According to Kruse (2012) employee engagement can be effectively used in the competitive business environment, as a tool for attaining a competitive edge in the market. However, in order to attain growth benefits from increased levels of employee engagement, it is important to use effective intrinsic and extrinsic motivational strategies that can enable the management to create and maintain an engaged workforce. The aims of this assignment is to understand the concept of employee engagement, identify its growth related benefits and recognise the impacts of having a demotivated and disengaged employees on the business. Moreover, in this assignment the employee engagement techniques used by Marks and Spencer will be assessed and based on the results, recommendations will be given to the management of the company which they can use to overcome any identified barriers that they might be hindering the creation of engaged workforce effectively.
A number of research studies have suggested that employee engagement is an emotional as well as intellectual commitment of an employee towards his/her organisation (Kahn, 1990, Shaw, 2005, Truss et al., 2006). Albrecht (2010, p. 351), defines employee engagement as the “extent to which employees are motivated to contribute to organisational success and are willing to apply discretionary effort to accomplishing tasks important to the achievement of organisational goals”. Mone and London (2014, p.4) stated that an engaged employee is “someone who feels involved committed, passionate, and empowered and demonstrate those feelings in work behaviour”. According to Kahn’s theory of engagement there are three main characteristics that are related to the varying degree of engagement in an employee includes meaningfulness of the position, safety and the availability which can be his/her own psychological availability to take up the job or conduct the given responsibilities. May et al (2004) on further investigation suggested that fitness of the role, resources and job enrichment are also important factors for creating an engaged workforce. Maslach et al. (2001) shed light on the burnout literature which suggest that burnout or engagement in employees occur due to the fluctuations in the six work-life leading areas which includes control, workload, rewards and recognition, social support, perceived fairness and values. However, both the above given models failed to effectively explain the reasons or conditions that results in the engagement level of different employees. Saks (2006) through his social exchange theory (SET) explained that relationships at workplace evolve as the time progresses, employees become loyal, they trust their leader and there is mutual commitment which is based on certain rules of exchange such as hard work in exchange of support or resources provided by the company or rewards.
Research studies have suggested that there are a number of advantages of having a fully engaged workforce (Albrecht, 2010). Employees who are completely engaged are the ones who feel satisfied with their job, they are happy and healthy which means that they deliver an enhanced performance resulting is increased consumer satisfaction and alleviated profit margins (Garber, 2012). A workforce that is completely engaged consists of employees that are willing to go above and beyond their ability to produce satisfied customers (Macey et al., 2011). An increase in satisfied customers produced by engaged employees means that the company will get more business, it revenues will continue to grow and the productivity will continue to increase. When employees have a high engagement level they share a good relationship with their manager and this relationship makes their retention easier. Also, research studies have suggested that engaged employees tends to take fewer sick leaves and also, shows lower rate of absenteeism (CIPD, 2014). They enjoy their work; therefore, look forward to add to the growth of the organisation through their innovative and proficient ways of working, as greater level of employee engagement promotes innovativeness and creativeness in employees (Cook, 2008). According to a report by CIPD (2014), engaged employees are the strongest advocates of the company or brand they work for and plays an important role in safeguarding the reputation of their company through continuous supply of good service levels and higher quality of products. However, in order to continue to maintain an engaged work force, it is important for management to respond to the needs of employees in terms of the availability of resources to grow, flexible working opportunities to maintain a healthy work-life balance and motivate them through extrinsic and intrinsic rewards. It can be said that through an engaged workforce, the employer can easily attain a competitive edge in its operating market.
Research studies have also suggested that a disengage workforce poses a big risk to the growth of the company (CIPD, 2014). This is because a disengaged employee will not be able to produce satisfied customer, the quality of services provided by him/her will be poor and the business will potentially incur a financial as well as reputational loss. It is identified through the findings of literature that disengagement threatens business collaborations, level of innovativeness offered by the company and makes it difficult for the management to effectively manage their labour resources (Carbonara, 2012). This is because disengaged employees will not be motivated to make a constructive use of their knowledge and skills. Therefore, creating an engaged workforce is critical for success in the competitive business environment and this requires the use of effective motivational strategies.
