Friday, January 1, 2010

What is DISengagement Costing Your Organization?

Richard Dickerson of The Brooks Group made the following statement: "We found that almost 85% became actively disengaged in their jobs within the first 2 hours at work because they were unable to use their talents on the job!"

Reading this made me wonder what must be the financial costs associated with disengagement, as well as benefits of engagement. In this regards, I located some data that I want to share here.

This insightful and very valuable data comes from a recent book written by Casey Wilson entitled "The Cornerstones of Engaging Leadership". It is as follows:

1. Current data suggests that MOST individuals working in organizations are NOT actively engaged. Here's the breakdown:

A. 19 percent are ACTIVELY DISengaged - people working AGAINST their organization.
B. 55 percent are DISengaged - people simply floating through their work days, people not giving it their all, withholding their discretionary efforts.
C. ONLY 26 percent are engaged - people who are passionate, committed, and connected to their work.

Bottom line: Roughly 3/4th of the people can contribute so much more, yet are NOT. Here are the costs and benefits Casey goes onto state that are worth seriously paying attention to.

* The Gallup Organization estimates that disengagement costs $350 billion per year in lost productivity. In addition, its research suggests that health care costs INCREASE when individuals are either non-engaged or actively disengaged, primarily due to stress, doctor visits, and physical problems. I recall reading at another place recently that nearly 75 percent of circulatory disorders are actually due to stress. 75 percent. Yikes! That's HUGE.

* The Corporate Leadership Council, surveying 50,000 employees from 59 countries around the world, found that highly engaged individuals perform 20 percent BETTER then non-engaged or actively disengaged individuals AND are 87 percent less likely to leave their organizations.

* Emotional engagement drives individual discretionary effort FOUR times GREATER then rational engagement.

* A study by Michael Treacy, author of Double-Digit Growth: How Great Companies Achieve It No Matter What, and his partners at Hewitt Associates indicates that companies with a 60 to 70 percent engaged workforce DOUBLED SHAREHOLDER RETURNS of those with only 49 to 60 percent engaged workforce.

* Companies with less then 25 percent of engaged people showed a NEGATIVE shareholder return. Data goes onto show that engagement not only affects individuals and leaders, it also affects customers and shareholders.


Let alone the human toll, payroll in most businesses tends to be the single LARGEST direct operating cost. Therefore, if such numbers don't make the case for truly paying attention to our most valuable resource, I don't know what will.

This reminds of me of the statement Judy Suiter makes in her book, The Universal Language of DISC - Reference Manual. She states:

"Why is it so many companies invest millions in buildings and equipment, and yet invest so little in the development of their most important asset-people?"

So...back to the question...what is the disengagement level in your business and what impact is it having on your teams, your organization?

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