A Framework towards Employee Engagement: The PSU Experience

Dr. Chandan Kumar Sahoo*

Associate Professor
School of Management
National Institute of Technology
Rourkela – 769008, (Odisha), India
E-mail: cks_pd@yahoo.co.in
*Corresponding author

Mr. Sukanta Mishra

Research Scholar (Commerce & Management)
North Orissa University
Takatpur – 757003, Baripada, (Odisha), India
E-mail: sukantamishra.phd.nou@gmail.com

To cite this document:

Sahoo, C.K. and Mishra, S. (2012), “A Framework towards Employee Engagement: The PSU
Experience”, ASCI Journal of Management, 42 (1): 92-110.
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A Framework towards Employee Engagement: The PSU Experience

Abstract
A successful employee engagement strategy helps to create a committed community at
the workplace and not just a workforce. When employees are effectively and positively
engaged with their organization, they form an emotional connection with the company.
This affects their attitude towards both their colleagues and the company’s clients and
improves customer satisfaction and service levels. This article contributes to the existing
literature of ‘employee engagement’ and will inspire employees to improve performance
within the job for benefit of the organization as well as achieving organizational goals
and improvement in customer satisfaction. This study will specifically emphasize the
relationship between the management and employee and provide an opportunity of fair
and equitable environment for effective improvement in service levels as well as
organizational performance and customer satisfaction. At the end part of this paper the
employee engagement initiatives taken by RSP (a unit of SAIL) will definitely support
and evidence the existing literature in the present context.

Introduction
Employee engagement is a valuable concept for understanding and improving individual
and organizational performance. In today’s organizations, employee engagement is vital
because more is being required of workers than ever before. Employee engagement has
become a hot topic in recent years. Despite this, there remains a paucity of critical
academic literature on the subject, and relatively little is known about how employee
engagement can be influenced by management. Although there is a great deal of interest
in engagement, there is also a good deal of confusion. At present, there is no consistency
in definition, with engagement having been operationalised and measured in many
disparate ways. Engagement at work was conceptualized by Kahn (1990) as the
‘harnessing of organizational members’ to their work roles. In engagement, people
employ and express themselves physically, cognitively, and emotionally during role
performances. The second related construct to engagement in organizational behavior is
the notion of flow. Flow is the state in which there is little distinction between the self
and environment. When individuals are in flow state little conscious control is necessary
for their actions. Employee engagement is thus the level of commitment and involvement
an employee has towards their organization and its values. An engaged employee is
aware of business context, and works with colleagues to improve performance within the
job for the benefit of the organization. The organization must work to develop and
nurture engagement, which requires a two-way relationship between employer and
employee. Thus employee engagement is a barometer that determines the association of a
person with the organization.

Engagement is most closely associated with the existing construct of job involvement
(Brown, 1996) and defined as the degree to which the job situation is central to the
person and his or her identity (Lawler and Hall, 1970). Job involvement is thought to
depend on both need saliency and the potential of a job to satisfy these needs. Thus job
 3

involvement results form a cognitive judgment about the needs satisfying abilities of the
job. Jobs in this view are tied to one’s self image. Furthermore engagement entails the
active use of emotions. Finally engagement may be thought of as an antecedent to job
involvement in that individuals who experience deep engagement in their roles should
come to identify with their jobs. When Kahn talked about employee engagement he has
given importance to all three aspects physically, cognitively and emotionally, whereas in
job satisfaction importance has been more given to cognitive side.

Human resource (HR) practitioners believe that the engagement challenge has a lot to do
with how employee feels about the work experience and how he or she is treated in the
organization. It has a lot to do with emotions which are fundamentally related to drive
bottom line success in a company. There will always be people who never give their best
efforts no matter how hard and line managers try to engage them. But for the most part
employees want to commit to companies because doing so satisfies a powerful and a
basic need in connection with and contribute to something significant.

