97. Why Engagement is Declining + Our Adapt-or-Die Moment

Transcript – Episode 97: Why Engagement is Declining + Our Adapt-or-Die Moment

Joe:
Recent research from Gallup indicates that employee engagement has declined more than 10% since the pandemic. I’ll tell you why and how to rally engagement where you work. Plus, I’ll read an excerpt from my forthcoming book about the adapt-or-die moment facing businesses and leaders everywhere that’s happening now on Boss Better Now.

Jamie:
You’re listening to Boss Better Now. This show is sponsored by Joe Mull and Associates. Now here’s your host, speaker, and author, Joe Mull.

Joe:
Hello again, BossHeroes. Welcome back. Whether you are listening to us on your commute, while working out, during the workday, or as part of your morning routine, please know how grateful I am that you choose to spend some time with us each week. By the way, if you didn’t know, you can always say, hey, Alexa, play Boss Better Now with Joe Mull, and you’ll get the latest episode. And I’m kind of sorry – not sorry – if I activated your device around you. Hey, I’m flying solo this week because Suzanne is traveling, so we wish her safe, glitch-free, dare I even say, enjoyable travel. And we soldier on with our next episode. And this week I wanna start with an update on some employee engagement research that was released recently by Gallup. So, if you’re not familiar, Gallup is the preeminent employee engagement research enterprise in the world. And they’ve been tracking employee engagement across the globe for, I, I think it’s about four decades now, for about 40 years. And they have their finger on the pulse of the degree to which people in the workplace are emotionally and psychologically committed. And if you’re not familiar, Gallup puts people into essentially three buckets as it relates to engagement. People are either engaged, not engaged, or actively disengaged. Engaged is the only category where people give it all they’ve got. They part with discretionary effort. They are emotionally and psychologically committed to their work. Not engaged are the folks who are just going through the motions, right? They’re doing the minimum. They’re doing just enough to get by. They sometimes say in a funny way, these are your employees who quit but forgot to leave. By the way, this idea of “Quiet Quitting” that you’ve been hearing about for a long time really falls into this category. And then that third bucket is actively disengaged. This is where people actually act out their unhappiness at work. These are the people who are toxic, who are disruptive. This is that legacy employee that pulls a new person aside and says, let me tell you how things really are around here -and then they poison the well for that person in their first few weeks on the job. And as Gallup has tracked engagement across the globe, what they have discovered is that since 2022, there has been a decrease in employee engagement. A recent survey found that only 32% of workers are engaged compared with 36% in 2020. They’ve also found that the share of workers who are actively disengaged has risen just a tick since 2020. While those considered not engaged has remained about the same, actively disengaged has ticked up from 16% to 18%, and not engaged is still hovering right around that 50% mark.

Joe:
And there’s a lot of reasons why this is happening, and I wanted to go through some of them with you because I think it can help us shine a light on the things that we know we’re supposed to be doing that activate commitment in the workplace, but that maybe we haven’t paid as much attention to. And certainly, some of these things are within our locus of control, but not all of them are. One of the things that’s really interesting about this research that has come out is what people are pointing to initially as the cause. A lot of folks nowadays are saying, well, one of the reasons that people are so disengaged at work is because of remote work, but we know that’s not necessarily true. Gallup has done considerable research on work-from-home employees, and they’ve found that they actually will have higher levels of engagement in the workplace as long as they get regular feedback from their direct supervisor.

Joe:
And of course, there are some circumstances where people who are in remote jobs and maybe experience less support from their boss or less connection with their team members or with the mission of their company where that circumstance can contribute to disengagement. So that is baked into the pie here, no question. But what I think is important to acknowledge is that as we’ve come out of the pandemic, we have slipped into some of the routines that maybe we had prior to the pandemic, and we’re no longer doing the things that actually drove employee engagement up in 2020. That’s right. Believe it or not, employee engagement in the US actually went up while we all were in the midst of perhaps the biggest workplace crisis any of us had ever faced before. And if you think about why that happened, it really isn’t a surprise when the pandemic landed, the kinds of interactions and accommodations that employers made for their employees were the very things that tend to supercharge engagement.

