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“I don’t need to engage my employees, we’re not like an MNC (multi-national company).”

“I already pay my staff, give them a job, now you tell me I still need to make them happy?”

“We don’t really have formal processes in place, or any real data on it, but we know our people are already very happy.”

“We don’t really have budget for employee welfare.”

When asked about employee engagement, many leaders and HR professionals in SMEs give similar responses to those above.

Small and Medium Enterprises (SMEs) make up 99% of Singapore’s enterprises, employ ⅔ of our workforce, and account for half of Singapore’s GDP.

This means that of the 3.6M working in Singapore, about 2.4M are currently working in an SME. Research shows that Singapore has one of the lowest employee engagement rates in Asia, standing at only 59%.

Mathematically, that suggests that there are close to 1 million employees in Singapore who are ‘zombie workers’, “people who are physically present at the office, but mentally absent or “checked out” as they go about work.” Chances are, some of these are in your company today.

No wonder then, that our workers have been found to be the least productive within 11 countries studied too.

 

So what exactly is employee engagement?

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Engagement is an abstract concept and there are many definitions of employee engagement floating around out there, but they all centre around two factors — emotional connection and performance. This article wasn’t written to bore you with the academic jargon.

Simply put, it’s the extent to which employees are motivated and productive at work.

 

Why should an SME care about engagement?

 

Overall, a global report has found four relevant reasons why SMEs should care about engaging their employees.

 

1. Keep your best people

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Compared with disengaged teams, engaged teams are 24% to 59% more likely to keep their best people. In SMEs, it is hard enough to convince good talent to join – the employee value proposition is much harder to compete against larger MNCs who may be able to pay more and offer better perks on the job.

Once good talent has joined your company, it makes a lot of sense to keep them for as long as you can, instead of having an unintended ‘revolving door’ policy!

 

2. Make more money

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Engaged teams were found to be 21% more profitable than disengaged teams. This means that if your staff are engaged, for every dollar made by a disengaged competitor, you are making $1.21, keeping everything else constant. For the same number and quality of staff, you would make more money than your competitors by having more engaged employees. At almost no extra cost.

If that is not a good enough reason to engage your employees, here’s another one…

 

3. Your customers would love you more

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Engaging your teams would delight your customers more. In many industries, the main interface with our customers is still our employees at the front line. It makes a big difference whether they feel connected with your company and mission, and the product or service they’re selling.

The research shows that happy employees do lead to happier customers. More engaged teams are 20% more productive and get 10% higher customer ratings than their disengaged counterparts. Bottom line is, you risk losing customers by not making the effort to engage your staff.

 

4. Your team actually shows up at work

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Ever felt the need to control the number of MCs (medical certificates) taken by your staff? Or wonder why you have had so many cases of staff going AWOL or taking last minute urgent leave? All of these are just symptoms of a bigger problem, and will continue plaguing you unless you control the primary reason this happens.

Fundamental disengagement is rampant, especially in SMEs where you find many such cases. Interestingly, the study shows that engaged teams actually have 41% less absenteeism, because employees feel that by not showing up they are actually letting their team and, yes, even their boss down.

 

Don’t get this wrong!

 

More than 80% of the SME leaders (and for that matter even MNC leaders) we’ve encountered have gotten this fundamental concept wrong.

And it’s not their fault.

Time and again we are led to believe that if we pay people more, they will work harder, stay longer, and be happier at work.

Even for those of us who know intellectually that is wrong, we still can’t shake the nagging thought that maybe, just maybe, we are mistaken. And just in case we are, maybe if we want better people, we need to do a fresh salary benchmarking exercise.

But conclusive research from Professor Dan Ariely at Duke University indicates that such extrinsic motivators are not only ineffective, but can also be counterproductive. Employee engagement and pay have no correlation.

Zero.

Incidentally, that’s great news for SMEs who have no or very very tight employee engagement budgets!

 

The 5 simple steps to take to get started, even if you’ve never run an engagement programme before

 

1. Removing communication blocks:

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It’s all about communication, communication and communication. If you can’t communicate effectively with your team members, colleagues and managers, engagement won’t happen. Be vocal and express yourself – that’s the only way to let others know how you feel and what you need.

Two of the main areas of communication breakdown are when setting clear expectations of what’s required at work, and when giving recognition when leaders observe good work.

If you manage people, it is worth spending some time thinking about how goals are communicated and reinforced regularly. Simon Sinek’s influential TED Talk about Starting with Why in these communications has been viewed more than 39 MILLION times.

