Employee Engagement in Manufacturing Sector
Employee Engagement in Manufacturing Sector
(Group 1)
Table of Contents
1. Objective of Study 3
2. Overview of Study Procedure 3
3. Background about Employee Engagement 4
4. Factors impacting Employee Engagement and Relative Weights 8
5. Measuring the Scores for each Factor 9
6. Finding from Employee Engagement survey 11
7. Analysis of Engagement Index Results 18
References -: 20
Appendix: 20
Objective of Study
This study focuses on measuring the employee engagement and interpreting the individual factors that impact employee engagement in India. It intends to measure the commitment, involvement, satisfaction and enthusiasm of employees in manufacturing sector towards their work and organization.
Overview of Study Procedure
The study is based on field work done with the help of two questionnaires. Please refer to Appendix A and B for the complete questionnaires. The questionnaires serve following purpose respectively:
Questionnaire A: Determine the relative weights of different factors impacting employee engagement. The method we have used to determine the relative weights for different factors is described in detail in the later part of the report.
Questionnaire B: To measure the score for each question that corresponds to one factor identified in questionnaire A.
Finally, using responses to Questionnaires A & B the Employee engagement index was calculated for the Manufacturing Sector in India. Further, the study also ascertains the Employee engagement index across different categories based on
1) Demographic characteristics
2) Experience in the Industry
3) Experience in the Organization
Background about Employee Engagement
Employee engagement is the level of commitment, involvement, satisfaction & enthusiasm, an employee has towards their work, organization and its values. An engaged employee is aware of business context, and works with colleagues to improve performance within the job for the benefit of the organization by utilizing their natural talents.
The concept of ‘employee engagement’ (EE) is rapidly gaining popularity, use and importance in the workplace. Research and consultancy firms, led by the high-profile Gallup organization, are focusing their efforts increasingly on surveys of employee engagement that aim to improve levels of engagement. This is because corporate results have reportedly demonstrated a strong link between some conceptualizations of engagement, worker performance and business outcomes
While there is much interest in engagement, there is also much confusion. There is no consistency in definition, and engagement has been operationalised and measured in many diverse ways. Engagement may be a global construct as it appears to be a combination of job satisfaction, organizational commitment and intention to stay. Indeed, some argue that engagement is a multidimensional consruct, in that employees could be emotionally, cognitively or physically engaged
However, despite this confusion in the literature, many companies and research firms see engagement as a powerful source of competitive advantage. Corporate results have demonstrated a strong link between some conceptualizations of engagement, worker performance and business outcomes. This is because corporate results have reportedly demonstrated a strong link between some conceptualizations of engagement, worker performance, job satisfaction, employee turnover and business outcomes
Great organizations win business by engaging the complex emotions of employees and customers. EE is ‘the psychology of how each employee connects with customers and with the organization, it is ‘an instant, and constant, competitive edge.
Gallup defines EE as a significant predictor of desirable organizational outcomes such as customer satisfaction, retention, and profitability some of the management literature defines EE as ‘a positive, two-way relationship between employee and their organization’ where ‘both parties are aware of their own and the other’s needs, and support each other to fulfill these needs. Engaged employees and organizations go the extra mile, and both reap mutual benefits.
The organization must work to develop and nurture engagement, which requires a two-way relationship between employer and employee.’ thus employee engagement is a barometer that determines the association of a person with the organization. Thus it is largely the organization’s responsibility to create an environment and culture conducive to this partnership, and a win-win equation.
The business world’s use of employee engagement
The Gallup organization, an international organizational research and consultancy firm with over 70 years’ experience, conducts the most influential business survey of EE and brought EE to the notice of industry. Gallup’s EE scale is based on studies from 1985, and in 1988 gallop patented its 12- item measure of EE, the q12 scale. The international business world’s wide use of Gallup’s EE survey is a major testament to the value that corporations are placing on EE.