Conceptual Framework
Employee engagement (EE) is a relatively recent developed concept in human resource
management and a mantra for today’s workplace and leading organizations to recognize
the vested interest for measuring, monitoring and maximizing the level of engagement
amongst the employees. It is defined as the level to which employees are fully involved
in their work, committed to their work, careful about their organization and colleagues
and are willing to extend themselves and go the extra mile for their company to ensure its
success. EE is a combination of organizational aspects like individual commitment,
organizational citizenship behaviour (OCB) and employee motivation (Wash, 1999). The
argument is that an engaged employee works with passion and is more committed to the
organization. In the other words it is the extent to which people enjoy and believe in what
they do and feel valued by doing it. It is the degree of commitment towards the hub
which an employee performs and till how long the employee remains with the
organization as a result of their commitment (Mahendru and Sharma, 2006).

In the changing global market, competition and managing change over a period of time
the strategy of an organization has changed from just promoting the knowledge worker to
increase EE. Employee engagement and organizational performance are highly
interlinked (Concelman, 2005). The trend shows that almost all of the companies explore
the possibilities for adopting employee engagement as a strategy for human resource
planning (HRP). Harter, Schmidt and Hayes (2002) examined the relationship at the
business unit productivity and employee engagement and noticed that the engaged
employees are satisfied employees, which in turn leads to higher productivity. According
to Erickson (2004), the best ways to shape the bahaviour of an employee towards work is
to improve employee engagement. But Stockley (2006) defined ‘engagement’ as the
extent that an employee believes in the mission, purpose and values of an organization
and demonstrates that commitment through their actions as an employee and their attitude
towards the employer and customers. An institution’s ability in providing psychological
safety such as good support from the supervisors and rewarding system has a positive
relationship with employee engagement, job enrichment and work role (May, Gilson and
Harter, 2004). Value of assessment and taking feedback of employees has been followed
 4

as practical strategy for employee engagement according to Glen (2006). He further adds
that work environment is a better predictor in this direction. Miles (2001) described it as
intensively involving all employees in high-engagement cascades that create
understanding, dialogue, feedback and accountability, empower people to creatively align
their subunits, teams and individual jobs with the major transformation of the whole
enterprise.

Burke (2005) considered engagement as equivalent to direct assessment of an employee’s

satisfaction with the organization, his job, work group and working environment. More
commonly, employee engagement has been defined as exhibiting discretionary effort
defined as extra time, brainpower and energy (Towers-Perrin, 2003) for accomplishing
organizational goals. An engaged employee is believed to display voluntary effort in
solving organizational problems without being asked to do so, a behaviour described as
discretionary effort. Wellins and Concelman (2005) have combined both discretionary
effort and commitment in their definition of engagement. Engaged employees and
organizations go the extra mile, and both reap mutual benefits. Gibson (2006) has defined
employee engagement as ‘a heightened emotional connection that an employee feels for
his or her organization, that influences him or her to exert greater discretionary effort to
his or her work’. High levels of employee engagement are associated with high levels of
organizational performance (Soladati, 2007). A lack of employee engagement can lead to
disloyalty and organizational failure (Khan, 2007). The focus for HR was on improving
‘employee engagement’, which was about creating an ‘emotional connection’ with
employees so that they are passionate, committed, and long term attachment
with the organization (Tomlinson, 2010).

Engagement is most closely associated with job involvement (Brown, 1996; Salanova,
Agut and Peiro, 2005; Maslach, Schaufeli and Leiter, 2001) and task identification (Bass,
1999). Just as employer’s job expectations from employees have increased, so also
employees expect in return, better working conditions, equitable pay, fair appraisal
technique, and better opportunity for career advancement. If any of these are denied, it
may cause a breach of psychological contract between the employer and his employee.
This may induce feelings of cynicism (negative attitudes) and lack of trust (Pate, Martin
and Staines, 2000). Cynicism is considered to be closely associated with workplace
burnout (Maslach and Leiter, 1997; Maslach and Schaufeli, 1993) which has been
considered as a negative antithesis of job engagement (Maslach and Leiter, 2008). Trust
has an important bearing on the level of engagement (Kouzes and Posner, 2008).
Employees often find difficult to make informed decisions due to inaccessibility of
relevant information. This, in turn creates a sense of mistrust within the organization. In
fact, Pech (2009) has emphasized on the concept of trust and control as necessary
conditions for enhancing performance. Job enjoyment, belief in what one is doing and
feeling valued- all contribute to engagement (Wellins and Concelman, 2005). People tend
to invest more time and effort in the roles they find enjoyable (Rothbard and Edwards,
2003). Moreover, individuals prefer to perform work that provides meaning, stability, a
sense of community and identity to their lives (Holbeche and Springett, 2004). Besides,
Parker, Jimmieson and Amiot (2010) showed that when individuals perceived high job
control, they experienced greater engagement.
 5