Secondly…

 

2. Pile on the recognition:

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If you want people to give you their very best, then make sure you give them the reward and recognition that they deserve. Even if you feel it is something not hugely significant, it doesn’t cost anything to give a word of praise. Position people in tasks/roles that make the best of their strengths, instead of focusing on pointing out weaknesses – no one appreciates having their noses rubbed in their mistakes all the time.

One of the things we’ve observed about managers is that their lives are so busy that it’s hard to notice when things go right or as expected. Our attention is inevitably drawn to the times when things don’t work, and we need to find corrective actions or diagnose errant behaviour.

However, the return on investment of being acutely aware of good work, and rewarding it, has been found to be a highly effective way to make sure that quality of work happens again. Staying this course, and giving recognition in the right way, will keep your teams both happy and productive.

 

3. Make sure to provide lots of training and development:

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Everyone wants to learn and develop their skills in their profession, no matter what it is. Training and development gives employees the tools they need to go above and beyond in their work, and makes them feel valued.

Daniel Pink writes in Drive: The Surprising Truth About What Motivates Us that one of the most important factors of motivation at work is a sense of mastery at what we do.

Targeted training and development, towards each individual’s professional development goals, is one way to give a sense of growth and progress within a career, even without formal promotions / pay raises.

Importantly, the 70-20-10 principle should be noted: for effective development, 70% should come from on-the-job learning, 20% from active coaching and mentoring, and only 10% from formal classroom / structured learning.

This is important because SMEs often think that training is expensive, not to mention the huge opportunity cost from taking staff out of their workday. The above principle suggests that such costs only need to be incurred 10% of the time – and even then, not all structured training is or should be delivered externally. Internal experts are probably more qualified to be able to impart such knowledge.

Far more important is helping managers and leaders understand how their leadership roles involve getting the job done, but also growing their team to do the job better over time. This will put them in the right mindset to be constantly helping improve the capabilities and skills of those working with them.

 

4. Understand there are many roads that lead to Rome:

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Gallup says remote workers log an average of four more hours per week than their on-site counterparts. These workers are slightly more engaged (32%) than employees who work on-site (28%), it found. Of course, there are jobs that require strict schedules so one can’t expect blanket flexibility on this front. But a little flexibility can go a long way in making employees feel valued and increasing their sense of autonomy.

Autonomy also happens to be another important factor in motivation at work identified in Daniel Pink’s book. The ability to choose how to leverage one’s own strengths to achieve a given result is immensely empowering.

More importantly, it also gives the individual a stake in the final outcome. Each team member is invested in a successful outcome, because the plan to get there was in part developed by them.

The opposite is the idea of ‘learned helplessness’, a phenomenon popularised by Martin Seligman where just by continually finding that you can’t do anything to affect or improve your outcome, you are at a higher risk of depression.

Again, the cost of implementing this? Zero.

 

5. What gets measured, gets done:

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Peter Drucker’s maxim of implementing the right kinds of management tools which can help you navigate important metrics applies even more so in the intangible arena of employee engagement.

Thankfully, there are many low cost and easy to implement tools to measure the employee experience, including employee engagement and effectiveness. Survey apps are an awesome way to check-in casually on a regular basis to see where an employee stands and what you, as a manager or colleague, can do to help develop this person’s career.

Addressing concerns and problems before they erupt into serious issues will ultimately help create a stronger bond between team leaders and employees. This will naturally aid in cultivating a positive corporate culture of strong peer relationships, managerial support and an engaged work experience.

 

Get Started – Today

 

Employee engagement is an intangible phenomenon with very tangible results. Fortunately, this is one performance lever that is available to SMEs without costing an arm and a leg. In fact, as an SME this is one area where you are likely to have an advantage over larger companies, simply because your team is smaller and people are more likely to know and care for each other.

So what are you waiting for? Use any (or all) of these 5 tips to start making your SME a talent magnet and build a lasting competitive advantage to outperform your competitors. Not tomorrow, not next week…today.

If you need help thinking about how to use technology and government funding to support your programmes, feel free to email me at [email protected], my team and I would be able to walk you through a complimentary strategy planning and best practice sharing session.

 

CheeTung is the CEO of EngageRocket, an HR tech startup that helps to automate employee feedback and analytics to deliver management insight, improving employee experience and performance. Before becoming an entrepreneur, he was Regional Director of Gallup in Southeast Asia. He read Economics at the University of Cambridge, and has an MA in Political Science from Columbia University under the Singapore Armed Forces Overseas Scholarship (SAFOS).