Why Do So Many Companies Struggle to Improve Employee Engagement?

When businesses encounter hiring or retention problems, HR teams and leaders may jump to the following solutions:

• Improve perks and benefits offered.
• Add more events to the social calendar. 
• Launch various HR programs.

While these efforts might be fruitful, many businesses may be disappointed to find that these things hardly move the needle.

Their turnover rate remains high and morale low.  

Why does this happen?

Many factors stand in the way of higher employee engagement. Many are tangible and obvious such as leadership resistance, passive managers, and lack of planning.

However, some other barriers are harder to see...

Although they are invisible, they hold a powerful influence on the outcomes of a business. 

This article will explore some of the key factors (both visible and invisible) that tend to hold businesses back from developing higher engagement. You'll understand why engagement efforts often don't yield the results companies are looking for and what you can do to remedy the situation.

Why Do So Many Companies Struggle to Move the Needle on Employee Engagement?

Employee engagement is a low priority for leadership

HR is often the team tasked with improving employee engagement. However, senior leaders are the ultimate decision-makers and gatekeepers of financial resources. 

To that end, when leadership is resistant to change, increasing employee engagement can become impossibly difficult.

Here are some signs that employee engagement is a low priority for leadership:

• HR teams are kept small and mainly tasked with focusing on administrative work. 
• Leadership favours low-cost and easy-to-implement solutions. 
• People are reluctant to question the status quo as they will be met with a "this is how things have always been done" mentality.

Leadership attitude sets the tone for an organization. Attitudes like these trickle down and affect how much people can actually change the status quo.

“Work is getting done, people seem happy enough” is a mentality that becomes fixed. As a result, employee engagement falls to the bottom of everyone's to-do list. At most, leaders may approve of lacklustre solutions, such as pizza parties and cheap gift cards, without any attempt at fixing the root problem.

In the end, a lack of leadership support and resistance to change can create a climate of cynicism and distrust. This, in turn, perpetuates a mediocre, high turnover culture.

Lack of a structured plan

“Employee engagement” is a big, cloudy term. Ask different people what it means, and you will get a variety of answers. 

So when an HR team is asked to improve employee engagement, it can feel like getting a pile of materials and being told to build an impressive house with no instructions or tools. Sounds impossible! Like they're destined to fail.

Since employee engagement seems so daunting, the following happens:

• Companies adopt a reactive approach. Solutions and programs are only considered when there is already a serious problem.
• Low-cost or single-stroke solutions are favoured. Employee engagement isn't looked at holistically. 
• Companies rely on "trendy" HR initiatives they see other companies. They don't think about whether their employees will benefit.

In short, companies favour a passive approach. The problem here is it makes employees feel as though their well-being is a low priority to the company. Worse, band-aid solutions can leave them feeling even more cynical. 

• For example, this Psychology Today article explains how using "token gestures" like mindfulness training to help employees cope with stress and burnout can backfire. When there are serious underlying issues in a workplace, these gestures appear hollow to employees. And it can actually make them feel worse than doing nothing. 

We all want to feel like our well-being matters. Making your employee experience a top priority is critical. In other words, businesses need a plan for scaling their engagement initiatives. 

If you have no idea what a structured plan might look like, we wrote a brief guide on how to start an employee engagement program to help you out.

Leadership motivations are in the wrong place

Even when leadership is on board, businesses are often disappointed with the results of their engagement efforts.

Why does this happen?

Because despite leadership support, their motivation was in the wrong place all along — the main goal is to improve productivity and profits.

In other words, their desire to invest in employee engagement is driven by self-interest. It's not about a sincere desire to improve the conditions for their employees.

As workplace expert Eric Kapinski explains in this Forbes interview, companies overly focus on desired outcomes like higher productivity and profitability. To the individual contributor, this sounds suspiciously like a request to work harder without any clear benefits in terms of pay or working conditions.

As a result, engagement programs or initiatives are out of sync with what employees truly need. And employees feel, at best, disconnected from their organization’s efforts, at worst, totally cynical.

There are several signs that this may be happening:

• Your company does not factor in employees' voices and opinions in the decision-making process.
• Your company copy/pastes what other businesses are doing without thinking about the problems unique to your organization. 
• Your company rushes through the process of rolling out programs and initiatives without thinking about the real problem you’re trying to solve. 

Bottom line: leadership buy-in is not enough. 

For employee engagement efforts to be truly worthwhile, they have to come from a real desire to improve your working conditions and employee happiness. 

You're probably wondering, what's the point in investing time in employee engagement if you're not going to increase productivity or profits? A business's main goal is to make money, isn't it?

Yes, of course. It's OK to want higher productivity and profits. However, when it comes to employee engagement, those shouldn't be the primary goal. The primary goal should always be to improve employee happiness and well-being. Everything else will naturally follow when your motivations are sincere and in the right place.

Policies and programs are seen as the ultimate “solution”

Think about a gym membership. The membership itself won't make you get in shape, right? You will only see results if you actually get up and go work out.

