Since the early 2000s, more and more companies are investing in employee engagement — and for good reason. According to Gallup research, businesses with higher engagement actually report increased profitability, higher productivity, and better employee retention. On the other hand, disengaged employees who don’t feel connected or appropriately challenged at work are more likely to take part in the new phenomenon known as “quiet quitting,” or doing the bare minimum at work. You can see why it’s in your business’s best interest to improve engagement.
But employee engagement is shaped by a wide variety of experiences an individual has with your organization. Everything from your new hire onboarding process to your company culture to the type of coffee you serve in the office can positively or negatively influence an employee’s level of engagement.
While the sheer number of factors influencing engagement can seem daunting, there are a few elements that play a larger role than others. Based on data from our 3,500+ customers, Lattice has developed a deep understanding of what the key drivers of employee engagement are so companies can know where to focus their efforts to have the largest impact on their work environment.
Read on for some of the most interesting finds from our research, as well as advice on how to best leverage these insights within your own organization if you’re a Human Resources professional or People manager.
11 Drivers of Workplace Engagement
1. Setting clear, quantifiable, and achievable goals drives engagement.
Effective goals can have a lasting impact on engagement. When your employees understand the criteria against which their performance will be evaluated, they’ll know what they need to do to be successful in their roles. That clarity and understanding can help boost employee confidence, drive job satisfaction, and ultimately increase engagement. In fact, we’ve found that an employee’s understanding of how their success will be measured with clear goals directly correlates to higher engagement.
But ineffective or overly ambitious goals can actually have the opposite effect, leaving employees demotivated and disengaged. In order to raise engagement, employee goals need to be clear, quantifiable, and achievable — while still motivating employees to do their best. That’s why, when setting objectives and key results (OKRs), the key results are just as important as the objective; having two to five detailed, tactical, and measurable key results to work toward gives employees a deeper understanding of how their success will be measured.
Our data also showed that employees who set individual goals more frequently have higher engagement scores than those who set them less frequently. We recommend working with your employees to set goals quarterly at the minimum, as this can help keep goals relevant and easier to measure.
2. Direct reports who meet anywhere from weekly to quarterly with their manager to discuss goals are the most likely to be highly engaged.
Goal-setting is only half of the equation. To ensure goals remain top-of-mind throughout the entire quarter, managers should frequently meet with their direct reports to discuss goal progress, relevancy, and any roadblocks that need to be addressed. We found that employees who discuss goals with their managers anywhere from weekly to quarterly are the most likely to be highly engaged. Having conversations any less frequently than quarterly is less desirable from an engagement standpoint.
3. Alignment with managers makes employees more likely to be confident in their ability to achieve their goals.
These regular discussions drive alignment between managers and their direct reports. In addition to this alignment correlating with higher engagement, we also found that individuals who strongly believe they are on the same page as their manager are also more likely to be confident in their ability to achieve their goals. Managers should be sure to explicitly discuss goal progress, road blocks, and strategy during weekly one-on-ones or ongoing check-ins. This helps improve alignment and even drive higher productivity by removing obstacles hindering employee progress.
4. Engaged employees have a deeper understanding of company goals.
In addition to knowing their individual goals, employees must also be familiar with the larger organizational goals to feel connected to the company’s mission. In fact, understanding company goals is critical to engagement. Explicitly communicating company goals helps employees better understand your organization’s vision and their role in helping to achieve it. It can also increase alignment, give employees purpose, improve motivation, and even boost productivity when employees know how their actions connect back to the overall company strategy. Don’t keep your employees in the dark — when they understand where the company is going they can be more confident in the organization’s success and the part they play in contributing to it.
5. Conducting employee performance conversations quarterly drives engagement.
While performance reviews often get a bad rap, when done well, they can positively impact employee engagement. Most employees want to know how they’re doing, where they can improve, and how they can grow their careers within the organization. These conversations give them those answers and a clear understanding of the steps they need to take to progress.
Quarterly performance reviews have the largest impact on employee engagement, while semi-annual and annual reviews have a moderate and lower impact, respectively. Depending on your HR team’s available resources and manager buy-in, more frequent reviews might not be realistic for your company, so simply run reviews as frequently as your business dynamics allow.
There are many ways performance reviews can boost engagement. Read our article 9 Performance Review Statistics HR Leaders Should Know for even more data and insights into how to create employee-centric reviews.
6. Frequent career development conversations can improve employee experience.
While professional development conversations often go hand-in-hand with performance reviews, according to employees, “the more often, the better” when it comes to conducting career growth conversations. We’ve found that managers who discuss career growth with direct reports anywhere between weekly and annually tend to have higher engagement than those who don’t.
