Why is it that some companies shine as beacons of light as good employers, whilst others have problems recruiting and retaining staff? Faye Bewley examines what it takes to get it right.

The best companies to work for all have one thing in common – employees who are not just committed to their jobs but are engaged in their work.

Measuring and monitoring that employee engagement is the latest gauntlet to be thrown to employers, because far from being just another buzzword or management fad, it can be linked directly to the bottom line.

One step up from commitment – two or three from staff satisfaction – employee engagement is fast-becoming the Holy Grail for firms who need a productive workforce to sustain a competitive advantage.

Historically, it has always been financial incentives, such as pay and benefits, that have proved most effective at attracting and retaining talent.

In the modern day workplace, pay and perks have been replaced by flexibility and work-life balance as key motivators, yet in the pursuit of employee engagement, the value of material rewards, and the contribution of the company payroll and employee benefits functions, should not be underestimated.

Assess the level of engagement

First, an organisation needs to be able to accurately assess the current level of employee engagement before identifying areas that need to be addressed, and benchmark themselves against other successful organisations within the same sector.

To help companies to both measure and improve their own workplace engagement, Best Companies launched its own accreditation scheme in 2006. The accreditation acknowledges excellence in the workplace and focuses on workplace engagement as an integral component of an organisation’s success, growth, and the bottom line.

What difference does employee engagement make? An engaged employee is someone who uses all their skills and ingenuity to help the company, as opposed to a disengaged employee who invariably spends much of their time looking for another job.

If a quarter of your staff are not engaged, for whatever reason, then they are not productive. Fail to engage your staff and you will lose them, inflicting serious damage on the bottom line.

The importance of leadership

Leadership is very important when it comes to employee engagement. Faith, confidence and inspiration in the leaders and their values are all higher in those companies where employees are more engaged. We questioned employees on whether they have a great deal of faith in the person leading the organisation, whether they have confidence in the leadership skills of the senior management team, how inspired they are about the person leading the organisation, and if they believe that the organisation is run on strong values/principles.

In all our previous research, listening to employees has been shown to be crucial in engagement. Accredited companies have learned this lesson. The results show a healthy percentage of employees who report that their senior managers are listening to them rather than just telling them what to.

It is clear that adequate development opportunities are key to staff retention rates and this is clearly illustrated by our findings. It is difficult for employees to engage with their job and their organisation unless they feel that they have the opportunity to grow and learn.

Pay and benefits

We are constantly being told that pay and benefits are no longer the main incentives for employees, which suggests that in terms of employee engagement they are less important than other factors such as leadership, well-being and teams. For example, you can persuade anyone to work for you if you offer them enough money, but do you really want just anyone? More importantly, will they be engaged with the company, and how long will they stay?

Tools that provide valuable comparative data are vital to clarifying the link between people, their engagement with the company, and the bottom line. But accreditation – the public acknowledgment of their status as an employer of choice – can impact more directly on the bottom line, by significantly reducing recruitment and retention costs.

Today’s graduates are savvy. They are not going to take the first job that comes along and they will use whatever means are available to identify the best companies to work for and to engage with.

There is no question that organisations are investing heavily in their people; in their personal development, pay and benefits, and their role within the company. In acknowledging employee engagement as a crucial link between that investment and the bottom line, those companies that make the effort to find out how their employees feel about them, and then act on their feedback, will enjoy the highest returns.

Faye Bewley is from Best Companies Ltd.