Why Incentivizing Managers Based on Engagement Scores Is Discouraged

It’s easy to see why companies incentivize managers and other employees based on overall engagement scores from a census survey. Organizations value engagement, and rewarding individuals for a strong score or a significant increase seems like a fair way to get everyone to buy in.

While the concept seems sound, there are issues that arise with incentivizing employees based on engagement scores. Engagement is essential and it’s important to keep people accountable, but we don’t recommend basing bonuses or pay scales on engagement numbers

The Problem with Tying Incentives to Engagement Scores Is That It...

...turns employee feedback into a score.

Focusing solely on the final number mutes the employees’ voices. Comments and feedback are lost when an organization focuses solely on the overall score.

...turns employee engagement into a manager metric.

Every employee inside an organization should feel accountable for employee engagement. While that accountability may look different for leaders, managers and employees, incentivizing one role (i.e. managers) can make others feel less accountable.

...leads to unhealthy behavior.

If a manager knows his or her bonus will be affected by scores on a census survey, they may change their actions around the time the survey is administered. They may threaten or intimidate employees into inflating scores. Similarly, especially if the results remain anonymous, employees may be overly critical if they’re unhappy with their managers and want to stick it to them.

...hurts post-survey action.

The ultimate goal of a survey is not to gauge the status quo, but to identify organizational strengths and areas that can be improved. If too much focus is put on the results, managers may lose interest in engagement after the survey.

...is unfair to managers.

Simply stamping a manager with a number removes all context from their performance. Maybe a manager is new to the job and hasn’t had a chance to make meaningful changes yet. Perhaps the starting engagement level of the team was particularly low. Elements such as team size and turnover play a large part in engagement scores and are many times out of the manager’s hands.

What to Do Instead!

Discuss engagement throughout the year.

Instead of holding managers accountable for one number associated with employee engagement, leaders can promote accountability among managers by regularly discussing engagement in 1-on-1 meetings. When leaders ask managers about their team’s engagement commitments, the action they’ve taken since the survey, and what progress has been made so far, it signals that engagement is important and that managers are accountable for driving engagement in their teams.

Set up non-metric based goals.

Don’t boil everything down to a number. Discuss ways to improve that fall outside numerical values, such as employee retention or absenteeism.

If Incentivizing is Non-Negotiable…

If you feel incentivization is a must for your organization, we have some suggestions that alleviate some of the issues identified above:

  • Don’t have a cookie-cutter bonus plan. Take variables like team size and turnover into account.
  • Place accountability at the senior leadership level instead of the manager.
  • Make engagement coaching and other resources available so those you’re incentivizing are set up for success.
  • Consider incentivizing on survey follow-up questions like, “My manager/leader shared the results of the last employee engagement survey with my team,” and, “My team has made progress since the last employee engagement survey.”