Robertson and Cooper (2010) have conceptualized the term ‘full engagement’ which
encompasses psychological well being of employees and leads to greater individual and
organisational benefits. Psychological well being of employees has been found to be an
important driver of engagement and is reported to be directly correlated with performance
(Wright and Cropanzano, 2000, Donald, Taylor, Johnson, Cooper, Cartwright and
Robertson, 2005; Harter, Schmidt and Hayes, 2002). It denotes a feeling of happiness
which arises when an employee enjoys performing his work. Thus, job which is both
meaningful and pleasurable leads to psychological well being (Fredrickson, Tugade and
Larkin, 2003). Poor psychological well being is manifested in the form of stress and poor
mental health. It is caused by job related factors such as strained workplace relationships
and less freedom at work. A matter of high concern for HR managers is that recent
surveys indicate low levels of engagement in many countries (Robertson and Cooper,
2010). The belief that paying enough to the employees will ensure superior performance
has become outdated (Woodruffe, 2006). Rather, employees are swayed by a host of non-
financial factors. Job fit (Resick, Baltes and Shantz, 2007), affective commitment and
psychological climate (Brown and Leigh, 1996) have been found to be positively and
significantly correlated to employee engagement while engagement is found to be
significantly related to discretionary effort and intention to turnover (Lloyd, 2008; Saks,
2006; Lockwood, 2007). People choose to work in those environments which provide
opportunity for engagement (Schneider, Goldstein and Smith, 1995). Employee
engagement matters as it impacts on companies’ bottom lines, both through human
resource (HR) related impacts such as recruitment, training, and retention and through
wider impacts on productivity, profit and achieving the core values, envisioned future and
objectives of the organization. The organization must work to develop and nurture
engagement, which requires a two-way relationship between employer and employee.

Importance of Engagement
An organization’s capacity to manage employee engagement is closely related to its
ability to achieve high performance levels and superior business results. A highly
engaged employee will consistently deliver beyond expectations (Wright and
Cropanzano, 2000). Some of the advantages of engaged employees are:
 Engaged employees will stay with the company, be an advocate of the company and
its products and services, and contribute to bottom line business success.
 They will normally perform better and are more motivated.
 There is a significant link between employee engagement and profitability.
 They form an emotional connection with the company.
 It builds passion, commitment and alignment with the organization’s strategies and
goals.
 Increases employees’ trust in the organization.
 Creates a sense of loyalty in a competitive environment.
 Provides a high-energy working environment and boosts business growth.
 Makes the employees effective brand ambassadors for the company.

Antecedents and Consequences of Employee Engagement

The antecedents of engagement appear to be present in the conditions under which
employees work and their outcomes are considered invaluable for an organization
(Erickson and Gratton, 2007). The nature of work (challenging and task variety) and the
 6

nature of leadership (transactional leadership) are the conditions that have attracted the
most attention (Macey and Schneider, 2008). Although there is little empirical research
on the factors that predict employee engagement, it is possible to identify a number of
potential antecedents from the different studies conducted earlier.
Job characteristics
Psychological meaningfulness can be achieved from task characteristics that provide
challenging work, variety, allow the use of different skills, personal discretion, and the
opportunity to make important contributions. Job enrichment was positively related to
meaningfulness and this mediated the relationship between job enrichment and
engagement (May, Gilson and Harter, 2004; Maslach, Schaufeli and Leiter, 2001).
Intrinsic and extrinsic rewards
Extrinsic rewards are the tangible rewards mostly of a financial nature such as pay raises,
bonuses, and benefits, given to employees. Intrinsic rewards are psychological rewards
that employees get from doing meaningful work and performing it well. Extrinsic
rewards though significant, play a dominant role in organizations where work is generally
more routine and bureaucratic in nature (Bates, 2004). Furthermore, a sense of return on
investments can come from external rewards and recognition in addition to meaningful
work.
Organizational and supervisor support
According to the organizational support theory (Shore and Shore, 1995) in order to
determine the organization‘s readiness to reward increased work effort and to meet socio-
emotional needs, employees develop global beliefs concerning the extent to which the
organization values their contributions and cares about their well-being. Perceived
organizational support (POS) is also valued as assurance that assistance will be available
from the organization when it is needed to carry out one‘s job effectively and to deal with
stressful situations (Rhoades and Eisenberger, 2002). In addition, first-line supervisors
are believed to be especially important for building engagement and to be the root of
employee disengagement (Bates 2004; Frank, Finnegan and Taylor, 2004).
Distributive and procedural justice
Distributive justice deals with the ends achieved (what the decisions are) or the content of
fairness, whereas procedural justice is related to the means used to achieve those ends
(how decisions are made) or the process of fairness. A review of organizational justice
research found that justice perceptions are related to organizational outcomes such as job
satisfaction, organizational commitment, organizational citizenship behavior, withdrawal,
and performance (Colquitt, 2001). When employees have high perceptions of justice in
their organization, they are more likely to feel obliged to also be fair in how they perform
their roles through greater levels of engagement.

