CEO buy-in crucial to boosting engagement levels

Behavioural changes ‘have to come from the top’, hears CIPD conference

The spearheading of change programmes by senior leaders can make the difference to improving engagement levels, the CIPD Employee Engagement conference heard today.

Eric Collins, managing director of Nampak Plastics, told delegates that the firm’s employee advocacy score had increased from 20 per cent to 81 per cent in three years, after he drove a cultural shift at the packaging manufacturer.

He explained that the company had already gone through a successful period of cost-cutting and was at its leanest, but he wanted to improve business performance by “using people to help make a difference”.

Despite initial resistance from some members of the board who were used to a traditional command and control structure, Collins pressed ahead with staff feedback sessions, which he fronted personally.

“Sometimes people block changes because they can’t see it for themselves,” said Collins, “but behaviour has to come from the top”.

A lack of performance feedback, team meetings and departmental co-operation were the main issues highlighted by staff, as well as a low level of employee engagement.

Initiatives introduced included leadership training for line managers, a staff suggestion scheme, an employee awards ceremony and a heightened awareness of CSR, linking the company’s 10 sites more closely with community and educational activities.

As a result absence levels fell by 26 per cent, labour turnover rates were reduced by 38 per cent and overhead costs per million bottles were cut by 7 per cent between 2007 and 2011.

Collins told the audience that having “courageous and honest” conversations was an important factor in building stronger workplace relationships.

“Through relationships we have opportunities, and through opportunities we have possibilities, actions plans and ultimately delivery,” he said.

Sharing the platform with Collins was Jonathan Austin, CEO of Best Companies. The organisation has surveyed more than 1.8 million UK employees during the 12 years it has been compiling lists of the country’s most desirable private and third-sector employers.

The conference heard that the country’s employee engagement scores were on the rise again after a 1.3 per cent slump in 2010.

Austin also revealed that Best Companies had canvassed more than 330 CEOs about the restructuring, pay and workforce changes in their companies over the past 12 months.

Three-quarters (73 per cent) of CEOs had made changes to the organisational structure, while 66 per cent had grown headcount and 72 per cent had increased pay.

The survey found that in firms which had gained a three-star Best Companies rating, CEOs spent 32 per cent of their time engaging with employees, compared to 23 per cent in non-accredited organisations.

Today’s conference took place in London and was chaired by David MacLeod and Nita Clarke, chair and deputy chair of the government’s Employee Engagement Taskforce.

Nampak Plastics was also the employee engagement and overall winner of the CIPD People Management Awards in 2010.

Comments

Comments in chronological order (1 comment)

Gordon Bromley 25 January 2012 16:17

Great article and a timely reminder of the crucial personal role CEO’s play in employee engagement. One point in the article interested me particularly, namely the reference to CEO's in 3* Best Rated companies "spending 32% of their time engaging with their employees" - that's way too low in my view!

Obviously company size is a variable factor here but generally my experience is that too many CEO's keep too much of what they actually do on a daily basis unnecessarily close to their chest rather than involving employees more widely on a consultative basis - other than the bank, the board, possibly investors if applicable + or one or two ultra-confidential strategic projects like a pending acquisition, employee engagement should be the major focus of any CEO's time. By adopting a more proactive approach to employee development CEO's could dramatically increase that time allocation to an optimum 70% level simply by bringing some of the barriers down on who gets involved in what and, to be frank, by getting out their ivory tower more often!

Through my work as a Chairman for the Academy for Chief Executives I am involved with many MD’s and CEO's of mostly SME companies on a daily basis and the issue of appropriate time allocation and employee engagement programmes is a frequent pre-occupation. Many CEO’s initially gasp at the idea that they could possibly spend 70% of their time in directly engaging with employees but it's not rocket science and it’s not impossible by any means. As a CEO if you believe in your staff (you have the right people on the bus!) and their almost limitless capability (given the opportunity) to achieve great things why, as CEO, would you want to spend anything less than that engaging directly with them to instil the necessary Drive, Attitude and Confidence they need to possess unlock that potential?

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