Employee Engagement – How Do You Measure Up?

Okay, I have three numbers for you – or percentages I should say – 30, 13 and 70. According to a recent study conducted by Gallup, 30 percent of U.S. employees are actively engaged in their job. Mull that over for a moment. That means seven out of ten folks around you will probably do enough to earn their paycheck, and nothing more. Sure, they’ll get the job done, but are by no means driven to go above and beyond in their work.

Sounds pretty bad, right? Well that’s actually quite better than employee engagement worldwide, which sits at a dismal 13 percent. Thirty is starting to sound good … Don’t fret though, there’s still one more number: 70. Management is shown to account for 70 percent of variance in employee engagement.

The tone set by leadership is shown to systematically carry throughout the company and directly influences engagement. If you can manage to get the right person in the role, that 30 percent engagement can be driven considerably higher. Management is the key.

Focus and approach

I’ve witnessed the effect that management has on engagement firsthand. In a former life (or so it feels), I was a sales manager for a big box electronics retailer. The biggest driver of profitability, by and large, was television sales. The TV by itself has a high profit margin, but when you add accessories, cables, surge protectors, Blu-ray players and audio, profits can soar. These stores live and die by the success of their TV department.

As you can probably guess, sales managers place a great deal of focus and investment on their salespeople – developing their talents, honing their skills and teaching them how to educate and connect with customers. While the underlying focus is often the same from manager to manager, approach can vary wildly.

Inaction in action

I recall one manager in particular and his method of “talent development.” Employees would regularly approach him after a sale, proud of their accomplishment, and looking for a little approval and encouragement. His response was typically a back-handed compliment: “Nice, I see that you sold an HDMI cable, you should have sold the surge protector too,” or, “Great, they purchased home theater surround-sound with the TV, why didn’t you sell professional installation?” No praise went without criticism; no good deed went unpunished.

In his mind, he was placing the bar higher and higher – helping his salespeople strive to be the best and reach a standard of excellence. It worked in a few cases. More often than not however, employees disengaged, confident that they could never do enough to satisfy. They could never reach their goals, because they were always reestablished right before they were met.

It’s all relative

I always did my best to encourage performance through individual achievement rather than a single standard of excellence. The biggest difference between these two methods is the approach towards goal setting. The first method establishes a measure for greatness, and produces an all or nothing mentality. In the words of Jedi Master Yoda, “Do, or do not. There is no try.” Maybe this works in the Marine Corps boot camp, professional sports and the Jedi Academy, but it’s not a prudent approach for an every-day Middle America workforce.

The other method takes a little longer, but is much more productive. We have to first take stock of an employee’s skill set and potential, and then work with them to establish a “next level.” Something that they can own; something on their terms. If we view performance as falling somewhere on a continuum, focus moves to direction and momentum. Not just good or bad, but getting better or getting worse. As long as we can keep consistently ticking along upwards, slow and steady will often win the race.

In part two of this post, we’ll look at some tangible methods of engaging employees. In the meantime, if your credit union would benefit from more streamlined and simplified performance management, click here to learn more about Performance Pro!

Setting Expectations for Success at Your Credit Union

by Charisse Rockett, PHR

Have you ever tried to put a 500-piece puzzle together using only 386 pieces? That is what it can feel like to an employee who has not be given straightforward expectations to accomplish their goals. An important part of performance management is to set clear expectations for employees so there is no question as to how their work should get done.

When your credit union's employees feel their goals and your expectations are undefined or ambiguous, they become frustrated, productivity declines, and you risk losing them. To keep them committed to you as their manager and to the credit union, you can't leave anything to chance. By including employees in the goal-setting process and then developing action plans with timelines, your expectations are clear and you are setting them up to succeed; the rest is up to them.

Learn more about HR Performance Solutions Performance Pro and manage your employees performance with ease. Start your 30 day FREE trial today!

Gaining the Competitive Advantage for Your Credit Union - Part 4: Walking the Walk

by Amy Neale

Below is Part 4 of a four-part series we've done on Gaining the Competitive Advantage for Your Credit Union.

