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Declining Employee Engagement

Podcast with employee engagement specialist, Don MacPherson

 
Don MacPhersonDon MacPherson

In the financial services industry, two-thirds of employees in organizations of more than 10,000 employees are under-engaged or disengaged, according to Modern Survey.

Over the past twelve months, employee engagement has dropped significantly across the U.S. workforce. In March 2010, Modern Survey released the results of a comprehensive study depicting a precipitous decline in the degree to which U.S. workers are psychologically invested in their work. Now, nearly six months later, a new study focused specifically on the financial services industry shows the same trend of declining engagement, only magnified to a startling degree.

Joining Peter Clayton for an Talent Acquisition Channel Podcast on TotalPicture Radio is the president of Modern Survey, Don MacPherson.

Our exclusive interview with Don MacPherson is brought to you by Jobs in Pods. "The only podcast where real employers, real recruiters, and progressive staffing and executive search firms talk about their jobs, and how to get them."

Talking Points

  • Give us some background about Modern Survey (history - services who some of your clients' are, etc).
  • Quoting from your press release... While employee engagement had trended upward in the U.S. financial services sector from 2008 to 2009, over the past year, the industry has experienced a tremendous decline. Most alarmingly, the number of disengaged employees has skyrocketed from 11% of the population in 2009 to 29% in 2010, a statistically significant increase of eighteen percentage points. Don, you would think that would get someones attention at BofA or Citi... has it?
  • How do you go about conducting these surveys? I can't imagine someone from Modern Survey calling up an AVP at pick-your-bank, and having that person say, "yeah, I hate my job, my boss, it totally sucks. I spend my day surfing eFinancial Careers looking for a new job." -- How do you measure engagement?
  • What are the metrics you use?
  • How large is your sample size?
  • What are the key drivers? (e.g., communications, compensation, benefits, work-life balance, management, etc.)
  • Is this all software driven?
  • What is the typical response rate?
  • How do you know the responders taking your surveys are being honest?
  • Are SVPs and VP as disengaged as AVPs and managers? Is there a correlation between income and and level of engagement?
  • How much does staff reductions and the fact that the survivors in these organizations are now expected to do the jobs of about 10 people and work 70 hours a week factor into your statistics?
  • Is there a difference between large financial institutions, and small community banks in terms of engagement?
  • So, extrapolating this further out... one would assume if these employees are that disconnected from their jobs -- the first opportunity they find to jump off the "jolly roger," they're going to take it. How does retention factor into this?
  • We're talking about banks. Let's talk about money. Are you able to come up with a cost? If 29% of you're employees are checked-out most of the time, that must affect the bottom line in a very significant way.
  • How do the banks compare to other comparable industries (e.g., insurance) -- is there something specific that banks seem to be doing more/less of than their brethren to drive their engagement scores down? 
  • There are many studies that show a direct correlation between employee engagement and customer satisfaction and profits. Why don't CEOs act on this?
  • You do these surveys for individual companies? 
  • What happens when you walk into a CEOs office with the head of HR and say, "20% of the people here hate their jobs." What's the reaction? Let me guess, "how much is that costing us?" Am I right?
  • Are companies trying to do anything to address this?
  • I have to think that financial instiuition's aversion and fear of social networks must play into this. What are your thoughts?
  • What are your recommendations to reverse this no-so-happy trend?

Financial Sector Sees Massive Drop in Employee Engagement

Latest Modern Survey Study Shows Decrease in U.S Engagement Magnified in Financial Services Industry

Minneapolis, MN, July 20, 2010

Over the past twelve months, employee engagement has dropped significantly across the U.S. workforce. In March 2010, Modern Survey released the results of a comprehensive study depicting a precipitous decline in the degree to which U.S. workers are psychologically invested in their work. Now, nearly six months later, a new study focused specifically on the financial services industry shows the same trend of declining engagement, only magnified to a startling degree.

While employee engagement had trended upward in the U.S. financial services sector from 2008 to 2009, over the past year, the industry has experienced a tremendous decline. Most alarmingly, the number of disengaged employees has skyrocketed from 11% of the population in 2009 to 29% in 2010, a statistically significant increase of eighteen percentage points.

