Employee Engagement & Performance: What is the Link?

If you’re a manager or HR professional, chances are, you ponder employee engagement pretty much every day. It ranks right up there with job performance—and with good reason. 

After all, these are powerful qualities that employers seek to elevate in their workforce. Studies show that employee engagement and performance are linked to productivity, profitability, and other key business outcomes. 

And they’re linked to each other as well. Unlock the key to increasing one, and you’ll improve the other, too—which is why this important connection deserves a closer look.   

Understanding Employee Engagement 

Employee engagement refers to the emotional and psychological connection that employees have with their work and employer (or not). It reflects the level of commitment and dedication they feel toward their jobs—which is intrinsic to overall employee satisfaction and employee morale.   

Engaged employees aren’t merely working for a paycheck; they actually love their jobs. But just 31% of U.S. workers feel engaged at work, according to Gallup’s latest research. There’s plenty of room for improvement.    

The Key Elements of Employee Performance 

Job performance refers to the extent to which an employee fulfills their responsibilities and meets their employer’s standards and expectations. 

Job performance encompasses the various aspects of an employee's work, as typically reviewed in performance evaluations. For many employers, key performance metrics include:

• Job proficiency
• Work quality
• Productivity
• Communication skills
• Collaborative skills
• Initiative/Creativity
• Adherence to company policy/processes
• Contribution to the achievement of company goals 

The Link Between Employee Engagement and Performance

There is a clear causal relationship between employee engagement and job performance. The more engaged workers are, the better they perform at work in myriad ways. 

For example, research demonstrates that engaged workers are not only more productive than their non-engaged peers, they produce higher quality work. In addition, engaged employees have lower absenteeism and turnover rates and are involved in fewer workplace accidents. They even generate higher levels of customer loyalty.       

In short, if you want to boost performance, enhance employee engagement. And that’s where performance management comes in. 

Performance Management and Employee Engagement

Performance management is the ongoing process of setting clear expectations for employees, then regularly measuring employee performance against those expectations, with the goal of continually raising the bar.  

Effective performance management improves employee engagement levels. For example, when managers provide employees with performance management tools, such as feedback, coaching and recognition—not to mention skill development opportunities—engagement rises. 

And when employee engagement rises, performance does, too. It’s an endless cycle—which is what makes them both so important. 

Performance Evaluation: Ways to Measure It

There are numerous ways that employers can measure performance and engagement, beyond conducting traditional performance evaluations. For example, employers can: 

• Conduct ongoing pulse surveys, carefully constructed to reveal employees’ attitudes
• Use 360-degree feedback assessments, which allows employees to give input regarding their peers and managers
• Direct managers to hold informal “check ins” with their reports, gleaning insights into their work and mindsets
• Track performance metrics such as absenteeism and turnover to gauge company-wide engagement and performance levels

As they say, if you can’t measure it, you can’t manage it. Nor will you know if your improvement efforts are paying off.

Focus on Employee Engagement 

Increasing engagement elevates job performance…and working together, they have the power to improve the bottom line. Engagement isn’t just a trending HR buzzword; it truly matters. 

Namely’s HR software is designed to simplify performance management and improve employee engagement, with a suite of tools and processes like 360-degree feedback, goal tracking, continuous feedback and performance reviews. 

Click here for more information or, for inspiration, read our Ultimate Guide to Employee Engagement Surveys.

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