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E252 | The Science of Engagement and Successful Management with Jim Harter

This week we learned from Gallup’s Chief Scientist of Workplace Management and Wellbeing, Jim Harter., Jim Harter. Jim is also the co-author of the Wall Street Journal bestseller Wellbeing at Work and the No. 1 Wall Street Journal and Washington Post bestseller, It’s the Manager. Now, he’s written another book, Culture Shock, where he explores how organisations adapting to this culture shock will determine whether they thrive or even survive and whether U.S. and global productivity will go up or down.

Jim has been studying human behaviour in organisations for 37 years and really gets a kick out of studying what happens inside them. His work at Gallup is to study what happens in the populace at large and to do massive polls of the world and workplaces around the world and understand what’s going on in people’s work and lives. Last year, Gallup did a daily survey throughout COVID, and fifteen thousand people take part in their quarterly survey, so they got some fantastic data. That’s why we wanted to invite Jim to Mind Your F**king Business Podcast to find out what that data said about working from home versus being fully remote, or hybrid. 

In this episode, we learned how many days in the office drive engagement. Also, do higher levels of engagement translate into better financial performance? How do we make business more productive and outperform our competitors? We also dig into the data about working from home versus in the office, and we find out what are the five things that drive wellbeing as humans, how to structure one-to-one meetings, and how often they should be. And finally, what are the top five things that we should talk about with our teams every week to drive high levels of engagement

An absolutely fantastic conversation. Download and listen to learn more.

On today’s podcast: 

  • Culture Shock
  • The effect of COVID on engagement
  • The five elements of wellbeing
  • Fully remote, fully on-site and hybrid. What’s best?
  • The managers are key to driving engagement

Follow Jim Harter:

Jim Harter – Gallup


Culture Shock

2023 Gallup Exceptional Workplace Award Winners

Gallup’s insights on engagement in the workplace 

Jim Harter is the primary researcher and author of the first large-scale, multi-organisation study to investigate the relationship between work-unit employee engagement and business results, including profitability, productivity, turnover, customer engagement, safety and health. Updated periodically, this study currently covers more than 112,000 business units and includes 2.7 million employees in 276 organisations across 54 industries and in 96 countries. He is the co-author of Culture Shock, as well as Wall Street Journal bestseller Wellbeing at Work. He is also the co-author of the No. 1 Wall Street Journal and Washington Post bestseller, It’s the Manager. Jim’s work has appeared in the Harvard Business Review, The New York Times, The Wall Street Journal, Fast Company and Time magazine.

Jim also co-authored the New York Times bestseller 12: The Elements of Great Managing and the New York Times and Wall Street Journal bestseller Wellbeing: The Five Essential Elements. His research is also featured in the bestselling management classic First, Break All the Rules. Jim has authored or co-authored more than 1,000 research studies on employee engagement and talent and on topics in applied psychology and wellbeing. His specialities include psychological measurement and estimating the economic impact of management initiatives.

Culture Shock and Gallup’s data collection

Jim’s new book, Culture Shock, explores the new workplace and the changes that we’ve all experienced over the recent years. Its purpose is to help leaders navigate through these changes. 

“I think there’s a lot of organisations still trying to figure out what to do. And we brought science to the equation and collected a lot of data. We want to help leaders know how to maximise productivity in this new workplace.”

As part of their research, Gallup is constantly collecting data in the US. They’ve run about fifteen thousand surveys every quarter on a number of topics related to work. And they also conducted daily surveys during COVID. 

“So they were really not only about work but also about life and how people were adjusting to all the changes that we’re going through”

Globally, Gallup runs the World Poll, surveying a couple of hundred thousand respondents in 120 countries every year. Their State of the Global Workplace report is also updated every year. 

“We get an estimate on how many people in the world are engaged in their work. We trend every quarter in the US. And we’re doing an annual study in Germany, and some other European countries.”

The effect of COVID on engagement levels

Jim tells us that during the early stages of COVID, the data showed an engagement peak, reaching an all-time high of 40% in the US. Shortly thereafter, he adds, it started to drop, but organisations were very responsive from early on. 

“About half of the people strongly agreed their organisation cared about their overall wellbeing. But engagement here in the US took a significant drop right around the time of the events surrounding George Floyd. Leaders had to take a step back and try to figure out how to respond.” 

It was in the second half of 2021 that they saw significant drops in employee engagement, not only in the US but around the world, which coincided with the so-called ‘Great Resignation’. In Jim’s view, what really happened was that companies realised they had to do some layoffs, and that had an effect on people. Suddenly it went from not being a great time to find a job to people feeling exactly the opposite. There were a lot of job openings, and people remembered how their employers treated them during COVID. 

“Resignations were really a function of both opportunity and some pent-up frustrations that some workers had kind of a chance to sit back and reflect on what work should be in their life.”