Joe:
So, for one, the conversations that direct supervisors were having with their direct reports were often focused on their direct reports, right? It wasn’t about the manager, it wasn’t about a corporate agenda. It wasn’t about getting as many things done as possible. It was all about, okay, what do you need right now? How can we adjust and tweak this job role to fit what’s going on with you? Because some folks had kids at home and were remote schooling, and some folks had partners or spouses that they had to work around their schedule. So, there was a lot of flexibility, there was a lot of accommodation, and the interactions that managers were having with direct reports were focused on the direct reports. The other thing that was happening is that leaders from the top down were overcommunicating, right? If you remember those first few months of the pandemic, we saw leaders from CEOs all the way down to frontline managers, constantly sharing information with their team members. And this was a necessity in a lot of places because so many things were changing so rapidly.

Joe:
I work with a lot of healthcare organizations and, you know, things were changing by the hour in some corners of the world and in some places. And so that over-communication helped people feel like they were in the loop and that they knew what was going on and they felt supported and taken care of. And of course, the other thing that was happening in the early months of the pandemic is that everyone had something to rally around, right? People figured out really quickly that we’re gonna need to come together. And all of the noise and the — the high school BS that sometimes creeps into the workplace, boy, we’ve gotta set that aside and we’ve gotta focus on getting through this together. And so, everyone was rallied around a shared purpose.

Joe:
And if you think about those three kinds of experiences together, right? Getting managers who were flexing and accommodating and, and were having employee-centered conversations over communication, keeping people in the loop, and rallying to a shared purpose. Well, right? There are three crucial ingredients to activate commitment or to help create the conditions that lead people to be engaged. Well, what’s happened since then? We’ve stopped doing a lot of those things, but here’s what else is going on. Everybody’s still short-staffed. So, so, many folks are overworked, their stress level is higher, and their energy level is lower. They’re experiencing burnout. Many folks have taken on more work than they had even during the pandemic or before it. And so, people are thread bear, their gas tanks are empty. And so, it would make, it would come as no surprise then that those numbers of people who are psychologically committed to their work would tick back a little bit because being burned out doesn’t lend itself to being engaged.

Joe:
The other thing that we have to remember is that in a lot of places, there hasn’t been a recovery from the pandemic. People are still dealing with the workloads, the work circumstances, the staffing challenges, and they were never given a chance to get away to recharge. A lot of the keynotes that I was doing in 2021, were focused on helping teams. How do we as bosses help teams overcome burnout and recover and, you know, re-energize again and re-ignite morale in the workplace? And one of the simple messages that I was sharing with folks is that we need to help people do less work and get more time away. And that’s really the only recipe for overcoming burnout, less work, and more time away, <laugh>. And when I would <laugh>, when I would have longer form learning experiences with audiences, maybe a half day workshop, for example, I would do an exercise where I would give people at the tables 10 minutes to answer that question, what can we do to give people less work and more time away?

Joe:
And I am telling you, people would look at me like I had just asked them to cure cancer at the table — Joe, that’s not even possible. We’re barely keeping our heads above water. And I know that that’s what people were experiencing, and I would acknowledge that, but I would say, I just want you to trust me on this. There’s no wrong answer to this question. It’s a brain-dumping exercise. Come up with anything that you can think of. How do we give people less work and more time away? And I would give those groups 10 minutes, just 10 minutes to come up with any idea at all. And when you’ve got 15 tables in the room and you give each of those tables 10 minutes, and then you ask those tables to report out, believe it or not, you end up getting a flip chart with 20, 30, 40 legitimate ideas, some really creative ways that you can help people do less work and get more time away.

Joe:
And it’s been remarkable for, for me to get notes and emails back from some of the people who attended some of those programs to say, you know, we went back, and we actually implemented a couple of these things and they’ve really made a difference. I’ll give you an example. I was in a program with about 300 people from the state of Kentucky a couple of months back, and I did this exercise with them. And one of the things that came out in the report out was that one organization had recently gone to its board and asked for two additional paid holidays off for their enterprise. Now, this was a group of federally qualified health centers in the state of Kentucky, which everybody in the room was a part of. And it led to this interesting conversation, and we’ve discovered that about half the organizations in the room got nine paid holidays a year for their employees. About a third of them in the room only got seven, and there were a handful that were getting 11. Can you imagine being a member of those teams that were getting seven paid holidays a year and learning that all the other enterprises like yours in the state were getting between nine and 11? What do you think they did? They went back to their boards, they showed them that data, and they got more paid days off for their employees. They also talked about things like cooling down the patient schedule at lunch, right? Or, or just blocking time for lunch where the team could catch its breath. They talked about staggered schedules and letting people leave an hour early here or throttling down staffing during times when it was less busy, just as a way to relieve the burden on people. And so, there are a lot of places where we’re still not recovered from the pandemic, where we still haven’t given people less work and more time away.

