Home / News / How employee engagement affects your bottom line

How employee engagement affects your bottom line


(nd3000 / Depositphotos.com)

(nd3000 / Depositphotos.com)

Successful companies know that customer engagement is mission-critical. The most successful companies engage not just their customers, but also their employees. When the heart and soul of your business is engaged, you’re in position to innovate, deliver exceptional customer service, and minimize waste.

Let’s begin by examining how employee engagement affects your company’s success.

Employee Retention

We all know how difficult it can be to attract and retain great employees. The search and onboarding process can be costly. Some research places that figure as high as 50 to 60 percent of an employee’s annual salary. That figure doesn’t include the cost of orientation, training and reduced productivity during the first few months. When all costs associated with turnover are taken into account, the cost can skyrocket up to 200 percent, according to a Gallup study.

Since employees who don’t feel engaged are far more likely to leave their job than employees who are highly engaged, it becomes clear that in employee engagement makes sense.


There’s no doubt that engaged staff will result in better productivity. In a comprehensive analysis of the results of 199 research studies that covered 152 companies from 26 countries, a significant difference was found between entities with the top 25 percent on the engagement scale versus those in the bottom 25 percent of the scale. Those with lower levels of engagement experienced an 18 percent drop in productivity compared with those on the higher end of the scale. Additionally, they saw a 60 percent reduction in quality, as measured by defects in products.

Customer Engagement

Improved employee engagement naturally leads to better customer engagement. No matter what department an employee works in, if they are engaged, they’re more likely to be knowledgeable about your processes, products, and services. Furthermore, they’re more likely to be interested and invested in helping to meet the needs of customers while solving their problems. When you look at it that way, it’s easy to see why employee-centric employers are also known to be customercentric. As Sir Richard Branson famously said, “Clients don’t come first. Employees come first. If you take care of your employees, they will take care of the clients.”

“One group we worked with found that by increasing employee engagement year-over-year, they were able to increase their market share in retail sales by almost 70 percent,” shared CEO Jeff Tobaben of Evolve Performance Group, a consulting firm in Bryan, Texas. He went on to say that among their competitors with declining employee engagement were also “losing market share.”

Other Contributors to the Bottom Line

It probably goes without saying that less engaged employees are more likely to miss work than those who are fully engaged. But are you aware of just how much of a difference it can make? In their own meta-analysis using data from 263 research studies, In an article published in the Journal of Applied Psychology, Gallup found that business units with highly engaged employees had a 37 percent lower rate of absenteeism than those with less engaged employees.

The same study reveals improved engagement also resulted in 48 percent fewer safety incidents and 28 percent less shrinkage.

Of course, understanding that better employee engagement is valuable isn’t enough to boost your bottom line. You need an action plan to find out if engagement really is an issue in your organization and to determine where the gaps may exist.

If improving employee engagement is becoming a priority for you as a means to improve the organization’s overall performance, reach out to us by visiting http://bit.ly/2C9SWfI to find out more and to discover some great workplace improvement ideas.


Actively engaged employees are the foundation of successful organizations

Get actionable tips on how to improve employee engagement

“The Ultimate Guide to Improving Employee Engagement” was created with managers in mind. If your goal is to increase employee engagement, get started by using the tips and best practices from Best Employee Surveys. This practical guide is based on data collected from some of the world’s leading organizations, particularly those that have earned the sought-after designation of being among the Best Places to Work.

Download the guide:




Check Also

(Rawpixel / Depositphotos.com)

Traditional marketing still relevant in digital era

Bill Gates once wrote in a 1999 book, “The Internet is becoming the town square for the global village of tomorrow.” The internet has only become more dominant since then. Businesses now have a dizzying array of choices to consider ...