Human Resource Management (HRM), in a broader perspective, is handling the employees as an essential part of the organization’s capital. It revolves around strategically analysing the job profiles and creating an environment that motivates the employees to increase their productivity and loyalty to the organization

The Human Resources field evolved first in 18th century Europe from a simple idea by Robert Owen and Charles Babbage during the industrial revolution. These men knew that people were crucial to the success of an organization. They expressed that the well-being of employees led to perfect work. Without healthy workers, the organization would not survive. HR later emerged as a specific field in the early 20th century, influenced by Frederick Winslow Taylor. Taylor explored what he termed "scientific management" (others later referred to "Taylorism"), striving to improve economic efficiency in manufacturing jobs. He eventually zeroed in on one of the principal inputs into the manufacturing process – labour – sparking inquiry into workforce productivity.

According to Dave Ulrich, the functions of HR are: Aligning HR and Business strategy, Re-engineering Organization Processes, Listening and Responding to Employees, and Managing Transformation and Change. Over the years, HRM has evolved way more than merely being the department that handles ‘hiring and firing’; it has now become an important aspect to be considered when an organization is having a vision of growing and empowering.

The size of the HR Department, naturally, depends on the number of employees and the size of the organization, the standard benchmark being, 1 HR Manager per 100 Employees. Typically, the HR Department of organizations has the following verticals, and the functions are highly inter-linked when compared wholly:

Current trends in HRM

Globalization and Technological Advancements are the two things that have affected the business lines in a significant way. While business lines are affected, so are the people, i.e. the employees and hence the department that takes care of all employee related aspects i.e. Human Resources. These advancements are also one of the reasons why HR as a ‘department’ has grown to become a crucial part of an organization. There has been a major shift in practices related to the HRD of organizations, listed as follows:

• Globalization: With the ease of access to neighbouring and far-off countries, political and economic reforms, every country has attracted numerous foreign organizations and also set up their bases in other Mass-scale development plans, mergers and acquisition deals have been implemented that have given rise to enormous

possibilities in the management of people.

• Diversity Management: Businesses today are no longer a single country / parent country They have grown in every way and so has the diversity of people. Diversity in terms of cross-culture jobs, changing male-female ratios, generations working together in an organization, diversity of every kind has to be handled in an effective way to

ensure smooth running of the business processes.

• Technology: The advancements in technology have been rather swift. It has been a boon to the organizations, but the bane to the pool of candidates, since more and more tasks can be
• Increased Employee Involvement: The times have changed and there is an increasing awareness among the top level managers of the fact that people are the most important aspect of any organization, followed by processes and Hence, there has been a sharp rise in Employee Involvement, and Employee Enhancement practices since

the last 4-5 decades.

• On Contractual Basis: These are common words that are tagged along while any job requirement is posted these This tactic is simply an outcome of contingent workforce plan which means that the employees are hired on

contract basis of 6 months to 2 years, and not as ‘full-time’ employees of the organization. This practice was implemented mainly to downsize the number of employees from the compensation procedures of the organization and also to have a vivid workforce in definite time periods.

• Virtual Organizations: In a virtual organization, the employees are geographically apart from each other, but with the use of technological communication tools, they work as a team to drive the business This is another

aspect where the HRD has to work diligently to develop compliance rules and employee relations for the virtual teams.

• Work-Life Balance: An important aspect of having ‘happy’ employees is to set up a work-culture that promotes work-life balance, e. equal time for work and family / leisure. It is necessary that the employee is as fit mentally as he

/ she is physically to be motivated by self to align their achievements in line with the organization’s vision and mission.

Employee Engagement

“There was a great deal of talk of the sequence of the 3 P’s – People, Products and Profits – It was decided that People should absolutely come first.”

- Donald Petersen ( Over 40 years with Ford and its CEO from 1985-1990)

Employee Engagement, in simple words, is an approach practised by organizations to instill a motivating work-culture so that the employees are committed to the organization’s goals and values, with an enhanced sense of their own well- being.