Joe:
There’s one other reason I think that engagement here in the US and across the globe has ticked down in the last couple of years, and that is unkept promises for job switchers and stayers. So, as we’ve come out of the pandemic, a lot of organizations have started recognizing that we’re living in the middle of a massive recalibration around how work fits into people’s lives. And people really are thinking about how their employee experience impacts their quality of life. In fact, this is a, a central theme that we’re seeing in what we’ve been called The Great Resignation. What I call “The Great Upgrade” is that people are choosing to stay or choosing to switch almost entirely based on whether or not their circumstances impact their quality of life. So, people who switch are looking for an upgrade in quality of life. For some people, that’s a, that’s an upgrade to commute. For some people, that’s an upgrade in pay. For some people, that’s an upgrade in the, the kind of fulfilling work that they’re doing or looking for a better boss or less toxic team culture. But in most cases, when people change jobs right now, it’s because they’re looking for an upgrade to their quality of life.

Joe:
And I think one of the reasons that engagement has ticked down is that a lot of people who have switched have not found those promises, kept employers who have said, oh yeah, yeah, we’re gonna grant you all sorts of flexibility around when, where, and how you’ve worked. And then they come in and they’ve not experienced that, or they’ve looked for a better boss or work that’s been more interesting or fulfilling, and then they’ve stepped into those roles and their boss isn’t the easiest person to work with. Or a lot of what they’ve been asked to do is mindless grunt work, and it’s not occurring on the schedule that was promised to them. The same can be true for people who stayed, where organizations made promises around pay increases that were gonna come, or adjustments to schedules that were gonna come, flexibility that was being promised, more training that was going to be delivered, we promise. And then those promises weren’t kept. And in a lot of corners of enterprise, maybe those organizations had perfectly good reasons for not keeping those promises. It’s really hard to do more when you’re understaffed, right? When you’re struggling to keep your head above water. But the reality is, if you switched or stayed because you expected your quality of life to improve and then it didn’t, well, yeah, I think your engagement would slip or you would move from that engaged bucket to that not engaged bucket, or maybe in some cases to that actively disengaged bucket.

Joe:
So, the question then really becomes, how do you fix this? How do we move the needle on employee engagement? What are the conditions that activate emotional and psychological commitment? Well, unless it’s the, this is the very first episode of Boss Better Now that you’ve listened to and the very first time you’ve encountered me, you know, I’ve spent the last year and a half writing and prepping for release a new book. It’s called Employalty – How to Ignite Commitment and Keep Top Talent in the New Age of Work. And I’ve spent more than a year analyzing more than 200 research studies and articles on why people quit an organization join another or stay long-term with an employer. And I can tell you with conviction that people join and stay and care and try when that organization wins in three areas of the employee experience, commitment and retention appear when employees get to do their ideal job, doing meaningful work, for a great boss.

Joe:
And I detail what the dimensions of those three factors are in this book that’s coming out on May 9th. Ideal job is about what I get in exchange for what I do and really has a lot to do with my compensation, my workload, and flexibility. Three things we’ve just talked about in depth. Meaningful work is about what I spend my time doing and who I’m doing it with. And our work becomes meaningful when we experience purpose – work that aligns with our strengths and a sense of belonging on our team. And then that third factor is great boss. We know that the person who supervises my day-to-day work is the single most influential factor in the employee experience. And we know that a great boss has to do a lot of things to be considered a great boss, but specifically, they need to grant and earn trust, engage in coaching, and commit to advocacy.

Joe:
So, these are all of the deep-dive areas that I talk about in this upcoming book, but that’s really at the heart of creating the conditions that lead people to thrive in the workplace. If you wanna see those numbers tick up in employee engagement across the globe, put people in a position to do their ideal job doing meaningful work for a great boss. Give them flexibility, better compensation, and a manageable workload. Give them a job that aligns with their strengths, that gives them purpose and a sense of belonging, and make sure they’re working for a great boss who engages in trust coaching and advocacy. You those nine boxes your employee engagement numbers are going to climb, I guarantee it.

