Tom O'Byrne is CEO of Great Place to Work, a research, consulting and training firm that helps organisations create engaged workforces. They recently put out their list of the 2013 Best Workplaces [PDF, 5.6MB].
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You talk a lot about trust in relation to employee engagement. Why is this?
Our model of employee engagement focuses on getting high-trust cultures and that’s a much broader and more comprehensive ambition than just focusing on employee engagement. We look at the whole organisational system, look at the leaders, the managers, and the employees.
Most other models work by trying to get employees to go above and beyond and focusing on what the managers want. This is inherently a one-way relationship where managers try to make the employee perform at a higher level.
We work by examining employees’ relationships rather than their behaviours, looking at the relationship between the employee and company, employee and the work itself, and employees and colleagues.
Overall, this model is focused on building and maintaining levels of trust, pride and camaraderie across an organisation, making it much more cyclical, so it's very much a two-way model, taking into account both the management and the employee's perspective. This is based on our research which suggests the key ingredient of a high-performing, highly-engaged workforce is a high level of trust, particularly between employees and the management.
You can build a house on poor foundations but those poor foundations then undermine the house. Trust is a strong foundation of a highly-engaged workforce. If you don’t have the trust in the first place, you can’t get people properly engaged. Highly-engaged workforces are the OUTPUT, trust is the input.
So trust underpins the Great Place to Work model?
Correct. Output of our model is engaged employees but the key ingredient, based on research, is trust. It’s fundamental to creating an engaged workforce, and leads quite well into our overall mission which is about building a better society. We spend over two-thirds of our life in the workplace, and we want to positively impact that experience of the employee. This can have a knock-on effect on the employee as a whole, which in turn affects the society we live in.
What are the main hurdles to engagement?
There are various challenges depending on the organisation but a couple of consistent themes come out. Commitment from the top is a significant challenge – buy-in must be there from the beginning, but it has to go further. There needs to be action, not just words, and the passion and drive to develop an engaged culture.
Another consistent challenge is organisations viewing engagement as a one-off project rather than something for life. Engagement is an on-going project that goes on and on for the life of the company. Organisations must get into the mind-set that it’s on-going, and continuously look for new ways to achieve improvement.
With the cold winds of recession blowing, encouraging companies to invest in something like this is very important and not easy. It takes considerable investment to build a high-trust culture, and not just money but time too – it’s not an easy process and you have to keep building on it and improving on it.
You also often get people saying it’s not practical because everyone at the company is so busy, we’re just trying to stay afloat, and these are two other key obstacles that we find across many organisations.
Many companies know the value of employee engagement but they’re scared because it’s difficult to measure. What advice would you give to companies that just can’t pin down suitable metrics?
It’s an interesting question. ROI is absolutely key on initiatives of this type and senior leadership are always looking for proof of ROI. They key thing is having a benchmark of where the company is – we actually use a survey for this and it’s a great way of tracking levels of engagement within a company. Employees are asked for their perceptions of the workplace and this acts as a baseline for the company. The success of engagement initiatives can be tracked via similar surveys against the initial baseline.
Separately, David MacLeod – on behalf of the UK Government – reviewed engagement in an initiative called Engage for Success, looking at what high levels of trust mean for the workplace and what it brings to financial results. In high-trust cultures, productivity was 18 percent higher, operating income 19 percent higher and sick days 50 percent lower. There’s strong factual evidence that growing trust and engagement has a big effect on the bottom line.
What differences do you see in engagement between large businesses and small businesses?
We get this question a lot. Big companies often say small companies have an advantage when it comes to creating engaged workplaces because there’s an inherent family environment, a tighter-knit culture and it’s easier to communicate. On the flipside, small organisations will say that the juggernaut multinationals of the business world have an advantage due to their budgets and their access to the latest technology. Interestingly, our rankings show a diverse mix of both multinationals and small, local organisations.