Employee Engagement is based on two-way commitment i.e. between the employee and the employer. It is an approach that increases the chances of business success, contributing to organisational and individual performance, productivity and well-being which can be measured and nurtured.

While discussing Employee Engagement, Gallup’s Employee Engagement Model, a theory that till date captures the essence of the importance of employee engagement assumes importance:

In the pie-chart above, 27% Employees are highly engaged and aligned to the processes of the organization, naturally, they are better at their productivity and are the ‘safe-bets’ of an organization. Followed by the 27% Employees who are highly disengaged, these are the employees who are difficult to get in-line with the culture of the organization and hence, their productivity levels are unreliable. But, Gallup suggests that the most threatening

(potentially risky) of the lot of the employees are the 46% of those who are neither engaged nor disengaged. These

employees need to be involved in such a way that slowly and steadily they incline towards the ‘Highly / Actively Engaged’ Group.

This theory succinctly explains the concept of ‘Employee Engagement’ which is all about, holding on to good employees and making a culture that makes good employees better.

Current trends of Employee Engagement

The trends in Employee Engagement have changed over the years, from being a non-existent part of the HRD to being a crucial one; employee engagement is growing and will grow slowly and steadily. The following are the trends and tactics used as a part of an organization’s Employee Engagement Practices:

The above mind-map shows a detailed overview of the best employee engagement practices in the industry. Every organization uses all of these methods and tools or a combination of these, and improvises on it constantly based on the feedback they receive.

Purpose of Project

Employee Engagement is a rising vertical of Human Resource Management as a tool to bridge the gap between the

employee attrition and talent availability. Employee Engagement essentially helps in retaining the existing employees and to ‘brand’ the organization’s people practices in such a way that there are more and more employees willing to work for the organization.

The purpose of this project is to understand the impact of employee engagement activities on the employees of organizations in the 6 largest and growing industry sectors, namely:

• Consumer Durables
• Financial Services
• Telecommunications
• Education
• Hospitality
• Media

The extent to which these employee engagement activities affect the employees can help in drawing inferences about the various activities that could be improvised upon where-as the suggestions could help in adding of certain activities, to view the impact of employee engagement through the perspective of the employees since they are the primary beneficiaries of these activities.

This Employee Engagement Analysis will also throw light on verticals related to it, such as attrition analysis, competitive industry practices, employee satisfaction levels, employer branding impact and the extent of attracting a talent pool.

The target group of employees were not only from the 6 sectors listed above but also those of varying managerial levels, of various departments in an organization so that there is a more refined look at employee engagement perspectives of employees from all backgrounds, i.e., it includes a diverse look-out on employee engagement practices and their respective impact.

Through the survey that was independently carried out, and the analysis done, this study will add immense amount of varied industry specific knowledge and enhance skill-sets related to the employee engagement vertical of HRM.

Research Methodology

The Research Methodology for “Evaluation of Employee Engagement as a determining factor to develop the Corporate Human Capital” employed was as follows:

1. Population = Employees of 6 Industry Sectors

• Consumer Durables
• Financial Services
• Telecommunications
• Education
• Hospitality
• Media & Entertainment

2. Sample Frame = 11 Employees from each of the above sectors (of various managerial levels)
3. Sample Size = 66
4. Method of Collecting Data = Questionnaire
5. Analysis of Data Obtained
6. Inferences

Note:

* Questionnaire and the justification of asking specific questions to the respondents on next page.

** The name of the respondent employee’s organization is kept confidential since they agreed to take the survey only if the organization they belonged to was not published on any platform. However, the respondents have provided the information about the sector and their designations in the organization that they are working in.

Questionnaire

1. Since how long have you been associated with your current organization?

< 1 Yr.

1 – 3 Yrs.

3 – 5 Yrs.

5 – 7 Yrs.

7 – 9 Yrs.

10 + Yrs.

