“What is this employee engagement? Is it really different from the employee satisfaction that we have been measuring all these years? Isn't it the same old stuff in a sexy new bottle?” The conversation had begun with a call from the Head of HR of an organization who wanted to know if we could help them with an employee satisfaction survey they were planning to conduct. After some initial probing about the needs and situation of the organization, the discussion went into the satisfaction versus engagement issue and his question: If employee engagement was simply a new name for an old concept.
Coming back to the question, employee engagement and employee satisfaction are certainly not the same thing. The look and the fizz are very different.
Employee satisfaction describes whether employees are satisfied and contented and the extent to which their needs and expectations are fulfilled at work. Measuring employee satisfaction enables the management to find out the satisfaction level of the employees and to understand where they should focus to improve satisfaction levels.
Employee engagement, on the other hand, is a positive psychological state characterized by high levels of energy, enthusiasm, passion and involvement in one’s work that lead to superior individual and organizational performance. Engaged employees:
- Think positively about their work and the workplace
- Feel passionate about their work and the organization
- Act with enthusiasm and put their heart into their work
Employee engagement is different from employee satisfaction in that satisfaction is a state of satiation or contentment whereas engagement is a state of activation, characterized by high levels of energy and action orientation. This is perhaps the most important distinction from a manager’s perspective as the implications are not difficult to see. A state of satiation and contentment triggers a homeostatic response – a need to offset any changes in the environment, an attempt to maintain the status quo.
Another important issue for managers is the performance outcome. Does satisfaction lead to higher levels of performance? Are satisfied employees necessarily more productive? Well, that has been the conventional wisdom. Despite the intuitive appeal of satisfaction-performance linkage, recent meta-analytic studies (studies that contrast and combine the results of many different studies to identify common patterns) find only a modest support at best for the satisfaction-performance hypotheses.
Research on employee engagement, on the other hand, shows that a high level of employee engagement is linked with higher levels of individual and organizational performance. Positive business outcomes for the organization include higher sales, higher productivity, higher revenue and better customer satisfaction on one hand and lower employee turnover, lower absenteeism, lower waste and fewer accidents on the other.
Another way of looking at the issue is to look at both sides of the equation. From this perspective:
Satisfaction is an index of: The extent to which employees are getting what they need from the organization.
Engagement reflects: If the organization is getting what it needs from its employees, characterized mainly by focus and intense involvement in one’s work.
At TTMS-PeopleProfit, we recently conducted a large scale, multi-organization employee engagement survey. The 20,000 or so survey participants came from several different organizations spread across different geographies. The findings of the survey, in addition to generating new insights, gave direct data-backed support to some of the notions we have discussed above.
A major case in point is the role that factors such as pay & benefits and job security play in the satisfaction/engagement question. An important part of employee engagement surveys is to conduct what is known as Key Driver Analysis. The analysis uses a statistical process known as regression modeling and tries to answer the question, which ones of the several drivers of employee engagement are more important in terms of their impact on the engagement levels measured. Such analysis helps in prioritising improvement actions and maximizing returns from the resources deployed in improvement efforts.
In this TTMS-PeopleProfit study, we discovered something very interesting. When the key driver analysis was performed for employee satisfaction, compensation & benefits as well as job security came out as high impact factors that drive employee satisfaction. When the same analysis was repeated for employee engagement rather than employee satisfaction, Pay-benefits and job security did not feature among high impact drivers.
Old wine in new bottle or a distinct strategic advantage?