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Thursday, July 15, 2010

Too much bottom-line focus can backfire

To meet the demands of today’s tough economy, many companies have been focusing more than ever on the bottom line. Too often, the result is a harried, stressful atmosphere, one in which managers, under pressure to make their numbers, are aggressively pushing staff to achieve financial goals. But, that’s a situation that can backfire. With less focus on new ideas and innovation to gain competitive advantage, many companies may find themselves not positioned strategically for the future. On top of that, they may be experiencing lower morale and employee engagement – and, as a result, reduced levels of productivity and retention.

In fact, a global study conducted by Right Management of companies in 11 countries found a clear correlation between employee engagement and intention to leave a company. For example, engaged employees across all levels of the organization are seven times less likely to leave in the next year than those who are not engaged and 1.5 times more likely to stay at least five years.

Organizations need to find ways to continue to improve operating efficiencies in the current economy, while still encouraging innovation, demonstrating employees are valued and ensuring a reasonable work/life balance. The message for companies? Creating an environment that recognizes individual contributions – while fostering creativity and a little risk-taking – can lead to higher engagement levels and a more-satisfied and loyal employee. And, those engaged individuals will be more productive, as well.

Those organizations that meet this challenge can expect to have a workforce with a competitive head start – ready and able to take advantage of new opportunities as the economy improves – rather than struggling just to keep up.

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