The McKinsey Quarterly just published (see "Some employees are destroying value. Others are building it. Do you know the difference?") the results of a thought-provoking study that I would like touch upon in today's post. McKinsey surveyed 15,366 workers in seven countries from November 2022 to January 2023 about their job satisfaction, well-being, and self-reported performance, sorting them into different groups based upon their post-pandemic working model (mostly in-person, hybrid, or mostly remote). Recognizing that self-reported performance data isn't always 100% accurate, the McKinsey investigators (Aaron De Smet, Marinbo Mugayar-Baldocchi, Angelika Reich, and Bill Schaninger) found that there are six distinct employee groups or archetypes across a spectrum of satisfaction, engagement, well-being, and performance. These workers range from the highly dissatisfied and actively engaged on one end of the spectrum to the super-engaged and highly satisfied employees on the other end.
These same investigators also estimated that employee disengagement and attrition cost a median-sized S&P 500 company between $228 million and $355 million a year in lost productivity, so now more than ever, focusing on employee engagement, well-being, satisfaction, and performance seems critical to the success of any organization. The central challenge for leaders in an organization then is to figure out how best to move as many employees from the highly dissatisfied group as possible towards greater levels of engagement and commitment to the organization. Importantly, the survey also found that the higher the level of satisfaction and commitment, the higher the well-being and self-reported performance (the converse is also true).
So what are the six archetypes and what can leaders do to have an impact on them? The first archetype, representing about 10% of the workforce are called "Quitters" (these are the individuals who may not necessarily be the lowest performers in the organization, but they are certainly the least satisfied and committed and may already be contemplating leaving the organization). "Disruptors" comprise about 11% of the workforce and represent those actively disengaged employees who are staying in the organization byt either "quiet quitting" or "loud quitting" (i.e., openly expressing their negativity about the organization). The "Disruptors" are "productivity and energy vampires" literally decreasing the motivation, drive, and engagement of everyone around them. They also tend to create additional work due to their lack of productivity and impact on everyone else's morale. The "Mildy Disengaged" comprise about 32% of the workforce and represent those employees who report below-average commitment and performance. These employees are neither satisfied nor actively disengaged and disruptive. However, they do the bare minimum required of their jobs.
Taken together, the bottom three archetypes account for nearly half of an organization's workforce! The good news is that with the right approach, most of these employees can be re-energized and re-engaged to improve their level of commitment to the organization. And as mentioned earlier, the higher the level of engagement and commitment, the higher the performance.
The "Double-dippers" comprise about 5% of the workforce and are individuals who likely hold two or more jobs without the employer's knowledge. This category has become more common with the change to remote work during and after the COVID-19 pandemic. These employees are evenly split between those who are engaged and contributing to the organization's success and those who are disengaged and are not contributing. The "Reliable and Committed" comprise about 38% of the workforce and are those satisfied and committed employees who are reliable performers that often go above and beyond for their organization. The last archetype are the "Thriving Stars" who comprise about 4% of the organization's workforce. These rare employees are highly committed and engaged and bring disproportionate value to the organization as a result. The most important consideration for this archetype is that they are at the highest risk of burn-out.
So what should leaders focus on to re-engage their employees? After looking at 12 factors that affect employees' satisfaction and commitment levels, the investigators found that nearly two-thirds of the total cost of disengagement could be explained by the top six factors, in terms of relative contribution to disengagement costs:
1. Inadequate total compensation
2. Lack of meaningful work
3. Lack of workplace flexibility
4. Lack of career development and advancement
5. Unreliable and unsupportive people at work
6. Unsafe workplace environment
Prioritizing these six factors could recoup a significant proportion of the money lost to disengagement, which will create value to the organization in the end.
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