To tie this all together – what good is having the competitive advantage with marketing, technology or rewards if you don’t have a staff qualified to support it? It’s no secret that to have a successful credit union you need successful, happy employees.

It’s not enough to say you have excellent member service; you need to walk the walk too. The best way to make that happen is to make sure your staff’s goals are aligned with your credit union’s goals. These goals need to not only be symbiotic but concise, defined, valued, reviewed and evaluated. The most cost-effective and time-saving way to ensure this happens is through an effective performance management system, such as Performance Pro.

For a performance management system to be effective it needs to weigh goals, offer customized factors, be easy to use and require the employee’s buy-in. Once an employee has bought into not only your credit union’s goals, but their own goals as well, it’s easier for them to understand the bigger picture. Then they’ll truly understand how every single member interaction helps everyone to achieve those goals.

The end result? Your credit union will have, attract and retain top performers – employees who help give you that competitive advantage we’ve been talking about.

The Best of the Rest

Defining what makes your credit union different gives potential and current members a clear, definite choice. And remember, if you don’t rise to the challenge – your competitors will be happy to do so.
 
Related Services: GSTV, Mobile, BoldChat, Financial Resource Center, Video Management, Invest in America, Sprint Discount, Performance Pro  

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Finding the Carrot: Creating Effective Incentive Plans for your Credit Union

Incentive pay, when used within the context of a reward system, should help motivate your credit union staff to achieve or exceed the desired results. Psychologists and compensation professionals often explain motivation to perform in terms of the Expectancy Theory which states that motivation is the product of three perceptions: expectance, instrumentality and valence.

·    Expectance - The employee’s assessment of their ability to perform the required job tasks. The employee must believe he/she can achieve/affect the end results.

Line-of-sight is typically used to describe this ability, which basically means how much control someone has over achieving a specific goal. Incentive programs with a strong line-of-sight for each employee have the greatest motivational impact and, hence, the greatest potential to be effective. 

Also related to expectance is how difficult the performance levels (targets) are to achieve. Targets that are set too high or two low usually have little or no motivational value. 

·    Instrumentality - The employee’s belief that requisite job performance will be rewarded by the credit union. Employees must believe that if they meet the objective, they will be rewarded.

Instrumentality becomes lower when subjective measures are utilized. We recommend building your incentive plan around concrete, objective measures. And be prepared to follow through with your plan, even if financial conditions change. Failing to do so will reduce instrumentality of future plans.

·    Valence – The value employees attach to the organizational rewards offered. The employee has to value the reward or it will have little motivational value.

Rewards must be significant enough to motivate effort (physical and/or mental) beyond what would be the norm or status quo. Providing superior member service or reducing operational costs are a few examples of behaviors that can be encouraged with an incentive program for beyond the status quo.  

Creating an incentive program around employees referring family and friends to apply for home or auto loans at your credit union is a good example of a lending incentive. Credit unions can typically have a loan referral fee of $5-$10 for consumer loans and $25-$50 for mortgage loans. 

Your credit union could also benefit from creating an incentive program around staff selling auxiliary products such as payment protection, GAP protection or extended warranty products.  A common structure uses a “pay per sale” method where the employee is paid a certain dollar amount for each sale ranging from $10-$25 per policy.

Loan growth goals can be cascaded down throughout the credit union with senior managers and back office staff being incented for the overall credit union loan growth goal.  Incentives may include branch managers being rewarded for achieving their branch loan goal; loan officers and processers incented on personal loan production; and tellers or other front line staff rewarded for loan referrals. 

In conclusion, it is possible to structure a plan that pays for itself and offers higher opportunities to all employees.  Incentive plans are designed to share organizational gains with all stakeholders.  One last tip – when developing your plan we recommend developing a cost/benefit analysis.  This will provide the template needed to set up a successful  incentive plan at your credit union.   

Related Services: Incentease, Compease, Performance Pro