The reason this question was asked was to get a direct insight into the number of years the employee has spent in an organization which gives us an initial understanding about how well the employee is retained in the organization

2. How many times have you been promoted in your tenure with the current organization?

1

2

3

4

5 or more

When an employee is promoted, the data about how many times he / she is promoted can be linked to the succession or career planning roles that the employer is taking and to measure the employees growth

3. On a scale of 1 – 10, how ‘Happy and Contended’ are you with your current job?

The employees happiness and contentment value have a direct co-relation with the ways in which the employer has developed the work-culture so that the employees feel welcome to work even after months/years of service

4. On a scale of 1 – 10, rate the ‘Work-Life Balance’ of your current job?

Work-Life Balance has been a major aspect of various researches about the over-all employee well-being, hence when the employee will gives it a score between 1-10, we can get a direct understanding about the measures taken by the employer to realise the importance of work-life balance for its employees’ well-being in the long-run

5. From the following 7 options, give each aspect of ‘Employee Engagement’ a rank from 1 to 7 (1 being the highest, 7 being the lowest) to the option that gives you the maximum ‘motivation’ to work better:

1. Career Growth Aspects
2. Work-Life Balance
3. Salary and Benefits
4. Work-Culture
5. Employee Bonding, Transparency f . Flexible Policies
6. Infrastructural Amenities

The above seven options capture an over-all view of the outcomes of various employee engagement activities that the employer administers – when the employees are asked to rank the options, we can ge1t a clear insight as to how the employees ‘perceive’ these activities as measures for their over-all betterment and for retaining the existing pool of talent as well attracting new potential candidates to create a productive work culture (which is one of the biggest motives of employee engagement and performance management activities)

• Do you feel ‘valued’ at work?

Yes	No
Being valued at work is directly related to the ‘trust’ that the employer has put into the employee to be able to contribute well to the organization. When the employee feels valued and respected at work, he/she will be more motivated to achieve the tasks he/she has been assigned

7. How frequently do you receive recognition from your supervisor / boss (apart from official rewards and recognitions)?

Frequently	Occasionally	Rarely
Receiving recognition is one of the biggest motivators for being more efficient at work and it also implies the fact that the employee is recognized and valued for his/her contribution to the organization with a positive outlook towards the career growth that the employee has the potential to accomplish

8. Were you given any leadership roles which also included employees who were senior to you?

No

Yes

Giving leadership roles to the employee for certain projects that include the employees who are senior to him/her in position gives us an understanding about the level of ‘transparency’ and ‘equity’ that all the employees are entitled to in an organization, and it also implies the amount employee empowering activities the organization carries out

9. What kind of measures does your organization take in order to 'improve' an employee's performance? (Tick all that apply)

Change in Projects / Responsibilities	Performance Improvement Plans	Training for added skills
Motivate You and Set Achievable Expectations	Two-Way Feedback / Reviews	Collaborative / Team-based Problem Solving

Improving the employees’ performance through various activities as stated above, we can get a clear insight as to how the employers are taking up the responsibility of improving under- performers and also improving the performers to become better at their KRAs and KPIs that need to be achieved

10. Do you see yourself still with this organization in a year, or, would you re-apply in this organization?

Yes	No
When an employee is well engaged with the current organization, it is obvious that he/she will look forward to being associated with the same organization in the future or if he/she were given an option, he/she will be willing to come back to the organization giving an over- view about the efficient employee engagement activities

11. Do your personal goals in life align with the organizational goals and visions?

Yes

No

Can't Say

When an individual’s ambitions and integrity values are aligned with the visions of the organization, the employee will display much more motivation in achieving his tasks and also be associated with the organization for a longer time, which is exactly what the employers are looking for in an employee

     12. Would you recommend joining your organization to others?

Yes	No
The response to this question is co-related to the fact that the more the employee is engaged to his/her current organization, the more enthusiastic he/she will be to encourage other candidates to join his/her current organization. This will give us an over-all insight as to how engaged are the employees in the organization

