How to Measure Employee Engagement – Solving an Impossible Problem

Employee Engagement Balanced ScorecardEmployee Engagement is a new buzz-word, and there is a profound reason for this! According to latest studies, Employee Engagement is directly associated with business performance results. Companies report huge costs reduction achieved while improving levels of employee engagement.

What is the definition of Employee Engagement

  • It is a business management concept (according to Wikipedia) that refers to employees’ enthusiasm with regard to their work.
  • It is an emotional attachment to the job, as said in Scarlett Surveys
  • It is emotional commitment to the organization and its goals, as stated by Kevin Kruse – a Forbes contributor and author of several business management best sellers.

I believe all the definitions play with the words, but the idea is the same.

What is important is to differentiate employee engagement from:

  • Employee satisfaction
  • Motivation
  • Happiness

Measurement Problem

In an article published on Forbes, employee engagement is defined as a feeling and is compared to love. How can one measure feeling and how can one measure love? There is no way to do this, but we can measure some related aspects (called “proxy questions” in the article).

  • There is the same problem with Employee Engagement as long as we agree that it is a feeling that we should treat and measure as a feeling. And we have no idea how to do this!

On the other hand, with digitization of all possible aspects, we can probably arrive at some reasonable estimations.

Traditional approach with surveys

The traditional way to measure employee engagement is to do a survey. My opinion is that surveys will never be objective enough. In the case of engagement, employees have a wide range of possibilities for gaming the answers. Even if a survey is done anonymously.

I believe that it is good idea to combine traditional surveys with objective measurements.

Measure what matters

Another problem of traditional surveys is that questions used in surveys are not related with business results. E.g. it is not clear if and how some factor, for example “family-like atmosphere in office,” will affect employee engagement and more importantly, how this factor will affect the company’s performance.

The analysis (Q12 Meta Analysis. The Relationship Between Engagement at Work and Organizational Outcomes) published by Gallup gives us a clue to this problem. This report summarizes the relationship between 12 engagement elements and performance outcomes. Next time when choosing questions for an employee engagement survey and decoding the results, you will have much more information about performance outcomes associated with certain drivers of employee engagement and their importance.

Objective measurement with KPIs and Balanced Scorecard

What might be an objective approach to Employee Engagement? As we discussed above, engagement is a feeling and there is no way to measure it 100% trustworthy, but we can try.

We have used the Balanced Scorecard framework and created an Employee Engagement Balanced Scorecard in BSC Designer Online (one might argue that it is not Balanced Scorecard, check out my opinion about the usage of BSC buzz word). Now you can see the result:

Employee Engagement Balanced Scorecard

View Employee Engagement Scorecard online

Check out the Balanced Scorecard:

  • On the KPIs tab, you will find perspectives and KPIs within these perspectives. Each KPI has a description together with target values.
  • On the “Business Goals” tab you will find some business goals as an example.

Action is the most important part

It doesn’t matter what you use to measure employee engagement – surveys or the Balanced Scorecard mentioned above. The most important thing is what you do with the information that you have. Act accordingly to improve employee engagement and you can improve business performance outcomes as a result.

Use Employee Engagement Scorecard project discussed in this article as a starting template for your own scorecard! Access this example project online or download .BSC project file for BSC Designer PRO.

View Employee Engagement Scorecard online

Related Articles

Strategy and KPIs Scorecard Expert | Speaker | CEO. Aleksey Savkin (LinkedIn, @bscdesigner) is helping companies to better formulate their strategies and make the process of strategy execution more tangible with KPIs. His areas of expertise are Balanced Scorecard, Key Performance Indicators, business performance management. Aleksey is a frequent speaker at conferences; the author of a number of articles and books on Balanced Scorecard. New book by Aleksey: 10 Step KPI System

Posted in Engagement and Loyalty
  • Aleksey Savkin

    Here is an excellent list of cases compiled by Torben Rick that answers the question “Why employee engagement is important?”nn

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