Other major research firms have followed Gallup in investigations of EE. ISR, another major international employee research and consulting firm, with over 30 years experience, has also conducted a large scale international EE study.
Developmental dimensions international inc (DDI), another major human resources consultancy, is also conducting engagement surveys. Kenexa, a provider of hr solutions was retained by starwood hotels & resorts worldwide to administer a global employee engagement survey.
Many more international research and consultancy firms are focusing increasingly on conducting engagement surveys. Hewitt associates, the hay group, achieve global and mckinsey & company all conduct EE surveys. Local consultancies are also heavily involved in EE surveys. Australian and New Zealand firms include: corporate vision, employee engagement human synergistic and change drivers. Clearly, the business world is interested in and finding a benefit to the use of EE research and development.
Consultancy firms and corporations have found significant benefits in EE for performance and profit. The Gallup organization found critical links between EE, customer loyalty, business growth and profitability. The Gallup organization cites countless examples in its literature of such results of increased corporate profitability due to increased EE, and is helping a great many companies worldwide to improve their performance through improvement in EE.
The ISR research firm also cites many examples of increased profit after increasing EE for companies. ISR examined the relationship between different levels of EE and corporate financial performance, measured by changes in operating margins and changes in net profit margins. Comparing high-engagement to low-engagement companies over a three-year period, the financial differences were substantial employee engagement ISR has found convincing evidence that organizations can only reach their full potential by emotionally engaging employees and customers
Categories of employee engagement
There are three different type of people in organization based on their level of commitment, involvement & satisfaction.
Engaged--"engaged" employees are builders. They want to know the desired expectations for their role so they can meet and exceed them. They're naturally curious about their company and their place in it. They work with passion and they drive innovation and move their organization forward by performing at high levels.
Not engaged--“not-engaged” employees tend to concentrate on tasks rather than the goals and outcomes they are expected to accomplish. They want to be told what to do just so they can do it and say they have finished. They focus on accomplishing tasks versus achieving an outcome.
Actively disengaged--the "actively disengaged" employees are the "cave dwellers."
They're "consistently against virtually everything." they're not just unhappy at work;
They’re busy acting out their unhappiness. They sow seeds of negativity at every Opportunity.
Importance and advantages of Engaged employees
A highly engaged employee will consistently deliver beyond expectations in the workplace Engaged employees will stay with the company, be an advocate of the company and its products and services, and contribute to bottom line business success. They will normally perform better and are more motivated. There is a significant link between employee engagement and profitability. They form an emotional connection with the company. This impacts their attitude towards the company’s clients, and thereby improves customer satisfaction and service levels it builds passion, commitment and alignment with the organization’s strategies and goals Increases employees’ trust in the organization Creates a sense of loyalty in a competitive environment. A high-energy working environment Boosts business growth makes the employees effective brand ambassadors for the company. Highly engaged employee will consistently deliver beyond expectations. Thus employee engagement is critical to any organization that seeks to retain valued employees. The Watson Wyatt consulting companies has been proved that there is an intrinsic link between employee engagement, customer loyalty, and profitability. As organizations globalize and become more dependent on technology in a virtual working environment, there is a greater need to connect and engage with employees to provide them with an organizational ‘identity.’ These are all good things that prove that engaging and involving employees make good business sense and building shareholder value.
In contrast organizations with least engaged employees are much more likely to have high employee turnover, low customer loyalty, less productivity and earnings. Negative workplace relationships may be a big part of why so many employees are not engaged with their jobs.
Employee engagement also affects the mindset of people. Engaged employees believe that they can make a difference in the organizations they work for. Confidence in the knowledge, skills, and abilities that people possess – in both themselves and others – is a powerful predictor of behavior and subsequent performance. Thus, consider some of the results of the Towers Perrin survey cited earlier:
• Eighty-four percent of highly engaged employees believe they can positively impact the quality of their organization’s products, compared with only 31 percent of the disengaged.
