EMPLOYEE ENGAGEMENT: A DILEMMA IN ECONOMIC

MELTDOWN
*Prof. Praveen Kumar
Head- Department of Management studies
Sobhasaria Engineering College
Sikar – 332001 (Rajasthan)
Email: pk61delhi@gmail.com
*Anchal Kumar
Lecturer
Department of Management Studies
Sobhasaria Engineering College
Sikar-332001(Rajasthan)
Email: anchal_kumar7@yahoo.com

Abstract
Employee engagement is the process to capture the hand, heads, hearts, and souls of the
employees to instill an intrinsic desire and passion for excellence. Engaged employees want
their organization to succeed because they feel connected physically, socially, emotionally, and
even spiritually to its mission, vision, and purpose. With economic downturn companies are
bleeding and facing financial constraints resulting in reduced pay, lay off and retrenchment.
Engaged employee are facing more heat as they have bond with the organization, their morale
are shattered putting a question mark on concept of employee engagement. Both employee and
employer are in catch 22 situations. This paper attempts to find optimal solution to keep the
employees engaged without drastically effecting economy of organization in the long run.

Keywords: Employee, Engagement, Morale, Layoff, Retrenchment

Introduction:

Committed and engaged employees are significant yet scanty resource for
any organization. Access to other resources is no longer limited with
liberalization and globalization. Capital flows has become easier. Technology
& Raw material are available to organization at the most competitive prices.
Information is available at press of keys. Yet, there is dearth of engaged
employee who are spiritually bonded to organization and puts extra efforts
for vision, mission, goals and objectives of the organization. It takes
systematic efforts utilizing many resources to nurture and train employees
and moulds them to organization culture. However, due to global slowdown,
world economy is under severe pressure resulting in downsizing and other
measures to reduce financial burden affecting even engaged employees who
are in psychological recession due to fear of retrenchment.

Many surveys in the US over last few years have shown that indices like
loyalty and trust have collapsed from 80% to 30 %. Recession has added to
their woes with uncertainty and simultaneous perceived pressure by
Management to increase productivity. Well known French companies such as
France Telecom, Peugeot have experienced increasing suicides among
workers in last two years. Even in US, rate of suicides has increased by 28%
in last few years.

In India too, simmering content have shown its visibility in Gurgaon Manesar
belt as well as in Greater Noida. Uncontrollable Food inflation has diverted
minds of employees towards survival of their families.

Impact of Slowdown on Terms, Conditions and Morale of the

Engaged Employee
In prevalent economic situation employers are forced to cost cutting devices.
With economic down turn almost all the companies are facing financial
constraints as there is substantial decrease in demand of goods and
services. With decrease in demand, productivity has got to be reduced,
resulting in surplus employee. Among the variable cost wages and salary
has the major share. The most of the business organizations have no choice
but opt for reduced pay, zero increment, decrease in fringe benefits,
reduction in expenses in social and welfare activities, increase in work hours,
attrition, lay off and retrenchment. Due to these factors, the morale of
employees is at lowest level and some time negative. Even the engaged
employees are finding their one foot out of door. They even don’t know
whether their position will be safe or not in next morning. Fear of
unemployment has led engaged employee to psychological recession.
This is one of the most critical and pathetic situation for both the parties.

A study has shown engaged employees to be more insecure then disengaged

employees. Engaged employees are bonded with the organization and feel
more pain and mental agony while thinking of separation from present
organization. Engaged employees integrate their goals and objectives with
the organization vision, mission and purpose and it is quite difficult to break
the emotional and spiritual bond. In the same way organizations do not want
to lose their star performers who are engaged with the basic objectives of
the organization. Companies very well know engaged employees are best
bet to overcome crisis during recession. As economic recession has engulfed
many companies and they find lay off and retrenchment as suitable way to
overcome the crisis like Jet Airways. This is a big dilemma for both employee
and employer as on one hand recession is forcing companies to even turn
out even engaged employees and on other hand, engaged employees can be
an asset to turn around from crisis.This is a catch 22 situation.