‘Engaged’ employees are builders. They want to know the desired expectations for their
role so they can meet and exceed them. They perform at consistently high levels and want
to use their talents and strengths at work every day. They work with passion, drive
innovation, and move their organization forward. Employees who are not-engaged tend
to feel their contributions are being overlooked, and their potential is not being tapped.
The ‘actively disengaged’ employees are not just unhappy at work; they are busy acting
out their unhappiness. As workers increasingly rely on each other to generate products
and services, the problems and tensions that are fostered by actively disengaged workers
can cause great damage to an organization's functioning. Thus antecedents are expected
 7

to predict engagement and engagement predicts the outcomes, it is possible that

engagement mediates the relationship between the antecedents and the consequences.
The main reason behind the popularity of employee engagement is that it has positive
consequences for organizations (figure 1).

Job satisfaction
Job satisfaction, a widely researched construct, is defined as a pleasurable or positive
emotional state resulting from the appraisal of one's job or job experiences (Locke and
Henne, 1986). It has been found that while the relationship between job satisfaction and
performance is weak at the individual level, but is stronger at the aggregate level.
Organizational commitment
This also differs from engagement in that it refers to a person’s attitude and attachment
towards their organization. Engagement is not an attitude; it is the degree to which an
individual is attentive and absorbed in the performance of their roles (Ostroff, 1992).
Intention to quit
Intention to quit includes basically the reasons why employees are going to quit the job,
and what factors made the employee to leave the organization (Bakker and Schaufeli,
2008). The engaged employees do not frequently quit the job.
Organizational citizenship behaviour
Organizational citizenship behaviour (OCB) involves voluntary and informal behaviors
that can help co-workers and the organization, the focus of engagement is one’s formal
role performance rather than extra-role and voluntary behavior. According to Maslach,
Schaufeli and Leiter (2001), six areas of work-life lead to burnout and engagement:
workload, control, rewards and recognition, community and social support, perceived
fairness, and values. They argue that job engagement is associated with a sustainable
workload, feelings of choice and control, appropriate recognition and reward, a
supportive work community, fairness and justice, and meaningful and valued work.

Figure 1: Antecedents - Consequences Dynamics of Employee Engagement

Antecedents Employee Consequences

Engagement
 Job Characteristics  Job Satisfaction
 Perceived  Psychological
Organizational makeup and  Organizational
Support experience Commitment
 Perceived
 Conditions that
Supervisor Support  Low Intention to
promote employee
 Rewards and Quit
Recognition engagement
 Procedural and  Interaction  Organizational
Distributive Justice between Citizenship
employees at all Behaviour
levels.

Source: Authors’ own.

