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The number one thing that defines a High Performing Workforce is Emotional Commitment, but did you know only 25% of leaders have what it takes to motivate and engage staff?

It is quite clear that both Australia and the USA have an engagement and productivity problem. Disengagement is said to be currently costing Australia approximately $33 billion in lost productivity, leading to the the fifth quarterly productivity decline in two years. Disengagement is costing the US a whopping $300 billion a year in lost productivity. Market research on engagement shows that almost all large businesses measure engagement year in, year out, and roll out initiatives to lift engagement. Unfortunately over half of these achieve no lift in their engagement scores as a result, and the results for one out of every six actually go backwards. Furthermore, of those that actually manage to lift engagement, the average increase in scores achieved is minimal at 5%. Not only does this paint a bleak picture for the future of the economy, it highlights the need to identify and validate new approaches to lifting engagement that are both economical and scalable. So what’s a solution? A: Lift the emotional intelligence (EI) of managers to improve employee engagement.

Genos International recently published the findings of a global research study on the relationship between a leader’s emotional intelligence and employee engagement. Intuitively most would guess that a leader with high levels of Emotional Intelligence (or “EQ”), who is skilled at perceiving, understanding and managing emotions, would be better equipped than leaders with lower levels of these skills at facilitating high levels of employee engagement amongst their staff. Interestingly, until now there has been very little empirical evidence to support this notion.

Genos assessed the emotional intelligence of over 200 leaders with a Genos emotional intelligence 360-degree assessment. They also assessed the individual engagement scores of 438 direct reports using a 12 item engagement survey. The results revealed there was a strong positive relationship between leaders’ emotional intelligence and their employee’s engagement scores. In the graph shown below each dot represents an employee’s engagement score. The x-axis of the graph represents leader’s emotional intelligence as a percentile score where scores between 1 and 39 are low; 40 to 59 are average and 60 and above are high.

As you can see, being low or average in emotional intelligence results in wide and varying levels of employee engagement where employees are disengaged, not engaged and engaged. These types of engagement scores are typical of low and average performing organizations. Conversely, high levels of emotional intelligence, indeed total emotional intelligence scores above the 75th percentile, result in consistently high engagement scores. These types of engagement levels amongst employees are typical of high performance organizations. Indeed Gallup’s research has shown that organizations with this type of engagement level amongst employees earn 3.9 times earnings per share greater than like organizations with wide and varied engagement results. The Genos research will be published in 2012 in the peer-reviewed journal Industrial and Commercial Training.

Implications for L&D

The Genos research suggests Learning and Development Professionals could play a greater role in helping organizations improve their employee engagement scores, in particular by designing and rolling out programs designed to improve the emotional intelligence of the leaders. Research on EI has shown that it can be developed via blended learning programs that include assessments, developmental workshops, action learning projects and coaching. Typically over a period of 3-6 months Genos has shown that the EI of leaders can be developed by an average of 20%, which could tip a wide number of leaders into that golden 75th percentile range.

Case Study

A large Australian retail organization was moving to a shared services model. Large-scale change projects were being facilitated and the announcement and commencement of them drove down employee engagement, talent retention and performance, and drove up fear, resistance and negative behaviors amongst employees potentially derailing some of the projects.

Reference: HPWs = High Performing Workplaces; LPWs = Low Performing Workplaces Boedker, C. et al. (2011). Leadership, culture and management practices of high performing workplaces in Australia: The high performance workplace index.

The solution: a leadership development program to improve project team leaders’ capacity to positively influence others, manage resistance to change and improve employee engagement. The program included a mix of assessment, developmental workshops and seven one-on-one coaching sessions, after which EI was re-measured.

Results: The company improved its overall staff satisfaction and engagement by 20 percent and employees increased their interpersonal effectiveness by 45 percent. In addition, the program produced a 23 percent improvement in project team leaders’ emotional intelligence and a 33 percent improvement in productivity within the group.

Conclusive Evidence

Another business case for Emotional Intelligence as a means to boost productivity has been shown in a recent study examining Leadership, Culture and Management Practices of High Performing Workplaces (HPW’S) in Australia (2011). This study found that employees in HPW’s experience more positive emotions such as feeling proud, valued, optimistic, cheerful and even loved. Conversely in LPW’s employees experience more negative emotions such as feeling anxious, worried, depressed, inadequate, and fearful. Being anxious was the most prevalent emotion in LPW’s with 56% of respondents experiencing the emotion. By contrast 68% of respondents experienced feeling proud in HPW’s.

The same study reported that Employee Commitment in HPW’s was found to be 23.2% higher than in LPW’s. Committed employees exert higher levels of discretionary effort and continuously go above and beyond what is expected of them. In fact, this can be anything up to 57% higher. Committed employees often also have higher levels of motivation, they strive to perfect their work, and to be more productive, innovative and creative. This evidence alone should be enough food for thought in considering EI development for leaders as a method for improving employee engagement.