How Do I Know We’re Ready to Invest in Engagement?
There’s a technological solution for every problem now. However, just because there’s a quick fix doesn’t mean your company requires the investment.
As CFO, my expertise is, of course, the numbers. But I’m also tasked with driving growth by connecting the numbers to our overall business strategy. None of that sounds like it deals with people, but employee engagement is a huge part of how I plan to hit our numerical targets.
As CFOs look to drive performance and profit, there are three signs they should look for that indicate the organization is ready to invest in an employee recognition platform.
1. Disengagement Is Costing You Money
When looking for ways to hit our numerical targets, spending money on a trendy HR topic may not seem like an obvious investment choice. But before discounting the idea simply because it is an “unfamiliar choice,” it’s important to look at the option from a numerical perspective just like how you would analyze any other investments. What is the ROI? What will the impact be on the business and our workforce?
Through calculations by Dr. Britt Andreatta, you can predict how much your disengaged employees are costing you. The most important number here is that each disengaged employee is costing you, on average, 34% of their salary.
On the other side of the coin, Author Jacob Morgan’s research for his book The Employee Experience Advantage suggests that organizations that invest in employee experience are four times as profitable.
If HR is raising red flags about disengaged employees, you should be worrying about the cost of turnover and a decrease in performance.
2. You Need Performance to Drive Profit
I dig into the numbers to drive growth and profit. Employee performance is directly tied to my goals. Need a steroid shot to increase performance? Employee engagement can help.
A Reward Gateway study found that nearly 3 in 5 employees would rather work for a company that had a culture where they were praised and thanked for their great work than for a company that paid them 10% more but didn’t thank them.
A Socialcast survey found that 69% of employees would work harder if they felt appreciated for the work they did. Start a conversation on how employee engagement can fuel employees’ needs. Sometimes a simple thank-you will go a long way.
3. You Need to Improve the Customer Experience
Poor customer service is losing U.S. businesses an estimated $75 billion per year, according to a NewVoiceMedia report. What causes an awful customer experience? Disengaged employees representing the business.
Customers are more likely to switch to your competitor if they’re unhappy and stay with you if they’re receiving quality service. Engaged employees are your best company ambassadors to those you do business with. A happy employee leads to a happy customer. Customer satisfaction is great for your bottom line.
Having engaged employees is key to meeting the organization’s monetary goals, because it means increased retention, improved performance, and better customer satisfaction.
If you’re looking to invest, CFOs can rely on the old and trusty data to back up the business case for investment in an employee engagement platform. Identify what you can measure and connect it with the goals and objectives you’re trying to meet as a CFO.
Elli Morii is the Chief Financial Officer at Reward Gateway.