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Drivers of Engagement
Career development influences engagement for employees and retaining the most
talented employees and providing opportunities for personal development (Concelman,
2005). Employees want to be involved in the decision-making processes that affect their
work. If the employee is given a say in the decision making and has the right to be heard
by his boss then the engagement levels are likely to be high (Schaufeli and Bakker, 2004)
and engagement levels would be high if their bosses (superiors) provide equal
opportunities for growth and advancement of employees (Burke, 2005). In order to boost
engagement levels the employees should also be provided with certain benefits and
compensations. Employees need to feel that the core values for which their companies
stand are unambiguous and clear (Pech, 2009). High levels of employee engagement are
inextricably linked with high levels of customer engagement, performance appraisal, and
safe working environment (Shaw, 2005). If the entire organization works together by
helping each other, the employees will be engaged. When an employee realizes that the
organization is considering his family’s benefits also, he/she will have an emotional
attachment with the organization which leads to engagement. There are a number of
reasons to expect engagement to be related to work outcomes. The experience of
engagement has been described as a fulfilling, positive work-related experience and state
of mind (Schaufeli and Bakker 2004; Sonnentag, 2003) and has been found to be related
to good health and positive work affect. These positive experiences and emotions are
likely to result in positive work outcomes. The engaged employees likely have a greater
attachment to their organization and a lower tendency to leave their organization as
reflected in figure 2.

Figure 2: Key Drivers of Employee Engagement

Career Image
Development

Performance
Empowerment Appraisal

Equal Employee Health and Safety

Opportunities and Engagement
Fair Treatment
Co-operation
Pay and Benefits

Communication Family Wellbeing

Source: Authors’ own.

Employee Engagement Efforts: The RSP Experience

The organization where the study is undertaken is Rourkela Steel Plant (a unit of SAIL),
Rourkela. SAIL is India’s largest steel maker with a turnover of Rs. 43,935 crores during
the year 2010-11 and ranks among the leading steel producers in the world, having
 9

sufficient facilities for optimum utilization of its human resources. SAIL among the four
‘Maharatnas’ of the country, owns and operates eight manufacturing plants – five
integrated steel plants at Bhilai, Durgapur, Rourkela, Bokaro, and Burnpur producing
carbon steels and three plants at Salem, Durgapur and Bhadravati making Stainless and
Alloy Steels. SAIL’s subsidiary at Chandrapur is a bulk producer of Ferro-alloys. RSP
is one of the unique Steel Plants under the SAIL umbrella with a wide variety of special
purpose steels, started during the mid 50’s of the 20th century in collaboration with
leading steel makers from the federal republic of Germany. Pandit Jawaharlal Nehru,
India’s first Prime Minister had described the public sector steel plants set up in the
1950s as the temples of modern India. It is a unique plant producing a wide variety of
flat steel products, which serve various special purposes. The present study is about
enhancing employee engagement and its impact on organizational performance. The
efforts given by RSP towards fostering employee engagement were:

a. Organizational culture
RSP promoting a strong work culture in which the goals and values of the organization
are aligned across all work sections. It builds a culture of trust, confidence, tolerance, low
ambiguity, and mutual respect by keeping success stories alive will not only keep their
existing employees engaged but also encourages the new incoming employees with this
contagious spirit of work culture. Consistent with company’s vision, goals and strategies,
RSP given emphasis on core values (customer satisfaction, concern for people, consistent
profitability, and commitment to excellence) for business success.

b. Role of top management

Employee engagement requires active support and commitment from top executives
through establishing clear vision, mission and values. Unless the people at the top believe
in it, own it, pass it down to managers and employees, and enhance their leadership,
employee engagement will never be more than just a corporate fad or another HR thing.
Employee engagement does not need lip-service rather dedicated heart and action-
oriented service from top management. Keeping in mind for active engagement of
employees, RSP has taken strategic actions for the following:
 building long lasting relationships with customers;
 uphold highest ethical standards in conduct of business;
 create and nurture a culture that supports flexibility, learning and is proactive to
change;
 charting a challenging career for employees with opportunities for advancement and
rewards;
 the opportunity and responsibility to make a meaningful difference in employees life
style.

c. Employee socialization
RSP executives are very careful in pooling out the potential talent of the new employee
through effective recruitment. The manager has to ensure role-talent fit when placing an
employee in a certain position. Once hiring decision is made the new employee should be
given both general orientation which is related to the company vision, mission, values,
policies and procedures and job-specific orientation such as his/her job duties, and
responsibilities, goals and current priorities of the department to which the employee
 10

belongs in order to enable him/her to develop realistic job expectations and reduce role
conflict that might arise in the future.