Modern Survey's Employee Engagement Index uses five questions that gauge the extent to which employees: take pride in their company, believe they have a promising future at their company, recommend their company as a great place to work, go "above and beyond" their normal job duties to help their company succeed, and intend to stay with their company. All five of these items saw steep declines from 2009 to 2010, including twenty-plus percentage point drops in the degree to which employees take pride in their organization, and the degree to which they are willing to put forth extra effort on the job.

Modern Survey President, Don MacPherson, explains, "The pattern we are seeing in the financial services industry is in line with the pattern we have seen for the overall U.S. workforce. But within financial services the declines in engagement are much more dramatic. Worker disengagement is even worse for the largest financial services companies. At companies with over 10,000 employees, two out of every five employees are disengaged. That compares to one in five for the overall U.S. workforce.

"Another disturbing trend we found is that employee "intent to stay" continues to drop. In 2009 it dropped to 62% favorable from 65% favorable the year before. This year it dropped to 55% favorable. Traditionally, the financial services industry has scored well above the U.S. workforce in this category. Now the percentage of financial services workers who intend to stay with their company is slightly below the US workforce. This is an important warning for executives because if employees leave their organizations there will be an incredible amount of damage control necessary to offset the knowledge and relationships that go with the exiting employees."

While there is no doubt that the latest findings present a troubling outlook for the financial services industry, Modern Survey Senior Consultant, Bruce Campbell, sees opportunity for organizations to overcome this trend of declining engagement and ultimately position themselves to succeed.

"Our findings indicate that financial services organizations are vulnerable to potentially devastating loss of talent in the coming months," says Campbell. "Given this, leaders and managers at all levels need to be paying more attention than ever to their employees – particularly their top performers and high potentials. Now is the time for a "high touch" approach to managing people. Invest extra time and effort in getting to better know and understand each employee as an individual – what their interests are, what they value most, their current concerns as well as their hopes for the future. Spending time on personal conversations like this tangibly demonstrates that you care about and value employees as individuals and this is something all employees want to feel and believe, perhaps now more than ever. Make notes about things you learn that can help you tailor the things you do to recognize and reward individual employees so that they have the greatest impact. And to minimize loss of key talent, perhaps the most important thing you can do is to create and communicate compelling, personalized visions of the opportunities for growth and advancement that are likely to become available to them if they continue to perform at their best."

See the full results from this study.

About Modern Survey

Modern Survey has established itself as a leader in the online survey industry, providing a robust suite of proprietary technologies combined with an array of consultative services that help our clients manage talent throughout the employee life cycle, measure and evaluate customer satisfaction and gain insight into changing markets. Modern Survey products and services have spanned 100 countries on six continents in over 30 languages. Through direct and partner channels, Modern Survey's tools and services have reached more than 500 companies, over 85 of which are among the Fortune 500.

About Don MacPherson

As President, Don helps develop the strategic vision and course for Modern Survey. Drawing on 15 years of experience in the field of employee measurement, Don also leads Modern Survey's consulting and employee engagement practices while assisting in the creation of new products and services.

Don's areas of expertise include understanding of employee and customer motivations, development of effective leadership, and creating processes for gathering feedback from transitioning employees. Prior to founding Modern Survey, Don consulted for American Express providing direction and management within the discipline of employee surveys and leadership development. Around the world―from Asia and Australia to the United Kingdom and across the United States―Don has designed and implemented customer, employee, and leadership surveys.

Among a variety of interests, Don volunteers his time to the A Better Chance Foundation and St. Jude's Children's Research Hospital. He is also a longtime, dedicated mentor with Big Brothers Big Sisters. Don's undergraduate studies in Denmark and his stint as a professional basketball player in Germany help him think fast, respond judiciously, and lead his business team to success. He earned his degree in History and Mass Communications from St. Cloud State University.

Peter Clayton

About Peter Clayton

Peter Clayton, Producer/Host, is an award-winning producer/director of radio, television, documentary, video, interactive and Web-based media who has created breakthrough media for a wide array of Fortune 100 clients.

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