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Employee Engagement – Return on Investment

Each year corporations spend millions of dollars on various forms of professional development and the seemingly never ending debate ensues in terms of, what is the return on investment? For a long time this has always been difficult to determine because the benefits are not obviously tangible and most often cannot be expressed in financial terms. I suppose it’s akin to putting people “our most important asset” on the balance sheet. Alas that hasn’t happened yet either.

So in the absence of any financial accounting mechanisms employee engagement surveys have emerged as an objective basis to assessing the human contribution. Given that engaged employees equate to reduced turnover, innovative contributions, improved efficiencies, etc, can one assume that if some form of professional development improves engagement scores then that supports a credible return on investment?

Gallup, Hewitt and Genos have become well known in the service and support of Employee Engagement Surveys. What’s really interesting is that you can ask people to answer between 8 (Genos) and 12 (Gallup) questions and from this very reasonably assess what the level of engagement is in a particular organization. In fact to put in perspective, research has shown that if you Emotional Intelligence trainingeven have 60% of the population “engaged” it is described as the ‘tipping point’, where there is a critical mass of engaged employees positively impacting the performance and culture of the business. So this is not about chasing the ultimate and unrealistic utopia of 100% engagement. If you can get a reasonable majority engaged, this can feed into, and perpetuate a significant improvement to the business.

Some models like the Genos approach goes one “big” step beyond this in terms of getting into the organization and accumulating data at a granular and action oriented level to identify what are the contributing factors. This inevitably leads to questions around selection, leadership and ultimately professional development. When organization approach training from this angle, i.e. a clearly defined need, the investment in training will be much more forthcoming.

About Bill Sex

Bill Sex is President of New England Coaching and specializes in supporting personal, professional and organizational advancement with specific emphasis on coaching skills, emotional intelligence and employee engagement / motivation.

One Response

Comment from Bill Anton
Time: February 14, 2012, 8:51 am

These are good indices of measuring what is with some links to how engagement relates to outcomes. I am interested in how to create engagement as well as measure it. In my experience, CEO self-knowledge is a necessary but not sufficient condition for doing this.

William D. Anton, Ph.D.
Psychologist, Psychoanalyst and CEO Coach

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