Page 64 - How America's Best Places to Work Inspire Extra Effort in Extraordinary Times

What Separates the Best from the Rest? C51

resources to help this business, just like everyone else. Where do I start, and
what’s going to give me the best return on my investment?” We realize
that looking for the best “return on investment,” so to speak, will be
important for all employers in building, or rebuilding, their status as
a great workplace.
Certainly, we reasoned, the impressive engagement scores of the
winning companies did not happen by luck or chance—winners must
be doing something better than or different from companies with
lower engagement scores. Since 2004, several hundred employers have
been recognized in various communities, so we knew we would have
plenty of companies to ask about their “secrets of employee engage-
ment.” Our job was to glean insights from our in-depth data analysis
and through discussions with winning employers, to ascertain “the set
of their sails.”

: ”LEADING” VERSUS “LAGGING” INDICATORS

We often hear experts in the fields of economics and accounting talk
about “leading” and “lagging” indicators. The so-called lagging indica-
tors help to explain what has already happened, while leading indicators
help to predict what will happen. In business, for example, a company’s
profitability is a lagging indicator, because it is a measure of what has
already happened in a business related to its relative profitability.
In human resources we might also talk of leading and lagging in-
dicators. A company’s yearly turnover rate, for example, would be a
lagging indicator, because it tracks historical data—the number and
percentage of employees that have already left the organization. This
and other lagging indicators are important to be sure, but we wanted
to help identify the leading factors that could help predict the future,
especially about critical business outcomes such as employee turnover,
profitability, or customer loyalty.
We have abundant evidence that the factors we are about to de-
scribe are leading indicators of employee engagement. How well we