Employee Engagement as a Pious Bond:

Degree of commitment and involvement of employees has various levels of

perception depending on an organization.
  Satisfied employees: are those employees who are happy with the
status quo and want to be a member of the organization. Satisfied
employees are not always productive employees.
 Motivated employee: are more concerned with individual goals and
puts extra efforts towards organizational activities for reward that
fulfils his/her unsatisfied needs.
 Committed employee: are those who are committed to goals and
objectives of the enterprises and there is integration of personal goals
and organizational goals.
 Engaged employees: are emotionally attached with the organization
and builders. They know the desired expectations for their role so they
can meet and exceed them. They're naturally curious about their
company and their place in it. They perform at consistently high levels.
They want to use their talents and strengths at work every day. They
work with passion and they innovate and move their organization
forward.

Employee engagement is the extent to which employee choose to invest

their physical, mental and emotional energy in their work and their
organization. In simple terms employee engagement is making employees to
work with not only their minds and bodies but also with hearts. When some
body puts heart and soul into work, he creates a congenial atmosphere
where organizational and individual goals can be achieved more effectively.
Employee engagement is a multidimensional construct that consists of
cognitive, emotional, behavioral components that are associated with
individual role performance. Engaged employees are key to consistent
growth, innovation and profitability of any organization. It is a process of
evolving discovering new height in the business world which would give a
competitive advantage to the organization. Engaged employee would have
strong belief in the organization, a voluntary desire and passion to love and
enjoy their work.Employee engagement is no doubt, a partnership between
the company and work force where everyone works together to achieve
business objectives as well as individual aspirations.

It is only an engaged employee who is intellectually and emotionally bound

with the organization, feels passionately about its goals and is committed
towards its values. He goes the extra mile and associates himself with the
actions that drive the business. Engaged employees are more likely to stay,
and be the advocates of the company, its products or services. Employee
engagement is a positive attitude held by employee towards the
organization and its values. It is rightly said that the only sustainable
competitive advantage for a company is human resources. Engaged
employees care about the future of the company and are willing to invest the
discretionary effort. An organization’s productivity is measured not in terms
of employee satisfaction but by employee engagement.
A recent study of nearly 8000 business units in 36 companies has revealed
that companies with higher level of employees engagements have shown
higher level of customer’s satisfaction, improved productivity, higher profits
and lower level of turnover and accidents. The Caterpillar when, set out to
increase level of engagement, found that its initiative resulted in 80% drop
in grievances with correspondingly 34% increase in highly satisfied
customers.

Process of Engagement:

Prof. Amartya Sen has referred to Niti and Nyay in his book “ The idea of
Justice” Whereas Niti relates to policies, principles and institutions of justice,
Nyay refers to delivery of justice. Whereas there are plethora of labour laws
and regulations but Nyay (deeply concerned with prevention of injustice) still
remains illusion in minds of employees.

Mr. R Gopalkrishnan, in his article on “Employees engagements: A leadership

Priority” published in Economics Times on 7th Dec., 09 has suggested four
pronged approach;

1. Involvement of Top Management:

Problem relating to disengagement are too significant to be left to HR

department alone.CEO must start process to identify root cause. There may
not be economic problem alone which leads to engagement. Fear and
uncertainty may arise from other factors and policies of organization and
even persons who are at helm to implement the policies.

2. Actions to measure and track employees engagements:

The first step is to measure employee attitudes. Engagement levels are

influenced by employees’ personal characteristics: a minority of employees
are likely to resist becoming engaged in their work. But people are also
influenced by the jobs they do and the experiences they have at work. The
way in which both senior management and line managers behave towards,
and communicate with, employees, plus the way in which work is organised
and jobs defined, contribute significantly towards making work meaningful
and engaging.