The same idea applies to organizations. Pilling on more programs and policies won't improve your employee experience. 

Without real action, employee engagement is simply wishful thinking.

Let's take the following story as an example:

• Your company is experiencing high rates of burnout and stress, so to help employees, your HR team implements a “burnout leave” program.
• Still, workloads and standards remain demanding, and deadlines remain unrealistic. ( i.e. The root cause is not addressed.)
• Although employees return from burnout leave feeling better, the work environment has not changed. 
• Ultimately, your company's problem remains unresolved.

Approaching employee engagement with a more "policy and programs" approach can be a trap. And making employee engagement the sole responsibility of HR ignores the many other factors that define employee happiness. 

Employee engagement is about thoughtful HR policies and programs — yes. But, it's also about:

• Leadership evaluating the sustainability and impact of the business model on their employees' long-term well-being.
• Assessing the norms and expectations that drive your organization.
• How managers treat employees daily.
• How peers treat each other and work together. 

In other words, employee engagement also means addressing the workplace conditions or norms that have contributed to poor employee well-being and replacing them with better ones. Everyone in a company should be held accountable for upholding these goals, not just HR.

Toxic norms (or people) are not addressed

Exclusion, gossip, hostility, and other disruptive behaviour spread like viruses. If leaders tolerate harmful behaviour, they can rapidly create a troubled and toxic culture and ultimately harm productivity and engagement.

A growing body of research proves the harm toxic people and behaviours can do to an organization's culture.

One study from Harvard showed that letting one toxic hire go quickly translates into a $12,500 cost-saving. In short, a single bad apple can be financially costly for your business.

Another 2022 study by MIT Sloan found that "toxic corporate culture" is the top predictor of employee turnover. It even came before compensation. 

Think of it like this: When employee engagement is high, employees feel a strong emotional bond with their peers, managers, and workplace. In short, they feel included, safe, and treated with consideration and respect. And most importantly, they feel proud to work for your business. 

If your employees are not receiving these fundamental feelings of respect, safety, and security, they will not feel engaged. More perks, programs, and policies will only serve as band-aids until your company can resolve the root problems.

So What Moves the Needle on Employee Engagement?

A top-down approach to employee engagement

The tone of a company is set by its leadership. They are the gatekeeper of resources, and they play a critical role in how the culture of an organization unfolds. 

To that end, the idea that employee engagement should be driven by HR and programs is flawed. This strategy often leads to the use of surface-level tactics that quickly lose their appeal. These strategies only give rise to more employee cynicism when executed poorly.

Bottom line: A strong, engaging culture can only flourish when viewed as a holistic entity everyone is responsible for creating. This is not just the job of an HR team. It's the responsibility of leadership, managers, and even each employee. Work cultures that are engaging are created when everyone takes consistent action to foster a satisfying work environment for all.

Real, tangible actions and change

Owning a gym membership won't get you results. Real progress only comes when you take action. This means actively changing your habits and behaviours to move towards your goal.

In the workplace, the same idea applies.

Policies are only effective if they’re followed. And HR programs will have very little impact if people don’t participate. Or if toxic people and behaviours are being overlooked.

In short, employee engagement is about big things like policies and programs. But it’s just as much about real, tangible action.

No matter how many shiny new policies, programs, and initiatives your company launches, you cannot build a healthy workplace if leaders are not proactively taking steps to correct harmful work norms.

A sincere desire to create a better work environment

When companies use HR programs to coax people into being productive, it fuels employees' distrust. This is especially true when these programs are surface-level and not aligned with employees' genuine needs. In short, when there are no actual attempts to improve the working conditions.

This approach generates employee cynicism, leading to a decay of faith in the programs and the company's efforts.

The moral of the story? Higher productivity should not be the primary goal of engagement efforts. That said, wanting to seek profit and productivity isn't harmful in itself. After all, you have investors to report to, and you're running a business. 

Creating a better workplace must be a company's primary goal. This will lead to more thoughtful and genuine efforts aligned with what employees truly need.

Listening to employees' needs

Engaging someone means actively interacting with them; it is a two-way conversation. In other words, to truly engage your employees, you must create a dialogue with them. Understanding their needs is key. And any actions or efforts your business takes should be aimed toward fulfilling these needs.

If you are launching new initiatives, programs, or perks without asking employees what they want first, you are not engaging them.

Final Thoughts

Increasing employee engagement may seem impossible. Throw in many engagement myths that circulate, and employee engagement might seem even more insurmountable.

But it's critical to remember that engaging employees don't always require expensive solutions or lavish programs. 

If you peel back all the layers, you will see that all engagement strategies have the same goal: to meet our universal psychological needs. In other words, employee engagement is nothing more than making structured efforts to treat people more humanely. 

For example:

• By helping employees learn and grow. 
• By helping employees feel recognized, respected, and appreciated.
• By taking employee opinions and expertise into consideration when making decisions.

When a workplace can tap into and satisfy employees' most fundamental psychological needs, employee morale and performance will improve.