An employee engagement program is a critical component of the Human Resource’s yearly strategic plan. Large organisations such as Cisco have their entire employee engagement planned out for every day of the year. This article structures the step-by-step process of designing an annual Employee Engagement Plan using the Strategic Management framework.
Designing an Employee Engagement Plan
Step 1: Scan the Internal Environment of the Organisation
Scanning the internal environment constitutes studying the various ways the organisation’s employees, management, stakeholders, business strategy, culture, resources and capabilities engage with each other.
For instance, what are the different employee touch points that the leadership have with the employees? What are the different productivity tools used in the organization? How does the organization implement a business strategy? What are the various employment benefits offered? How often are outreach programs conducted by the leadership team?
HR needs to not only frame these questions that are unique to their organisation, but also self-evaluate the organisation on how well they fare in each of these interactions.
The tools that can be used to conduct this study are:
- Group discussions
- Employee/ Stakeholder Interviews
- Employee surveys
- Resource data
- Performance reviews
Expected outcome of this step: Strengths and Weaknesses of the organisation’s current engagement program.
Step 2: Scan the External Environment of the Organisation
The external environment of an organisation consists of the competitive, economic, political, sociocultural and technological landscape of the market the organisation is working in.
These are important to be taken into consideration in framing an annual engagement program. These affect the effectiveness of all strategic initiatives.
Abhijit Bhaduri, author of the best seller ‘The Digital Tsunami’ mentions how technology trends like Augmented Reality and Holography can be effectively used in job simulation and employee experience. Thus having a careful watch on changing competitive benchmarks, industry trends, etc., prove useful to reinvent a program to create an engaged employee.
The following tools can be used to conduct this scan:
- Market research
- Competitor Analysis
- Trend Analysis
Expected outcome of this step: Opportunities and Threats of the (HR) organisation
Formulating the Strategies
Step 3: Setting Organization’s Employee engagement objectives
The process of goal setting typically constitutes defining objectives that the organisation wants to achieve in their people front – their culture, human capital, their people policies, etc. Strengths, Weaknesses, Opportunities and Threats can be a context to determine the objectives.
For example, an assumption such as - ‘Our competitors use employee referrals as a strong source to recruit their talent. Referral employees tend to be the best and the most retained talent in the industry,’ is a threat that could lead an organisation to consider ‘Improving employee referrals’ to be their HR goal.
The S.M.A.R.T. methodology is predominantly used and is famously known for its ability to guide and help achieve goals. It draws the following guidelines.
For example, a goal like ‘Improving the employee referrals of the company’ needs to be:
- Specific, for example, ‘We aim to improve our employee referrals.’
- Measurable, for example, ‘We aim to improve our employee referral %age from X to Y.’
- Achievable, for example, ‘We already are at X, thus achieving Y should be practical.’
- Relevant, for example, ‘Employee referrals are a double-edged sword that helps recruit new employees and that also indirectly indicates the employee Net Promoter Scores.’
- Timely, for example, ‘This increase in employee referrals needs to be within this financial year.’
Expected outcome of this step: A timeline and a priority list of SMART goals.
Step 4: Gap Analysis
After setting the objectives, the next step is identifying the status quo of the variables and recognising the distance that needs to be covered to achieve the planned goals.
This can be done using various tools, but a Fishbone (Ishikawa)analysis is a pretty simple and effective tool to drill down on the exact issues that need to be tackled to achieve these goals. The following is a snapshot of how Fishbone analysis (Lean Six Sigma) is done.
- Organise a cross-functional focus group.
- Allow them to identify the root causes (gaps) that affect achieving a prescribed goal.
- The root causes (gaps) can be categorised under ‘People’, ‘Processes’, ‘Policies’, etc., and further drilled down.
- Root cause analysis recommends understanding up to 5 levels of ‘Why’s of every cause to derive the exact root cause.
- List out the final list of root causes (Gaps).
For example, a fish bone analysis of ‘Employee referral’ might bring out root causes such as ‘Pay inequities’, ‘Lack of employee insurance’, ‘insufficient employee feedback mechanisms’, etc.
Expected outcome of this step: Qualitative /Quantitative Gaps in the existing process
Step 5: Choice of Strategy
Once the exact gaps in the process are listed, these need to be prioritised to execute. There generally are a number of paths to achieve goals, thus, selecting the right strategy (or a gap to tackle) is a critical component of execution.
The fishbone analysis further allows screening and prioritising these gaps using the following method:
Against each of the final list of root causes, evaluate the following:
- How does solving this gap impact the achievement of the goals? (Impact)) (Rate this on a scale of 1: signifying low impact to 10: signifying high impact)
- How financially feasible/ easy is it to work on solving this gap? (Ease) (Rate this on a scale of 1: very difficult to 10: very easy)
- Calculate the [Impact + Ease] value and tabulate it against the respective root cause
- Order the list of root causes (gaps) in decreasing order of the sum (A Pareto chart)
For example, a gap such as ‘Pay inequalities’ has low ease (because of the high cost involved) and a high impact, whereas ‘Insufficient employee feedback mechanisms’ has high ease (because the cost of implementation is low) but has a moderate impact. Depending on financial feasibilities and business priorities, leaders should further choose to tackle apt strategies.
Expected outcome of this step: An employee engagement program - the list of all the strategies that aim to address the top priority gaps.
Implementing the Program
Step 6: Creating the team
The team that leads the implementation of employee engagement is important for its success. Depending upon the expertise a particular strategy requires - the team needs to have members who can contribute to it.
For example, a ‘Creating a robust employee feedback mechanism’ strategy requires questionnaire design experts, technology experts (if automation is required) and HR experts (to lead and implement the strategy - in a way that increases engagement.).
Expected outcome of this step: List of team members and their roles in each of the high priority strategies.
Evaluating the Program
Step 7: Measurement of performance
The 'measurability' aspect of the SMART goals provides metrics to be watched to evaluate the impact of the strategies to achieve goals.
For example, for the goal ‘Increasing employee referrals from X to Y’ - the actual percentage of employee referrals out of the total recruitment is the metric to be watched.
Expected outcome of this step: Value of the Metric used for measuring employee engagement.
Step 8: Analysing Variance
The variance between actual and standard performance needs to be calculated to find a further gap in implementation.
For example, if the strategies did not allow achieving an expected Y% employee referrals within the stipulated time, these need to be re-evaluated and reconsidered.
Expected outcome of this step: Variance of the Metric measured (= Planned metric value – Actual achieved metric value)
Step 9: Taking Corrective Action
Re-evaluation of strategies should follow the entire flow of setting goals and selecting strategies (From Step 1 through 9). The reason why a strategy is ineffective or a goal is not being achieved could be because of a wrong assumption throughout the course of planning a strategy.
For example, the reason why the goal ‘Improving the employee referrals of the company’ is not being achieved could be because of the following few of the many other plausible reasons.
- The target to be achieved was assumed wrong - 'Y' was too high a target.
- The timeline is too short.
- The fishbone analysis missed out a major determinant, for example, ‘Referral rewards for the referring employees'.
- Miscalculation in the impact analysis. For example, the impact of ‘Pay inequities’ were lower than assumed.
- The team did not have an important skill required for implementation. For example, say questionnaire design in employee feedback implementation.
Expected outcome of this step: Identifying the wrong assumptions, correcting it and reinitiating the strategy