Ten Actions You Can Take To Mobilize Your Workforce around Your Business Strategy - Part 2

2. Shaping the Bottom Line

Employee engagement is not just an HR issue. A withdrawal of commitment and engagement impacts employee performance, which in turn has a domino effect on financial performance. There are repeated examples of the impact on earnings and revenue of engagement. For example:

Companies with higher levels of employee engagement have 71% more revenue than their industry peers.

Increasing engagement can add 2-3% to both operating margin and net profit, while lower levels of engagement will erode operating margin and net profit by 1-2%.

These conclusions are not only striking, they are prescriptive. They tell us that if an organization takes action to improve employee engagement, they will most likely improve financial performance. In fact, one body of research even deciphered what we call the 10:6:2 Rule:

Every 10% Increase in Commitment
Yields 6% Increase in Extra Employee Effort
Yields 2% Increase in Company Financial Performance

Increasing employee engagement is a bottom line company performance issue.

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