What followed from that was the now-called ‘quiet quitting’ – something that has been out there for a while before then–. At Gallup, they call it ‘not engaged people’. These are the ones that show up to the minimum required, and that tends to be most people in most jobs, says Jim. It doesn’t have to be that way, but it tends to be, and it has a lot to do with management. 

What are the different levels of engagement

The way Gallup classifies the levels of engagement are ‘engaged’ (people that is putting in discretionary effort), ‘not engaged’ (those that are doing the minimum required) and ‘actively disengaged’ (those who are ‘active terrorists’ in their own organisation). 

“They’re emotional but against the organisation, and they’re bringing other people down with them. We call them loud quitters […] Those might actually be the people on TikTok that were being vocal. I mean it was surprising to me that people would go publicly and tell the whole world that they’re going to do the minimum required including their employer. That’s pretty bold.”

If people don’t have great management and don’t feel inspired in their work, they can easily become quiet quitters. It’s hard to imagine that that could ever be functional for the individual or the company because most companies have value statements and almost every job requires some level of discretionary effort. 

“Random things that might pop up that coworkers might need or that customers might need. And so even though there are specific job descriptions, any kind of withdrawal like that is not good. I don’t think it’s good for the individual either because they don’t feel good about their work.”

Is the four-day week better for engagement?

Happy, whose founder and CEO Henry Stewart was on the show a few weeks ago, was one of the companies that decided to continue working four days a week after the UK trial. He then said their productivity went up because of this. But, is there really a link between a four-day week and higher levels of engagement? 

The simple answer from Jim is no, engagement is not higher with a four-day workweek. Although, in some cases, wellbeing is a little higher. 

“People say that is an on-site job where they have to be on site. They do say they would change an employer for a four-day workweek. What I pull out of all the data on that and other policy-related things is that if you put policy before engagement, you’re going to have problems because you could institute any policy.” 

Many times, says Jim, policies are put in place because there’s an underlying assumption that work is bad for people. But it doesn’t have to be that way. It can be very inspiring, and lead to incredible lives because we spend so much time doing it. The four-day workweek might be the right answer for some companies or some individuals, but he thinks is a blanket policy that doesn’t make much sense. It’s actually going to cause more stress for some people because they have to crunch all their work time into four days.

How does Gallup measure engagement?

When it comes to measuring engagement Gallup Q12 is a great tool that links strongly to performance. Jim reckons it’s as good as it gets in terms of predicting retention rates and productivity for business units, profitability, and how customers feel about the service. So the foundation of that tool was around elements that link to performance outcomes and that managers and employees can do something about to fix it.

“We just awarded 57 organisations ‘Exceptional Workplaces’ that we review every year. So even though the US average is a little over 30%, the global average is a little over 20% engaged workers. These companies have reached 70% plus engagement. And it’s a high bar because we make it a high bar. It means something when you get to that 70% plus level. It means you’ve got a consistent culture, you’ve got better performance.” 

For Jim, the metric matters and there are a lot of soft metrics out there where people are celebrating 80% engagement that isn’t real. For instance, Jim referred to the eNPS. For him, this survey doesn’t have a correlation with performance, and it doesn’t tell the organisation what to do about it. 

“You get an answer, and you can add a bunch of scale points together and get a positive result. As researchers, we’ve tried to stay away from that approach and certainly engagement links to whether people recommend their company.”

Engagement also links to other things like employment brand, but also to hard outcomes. At Gallup they measure profitability in business units, and whether people stay or leave their company, whether there’s more of a tendency to leave. 

“During the great resignation here in the US, engagement mattered even more than it has in the past. Actively disengaged workers were even more likely to look for other jobs, and engaged workers were a lot less likely to look for other jobs.”

“Two-thirds of the actively disengaged people could be turned around by management”

Jim argues that a good reason to be disengaged is having terrible management. Perhaps a manager comes in and only critiques. They don’t build any trust. It could be someone that was really good at their prior job, but when they got into management they didn’t know how to deal with people. He adds that the top two reasons why people become managers are being good at another job, and tenure, and neither of those related to whether someone is good as a manager or not. 

The five elements of wellbeing

To study global wellbeing, Gallup uses their World Poll to understand what are the elements that can be measured, that individuals can act on and change, and that are generalisable across the world that are part of being human. By asking that question, they found five elements that affect wellbeing. 

  1. Career: That’s one of the most foundational elements. If that’s not inspiring, you’re not going to have a great life. 
  2. Social: There’s a social aspect to work, and it’s important for people to realise and not assume that we’re robots on Zoom calls. Social can be an intentional part of a good workplace, and of the rest of our lives. 
  3. Financial wellbeing. Certainly, money plays a strong role because it gives us choice, says Jim. People with the highest financial wellbeing have long-term financial security. They feel good about where they’re headed, and they do things to reduce the daily stress that comes from finances. 
  4. Physical wellbeing. So, how do we manage our lives so that we can do what we want to do? Most people reach their 50s and start learning about some disease burden that they have to manage. 

