Mike Emmott from the CIPD, Paul Gollan from the LSE and Stephen Perkins from the University of Bedfordshire once again produced an excellent conference on ‘Getting value out of employee voice’ recently. This unique annual event combined policy input from Nita Clarke at the IPA and Paul Nowak at the TUC, the latest academic research on voice and engagement from the US and UK, and leading case studies from the likes of Capgemini and Eurotunnel.
A number of conclusions can be drawn from this mass of ideas, information and experience.
First, the business case for heavily involving employees at work is stunningly obvious. If you want to improve employee engagement and productivity, boost customer service levels, and avoid industrial action over pension changes, then you need to engage with and listen to your people. As one speaker put it, in this social media, end-of-hierarchy and death-of-deference age, people expect to, and have to be given, a voice. Not just a ‘let-off-steam’ kind of voice but, as John Purcell said, based on his latest research, a genuine voice: sharing important information across a wide range of areas, being treated with respect and trust, being listened to, and able to make a contribution and a difference, so that, as at Capgemini, a joint solution to tricky issues such as pension deficits can be developed and agreed.
Second, though, most organisations and many boards seem to be blind to this realisation. As Vince Cable put it recently, regarding the regulations for employee involvement and consultation, “this potentially powerful mechanism for employees (and employers) has been under-utilised.” I’ll say.
Indeed, while dictators in the Middle East have been having a tough time of late, they seem to be thriving in many of our organisations. Beneath the froth of employee engagement jargon, the levels of employee involvement seem to have been going into reverse. Take, for example, the evidence that:
- joint consultation committees only operate in 14 per cent of workplaces, compared with 20 per cent a decade ago
- pay is set unilaterally by management in 79 per cent of private companies, a figure which has paralleled the massive growth in internal pay differentials
- trade union membership has fallen to a quarter of the labour force
- in the NHS, only 28 per cent of staff thought managers involved them in decision-making, while wider national employee attitude data indicates a 10 per cent decline in those that felt encouraged to put ideas to management, and increases in those reporting intensification of supervision and undue pressure to perform.
No wonder employee engagement levels have also declined. In fact the proportion of employers who survey staff attitudes (37 per cent) may also have gone into reverse, since a number of major companies have postponed their annual surveys this year due to the significant changes they have underway. That’s a bit like companies telling the City that they are not going to produce their annual report and accounts this year as the financials are bad, but they will do so again next year assuming levels of profits recover.
In fact, the reverse should be happening. Speakers cited examples such as Jaguar, where a genuine joint effort to address severe economic difficulties and ‘sharing in the pain’ has underpinned a remarkable recovery, leading to ‘sharing in the gain’, and companies such as John Lewis, with their all-partner profit sharing plan and remarkably open culture.
Employee engagement and involvement have to be much more than superficial statements in the good times if they are to impact on business performance, and HR leaders have to have the guts to point this out to colleagues who as one speaker put it, are liable to be suffering from a ‘bunker mentality’ in response to current business challenges.
At the foundation of Aon Hewitt’s well-used, three-tiered model of employee engagement is that employees have a ‘say’. Only with this can they move on to productively stay with the organisation and strive to deliver the outstanding levels of performance required in today’s hyper-competitive world. Fancy performance management, leadership development programmes or incentive plans will have no impact whatsoever if an employee goes to their manager to suggest improvements but gets told to shut up and get on with their job.
Nita Clarke told us she had been re-reading the original Bullock report, which still contains many lessons for employers today. Published in 1977, in response to the low productivity and awful employee relations climate in the UK, the government-commissioned enquiry concluded: “The more people are able to influence decisions which closely affect their work, the more effective that involvement will be and the greater the commitment to the company’s objectives, which generates wealth or services for the community as a whole.” The ‘industrial democracy’ terminology of the report’s title might seem outdated today, yet is perhaps a more accurate description of what’s now required in many organisations than ‘engagement’.
My conclusion from all of this excellent work on realising the value from ‘voice’ was that without genuinely involving employees and giving them a fairer share of power and wealth, the potential return from engaging your employees to raise organisation performance will never be realised in practice. As Churchill put it, democracy may have many imperfections, but it is better than the alternatives.