Survey Analysis

1. No. Of Respondents

2. Age Group of Respondents

3. Designations/Departments of the Respondents:

4. Tenure in the Organization:


• From the chart above, maximum respondents have been with one organization for a tenure of < 1 year to 3 year.
• This may be in case of entry level employees as well as experienced employees who have just switched their organizations
5. No. of times promoted in the tenure with the organization:


• From the chart above, maximum of the respondents have been promoted once in their tenure with the organization, followed by twice and so on
• The data above can be co-related with the tenure, since the number of employees being in an organization for < 1 Year – 3 Years is 46; hence they will be promoted at least once in their respective organization
• This gives an insight about the fact that every organization has considerable employee development plans in place so that every employee rises in his/her career
6. Scores from 1-10 on being ‘Happy & Contended’ with the Organization:

• The parameter chosen above is completely based on ‘human emotion’ – basically how the employees feel about their organization, which is directly related to the measures taken by the employer towards employee well-being
• The measurement of being happy and contended also tells us about how the employees feel about their job role and the If they were not satisfied with the same, they would definitely be unhappy and detached.
• Percentages:
• More than 50% (57% to be precise) of the respondents have rated their happiness and contentment quotient from 7 – 9 points out of 10
• 33% employees have given a score of 4 – 6 points out of 10 on their happiness and contentment quotient
• 6% in the range from 1 – 3 out of 10 about being happy and contended
• Only 3% have rated their organization a full 10/10 in terms of this parameter
7. Scores from 1-10 on the ‘Work-Life Balance’ of the Organization:


• The scores that the employees give to the Work-Life Balance that they have in the organization gives insight into the degree to which the employer / organization is employee-friendly, whether they have policies in-line with the betterment of work conditions for the employees or not
• The employers should conduct surveys on the employees work-life balance repetitively to ensure a productive work environment along with more employee retention, all of which is beneficial to the employer
• Maximum of the respondents, e. 30/66 are satisfied with the work-life balance, followed by those who feel the work-life balance is average i.e. 26/66
• An insight into the employees work-life balance perception gives an idea about the efficiency with which the employer has allotted job roles and job descriptions so that there is equity and equality in the work provided – too many responsibilities to one employee as against lesser responsibilities to another employee, both having same designation

The parameters below give a detailed insight about how the employees perceive the various employee engagement activities and their respective ranking based on importance that the parameters have:

8. Ranking of Employee Engagement Activities by the Employees:

The following is a list of the employee engagement activities that the organization implements. The respondents were asked to rank these activities / policies from 1 to 7 (1 being the highest) on the basis that they feel is the most important activity of employee engagement which motivates them to stay in the organization and most importantly, work to their fullest potential



The frequencies of ranks are now plotted in a collated graph which will give an over-all insight about the rankings of the employee engagement activities that motivate an employee:



In Majority of respondents have ranked the following parameters from 1-7:



The rankings above show that more than salary and benefits, the employees are inclined towards having a balanced work-life, healthy work culture and future prospects of growth

9. Being Valued at Work:

• Being valued at work means the employee’s contribution is being rightly put to effective use and it adds to the over-all productivity of the organization as a whole
• The significance of this parameter leads to having efficient cross-functional teams so that each and every department is related and in-line with the organizational goals
10. Receiving Recognition at Work:

• Recognition, apart from the usual rewards and recognition, is a very effective motivational tool for the employees to understand their potential and also to self-improve themselves in their potential talents
• Recognition from their peers/colleagues or seniors and even super-seniors has a positive boost on the employee and eventually motivates others also to work to those performance standards
11. Given leadership roles with seniors also in the team:

• Leadership roles empower the employees and such projects enable them to take on more responsibilities, through which the senior managers can recognize the succession plans for the respective employee, which is a very important aspect to keep in mind when the organization has learning and development as well as performance management policies in place
• Giving an employee certain leadership roles which has seniors also working under or along with the employees, is a very effective tool to inculcate transparency and added creativity to the organization
• About 53% of the employees are given such leadership roles, which may be when the employee has spent about 3 – 5 years or more with the organization, as against 47% of the employees getting leadership roles but not with a senior working under or along-side the employee
12. Measures for Improving Employee Performance:

• The data above is given individual frequency since every organization has one or more than one ways to improve an employee’s performance
• Most of the organizations have set guidelines for specific under-performers through the PIP i.e. Performance Improvement Plans. Few of the employees are given team-based tasks rather than individual tasks, and most importantly, there are policies for employee training and development that are set every year based on the employee performance appraisal
• Improving employee performance as against laying them off, is financially beneficial to the organization since the cost of hiring new employees and exiting the employees is saved in the process
13. Willingness of the employee(s) to continue working after 1 Year or reapply in the same organization:

• When the employees are willing to continue in the organization for a year, the employers will get insights into two main things: how effectively the employee is ‘engaged’ or ‘attached’ to the organization, and the attrition rate for the coming year so that manpower can be planned accordingly
• 44 out of 66 employees, e. 67% of the employees who took the survey are engaged with their current employer and 33% are disengaged. Now the employer has to further segregate the 33% employees into those employees who have potential to ‘add’ to the organization and those who don’t, so that employee development plans can be initiated on those lines
14. Employees’ Personal Goals aligned with Organization’s Goals& Visions:

• When the employees’ personal career goals are aligned with / parallel to the organizational goals, there is more sense of responsibility towards the employer, added productivity, performing more efficiently even with added responsibilities and above all, the employees are retained in the organization for a longer duration as against those who aren’t aligned with the organization
• The extent to which the employees are aligned or the number of employees who are aligned with the organization is a direct indicator of the fact that the employee engagement policies are having a positive impact on the employees with a bigger picture in mind of retaining employees as well as nurturing leaders for tomorrow
15. Will the employee recommend his/ her current organization to others?


Inferences

No.	Employee Engagement Activity	Inference(s)
1.	Promoting Employees	• When an employee has a tenure of 0 – 3 Years, he/she will at least be promoted once in that tenure, followed by more promotions based on performance • The promotion activity gives an insight about the fact that the organization is taking measures for employee development and succession planning so that the employees are aware of their growth opportunities
2.	Happiness and Contentment Quotient	• When the employees are in a mentally happy state, they will look forward to coming to work every day and take more responsibilities to finish tasks in time • If the employees are contented with the work they do, they will ensure that they are self-motivated to perform to their fullest potential to the tasks assigned
3.	Work-Life Balance	•  Having a work-life balance and policies that are employee friendly gives them positive reaffirmation that the employer is looking after them effectively in return of the service that they provide •  Work-life balance along with ‘office-perks’ make them more inclined to the organization and work more effectively in the long-run
4.	Career Growth/ Future Aspects	• When the organization has an effective succession plan for the employee and the employee is involved in these decisions, he/she will stay with the organization for a longer duration •  If the employee has faith that there are immense growth opportunities, he/she will work more productively to prove themselves and make the most of the development and succession plans that the organization has set
5.	Salary and Benefits	•  Though this aspect is a part of Employee Compensation & Benefits and Performance Management, it is a very crucial aspect of employee engagement also, since money is one of the biggest motivators for employee productivity • Employees have ranked Salary and Benefits lower then Career Growth Aspects and Work-Life Balance, which means that employees of the 21st Century are no longer just inclined to money, but are looking for something more from the employers for their over-all development
6.	Work-Culture	•  Having a positive, performance-driven, team-building and growth inculcating work-culture has immense impact on the extent to which employees are engaged with the organization • It is directly co-related to retainment of employees since they naturally look forward to giving more of their potential to the organization
7.	Employee Bonding/ Transparency	•  This aspect is more inclined towards an employee and his supervisor’s behaviour as against employee-employee behaviour, i.e. the more the openness in communication among the employees, more the ease of work • The employees will not be uncomfortable with sharing their ideas, reviews in front of all other employees. Though this may seem like a minute aspect but inculcating the idea of ‘open-door policy’ has immense impact on having a performance driven culture
8.	Being Valued at Work and Receiving Recognition	• As experts have always maintained, even a small appreciation towards the employee’s work can drive the employee to either become better at his/her work or be consistent with his/her performance • Being valued and being recognized positively re-enforces the employee’s belief that he/she is ‘counted’ in the organization and is doing his/her bit to take the organization forward
9.	Leadership Roles Given	• Giving an employee tasks and responsibilities which involve leading and developing a team will make him/her more responsible and ready for further promotions • When employees are developed in such a way, it reduces the employers liability of hiring leader positions from outside which is often costly for them
10.	Enhancing Employee Performance	•  This aspect would be covered under the learning and development policies of the organization, but making the employees aware of the fact that the employer is taking measures to enhance the performance of an employee, and even underperforming employees will make them more inclined to the organization and there will be reduction in the employee- turnover rate as well
11.	Flexibility Policies and Infrastructural Amenities	•  The perks and the facilities which are inclined towards employee well-being might seem like a small aspect but in the end has a lot of impact on the engagement levels of an employee • If the employee is provided with amenities which ‘ease’ his/her performance, he/she can perform more productively in the set time which itself is beneficial to the organization