“Can we manage our lives so that we can essentially do the kinds of things that we want to do and have high energy on a daily basis? And some things we can’t control, some things we can’t manage our lives so that we have high energy.”

  1. Community wellbeing. This has to do with where you live. Do you live in a place that you can be proud of? Do you live in a place where you can get involved and make a difference? It’s basically about living in a safe place.

Fully remote, fully on-site and hybrid. What’s best?

For Jim, the decision to go hybrid shouldn’t be random. You should trust people. But if you don’t have a plan and some predictability about how you do hybrid, it’s just not going to work. 

“There’s high risk with hybrid if you don’t have the right management and the right leadership around it. And I think that’s what companies aren’t getting right. They’re taking one extreme or the other. They’re even saying, get your butts back in the office. Or they’re saying, we trust you to do what you need to do. And so the criteria aren’t in place to make it work right.” 

Culture has to be intentional, and that starts with hiring. If you want to build an in-office culture, you need to plan that into your hiring process. People need to know that before you hire them, adds Jim. 

When looking at the data, Gallup categorises people according to how many days they were showing up in the office. They asked them what their employer was asking them to do, whether it was a requirement or a guideline, and what they were actually doing. Gallup found that the highest the level of engagement, the lower the levels of burnout (among people in remote-ready jobs).

“If people were in jobs where they have some asynchronous collaboration – meaning that they have independent work, that at some point they bring together with other people – about two days together is where engagement peak, two to three days. And for highly collaborative work where people do work together a lot, three days is where we saw peaks in engagement.”

Jim also reveals that it was in people who are five days a week in the office that they found the lowest levels of engagement. The reason for that, he thinks,  is because when we all went through this pandemic and were forced into trying remote working. Some people didn’t work too well because of their family situation. For others, it worked well and they found themselves with greater autonomy. 

“There’s this thing in behavioural economics called the endowment effect. They were given some autonomy and some choice, and they didn’t have to do the dreaded commute, and they learned that it wasn’t as necessary as they thought. And so you try to take away the endowment effect basically means that if you take something away from somebody that they’ve already got, it hurts a lot worse than the joy they got in getting it in the first place.” 

Why do people like working from home?

Before COVID, anyone who commuted longer than 45 minutes would probably change jobs at some point just to reduce the commute. Jim tells us that since COVID, the time has dropped to 30 minutes. That’s how much people can’t tolerate right now. It seems the commute is more tolerable for people that are engaged in their work. It’s analogous to leaving home to go fishing or hunting. You’re pursuing something that gets you excited. 

“I’ve got a 40 minutes commute. I’d rather not do it, but I can see the payoff. So it’s worth it to me to come into the office three days a week or sometimes more, but three days a week, and to have the 40 minutes commute. But the criteria has changed for people in general and most people aren’t engaged in their work, so they’re going to have higher stress with the commute. But that’s the first thing that came to me when I asked people, why do you like working from home? Whether it’s hybrid or fully [in the office], the commute was the number one reason.”

The second reason people gave Jim was that it was better for their wellbeing. The third reason was it was better for their family. So people saw the time savings, but what they didn’t see right away was the effect on their team’s in-person time. You’ve got to experience it to remember its value. 

“It’s really important for leadership to list off the whys to, first, identify and be intentional about what you want your culture to be and second, to explain why being the office matters. If that’s what you want your culture to be and what the payoff is for the individual.” 

When Gallup asked people how they decided where they’re going to work, whether it’s in the office or at home, 87% of them said it was either leadership told me, my manager told me, or I decided on my own. 

The fourth criterion? I decided with my team, which, by the way, is the most highly related to engagement, but only 13% of people said they worked it out with their team in terms of people showing up to the office, nobody else is there. It’s not very inspiring, concludes Jim.

It’s the manager

For Jim, there’s nothing more enjoyable than getting something done with other people. 

“It’s such an enjoyable thing. And to accomplish things together, people need to see that, and feel that again. And I think it’s on managers to almost force those kinds of conversations among their team.” 

It comes down to the manager knowing how the team functions, what each person’s job is, and how much of it they need. Better managers are in the only position in an organization or the only ones in a position to know the idiosyncrasies of each person, to know their strengths, their life situation, their family, etc. To be able to juggle that, to make it work and to be able to explain it to their colleagues so that they know why people are in at certain times and when they’re not.

“There needs to be some transparency about that again so that it’s predictable. And I actually think, even though I cited some depressing declines in engagement, I think that employee engagement and well being could reach all-time highs through this. If we get managers upskilled, or re-skilled to have the right conversations with people and be in touch with them on a regular basis. I think hybrid work even though it has higher risk, it also has higher reward if we get it right.”

Book recommendations 

Wellbeing at Work

It’s The Manager

Maslow on Management

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