d. Redeployment
This process is continuously carried out in RSP to meet the changing needs of individual
and the organization. Redeployment in an organization helps individual employees in
learning new skills and thereby breaks the monotony of doing the same job over the
years. It helps them to get exposure to newer technology and also prevents job loss in the
process of technological up gradation. For RSP, redeployment helping towards improved
productivity as because of employees’ satisfaction and perceived engagement.

e. Employee involvement
Clear and consistent communication of what is expected by employees will pave the way
for engaged workforce. Proper sharing of power with employees through participative
decision making will induce feeling of sense of belongingness thereby increasing their
engagement in realizing it. Some key employee involvement strategies which are adopted
by RSP towards proper engagement of the existing workforce are:

 Mass contact exercise which does not have a parallel in the corporate sector, where
the Managing Director along with the Executive Director (Works) sits with nearly
500 employees on each Wednesday. The purpose is to identify the priorities of the
organization through talking face-to-face and making presentations that spell out the
achievements and shortcomings pointing out the areas where thrust is needed.
Employees come forward with their commitment regarding what they would like to
do individually and as members of their department to overcome the shortcomings
and take the Rourkela Steel Plant forward.

 Performance excellence workshops is another programme where again the

Managing Director along with the Executive Director (Works) sits with nearly 100
employees belonging to a specific department or function which also includes key
members of support service departments. The workshop is highly interactive in nature
where employees not only provide inputs about difficulties but also come out with
concrete implementable suggestions involving their own actions.

f. Training initiatives
Training facilitates development of employee’s knowledge and skills which in turn help
in attainment of organization’s goals and objectives. Generally it is understood that when
employees get to know more about their job, their confidence increases there by being
able to work without much supervision from their immediate managers which in turn
builds their self-efficacy, commitment, and job involvement. Accordingly, RSP has
formulated training and development initiatives for its employees and the salient features
of these initiatives are:
 development of base-line standard of competency for different positions;
 meeting organizational, occupational and individual training needs identified every
year;
 developing leadership skills to create proactive and dynamic organization;
 fostering climate of continuous learning through knowledge management;
 11

 providing re-training for redeployment and multi-skilling training to support

manpower rationalization; and
 evaluating effectiveness of training to continually enhance the quality of training in
RSP.

g. Performance management
For an objective assessment of the performance and potential of the employees and to
distinguish between different levels of performance, the HR department of RSP takes
proper steps towards effective performance management. A comprehensive appraisal
system for the employees has been developed to ensure an objective assessment of
performance and potential of the employees and to integrate company's and individual
goal. Performance planning will contribute significantly to role clarity, competency
utilization, potential development, and performance improvements.

h. Pay and reward systems

RSP a unit of SAIL intends to introduce performance linked pay and recognition systems.
SAIL believes in the philosophy that good performance should be recognized and
rewarded. The quantum of rewards and the form of rewards depends upon many factors.
The recognition and rewards may take many forms. Details of the performance linked
pay and other rewards will be evolved after first year of the implementation of the
employees’ performance management system. In addition, RSP has introduced the
following forms of non financial rewards such as: job design, praise, long service awards,
work related trips, Chairman’s dinner, Director’s dinner etc.

i. Non-statutory welfare schemes

 Mediclaim policy
This Scheme has membership of following categories of SAIL/RSP employees: retired
employees, employees who have taken voluntary retirement, employees who cease to be
in employment on account of permanent total disablement, spouse of an employee who
dies in service, and employees who resign at the age of completion of 57 years.

The members covered under the scheme can get themselves admitted in any of the
registered nursing homes / hospitals anywhere in India including SAIL hospitals for
major/minor surgical and non surgical diseases/hospitalization. The member can get the
hospitalization benefit up to Rs.2,00,000/- per member per policy (with clubbing facility
between employee and spouse). This limit includes domiciliary hospitalization. The limit
of reimbursement of OPD expenses would be Rs.4000/- per member for the policy
period.

 Employees family benefit scheme

To provide monetary benefit to an employee in case of permanent total disablement or
permanent medical unfitness or to his / her family in case of death of the employee while
in service of the Company. Employees who have put in a minimum of one year of regular
service in the company (SAIL/RSP) are eligible for the benefit under the scheme.

