost management Better risk management Regulatory Reputational

Can engagement make a financial difference ? Companies with high engagement are 71% more likely to out perform their peers in sector. (CLC) Can produce an Earnings per share 2.6 times higher than competitors with low engagement (Gallup) Could increase revenue by up to 43% (Hay) Companies with greater than 10% profit growth had 39% more engaged staff and 45% few disengaged staff than those with less than 10% growth (Hewitt) Bank branches with high employee engagement achieved 16% high profit margin growth than those with lower scores (Standard Chartered) Accenture managed to increase net revenue by 21.6% in 6 months by implementing an engagement initiative. Companies with high engagement scores improved operating income by 19.2% compared to a decline of 32.7% in those with low scores in a 12 month period (Towers Perrin) Engagement can halve days lost though sickness (CBI)

The basics work to drive engagement Problem - Over 50% of middle managers and 70% of 1st line managers say they aren’t being developed well and that restricts performance…and engagement. Answer : A credible development plan can increase engagement by up to 45.4%. Where leaders make clear line of sight from individual to corporate objectives can increase commitment by up to 28% Where leaders deliver fair & accurate feedback it can increase commitment by up to 39% Effective on boarding can increase commitment by up to 25% A good leader reduce the risk of talent loss by up to 87% The line manager is responsible for over 80% of the top 20 drivers of executive retention and commitment. Overall …. a good line manager who engages and develops people can increase an individuals potential AND performance by at least 30%

Engagement - The Leadership Challenge Good 10% Good 30% Competent 20% Less than competent 60% - unaware or unable to engage Competent 60% Less than competent 10% Counter productive 10% NEED TO BE NOW Note : % of total managers at each ability level

How many are engaged with engagement ? Integrated system. CE leading by example, line managers at all levels engaging and developing people and performance. Clarity on people roles. 5% Top quality Systems apparently in place but only delivering engagement to top 10% of rank and performance. Strategic veneer 20% Realisation engagement is not just a survey - starting to integrate a system from ad hoc components. Finding their feet 20% Implementation of first core HR components – risk minimisation – not engagement – maybe a survey 50% Just starting the journey 5% Not concerned

What impacts upon your people, what they do and how well they do it Engagement for what ? Present Leaders HR Policy and measurement Future Leaders PRODUCES CONFUSION Line Managers & Staff Engagement What impacts upon your people, what they do and how well they do it Employee communication & culture building OrganisationalDesign -Optimum structure Internal & external brand Performance Management& reward

ORGANISATIONAL ENGAGEMENT ALIGNMENT Present Leaders HR policy and measurement Future Leaders ORGANISATIONAL ENGAGEMENT ALIGNMENT Line Managers & Staff Engagement Employee communication & culture building Organisational Design -Optimum structure Internal & external brand Performance Management& reward

Engagement : emotional link is vital ! Purchase decisions : Up to point of buy : 80% logic 20% emotion At point of buy : 80% emotion 20% logic Performance is 57% rational / 43% emotional Line manager accounts for 80% of the emotional decision ! If you don’t use emotion you lose nearly 50% of your chances of success.

Why doesn’t it deliver benefits ? Basics not in place – low leadership quality No cascade – top levels only Engagement for what ? – no alignment onto critical deliverables No personal benefit – just business Using Rational drivers only – no emotion 43% less chance of engagement. Ineffective communication – haven’t heard and what’s the point ? Internal and external brand not aligned – employees are 2nd class citizens.

Summary Most organisations : Basic delivery of leadership is simple Don’t understand the business benefits of engagement Are not performing at their full potential due to ineffective leadership at all levels which creates low engagement Basic delivery of leadership is simple Building good engagement with consequent bottom line benefits is simple Good communication is key to success – often neglected This is not an HR initiative it is a critical strategic imperative so must be driven by the CEO This is not about the few its about the many – be that people in organisations or organisations across British business Use the support you can – Engaging for Success & expert advice.

For case studies, articles and ideas see : www.chrisroebuck.net