Marks and Spencer (M&S) is a leading retailer operating on a global level. Their major products and services includes home products, food products, general merchandise, clothing and financial services. The company now operates in more than 59 territories and their recent annual turnover is about £10 billion. In the United Kingdome, the company has more than 800 stores and has a huge workforce of more than 83,000 employees, who are continuously adding to the success of the company through their hard work and dedication (M&S, 2015). They serve more than 33 million customer every week, suggesting that consumer satisfaction is of utmost importance for the success of the organisation. M&S motivate their employees both through intrinsic and extrinsic rewards. Extrinsic rewards are given in the form of base pay which is a fixed hourly pay of the employees based on the position that he/she holds in the organisation. They review their basic pay on annual basis and assures that it is kept competitive over the period of time in accordance to the changes in the operating market (M&S Annual Report, 2014). This is a good strategy to maintain the attraction level of the company (Daft, 2011). Employees across the company are offered 20% discount on all their purchases from the brand, online as well as offline through use of their employee discount card. An additional discount card is given to the employee’s partner or a family member to enjoy the similar benefit. Employees are given paid holidays of minimum 28 days in a year, together with the annual bonus that is paid to the employee as a reward for helping the company to attain their growth objectives (M&S Annual Reports 2014; 2013). It is a good strategy to make employees feel valuable and a part of their success (Armstrong, 2012). The advantage of doing so is that it makes employee work harder for the success of the organisation and give their best (Armstrong, 2012). M&S offer their employees an excellent defined contribution pension plan, where is the employer put in 3% of their pay every month towards their pension, the company in return will pay 6%. The company offer its employee life assurance cover and heath care products at discounted rates. Employees at M&S can benefit from discounted holiday packages, be a part of their Sharesave scheme through which they can save an amount between £5 and £250 each month for max 3 years and then can withdraw the savings at the end of 3 year period or can buy the company’s shares at 20%. Also, take advantage of the Salary Sacrifice scheme which helps employees to save money on tax and NI (M&S Annual Report, 2014).
The intrinsic rewards given by company to its employees includes continuous developmental opportunities through various trainings and refreshment courses. The aim of these development courses is to strategically contribute to the personal and professional growth of the employee (M&S, 2015). Employees from day one are given a supervisor, who trains them and looks after them until they become fully skilled for the position they have been appointed on. Line managers are always there to provide continuous support to the employees and ensure that their skills are up to date with the demands of the working environment. The company has an effective communication network between the management and other employees which enables continuous flow of information that enables the employees to work in accordance to the growth objectives of the organisation in an effective manner (M&S Annual Report, 2013). Management promotes team work, as it has a number of advantages that includes enhanced quality of work, provision of good quality of services to customers, attainment of growth objectives in the decided time frame, enhanced engagement and increment in the growth profits (Garber, 2012). Democratic leadership style prevails within the organisation that empowers employees to contribute to the decisions of the organisation that are related to growth. Employees are encouraged to share their ideas and pinpoint the organisational needs. This way employees feels involved and responsible. Employees work under the guidance of their line manager in M&S; and excellent performing employees are given a chance to take up more responsibilities and a higher position. Research studies have suggested that this leadership is highly effective in generating an engaged workforce, enables the organisation to attain higher levels of consumer satisfaction levels and increased profit margins (Kelleher, 2013; Ahlstrom and Bruton, 2009).
The employees at M&S are provided the opportunity to request to work flexible hours, take leaves for provision of care to a family member or voluntary works, this allows the employees to maintain an effective balance between their personal and professional life. This is good for the well-being of their employees, as research studies have suggested that employees who are able to maintain a good work-life balance are physically more active ad psychologically fit, as the stress of being unable to maintain a work-life balance is identified as a major cause of psychological disorders such as depression which then negatively affects the overall well-being of that employee (French, 2011; Price, 2011). It is also noted that the company shares a healthy relationship with its suppliers and positively contributes in their growth by providing continuous business which has resulted in the formation of a trustworthy relationship with them (M&S Annual Report, 2014). M&S also looks after the communities in which their employees lives and contributes in improving their living standards through various activities such as supporting local educational institutions, health care providers, charities etc. It wouldn’t be wrong to say that M&S through all these motivational strategies has drastically improved its attraction as one of the desired employers in potential employees (Smith, 2015).
It is clear that the company motivates its employees through various effective extrinsic and intrinsic rewards which has successfully contributed in creating an engaged workforce. It is also evident from the success of the organisation during the period of recession and also from the continuous increase in its consumer index which signifies the growth in the consumer satisfaction levels as a result of services and products provided by the company to its customers. However, it is identified from the company’s annual reports that finding the most suitable employee is a challenge for the company with which the company is dealing through a highly structure recruitment process which enables them to short-list the best candidates at the start of the process. Also, the employee engagement score at present is 80% which the company wishes to increase. This value could possibly be due to the fluctuation in the preference of employees in terms of the rewards, for example some might prefer extrinsic over intrinsic or intrinsic over extrinsic, in both the situations they will not be satisfied if they will not get rewarded the way they want to. Therefore, recommendations are provided in the next section to M&S so that they can improve their employee engagement level and overcome barriers in creating a highly engaged workforce.