HR professionals, take note — many managers shy away from these conversations if they don’t know the development opportunities and growth resources your company offers. Make sure you educate managers on all of your available resources and internal growth opportunities to ensure they can have meaningful career conversations with their direct reports. You might also want to remind them to add “growth opportunities” as a recurring item on their one-on-one agendas so development is always top-of-mind.
7. Fair and transparent compensation improves engagement.
Tying compensation to performance can be a lever for improving engagement. Lattice data found that employees who understand their compensation is tied to their performance were more likely to be engaged and believe they are paid fairly. Still, employees can’t know how compensation is calculated at your organization unless you tell them. Transparency matters, so be sure to prioritize communication and transparency throughout your compensation process.
8. Sharing employee engagement survey results at the organizational and managerial levels fosters engagement.
When running an employee engagement survey, don’t keep the results to yourself. There is a direct and meaningful correlation between presenting engagement survey results to your employees and their overall engagement. HR leaders should always make a point of reviewing qualitative and quantitative results with employees promptly after the close of a survey. This ensures that employees feel they are playing a part in improving your workplace and allows them to hear the feedback other employees shared on the survey. Employees have much to gain from workplace improvements, so it only makes sense to include them throughout the survey process.
Reviewing results shouldn’t just occur at the organizational level. The same correlation can be found when managers take the time to review these insights with their team members. In fact, we’ve found a marked difference between engagement levels of managers who review engagement results with their teams and those who don’t.
9. Taking action on survey results improves employee engagement.
After analyzing engagement survey data, your organization’s leadership and managers should have a clear understanding of what actions need to be taken to improve the workplace experience. Both leadership and managers should share detailed plans of how your company intends to address employee feedback and survey findings.
Presenting these results can drive engagement, but only if you take action like you say you will. Our data showed that taking action drives engagement more than just presenting or discussing results. So you’ll need to update your employees on what employee engagement initiatives you’re launching based on your learnings. For example, if your survey revealed that many employees are feeling burnt out, you could launch new mental health or well-being offerings to help alleviate burnout, or allow remote work two to three days a week. Then, be sure to clearly communicate these plans with your workforce.
We also found that taking action is slightly more important at the company level than the manager level, so hold your business accountable and show employees you’re serious about improving life at your company.
10. Receiving recognition for good work is positively correlated with engagement.
Everyone deserves to be acknowledged and rewarded when they do a good job. Whether that’s with a promotion, raise, bonus, or even public recognition, regularly celebrating your employees’ hard work can be a major morale booster. In fact, receiving recognition for good work is positively correlated with higher engagement.
To that end, make sure your business has multiple ways to celebrate and honor your employees’ many contributions, whether that’s by sharing positive feedback privately in one-on-ones, or publicly with employee recognition software or a “praise wall,” a physical or virtual location (like a bulletin board in the office or a Slack channel) where employees can recognize their colleagues’ exceptional work.
There are many ways to recognize and reward your employees, so feel free to choose the ones that are best suited for your business. Whatever you pick, the goal is to help your employees feel both seen and appreciated by their peers, supervisors, and the organization at large. Building a culture of recognition can not only help improve engagement, but can also increase employee retention and help bring your company values to life.
11. Engagement flourishes in a culture that supports employee autonomy and well-being.
Most employees want the trust and autonomy to do their jobs as they best see fit. Unfortunately, micro-managers and inflexible processes can hinder this, frustrating employees and pushing them to seek this freedom elsewhere — by leaving for a different company. Our data showed that when managers are able to give their direct reports the autonomy they crave, engagement flourishes for both employees and managers.
In addition to autonomy, today’s employees also want to be able to be their authentic selves at work. We found that investing in psychological safety and mental health resources for your employees is actually smart for your business. Our data revealed that direct reports having the emotional resources (like support and positive workplace relationships) they need to do their job is more predictive of engagement than having physical resources (like computer software). Be sure to ask questions in your engagement surveys about company culture, employee well-being, and workplace experience so you can learn what’s needed to build a workplace where everyone feels welcome and happy.
Knowing where to focus your efforts is the key to creating an effective employee engagement strategy. Our data found that clear employee goals, compensation transparency, performance reviews, career development, and engagement surveys are the top drivers of engagement in today’s workplace.
That said, many businesses are struggling to connect with employees and foster engagement in a hybrid work environment. To assist with this formidable challenge, we’ve created a new eBook, Driving Engagement and Retention in the Hybrid Workplace. If you’re looking for help navigating the new world of work and building an engaged workforce, download this guide now for actionable ways to increase engagement and performance — no matter where your employees are located.