Why Employee Engagement Matters for Government Financial Management.

Author:Lavigna, Bob

My chief assets drive out the gate every night. My job is to make sure they come back." (1) his is a concern for every organization, and especially for government financial management, where the war for talent is often fierce. And unlike many other public-sector occupations, the quest to recruit and retain financial management talent often requires head-to-head competition with the private sector.

We often hear leaders in government say that their employees are their most important resource. After all, public-sector organizations can't succeed without talent--the right people with the right skills in the right places at the right times. In government financial management, people are indeed the primary resource.

But just having talented employees isn't enough--they must also be committed and engaged. Decades of research, including in government, have shown that a high level of employee engagement drives superior organizational performance.

According to a 2018 GFOA report on employee engagement, "If staff are fully engaged in their jobs, then they will put in the extra effort needed to provide the best services possible. If they are disengaged, they will, at best, put in the bare minimum effort necessary to satisfy their job description and, at worst, will actively seek to undermine the organization." (2)

In other words, employee engagement isn't just another touchy-feely human resources program, and it isn't about making sure employees are happy all the time. It's about delivering performance and service, especially in financial management.

But what is employee engagement, exactly?

According to the U.S. Merit Systems Protection Board, which has done extensive research on employee engagement in government:

Employee engagement is a heightened connection between employees and their work, their organization, or the people they work for or with. Engaged employees find personal meaning in their work, take pride in what they do and where they do it, and believe that their organization values them ... The greater an employee's engagement, the more likely the employee will go above and beyond the minimum required and expend discretionary effort to provide excellent performance (3) WHY ENGAGEMENT MATTERS

Research in the public and private sectors has consistently and conclusively shown that improving engagement improves organizational performance.

In the private sector, this research shows that high-engagement companies outperform low-engagement companies on key financial indicators such as sales, revenue, revenue growth, profit, stock price, earnings per share, and so on.

For example, as reported in the Wall Street Journal last year, an analysis of 693 large publicly traded companies showed that the single biggest driver of performance was employee engagement and development--more important than research and development, new products, marketing, and even leadership. (4)

Of course, government does not typically have the same kinds of financial metrics as private-sector firms. However, engagement also drives important outcomes in government (5) These include achieving strategic goals, delivering responsive customer service, promoting innovation, retaining good employees, improving attendance, and even keeping workplaces safe. For example, one analysis revealed that federal agencies with the most-engaged employees were three times more likely than low-engagement agencies to achieve their strategic goals (6)

The annual national survey conducted by the Institute for Public Sector...

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