Joe:
I’d love to hear what you think. Why else do you think that employee engagement across the globe has slipped in the last year? You can share your thoughts with me by emailing the show at bossbetternow@gmail.com. I’d love to hear from you. That’s also where you can suggest questions that we answer for the show. By the way, you know that Suzanne and I spend a lot of time on the show combing through questions that we get and giving you scripts and options, and ideas for various kinds of challenges that you might face as a supervisor. So, we’d love to hear from you along the way, bossbetternow@gmail.com. Send us your thoughts.

Joe:
And that brings us to the Camaraderie Question of the Week, which I have to tell you is a bit of an odd segment to do by myself because I don’t really have anybody to talk to about my answer to the question. So, what I decided to do was take a bit of a different approach this week with our question. I get asked a question a lot by others that I decided to share here on this episode as part of this segment. The question I get asked by a lot of leaders and a lot of folks who supervise leaders, is this, Joe, what’s the best book you can recommend for bosses? And I’m gonna give you my answer right now. If you can only read one book this year, it should be mine. But hold on, I actually have that sound effect here. Let’s do that for the comedy.

Joe:
No, if you, if you are gonna read two books this year, I’d love it if the first one was mine, but <laugh>, if it’s not going to be, then my favorite book to recommend for leaders is Drive: The Surprising Truth about What Motivates Us by Daniel Pink. Now this book is, God, I think it’s almost 12, 14 years old now, but without question, it’s my favorite book to recommend to leaders because what Daniel Pink does is he takes all sorts of research, social science, research on intrinsic motivation, and he uses it to frame these three experiences that people need to have in order to move from, have to, to want to. It’s a really easy read. He does a wonderful job with storytelling and translating a lot of social science research. I know a lot of you have read this book, but this is my number one top-recommended book for leaders that’s not by me. And it’s absolutely a, a leadership classic at this point, even though it’s only been out for a couple of years. One more time…. It’s called Drive: the Surprising Truth About What Motivates Us by Daniel Pink. And we will link to that listing. So, you can find that book on the podcast episode transcript for this episode over at bossbetternowpodcast.com. So, if you’re looking for the link, just go to bossbetternowpodcast.com and we’ll take you there. And that’s the Camaraderie Question of the Week.

Joe:
All right, friends, that brings us to our third and final segment for this week’s episode, Storytime. Our story today comes from the book I just told you about. One of my favorite things about this new book that I’ve written is that I spent a lot more time sourcing and writing stories that act as a kind of connective tissue to the ideas and research that I shared in this book. I, I think, and I know without question, this is the best thing I’ve ever written for that reason, I really leaned into stories in this book, and I think it makes the book imminently more readable. And really that’s a lot of the feedback we’ve gotten early on. And so, I’m gonna share this story with you, which in the book is referred to as the Blockbuster epilogue. Despite being on the verge of bankruptcy, their only option was to rent a private jet. The three executives had been requesting a meeting with the leadership at Video Rental Giant Blockbuster for months.

Joe:
Their young company was in trouble. It was September 2000 and the.com crash, coupled with slower-than-expected, customer growth had pushed their company to the brink of collapse. The three leaders were convinced that a sale to Blockbuster was the best path to survival. These men were together in an evening meeting in California when they learned that Blockbuster had finally granted their request for a sit-down. The only problem, Blockbuster wanted them in Dallas at 11:30 the next morning. The three men co-founders, Marc Randolph, and Reid Hastings, along with CFO Barry McCarthy saw this for what it was a power move. This was a flex designed to put them in their place. After all, they were competitors. The company these men built was trying to siphon business from Blockbuster with a DVD rental by mail service. They called Netflix in his book That Will Never Work.

Joe:
Randolph recounted their meeting with Blockbuster in the fall of 2000 and the events leading up to it when Hastings suggested that the only way, they could make the meeting was to charter a private jet, CFO McCarthy objected citing the $20,000 expense. Hastings replied we’ve waited months to get this meeting. We’re on track to lose at least 50 million this year. Whether we pull this off or not, another 20 grand won’t make a difference. They booked the charter around the table the next day were several members of Blockbuster’s leadership team, but the visitors from Netflix knew theirs was an audience of one CEO John Antioco had joined the company two years earlier during a downturn in Blockbuster’s performance and was largely credited with turning things around. A year earlier, he’d presided over a successful IPO that raised 465 million for the company.

