There is no doubt about it. Culture and employee engagement are both vitally important for an organization. They are both concerned with attracting and retaining talent, so they are closely linked. But, like two sides of the same coin, they are also significantly different.
Have you ever wondered why one company is able to hire great people, drive innovation, and continuously grow while others lurch from one re-organization to another? The answer is culture.
Culture describes the way an organization works in practice, despite what the organization chart or mission statement say. And it’s vitally important.
According to Global Human Capital Trends 2016, Culture and Engagement (Deloitte University Press), “employees value ‘culture’ and ‘career growth’ at almost twice the rate at which they value ‘compensation and benefits’ when selecting an employer.”
Culture directly impacts organizational performance, and HR leaders recognize it, reports Deloitte. Fully 82% believe that culture is a competitive advantage and, in 2016, 50% are attempting to change their culture in response to shifting talent markets and increased competition.
So it’s a huge surprise that fewer than 12% of companies believe they truly understand their culture. In this environment, HR has a golden opportunity to step in and become the culture champion CEOs need.
In this role, HR can help the organization understand its existing and desired cultural values, develop plans to make the necessary changes, and monitor and measure progress.
If culture describes the way an organization works, engagement describes how employees feel about the way things are done. And it’s just as important as culture – 98% of executives in the Deloitte report rated engagement as an important or very important priority for their companies.
Why is it so important? In the current employment landscape, competition is fierce for talented individuals. They will naturally gravitate to companies that are great places to work. And it’s not difficult for them to find out which companies those are.
A second reason engagement is such a priority is the diversity of today’s workforce. Companies can have up to five generations of employees working for them, a wide-ranging mix of genders, races, cultures, and sexual orientations. Plus, they may have a mixture of full-time, part-time, and contractual workers. Each of these groups will have its own motivations and aspirations.
Fostering engagement in this environment requires a new way of thinking. According to the Deloitte report, traditional definitions of engagement “… need to be expanded to include five key elements that drive engagement: meaningful work, hands-on management, a positive work environment, opportunities for growth, and trust in organizational leadership.”
Engagement also needs to be measured. Not once a year, but by continuously listening to employee feedback, trying new approaches, and actively addressing operational problems.
Fortunately, a new generation of open, anonymous feedback systems is available that allows employees to rate all aspects of their working environment, giving leaders the critical insights they need to drive meaning, purpose, and passion among their workers.
Culture and engagement are clearly related. Having the right culture attracts people who feel comfortable with it, producing a high level of engagement. On the other side of the coin, programs to improve engagement often uncover cultural issues that need to be addressed.
Creating an organization that attracts, retains, and nurtures the best talent requires CEOs and HR departments to focus closely on both.
Discover the results of Deloitte research into how culture and engagement impact business performance.
- Download the Deloitte Global Trends 2016 Culture and Engagement report (registration required).
- Watch the research-based Deloitte ‘The New Organization: Different by Design’ on-demand webinar (registration required).
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