 

Conclusion

Employee Engagement is essentially about how the employer is making the organization more and more employee-

friendly. It begins with the premise that the senior / top management should inculcate in the organization’s values: ‘Employees come first’. An ‘engaged employee’ is defined as one who is fully absorbed by and enthusiastic about his / her work and so takes positive action to further the organization's reputation and interests.

From the survey, its analysis and respective inferences depicted above, it is clear that employee engagement has become a crucial activity of utmost importance since attracting, developing and retaining the employees ensures that the employees work to their fullest potential which is further beneficial to the organizations’ productivity in terms of growth as well as revenue generation, apart from long-term sustainability.

In today’s Corporate World, of the 21st Century, money has lost the race into being #1 in employee motivation methods. It is topped by the career growth aspects in the work-culture or work-life balance that the organization has to offer to the employees, then followed by compensation and benefits, in the employee engagement activities taken into consideration for this analytical study.

The most impactful drivers of employee engagement are:

• Employee’s perception of the importance of the job and his/her value in the organization as well as the alignment of personal goals of an employee with the over-all vision and goals of the organization
• Transparency between the employee-employee, employee-supervisor for free and effective communication and also setting the performance expectations in better manner so that the employee is motivated to perform on those lines
• Career advancement opportunities, succession planning and promotion plans along with a clear and equal set of roles and responsibilities given to the employees holding similar designation(s)
• The type of bonding and relationships among all the employees and the work-life balance that the organization has inculcated
• Work-culture includes the quality of the values incorporated and acceptable behavioural aspects of the organization

If all the employee engagement activities aligned well, then the employee will look forward to being associated with the organization even after a year/years, re-apply in the same organization and also recommend working in his/her organization to others.

All the activities of Human Resource Management are directly or indirectly, in some or the other way, co-related to employee engagement and hence, having an idea of the degree of how engaged are the employees will have immense impact on the organization.

Bibliography

• Gallup’s Surveys on Employees and Employers
• ‘What engages the employees the most?’ – Ivey Business Journal
• Employee Engagement Articles – Harvard Business Review
• Meaning of Employee Engagement – Industrial Psychology aspects
• Employee Engagement in Theory and Practice – Routledge
• Other articles and books from MET’s Institute of Management’s Library

 

Authored by

Binal Chitroda

MET, MMS – HR Specialization     MET, MUMBAI

Mentored by

Prof. Arun Patil

Tags: MET Institute of Management