In accordance to the findings of the research about the extrinsic and intrinsic rewards strategies used by the organisation, it is recommended that the company must consider the following strategies to further improve the employee engagement level and to overcome barriers related to creating an engaged workforce that can hinder the long-term growth of the organisation.
a) It is recommended that to attain higher levels of engagement, the line managers must be made accountable. This is because, the increased responsibility will push them to provide utmost support to their sub-ordinates which will improve the relationship between them and the result will be enhanced levels of engagement by both the parties to attain mutual organisational goals.
b) It is advised that employees must be given an opportunity to give ideas about the design of reward system which will enable the company to come up with the most effective reward system to boost employee morale and to attain 100% employee engagement score.
c) In order to attract the right employees, the company must create awareness about the benefits that it offers to its employees through Social networking sites which are actively used by people of all age. This strategy will give the desired exposure to the company and also enable them to hire employees that have positive views about the working environment of the company. Such employees will find it easier to adjust in the new environment as they know what to expect in future and will also start contributing positively to the growth of the company from their first day at work. Also, an engaged employee workforce can be created in a short span of time through this strategy.
d) Another recommendation, is that the management must think about the inclusion of new motivational strategies. For example, cost of education is increasing day by day and M&S can provide education sponsorship programs for the children of employees or contribute in the fees of its employees who are still in education. This will enable the company to enhance the employee engagement level, as employees who will get such support for their families will automatically become loyal to the company and will work harder having a higher level of peace of mind in regards to their future or the future of their children.
e) Also, there is a need of connecting employees with the bigger picture to attain higher levels of engagement. This can be done by making improvements to the existing communication strategy. It should be clear and employees must be informed about the practical implications of the designed growth strategies.
It can be concluded that, the above given recommendations will enable the company to improve its existing employee engagement level and enhance the number of benefits that it can attain from a completely engaged workforce. It is vital to create and continuously maintain an engaged workforce for the long-term well-being of the company in terms of financial growth and reputation.
Ahlstorm, D. and Bruton, G. (2009) International Management. USA: Cengage.
Albrecht, S. (2010) Handbook of Employee Engagement. UK: EE Publishers.
Armstrong, M. (2012) Armstrong’s Handbook of Reward Management Practice. London: Kogan Page.
Carbonara, S. (2012) Manager’s Guide to Employee Engagement. London: McGraw-hill.
CIPD (2014) Employee Engagement: Fact Sheet [Online]. Available at: www.cipd.co.uk [Accessed 12 Aug 2015].
Cook, S. (2008) The Essential Guide to Employee Engagement. London: Kogan Page.
Daft, R. (2011) Management. USA: Cengage.
French, R. (2011) Organisational Behaviour. London: Wiley.
Garber, P. (2012) The Manager’s Employee Engagement Toolbox. VA: ASTD publishers.
Kahn, W.A. (1990) ‘Psychological conditions of personal engagement and disengagement at work’, Academy of Management Journal, 33, pp. 692-724.
Kelleher, B . (2012) Employee Engagement for Dummies. London: Wiley.
Kruse, K. (2012) Employee Engagement. USA: Independent Publishers.
M&S (2015) [Online]. Available at: www.marksandspencer.com [Accessed 12 Aug 2015].
M&S Annual Report (2013) [Online]. Available at: www.marksandspencer.com [Accessed 12 Aug 2015].
M&S Annual Report (2014) [Online]. Available at: www.marksandspencer.com [Accessed 12 Aug 2015].
Maslach, C. Schaufelli, W.B. and Leiter, M.P. (2001) ‘Job burnout’, Annual Review of Psychology, 52, pp. 397-422.
Mone, E. and London, M. (2014) Employee Engagement through effective performance management. NY: Routledge.
Price, A. (2011) Human Resource Management. USA: Cengage.
Saks, A.M. (2006) ‘Antecedents and consequences of employee engagement’, Journal of Managerial Psychology, 21( 6), pp. 600-619.
Smith, R. (2015) [Online]. Available at: http://realbusiness.co.uk/article/30025-john-lewis-most-desirable-brand-for-jobseekers-as-apples-popularity-drops [Accessed 12 August 2015].
Shaw, K. (2005) ‘An engagement strategy process for communicators’, Strategic Communication Management, 9(3), pp26-29.
Truss, C., Soane, E., Edwards, C., Wisdom, K., Croll, A. and Burnett, J. (2006) Working Life: Employee Attitudes and Engagement 2006. London; CIPD.