On the separation of an employee from the services of the company on account of death,
permanent total disablement or permanent medical unfitness, his/her nominee/the
 12

employee, as the case may be, on depositing with the company a sum equivalent to the
PF and Gratuity amounts due to the employee, would be entitled to monthly payments
equivalent to the basic pay + DA last drawn as per the scheme. Such monthly payment
would continue till the normal date of superannuation of the employee. If the amount
deposited is less than the amount due as PF and Gratuity to the employee, the monthly
payment will be reduced in the same proportion.

Impact of Employee Engagement

Conducting regular survey of employee engagement level at RSP helps to identify key
factors that make employees engaged. After finalizing the survey, it is advisable to
determine all the factors that driving engagement in the organization, then narrow down
the list of factors to focus on two or three areas. It is important that organizations begin
with a concentration on the factors that will make the most difference to the employees
and put energy around improving these areas as it may be difficult to address all factors at
once. RSP executives developed action-oriented plans that are specific, measurable, and
accountable and time- bound to build the climate of workforce engagement.

Labour productivity (LP) is considered as an indicator of productivity of the workforce

directly engaged in production process of any organization. LP as an improvement factor
and makes effort to bring it at par with the competitors in the industry or world class
organizations. Being a manufacturing industry, RSP gives continuous thrust to enhance
its LP to bring it at par with other steel manufacturers. In RSP, substantial improvements
have been noticed in LP due to manpower right sizing, employee engagement initiatives,
technological up gradation. During the period 2004-2011, the total manpower of RSP
reduced from 22991 to 18822, LP has been improving from 88 to 181, and turnover has
been gradually increasing from Rs. 2309.84 crores to Rs. 7445.00 crores, nearly more
than three times during last ten years (table 2, table 3), which are the outcome of
proactive employee engagement measures of RSP.

Table 1: Calculation of Labour Productivity

Crude Steel Production + 50 % of Saleable Pig Iron 365

LP = ---------------------------------------------------------------- X -------------------------------------------------
Average Works (Technical) Manpower Duration for which LP being calculated
(Number of days)

Table 2: Manpower and Labour Productivity of RSP

Status 2004- 2005- 2006- 2007- 2008- 2009- 2010-

05 06 07 08 09 10 11
Manpower 22991 22297 21680 21105 20192 19455 18822
Labour 88 128 148 158 162 173 181
Productivity
Source: Deptt. of Personnel (PIS Section), RSP
 13

Table 3: Year-wise Production and Turnover of RSP

Financial Production (in MT) Turnover

Year Hot Metal Crude Steel Saleable Steel (Rs. in Crores)
2001-02 1.46 1.33 1.35 2309.84
2002-03 1.64 1.47 1.52 3144.88
2003-04 1.72 1.57 1.57 3813.88
2004-05 1.69 1.60 1.55 4674.19
2005-06 1.77 1.66 1.61 4586.65
2006-07 2.12 1.99 1.94 6335.90
2007-08 2.22 2.09 2.06 7321.66
2008-09 2.20 2.08 1.98 7623.17
2009-10 2.26 2.12 1.99 6992.24
2010-11 2.30 2.16 2.03 7445.00
Source: Deptt. of Finance, RSP.

Conclusion
Employee engagement is indeed a concept which if implemented properly makes a lot of
sense. It is a simple idea rationalizing the fact that the engagement and commitment of
employees towards their work and organization can make a huge difference. Engaged
employees create winning organizations that are more profitable, a fun place to work in
and offer superb customer services and other solutions for which the organization exists.
Today, however, there is clear evidence that business leaders are not simply saying this –
they are actually experiencing it too with the engagement tools. So that employee
engagement has potential applications for HRM practices such as role definition, support
and flexibility. People are a key component of any company’s ability to execute its
strategy and achieve its goals. Companies who are able to better engage their people also
deliver better business performance and maximize the shareholders value. Now almost all
of the organizations have investing money towards people (HR-related practices), so that
it will create value for organizational performance.

Increasing employee engagement is highly dependent on leadership and establishes two

way and transparent communication where people work and views are valued and
respected. It is about building a truly great relationship with the workforce. Any
organization that embraces fine management philosophy, recognition of employee’s
talent, potential and is committed to providing enriching professional experiences is
bound to succeed. The drivers of employee engagement which are motivating employees
to fully involve in their work and committed to their work, care about their organization
and colleagues and are willing to go the extra mile for their organization to ensure its
success.
 14

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