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Employee Engagement: HR’s Underestimated Revenue Driver

  • 30 April 2021
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Employee Engagement: HR’s Underestimated Revenue Driver
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Is your organization currently measuring employee engagement? If not, how do you start? If you are, how are you making sure you’re keeping your eye on the metrics that count? In this article, Personio's Chief People Office, Ross Seychell, breaks it all down for you. We hope you enjoy the read!

Employee engagement is far more than a vanity metric. If you measure it correctly, it can become a key element of your company’s success. 

When you systematically evaluate employee engagement, you give employees a voice, make negative trends visible in time, and increase both team productivity and company performance. 

In this article, I want to share how I view employee engagement, how to develop a strategy for measuring it, and what KPIs we focus on here at Personio. Enjoy! – Ross Seychell, Chief People Officer at Personio

Why Should You Measure Employee Engagement?

We can view employee engagement as a barometer for so much of what goes in within your organization. It can show you when things are running smoothly, while helping you prepare for any potential issues before they ever reveal themselves. 

In fact, studies show that motivated employees are up to 22% more productive, making their companies more profitable. According to a survey by Gallup, companies with highly engaged employees generated around 147% higher earnings per share than companies where motivation left much to be desired.

💡What are the benefits of measuring employee engagement?

  • Giving employees a voice
  • Understanding trends 
  • Identifying problems early and taking countermeasures
  • Preventing employee turnover
  • Increasing business performance


As a key performance indicator (KPI), employee engagement shows how your employees think and feel about your company. If you don’t measure employee engagement, you run the risk of a drop in morale, a loss of team loyalty, and even sudden resignations.

Therefore, measuring your employee engagement has a strategic impetus, because the key figure is directly related to the company’s success. Since HR departments should act as partners to management – after all, they “control” the most important corporate resource, the employees – they must keep firm watch over this key figure.
 

Measuring Employee Engagement: A Framework


To measure employee engagement, you should first ask yourself three essential questions.

  • Why – What is the overall goal of measuring your employee engagement? 
  • What – What data do you want to measure, and what data do you already have access to versus what data can you get?
  • How – How will you collect the data and how will you analyze it? 

At Personio, an important “why” is related to our rapid growth, because while we want to scale, we also want to preserve our company culture. So, we pay close attention to how the mood of the team changes: Are people still happy or are there growing pains somewhere? 

To do this, we look at various metrics all along our Candidate and Employee Journey.

The crux, however, lies in the actual measurement. Companies like Microsoft are increasingly relying on the analysis of indirect data sources: For example, they evaluate the volume of e-mail traffic in teams as a sign of commitment and job satisfaction. 

A counter to purely data-driven analysis is an employee survey. In fact, at Facebook, this provided more than twice the accuracy in predicting employee resignations than an analytical approach tied to Big Data.

At Personio, we rely on a combination of classic methods, such as surveys, and machine-based methods. For most analyses, we use the reports that can be found in our software, Personio. 

This reporting helps us to better understand and visualize data. We have also connected the CultureAmp feedback platform to Personio. Using this tool, we conduct regular Pulse Checks and Engagement Surveys, in which we ask specific questions about employee motivation.

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Continue along in this article to learn more from Personio’s Chief People Office, Ross Seychell, about his five most important KPIs when it comes to employee engagement. Click here to read more.


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