Corporate Performance at Risk as Today's Rising Talent Prepares to Jump Ship
The Corporate Executive Board announced that the business world's rising stars are increasingly disengaged and actively seeking new employment opportunities. The findings are the result of a recent employee engagement study revealing that 25 percent of employer-identified, high-potential employees plan to leave their current companies within the year, as compared to only 10 percent in 2006. The study, also revealed that 21 percent of employees today identify themselves as "highly disengaged." This group has increased nearly three-fold since 2007. CEB's Corporate Leadership Council identified six tips companies can use to identify, re-engage, and more effectively manage high potential employees:
Stimulate. Emerging leaders need stimulating work, recognition, and the chance to grow. If not, they can quickly become disengaged.
Test. Explicitly test candidates for ability, engagement, and aspiration to make sure they're able to handle the tougher roles as their careers progress.
Manage. Having line managers oversee high-potential employees only limits their access to opportunities and encourages hoarding of talent. Instead, manage these high-potential employees at the corporate level.
Challenge. High-potential employees need to be in positions where new capabilities can - or must - be acquired.
Recognize. High-potential employees will be more engaged if they are recognized through pay, so offer them differentiated compensation and recognition.
Engage. Incorporate high-potential employees into strategic planning. Share future strategies with them and emphasize their role in making them come to fruition.
Hewitt Analysis Shows Steady Decline in Global Employee Engagement Levels
While the economy is slowly recovering, a recent analysis by Hewitt Associates shows employee engagement and morale in the workplace are not. Almost half of organizations around the world saw a significant drop in employee engagement levels at the end of the June 2010 quarter -- the largest decline Hewitt has observed since it began conducting employee engagement research 15 years ago. This highlights the growing tension between employers -- many of which are struggling to stabilize their financial situation -- and employees, who are showing fatigue in response to a lengthy period of stress, uncertainty and confusion brought about by the recession and their company's actions.
Hewitt's analysis suggests a clear link between employee engagement levels and financial performance. Organizations with high levels of engagement (where 65 percent or more of employees are engaged) outperformed the total stock market index even in volatile economic conditions. During 2009, total shareholder return for these companies was 19 percent higher than the average total shareholder return. Conversely, companies with low engagement (where less than 40 percent of employees are engaged) had a total shareholder return that was 44 percent lower than the average.
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