Employee Engagement: If Jack Welch Thinks It’s Worth Measuring…

• Posted on February 29, 2016
• by Lisa Sperow
• in Employee Engagement
• No Comments.

“Employee Engagement: Fluffy Nonsense or Mission Critical?”

That’s the title of a webcast that you can find on the HCI (Human Capital Institute) website, and I love it.

And of course, I know the answer. Employee engagement is not fluffy nonsense at all.

In fact, as Kim Carlson and Heidi Farris (the presenters in the webcast) note, employee engagement is crucial in an organization in order to maximize overall performance.

And employee engagement is not something fluffy, but something that can actually be measured with its own metric in a way that correlates to the achievement of business objectives. Emphasis on the word metric.

By definition, metrics are a “method of measuring something”  …which indicates that there is some type of value assigned to whatever it is we are measuring.

In many companies, however, people talk about employee engagement as though it’s a feeling in the air or the mood of the day. Ask many different employees at a company how engaged they are as a group, and you’ll get a different answer from every person polled.

Managers will say that employee engagement is important to them, and that they are always working on improving their engagement levels. But often, there’s no concrete way to know if improvement is truly being made.

It’s one of the most cliched lines in business, but… you know it’s said so often for a reason.

You can’t manage what you don’t measure.

(I know. Don’t we all groan and roll our eyes just a bit every time we hear that?! But still.. we’re often busted by it!)

Jack Welch was one of the world’s most respected and celebrated CEO’s ever. During his tenure at GE, the company’s value rose over 4000%.  He had an unmatched track record of success. As such, Jack was quite a busy guy. He was under pressure to manage people and business units all over the world, and he was held accountable for all kinds of metrics.

And guess what? He didn’t think employee engagement was a fluffy metric, either. He actually thought it was one of the most important of all of them!

According to Jack Welch, “There are only three measurements that tell you nearly everything you need to know about your organization’s overall performance: employee engagement, customer satisfaction, and cash flow.”

In an interview with the Kansas City Business Journal, he elaborated on each:

“First and foremost is employee engagement. How do employees feel about their jobs, where they’re going, and do they like the work? Are they proud of what they do?

“Secondly is customer satisfaction. You don’t have a business without customers, but you’ve got to have employee engagement first.

“The third is cash flow. If you’ve got the first two right, you’ll get the cash flow. If you don’t, you won’t. It’s really that simple.”

It really is that simple. Engaged employees are the key to so many positive business outcomes: increased customer satisfaction, improved productivity, increased profits, decreased turnover, decreased absenteeism… I could go on.

Everyone says they want to increase employee engagement at their companies, but not everyone takes the time to actually measure it and develop a strategy for improvement and continued measurement.

But if Jack Welch thinks it’s worth measuring…. don’t you?

Want to start measuring – and managing – employee engagement at your company? Contact LEGEND Talent Management to learn more about how we can develop a strategy for you!