Rules of Engagement

These days, to gain an increase in productivity and profitability, ? entrepreneurs must boost employee morale

In doing so, they regrettably have to manage the results. According to a 2007 study conducted by the global professional services firm Towers Perrin, there is a strong connection between employee engagement and company financial performance (see charts). In Closing the Engagement Gap: A Road Map for Driving Superior Business Performance, engagement is defined as employees’ willingness and ability to contribute to company success. Findings conclude that “the more engaged the workforce, the better the company is likely to perform on a range of key financial metrics.” With a direct correlation between ­productivity and employee morale, a solid confidence and engagement throughout your company—from the top down as well as the bottom up—is necessary if you intend it to increase profitability and thrive.

All Together Now

“First, be aware that what it takes to motivate employees during a downsizing period is different than during a period of growth,” says Bryant. In times of prosperity, employees basically feel grounded and can focus on their daily tasks. But these days your employees are likely to be distracted and disengaged by the reports of “doom and gloom” bombarding the airwaves and the rumors swirling around the office at work. Now, more than ever, they are looking to you for positive leadership and reassurance.

For example, one of the most powerful things you can do as a leader, to show your employees your loyalty toward them and usher in an environment of camaraderie, is to be the first person in the company to take a salary cut. “If you take this step, they are sure to follow if they care about saving the company and preserving a job for themselves later,” says Adrienne Graham, chief talent acquisition consultant and CEO of Hues Consulting & Management Inc. in Alpharetta, Georgia.

It’s also important to let employees know that it requires a team effort to get through the tough times, according to Tanisha Russell Day, managing consultant of KEY HR Consulting L.L.C. ( in Teaneck, New Jersey. “When they see you roll up your sleeves and assist with duties outside of your core responsibilities, that will promote teamwork and boost morale.”

Communication is critical during times like these. Pretending things are OK or keeping silent about the state of the company are big mistakes. “Before this recession you could just tell your employees how things were going to be done. Today, you need to ask them to participate,” says Douglas Duncan, a 30-year human resources veteran and president of Maplewood, New Jersey-based Your HR

For example, when you are looking for places to cut costs, instead of singling out one department to take the brunt of it or making across-the-board cuts, ask your people where they think they can save the company money or what revenue-generating ideas they may have, such as utilizing free or low cost Web conferencing systems such as Skype or telecommuting to save money on utilities. “If you ask them to cut back, you cut back as well and show them. It could be carpooling to work, converting travel meetings to Web conferences, or bringing in your lunch. You can scale back on expensive items and client entertainment expenses,” says Graham. “Whatever you choose to do, make sure your staff knows about it.”

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