Your Secret Weapon for Measuring the ROI of Employee Engagement: The Right Employee Communications App


If you work in human resources or front-line management, you know the power of people. Especially people who have that special “it.” They’re the ones who make your workplace thrive, your customers happy, and, yes, improve your bottom line. 

You can sense their presence in the office vibe. You can hear it in the appreciation in customers’ voices. More than anything, though, you feel it in your gut. 

But these days, your gut’s not good enough. 

Welcome to intuition in the age of analytics. The executive suite expects you to back your claims with data. They want to know what’s the return on investment (ROI) on employee engagement. 

This is good news, actually. The more solid your data, the more solid your footing when budgets are reviewed. And the more data, the more support you can garner for your programming. 

In this post, we’ll cover 3 key points you need to know about ROI on employee engagement.

  • Where employee engagement can be measured
  • The high costs of low employee engagement
  • Gathering data with your employee communications app

1. Where Employee Engagement Can Be Measured

In a report released in July 2018, Show Me the Money: The ROI of Employee Engagement, DecisionWise, the employee engagement consulting firm, presented evidence of employee engagement ROI in virtually every way you can measure an enterprise’s well-being. 

Metrics DecisionWise highlighted include: 

Earnings per share & turnover

  • Companies with highly engaged employees have earnings-per-share levels 2.6 x higher than companies with low engagement scores.
  • Organizations in the bottom quarter of engagement scores experience 41% higher turnover. 

Net income and shareholder return

  • Companies with highly engaged employees experience 2x higher net income than companies with poor engagement scores.
  • Organizations with highly engaged employees experience a 7x-greater 5-year total annual shareholder return than organizations with less-engaged employees. 

Operating income

In research prepared for the United Kingdom government (Engaging for Success: enhancing performance through employee engagement), David MacLeod and Nita Clarke found the following correlations:

  • Companies with low engagement scores earn an operating income 32.7 percent lower than companies with more engaged employees.
  • Similarly, companies with a highly engaged workforce experience a 19.2 percent growth in operating income over a 12-month period. 

Profitability & attrition

The Corporate Leadership Council (CLC) studied the engagement level of 50,000 employees around the world to determine its direct impact on both employee performance and retention.  The CLC found that 1) engaged companies grow profits as much as 3X faster than their competitors; and 2) Highly engaged employees are 87 percent less likely to leave the organization. 

If companies want to bolster productivity and profitability, increase customer loyalty and operating income, and slash attrition and disengagement losses, they have to engage employees. 

employee engagement app

2. The High Costs of Low Employee Engagement

For some organizations, employee survey company Culture IQ found, the biggest obstacle to measuring employee engagement is determine what exactly to measure. At the most basic level, you could determine how much money is lost through disengaged employees and how much money can be gained by engaging or re-engaging them.

Gallup’s “State of the American Workplace” report shows that up to 70 percent of employees are disengaged in the workplace, costing companies $450-550 billion every year. 

In its report “15 Stats that Prove the ROI of Company Culture,” Glassdoor found that companies with engaged employees outperform those without by more than 200%, and companies that invested 10% more in employee engagement also increased company profits by $2,400 per employee per year. 

3. Gathering Data With Your Employee Communications App 

When it comes to gathering data, organizations that execute engagement strategies through an all-in-one mobile app have a distinct advantage. An employee communications app with built-in analytics capabilities allows you to both collect extensive metrics and make sense of them. 

While other tools help you track more macro metrics of engagement (turnover, absenteeism, cost per unit, speed of production) your employee communications app with analytics capabilities gives you data on a more specific scale – with a huge savings when it comes to content development. 

On more of a micro level, you can learn things like which content resonates most with your audiences, or how many people completed a training module within three days of its release. No one made it through a video? Send out a query asking why not. Between surveys and following users’ digital trails (what content they used, for how long and where they went next), you can better select content that is attractive and effective for differing segments of your workforce. 

These analytics make it easier to understand your employees and better meet their needs – more cost-effectively. 

Conclusion 

An employee app platform like hubEngage gives you the power both to create a workforce invested in their work and an effective means of measuring the ROI of various initiatives in real time. 

We invite you to try the hubEngage app for free and discover for yourself how close at hand better employee engagement is.



 

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