This month the employee engagement survey bandwagon stumbled when a long time proponent of employee engagement — KPMG— reported that all of their employee engagement efforts had not resulted in increased performance. KPMG decided to forego the employee engagement survey.

What are employee engagement surveys? They vary. Some HR Departments retain consultants to perform what I call the “lovey-dovey survey.” These surveys ask questions such as “Do you like your coworkers?” and “How do you feel about your employer?”

A different type of employee engagement survey asks questions like “Does your manager listen to you?” The downside of this kind of survey is that it often creates employee expectation that if managers don’t listen, the company will take action!

Some consultants implement employee engagement by looking at measurable results. One company successfully used employee engagement efforts through a pilot. The test group showed a 54% increase in comparable store sales.

So this begs the question, are companies throwing the baby out with the bath water when they abandon employee engagement including this pilot that actually has measurable results?

KPMG is implementing a program of in the moment performance feedback. This is much appreciated by the experienced employees who don’t feel traditional annual employee reviews are motivating.

But how will the Millennial react? Millennials have been brought up with the accolade “good job” for every action they take. They received trophies in sports just for showing up and no special reward and feedback was given to the best players. Experience with the “specialness” of Millennials has influenced some companies to get rid of any comparative feedback and they’ve abolished performance reviews all together.

Going forward, as companies like KPMG re-introduce measuring performance instead of relying solely on measures like “Great Place to Work” contests, HR and management will have to design motivating feedback mechanisms for all of their diverse employee populations. Baby boomers and Millennials are not motivated identically.

The decision making should evaluate keeping the employee engagement methods that have proven to result in measurable performance gains­ while getting rid of the surveys that focus only measure employee satisfaction without corresponding gains in productivity.

Myth Busted: Small business owners forget that disgruntled employees can make claims for wages before the Labor Commissioner— without hiring an attorney— and more often than not they can recover a lot of money.

In the last six months I heard about two small employers whose employees became dissatisfied and went to the Labor Commissioner. The employer with four employees had an award of about $40,000 against it. The employer with 18 employees had to pay about $25,000. Now it is defending similar complaints from the other employees who were also denied overtime.

Suggestions for Reducing Risk

• Don’t rest on the idea that all of your employees love you and they would never turn against you. Sadly it happens much more frequently than you think.
• Get realistic human resources and legal advice about how the Labor Commissioner rules on overtime claims before you make your decision as to who will be paid overtime. In practice these agencies find against employers far more often than finding in favor of the employer.
• Pay overtime from the get-go. The law permits small business owners to manage the payment of overtime. Many business owners find they actually increase productivity and save money through a closely-managed overtime program.

 Is HBR Poll a Wake-Up Call?

A recent Harvard Business Review article revealed the results of a Harris Poll that showed sixty-nine percent (69%) of managers feel “uncomfortable communicating with employees.”

I am sure this is no surprise to most people — since as employees, managers or human resources professionals we’ve all experienced one or both sides of an awkward, ineffective interaction.

The question is, what are you doing to address this seemingly pervasive problem?

Instead of shrugging your shoulders and attributing the problem to human nature, here are a few suggestions that are proven to help your managers become more effective communicators:

1. Train your managers to give in-the-moment behavioral feedback.Many managers only know how to give criticism in 1:1 meetings or worse yet in annual performance reviews. The trend, especially with millennials, is to give feedback on the spot.

In the training, show how to give immediate feedback either in face-to-face conversations, text messages or by email with practical suggestions such as:

• Feedback in person might be “Your creativity made all the difference!”
• A text message with the ever-effective “Great job!” is generally appreciated.
• Negative feed back in an email could read. “Your failure to show up at the team meeting this morning hurt the team.”

2. Encourage senior management to lead by example.  If in-the-moment feedback is going to be part of your culture, top management needs to learn, it, apply it and reward it.

3. Teach managers to focus on top performers– I am sure you’ve noted that most top performers take critical feedback to heart. Your management time is better spent with your best performers who will often thrive on suggestions and challenges for professional and personal growth.

4. Consider letting go of performers who don’t respond favorably to feedback. At-will employment means that you can fire poor performers without giving warnings and improvement plans.  Make sure your employee handbook doesn’t make unnecessary promises of performance improvement steps prior to termination. Before termination, review your facts with a human resources attorney who may suggest offering a few weeks of separation pay in exchange for a release or may recommend a different approach if there is risk of a discrimination claim.