Any organisation can create a highly-engaged culture and it doesn’t really matter what size you are, particularly once the appetite and drive is there from the organisation to want to make it happen. Across the board – from large multinationals to small family businesses – one of the most common factors of the most engaged workplaces is a passion for what the company does and the values they believe in.
You mention that engagement tends to go up the further you go up the seniority ladder within an organisation. Why is this?
One thing it tends to not be about is remuneration – that’s actually what we’d call a hygiene factor (factors that do not give positive satisfaction but cause dissatisfaction if they are absent). Of course if people aren’t being paid fairly they can be disengaged but extra money doesn’t buy engagement.
In part it’s because they have a key part in developing strategy and plans and feel closer and more in control of their own destiny. Further down the chain not all companies are very clear with employees over what their plans are, and not all employees feel the management is very competent. It can come back to control too – in low-trust cultures lot of employees feel their destiny is directed solely by their superiors.
One of the problems I think is that when employees don’t have access to company financials it can feel like a brush-off.
Yes, that’s one of the key things that come out in high-trust organisations. A lot of the time we look at survey results and there’s a disconnect between views of employees and employers and a lot of time it comes down to poor communication. Maybe management aren’t getting across their plans or communicating their plans or strategies – this forms a disconnect as employees feel they don’t have the information they need to operate effectively.
What parallels are there between CSR and engagement?
I guess the biggest parallel is that neither of them are one-off activities. Both are hard work. Even the great workplaces have to maintain their status – you can’t stand still and you have to constantly try to take things to the next level. You’re working at both CSR and engagement every day, every hour, and every minute to create the right culture.
What changes and trends have you seen in engagement in recent years?
We have a lot more invested in research and development – it’s in the early stages but we are seeing some interesting trends coming out, including innovative applications of IT and people management, particularly related to communication. Another key trend is significant gaps in perceptions between leadership/management and employees and that despite the existence of well-meaning policies designed to make the workplace good and fair for all, certain minority groups are feeling much less positive about the experience than other staff. In other words, discrimination still happens.
There are a huge amount of internal and external factors influencing engagement. For many companies this creates a fear factor that prevents them taking action.
True but you need to look at the high-level factors. For employees, a great place to work is one where the employees trust the people they work for, and one where they’re primed in what they do and enjoy the people they work with. From the manager’s perspective, it’s when they achieve their organisational objectives with employees who give their personal best and work together as a team or family in an environment of trust.
Of course, you can break it down further. At Great Place to Work we use a culture audit to get a baseline on the organisation’s existing engagement levels. This audit looks at nine key practice areas which drive high-trust cultures: hiring, listening, developing, inspiring, thanking, caring, speaking, sharing and celebrating. Once organisations have a baseline it’s easier for them to influence the development of a engaged workforce. All organisations do something well and often it’s about leveraging the positive to get the ball rolling.
You’re active in many countries across the world. Is it possible to map engagement across different cultures?
There’s no one culture that’s right for all organisations, but all organisations must create their own culture. Trust is absolutely essential wherever you are in the world. Interestingly the survey we use to track levels of engagement is the same in every country, although obviously it’s translated into the local language. A lot of multinationals take part in the survey because they want to compare how engaged their cultures are across all territories. Of course there are lots of differences, but you’d be amazed at the similarities. Companies face the same sorts of challenges and the same sorts of trends emerge.
Is communication a fundamental step to building trust?
It’s definitely up there and is key at all levels. It forms part of the fact that building trust is not just a project to achieve short-term targets, but a long-term journey. Many organisations struggle with getting or creating a great workplace and it's tough out there – there are thousands of organisations that are on journeys to become great places to work. Some never make it, some it takes years. It's not about painting by numbers: you are dealing with people, the psychology of people, and people are COMPLEX. There are so many variables which can influence trust and engagement levels.
This task is made even harder because organisations are constantly changing. Employee expectations change based on their own experiences, the economic climate and the organisation’s business performance. There needs to be a continuous cycle of revealing, reflecting and implementing, but end results can be fantastic. People have the most wonderful potential – they are an organisation’s key asset.