New engagement survey metric uncovers a new risk for employers who want to keep their top performers, according to Leadership IQ

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CEOs may ignore many of the metrics that HR departments track, but a new metric that links employee engagement scores with performance appraisal ratings is quickly capturing the attention of business executives and the media. Leadership IQ has identified that in 42% of companies studied, low performers are actually MORE engaged than high and middle performers.

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HR departments typically track dozens of metrics, many of which are ignored by CEOs. But Leadership IQ has developed a new HR metric that links employee engagement survey scores with performance appraisal ratings. And it's quickly capturing executives' attention, with articles and commentary across every major business information medium just in the past 3 days.

"CEOs need to take note," says Mark Murphy, founder and CEO of Leadership IQ, a globally respected provider of employee engagement and leadership development programs. "For years, we've believed our best performers are also our most engaged employees and so we had little to worry about. Not any more."

Leadership IQ researchers linked employees' scores on their annual engagement surveys with the scores they received on their annual performance appraisals at 207 companies. And then, by identifying statistical relationships between engagement and appraisal scores, Leadership IQ is able to make predictions and recommendations about high performer turnover, low performer accountability, middle performer development, and much more.

In the latest example of this metric (the one featured in the WSJ, CNBC, CBS MarketWatch and others), Leadership IQ identified that in 42% of the companies, low performers are MORE engaged than high and middle performers.

Leadership IQ's study, titled "Job Performance Not a Predictor of Employee Engagement" also detailed a 1,000-person technology-services firm, where low performers were more engaged than high performers. The annual appraisals at this technology firm use a 4-point scale, ranging from Unacceptable to Superior. According to the company's 2012 statistics, 18% of employees can be considered low performers, 20% are considered high performers, and 62% are considered middle performers.

After Leadership IQ administered an employee engagement survey, it found ...

  •     Low performers were significantly more motivated to give 100% effort at work than high performers
  •     Low performers were significantly more likely to recommend the company as a great organization to work for than high performers
  •     Low performers were significantly more likely than high performers to believe that leadership holds people accountable for their performance
  •     Low performers were significantly more likely than high performers to feel that all employees live up to the same standards

There are ample reasons why these findings put organizations at risk. One of them is the fact that high performers, who thrive on being highly engaged, don't tend to stick around very long if they aren't engaged. It's disturbing news for any company that believes their people are their most important asset.

The best leaders are responding by learning the facts and taking action. They discover and act on the factors pushing valuable employees out the door and build on the factors that tug at them to stay. They take action to make all employees more mentally and physically accountable.

Great organizations also identify the key attitudes that define their success and failure so their leaders can accurately identify, reward and correct behavior according to actual employee performance. They make sure employees, especially high performers, understand the company vision and they recognize that what defines most low performers is the wrong attitude (not a lack of skill).

Download a complimentary copy of the study, or contact Leadership IQ at 800-814-7859 or email info(at)leadershipiq(dot)com to learn how to assess this HR metric in your own organization.

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Lauryn Franzoni