• Seventy-two percent of highly engaged employees believe they can positively affect customer service, versus 27 percent of the disengaged.
• Sixty-eight percent of highly engaged employees believe they can positively impact costs in their job or unit, compared with just 19 percent of the disengaged
Given these data, it is not difficult to understand that companies that do a better job of engaging their employees do outperform their competition. Employee engagement can not only make a real difference, it can set the great organizations apart from the merely good ones.
Factors impacting Employee Engagement and Relative Weights
Employee engagement is a result of Job Satisfaction, Job Involvement, Perceived Organization Support and Organization Commitment. Based on this we felt the below factors could be important Employee Engagement.
1) Work Profile
2) Recognition, Praise and Growth
3) Conducive Work Environment
4) Mentoring and Guidance
5) Empowerment
6) Responsibility
7) Alignment with Organization goals and values
The Questionnaire A is intended to measure the relative weights of above 7 factors. The employees were asked to rank each of these in ascending order of importance from one to seven i.e. a rating of 1 was assigned to most important factor and 7 was assigned to least important factor.
Calculation of Relative Weights
Once the ranking is obtained, the rankings are reversed to obtain to help in calculation i.e. a rank of 1 is assigned a value of 7 and one with a rank of 2 is assigned a value of 6.
Weight for each factor = Summation of ranking given to the factor / Sum of rating given to all the factors
If n is the number of respondents then,
Sum of ratings given to all the factors = (1+2+3+4+5+6+7) X n = 28n
Therefore,
Weight for each factor = Sum of ratings for the factor / 28n
Measuring the Scores for each Factor
The Questionnaire-B is intended to measure the scores for each question which in turn corresponds to one of the above 7 factors. Thus by multiplying the scores from the survey responses in Questionnaire-B with the weights calculated in Questionnaire-A, we found out the index for each of the 7 factors and also the cumulative Employee Engagement Index.
The assignment of each of the 12 questions to 7 factors is given below:
|Factor in Questionnaire A |Questions Assigned from Questionnaire B |
|Work Profile |At work, do you have the opportunity to do what you do best every day?|
|Recognition, Praise and Growth |In the last 1month, have you received recognition or praise for doing |
| |good work? |
| |In the last year, have you had opportunities at work to learn and |
| |grow? |
|Conducive Work Environment |Does your manager, or someone at work, seems to care about you as a |
| |person? |
| |At work, do your opinions seem to count? |
| |Are your associates (fellow employees) committed to doing quality |
| |work? |
| |Do you have a best friend at work? |
|Mentoring and Guidance |Is there someone at work who encourages your development? |
| |In the last six months, has someone at work talked to you about your |
| |progress? |
|Empowerment |Do you have the resources you need to do your work right? |
|Responsibility |Do you know what is expected of you at work? |
|Alignment with Organization goals and values |Does the mission/purpose of your company make you feel your job is |
| |important? |
Employee Engagement is calculated at the following subset levels
1) Demography - We divided the employees into two age groups
a. Between 20 and 30
b. Greater than 30
2) Experience in the Industry
a. Less than 4
b. Between 4 and 10
c. Greater than 10
3) Experience in the Organization
a. Less than 4
b. Between 4 and 15
c. Greater than 15
From the Employee Engagement indices found in each of these categories, the study aims to identify the factors where the industry is performing poorly and which could be worked on.
Finding from Employee Engagement survey
|Employee Engagement – Age wise |
|Factors |Age30 |
|Responsibility |25.54 |23.88 |
|Empowerment |14.61 |14.61 |
|Work Profile |16.78 |22.65 |
|Recognition, Praise and Growth |14.98 |12.86 |
|Conducive Work Environment |11.17 |10.18 |
|Mentoring and Guidance |9.68 |8.82 |
|Alignment with Organization goals and values |7.24 |7.01 |
| | | |
|Total Employee Engagement |62.51 |72.80 |
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|Employee Engagement – Industry Experience wise |
|Factors |Industry ................
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