In today’s highly competitive talent market, employee engagement has become a critical lever to managing retention. It has been well recorded that disengaged employees are far more likely to quit than engaged ones and a well-publicized study argues that top quartile firms in employee engagement exhibit significantly lower employee attrition than bottom quartile firms, with improvements of up to 65% in lower turnover1. However, employee engagement is a lagging measurement of something much more immediate, network energy!
In one specific case, we saw a company in which nearly 50% of all employee attrition was occurring in the first 24 months of a newcomer’s tenure. This was highly correlated with a decrease in employee engagement during these first two years. This led to a series of initiatives to resolve this dilemma. The company launched a new cultural assimilation program, created a new on-boarding tool, and designed a monthly newcomer development series. Interestingly, these solutions only had a minimal impact on engagement. One thing, however, did significantly impact employee engagement. The energy of the team an employee joined, or network energy.
When an employee joined a so called, “toxic team”, in other words, a team that displayed negative energy, his or her level of engagement began to drop immediately. In fact, on average, when a newcomer joined a negative team, engagement dropped 3 times that of a positive team in the first 24 months, while at the same time, those who joined positive teams maintained high levels of engagement (figure 1). This insight should shift the way we think about employee engagement. Rather than focusing on organizational initiatives to shift engagement, we need to focus on enabling teams to generate positive energy that is contagious across the network. Consider when someone is in a bad mood and you engage in a conversation with them. Are you not more likely to walk away in a bad mood? In this same way, if the people you work with are perpetually negative, their negativity can also become contagious.
Figure 1. Engagement by Tenure
University of Michigan professor and network expert, Wayne Baker, argues that if you want to create a positive organization, you need to nurture energizing connections. His research suggests that thriving organizations have a higher number of energizing ties verses de-energizing ties from employee to employee. He argues that a 3 to 1 ratio of energizing connections to de-energizing ones creates a tipping point towards becoming a thriving organization2. This is exactly what we saw in one organizational study that was designed to examine the patterns of network energy within a critical operating group. A network survey was conducted to understand how energy connections showed up in daily interactions. People were asked two simple questions. 1. Who do you interact with and 2. of these individuals, who energizes vs de-energizes you? The diagram below shows the effects of these interactions for one function. The green nodes provide energy to the people around them, while the red nodes take energy away3.
There are two critical things to notice about this study. First, the 3 to 1 ratio proved to be true. In a network of nearly 150 employees, just under 100 of them are providing energy to others. Just as significant, this group was recognized as one of the more effective, highly engaged groups within the organization. Second, and more importantly, energy seemed to cluster in this function. The negative red nodes tended to be connected to one another, and the more positive energy providers, which are represented by the green nodes, tended to be connected to one another. This pattern suggests that energy spreads from person-to-person in much the same manner as it did within the first study of positive and toxic teams. In this study, however, positive teams seemed to have a spillover effect on the teams close to them. The positive teams were concentrated in the center of the network, pushing the de-energizing teams to the periphery of the network. This phenomenon could be a game changer for employee engagement, suggesting the network energy spreads first within team, and then from local team to local team. That is, if a positive team frequently interacted with another positive team their energy seemed to be contagious.
This is also a game changer for taking actions. Enterprise-wide actions, such as new cultural assimilation programs, may provide many positive benefits, but it appears that local actions may actually spread even more rapidly. The organization above decided to flip employee engagement upside down by first focusing on local team energy. They enabled these teams by creating three energy activations to shift local energy by:
- Facilitating positive energy early exchanges - as newcomers joined teams, exchanges were designed to help them immediately feel valued by their peers using such methods as “appreciative inquiry” and “success moments”.
- Facilitating active idea sharing – idea primers were created to encourage the entire team to more actively share ideas and advice. This included such activities as “give & takes” and the “reciprocity ring”.
- Enabling connection nudges - to build the networks necessary to be successful. A simple pulse check routine called “critical connections” was established so people could build the necessary connections to first build credibility and then influence more broadly.
The impact of these interventions was very encouraging. They had an immediate influence on the engagement drop for newcomers, while also significantly reducing the attrition problem in the first two years for new employees. In summary, based on a growing pool of network research, we are developing a better understanding of how energy flows across an organization, suggesting that energy is the antecedent to engagement. This makes engagement much more actionable, as energy spreads locally, from person to person. Indeed, if energy is the new engagement, we may need to move away from launching expensive enterprise wide solutions and shift our focus to local team activations.
Sources
[1] https://www.gallup.com/workplace/236927/employee-engagement-drives-growth.aspx
[2] Baker, W. (2019). Energize Others to Drive the Innovation Process. People and Strategy Journal, 42 (2), 42-47.
[3] Note: this is a simplified version of the network analysis and for ease of interpretation it does not show the level of intensity of these energy interactions.