Many employers in both private and public sectors now conduct regular
employee attitude surveys. The results typically show what employees feel
about their work on a range of dimensions including, for example, pay and
benefits, communications, learning and development, line management and
work-life balance. Attitude survey data can be used to identify areas in need
of improvement and combined with other data to support performance
management.
The drive for an engaged workforce needs to build on good people
management and development policies, and the active support of line
managers. People management strategies and policies need to be aligned
with those of the wider business. Employees need to understand how their
work contributes to organisational outcomes. A minority of employees may
not want to be engaged; organisations may need to give particular attention
to recruitment and communications. There is no short-cut to building and
maintaining employee engagement, but the time, effort and resource
required will be amply repaid by the performance benefits.
Engagement can be said to have three dimensions:

• emotional engagement - being very involved emotionally with

one’s work
• cognitive engagement - focusing very hard whilst at work
• physical engagement - being willing to ‘go the extra mile’ for
your employer.

The report finds that over a third of employees are actively engaged with
their work – a rather higher figure than some other surveys. Of the three
types of engagement identified, levels of emotional engagement are the
highest, with around six in ten employees being emotionally engaged
(feeling engrossed in their work), whilst three in five are cognitively engaged
(focusing very hard on their work) and around four in ten are physically
engaged (willing to go the extra mile).

Public sector employees are more likely not to feel their senior managers have a
clear vision for the organisation and have less trust and confidence in their senior
managers. They are also less likely to believe organisational communication

Employee surveys are used in an attempt to quantify a company’s employee

engagement, compare this score with a standard and give management
feedback about employee opinions. This data can be used as a basis for
management development and manager-employee communications.

3. Training & Development;

Technological, environmental and organizational structural changes may

sometimes result in losing interest in work. Similarly new breed of operating
managers have not experienced the long and turbulent times of trade unions
activism and thus need to be trained on empathy and listening skills to
understand root cause of employees’ distraction from work and suggest
suitable measures to top management within time.

Regular training programmes are required for employees to create

awareness about changes and its impact on them.
4. Accessibility and Open Communication:

Perceived managerial fairness in dealing with problems also impacts

significantly on individual performance, although it is not significantly related
to engagement.

Similarly the Institute of Employment Studies (IES) has concluded that the
main driver of engagement is a sense of feeling valued and involved. The
main components of this are said to be:

• involvement in decision-making
• freedom to voice ideas, to which managers listen
• feeling enabled to perform well
• having opportunities to develop the job
• feeling the organization is concerned for employees’ health and
well-being.

Top management must connect directly with lower levels of employees to

get pulse of the grievances and act on them earnestly. This will help win
trust of employees. GE has won trust of their employees by sharing with
them the impact of recession on organization.

Conclusion:

Engaged Employee as a Silver bullet to Combat Recession

The engaged employee is strategic advantages in a bad economy because it

makes employee resilient, which helps them get through tough times.
Resilient employees have the flexibility to bounce back from bad news and
immediately focus on ways to improve the business. Employee engagement
should be maintained in downturn as it gives competitive advantages.
Employee engagement in times of difficulties and severe economic climate is
far more profoundly important. Employees are willing to give their all when
they are well treated, appreciated. It’s their decisions, their actions and their
attitude that really make the difference in a downshifting economy, it is
crucial for companies to stay focused on employee engagement and
continue emotional and spiritual bond, building highly-rewarding and
productive relationships with employees who can make a positive difference
in a company's long-term success. Employee engagement should be a tool to
minimize impact of recession and employers must continuously encourage
their engaged employees to provide input on key business issues, think
innovatively, and leverage their strengths to help create an organization
where employees want to work and achieve company goals.
With changes in terms and conditions of employment, employer should show
empathy and any lay off or retrenchment should be done keeping human
face in mind. Lay off or retrenchment of engaged employee must be
avoided. Reduced pay, zero increment, work sharing, sabbaticals, leave
without wage, redeployment, outplacement and all other alternatives must
be tried first then only engaged employees should be laid off, as these
employees are main assets of the company. Communication is most
important. Keep employees informed whether they request the information
or not. In difficult economic times, it is more important than ever to push the
information out and make sure that everyone in the organization hears the
messages. Keeping open lines of communication is good, but don’t wait for
questions and concerns; anticipate what employees want to know and get
that information to them. Offer opportunities for individuals and small groups
to express their worries and concerns. Tell them what you know about the
situation, acknowledge their strong feelings, and show respect for their
views. This will go a long way towards building trust and increasing the level
of employee engagement.

Reference

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