Joe:
As Randolph writes, he was ready to hear us out, but what we said had better be good. At the meeting, Hastings aimed to make the acquisition of Netflix a no-brainer value add for Blockbuster. He efficiently detailed Blockbuster’s strengths and identified areas where they could benefit from Netflix’s market position and experience. He suggested that if Blockbuster bought Netflix, we will run the online part of the combined business. You will focus on the stores, we will find the synergies that come from the combination, and it will truly be a case of the whole being greater than the sum of its parts. The Blockbuster leadership team were dismissive. Their general counsel proclaimed that the business models of Netflix and nearly every other online business would never be profitable. The Netflix executives challenged these perceptions for a few minutes. Then the question was asked if we were to buy you, what were you thinking? I mean, a number, 50 million Hastings said, Randolph writes that during this discussion, he was watching Antico. He notes that throughout the meeting, the Blockbuster CEO was engaged and professional demonstrating all the nonverbal cues of someone listening attentively. When Hastings quoted their price, however, Antioco’s face changed, the corners of his mouth turned upwards slightly. Randolph says It only lasted a moment, but as soon as I saw it, I knew what was happening. John Antico was struggling not to laugh.

Joe:
You probably know that Blockbuster never bought Netflix. The meeting between the executive teams in 2000 never resulted in a sale or even a serious counteroffer from Blockbuster. At the time, the leadership of the video rental company couldn’t imagine a future that existed entirely online or that didn’t include the ritual of going to the video store and browsing the titles available to rent. By the way, if you were born after 1998, it’s likely you have no connection to this experience. Turning down the chance to buy Netflix for 50 million will go down as one of the great business gaffs of all time. It’s one mistake in a series of errors made by Blockbuster that ultimately led to its demise. Not long after that fall 2000 meeting, both companies found themselves facing an adapt-or-die moment. One knew it and changed how they did business. Netflix went from renting movies by mail to streaming.

Joe:
Blockbuster, conversely, was either oblivious to the future or resisted it for far too long in its final years, blockbuster tried to change haphazardly embracing DVD by mail streaming and video on demand, but it was too late. The media giant went from having more than 9,000 stores worldwide to just one. Today, a single blockbuster remains a privately owned store in Bend, Oregon. Its continued existence driven largely by nostalgia. Otherwise, the company no longer exists. While Blockbuster went bankrupt in 2010, Netflix is now one of the world’s most valuable companies. The streaming service currently has a market cap of 100 billion or 2000 times the 50 million asking price floated at the meeting that day. The Netflix blockbuster story is a lesson in what happens when you do or do not adjust to a changing business landscape.

Joe:
I’m gonna stop the excerpt there because really it sets up the entirety of the book that what’s happening right now is an adapt-or-die moment, and that people, as we talked about at the beginning of this episode, are making changes to how work fits into their lives. There’s a massive recalibration taking place around it. In fact, right now, you’re living in an era where trying to find the best person for the job is an antiquated strategy. What you have to do is create the best job for the person. It’s an adapt-or-die moment. And so, if you want to find and keep devoted employees and you wanna have no issues or obstacles to serving your customers in the best way that you possibly can, you have to adapt. You have to understand that a different kind of employee experience is necessary. A more humane employee experience is required. One that no longer treats employees like a commodity, one that meets the needs and values of a changed workforce. I hope you’ll consider grabbing a copy of the book. I would be delighted if you’d consider pre-ordering it this week. You can do that on Amazon, on Barnes and Noble, on indiebound.org. I’d be even more thrilled if you would order two copies, one for you and one for a partner to read it with an accountability partner that you can use to discuss the ideas in the book and then put some things into action where you work. We’ve even created a book club kit for any organization that orders 10 copies or more. We give it away for free. If you send us proof of purchase that you’ve ordered 10 copies or more, all you have to do is send that to hello@joemull.com and we’ll send you the book club kit, which includes a video, a robust discussion guide, and an implementation checklist. And yes, the book will be available on audiobook. We’re recording it, right? That’s why reading that little excerpt was good practice for me. So that’s all for this week, folks. I hope you’ll take a moment and go online. Order a copy of employee E M P L O Y A L T Y. You can search that or just search my name, Joe Mull. It’s available wherever you order books, and I hope you enjoyed what you got out of this episode today. Thanks for listening. We’ll see you next time.

Jamie:
This show is sponsored by Joe Mull and Associates. Remember, commitment comes from better bosses. Visit joemull.com today.