Mind the CEO gap: what it is and how you can fix it

By Matt Macri-Waller

Employee engagement is no longer an issue for HR departments alone. It’s landing on the desks of CEOs, coming up in board meetings and now, more regularly than ever, it’s featuring in the mainstream media.

This is with huge thanks to HR professionals all over the UK for championing employee engagement and getting it higher and higher up workplace agendas. By starting to measure it and finding new ways to increase it, we’ve improved awareness (and hopefully engagement rates) across the UK and beyond.

But we can’t stop there. While ‘employee engagement’ is now a popular term within the HR and Employee Benefits industries, there’s a lot more to it than meets the eye. It’s important that executives understand it at employee level, and that there’s a clear line of communication to bridge the gap between CEOs and employees at every layer within your organisation.

The CEO gapAccording to The Global Human Capital Trends 2016 report, 48% of CEOs and HR leaders cited employee engagement as very important. However, in many organisations there’s such a huge gap between the CEO and employees at other levels of the organisation, are employees’ needs really understood? And do they feel cared for and communicated with?

The graph below shows that when over 200,000 employees in 40 companies were surveyed, there was a negative correlation between Employee Net Promoter Scores and the organisational layer an employee sits in (0 is the most senior executive team).

An Employee Net Promoter Score is worked out by asking employees whether they would recommend their place of work as a good/great place to work out of 10. Those who score it a 6 or lower are known as detractors, those who score it a 7 or 8 are neutrals and employees who score your organisations a 9 or 10 are your promoters.

At any given moment, on average 64% of employees at your organisation are unengaged. Given a sample of five employees, what are they likely to be thinking during a typical day in the office?

“I love my job”
“I’ve had worse days in the office, I guess”
“I don’t want to be here”
“I wish I meant something here”
“I’m looking for a new job”

What does this mean for your organisation?Gallup’s State of the Workplace report, which states that only 18% of global employees are engaged, shows that having 60%+ engagement with employees results in a staggering 27% higher profits.

Typically speaking, the bigger the gap between the CEO and each level of employees, the worse communication gets. This gap could be a result of having 6 levels of management between someone who works on the shop floor and the CEO. Or it could be that there are 40,000 people working at your organisation and it’s impossible for the CEO to speak to each and every one.

However the gap is created, the result is that communication becomes less relevant and less meaningful. When two-way communication disappears, so does transparency, trust, understanding, strategic alignment and as a result; engagement.

Employees stop feeling valued when they aren’t communicated with by Senior Executives effectively, stopping them connecting with the organisation on a personal level. This shows a decline in engagement, and impacts business growth and revenue. It also undermines any great work you’re doing in other areas to engage employees, such as improving company culture, or offering a great employee benefits package.

CEO and Founder, Matt Macri-Waller reiterates the statement he made when he first set up Benefex: “No one comes to work to do a bad job.”

“No one comes to work to be disengaged. There’s simply a collection of missed opportunities for the organisation and the individuals who work there to engage with each other.”

How can you bridge the gap?Employees are aware of how they should be treated by their employer. In-demand employees have high expectations and they know what’s being offered by your competitors. Glassdoor, Fortune and The Times are no longer the only places reporting on which companies are the best places to work. In recent years the news of new and exciting employee benefits have been reported on in admiration and awe; “I’d love to work at Virgin” your employees have started to say, while daydreaming of what they would do with all that unlimited holiday.

While this is doing wonders for employee awareness of their benefits scheme, is it providing an unfair benchmark? Can every organisation offer unlimited holiday, three healthy meals per employee each day and an annual trip to Hawaii? Of course not, but there is a lot you can do to educate your employees, help them understand what’s on offer to them, and how it’s a fantastic deal in relation to your organisation and how it works. It’s also a great idea to get them involved in shaping the company culture, and defining what creates a happy, engaged workforce.

In 2016 online insurance company Simply Business topped the Sunday Times 100 Best Companies To Work For list for the second year in a row.

While many staff are based either in the open-plan London office, or the Northampton contact centre, “a number of staff live abroad and work remotely full-time”. Chief Executive Jason Stockwood told The Sunday Times: “You can’t force people who hate their environment to do a good job,” he adds. “Customers only come first if our employees are happy and doing a good job.

“Perks include a benefits package with private health insurance and life assurance. Trips, nights out and office beers are part of the company’s fabric, as are charity events.”

To close the gap, improve communication, and increase engagement at your organisation, remember the Five Rs

ReachOnce you’ve decided on the message you need to get across, it’s important to take the time to understand your employees. Look at the demographics of your workforce, speak to employees and build a clear understanding of how you are going to reach your audience. Consider the tone, format, content and overall type of communications that need to be used; reaching your employees in a way that they want to be reached without being intrusive or ignored.

RelevanceThe best way to ensure employees are receiving a message that’s relevant to them is to segment communications by demographic, for example; pay grade, location or time at the company. Your ability to segment will depend on the data you have available, so use it to your advantage.

You should also segment the type and tone of each communication method. Constantly think about how you make it as relevant as possible to the employees you’re communicating with; would you be impressed with receiving an email about a change that only affects high earners if you weren’t one yourself?

ReinforcementWhether your message is about core values, culture, a transformation project, recognition or benefits; just telling people won’t help you. You need to build engagement with the message, and to do this you should seek every single opportunity to reinforce it again and again.

You’ll need to get creative with your communication methods here, take a look at the Benefex Guide to Reward and Benefit Communications for more ideas.

ReactionFocus on the reaction that you want people to feel as a result of what you are telling them. A simple shift to think about whether you want someone to be informed, interested or take action, will make you communicate in a completely different way.

Always refer back to the desired outcome, especially when you are writing or reviewing content, messaging and the overall strategy.

RepetitionSimilar to reinforcement, but telling people the same message (whether that’s through one channel or 10) also won’t help you. Knowing your core messages inside out is key to this being a success. Develop a long-term strategy and embed them within your company culture in order to drive real change and close the gap.

Benefex combines employee benefits with innovative technology, data and communications to help companies understand, influence and measure the engagement of their people. Speak to one of our experts for more information on closing the CEO gap and increasing employee engagement within your organisation.