According to Gallup’s State of the Global Workplace: 2023 Report, disengaged employees cost the world a staggering $8.8 trillion in lost productivity. That figure isn’t just an abstract statistic; it’s comparable to the GDP of entire countries, overshadows the budgets of major governments, and accounts for roughly 7% of the global economy. Over the past 40 years, this lost productivity could have lifted millions out of extreme poverty. And yet, despite this immense opportunity to create change, key employee engagement, culture and wellbeing metrics haven’t really moved the needle—in many ways, they have even worsened
Two elements that have particularly declined are expectation clarity and connection to mission — spurring what Gallup calls the “great detachment.”
Add to this the disruptive changes to how we work. Hybrid working has transformed organizational culture in profound ways. According to Gallup research, employees appreciate the flexibility that hybrid models offer, enhancing their work-life balance and productivity. However, this shift also poses challenges for connection and collaboration. To nurture a strong culture, companies must be intentional in fostering relationships among remote and in-office teams.
The Manager Squeeze
While the state of engagement might sound overwhelming at first, there’s a critical insight that can turn this situation around: managers make all the difference. Gallup’s research consistently shows that around 70% of the influence on employee engagement comes from managers. Even the most cutting-edge surveys or elaborate engagement plans won’t have an impact if leaders fail to act on what they learn or don’t set a compelling example of support and care. Importantly, if they fail to set their managers up for success.
However, many managers today feel the weight of the world on their shoulders. They grapple with burnout, navigate intense stress and often battle a sense of isolation. These leaders are expected to hit ambitious targets, manage diverse teams and steer through constant change, frequently without enough support.
When managers feel overwhelmed, their challenges trickle down, leading to lower productivity, stifled innovation and a weakened organizational culture. I remember speaking with a seasoned manager in a financial services organization who described his role as steering a small boat in a storm. The waves of targets, shifting priorities and unexpected challenges left him feeling exhausted and unsupported. His story illustrates that if we don’t invest in our managers, the ripple effects can be disastrous for everyone involved.
Building A Culture Of Engagement
So, what can we do about it? Forward-thinking organizations are already taking a new approach. They aren’t satisfied with running endless surveys that gather mountains of data only to have it filed away and forgotten. Instead, they focus on the right metrics and build the capabilities of their managers to have active, ongoing dialogue with their teams. They’re building a true culture of engagement—one that gives managers the tools and support they need to create a dynamic and innovative environment.
Imagine the possibilities: organizations honored with Gallup’s Exceptional Workplace Award typically report engagement levels near 70%. In those companies, for every disengaged employee, there are as many as 14 fully engaged ones—a ratio that far outpaces averages in the U.S. and worldwide. These numbers aren’t just statistics; they illustrate that a focused, human-centered, culture-building engagement strategy can reshape our work environment.
Consider these four strategies to foster this culture of engagement:
1. Focus on Meaningful Metrics—Measured Over Time
Let’s face it: we’ve all endured those marathon surveys that ask every conceivable question. It’s time to trim the noise and zero in on what matters. Employee engagement should be monitored with clear, actionable metrics rather than overwhelming lists of questions.
Gallup has identified twelve key conditions that drive performance at the workgroup level. When teams truly master these conditions, the impacts can be enormous. However, the survey is just the first step. The secret lies in getting every manager to discuss the insights and drive action based on what they learn.
To drive even greater impact, consider developing an “enterprise engagement scorecard” that additionally includes factors such as operational quality or customer engagement. Further, instead of a one-off survey that provides a snapshot, this scorecard continuously tracks a handful of crucial indicators: Are managers accountable for planning actions based on insights? How frequently do employees feel their strengths are recognized? What is the turnover rate among high-potential talent? How are team-level innovation efforts faring? Which of your locations have world class employee engagement and customer engagement?
Case in point: Global hospitality brand Kempinski, known for its incredibly diverse range of hotels from Nairobi to Havana, but still boasts a highly consistent and stable employee experience. Leaders prioritize consistency, ensuring employees feel the same reliability as Kempinski customers. Part of this involves ensuring that metrics and actions related to employee engagement and guest service are perceived as a unified strategy.
2. Engaged Managers Equal Engaged Employees
We all know that a manager’s energy sets the tone for the entire team. When a manager is genuinely engaged, approachable and supportive, that positive energy cascades to every employee. Conversely, if a manager is burnt out or detached, that negativity can quickly permeate the group.
The first step is to set clear expectations for managers—meeting targets while cultivating a nurturing, proactive team environment. Manager development programs should go beyond traditional business skills; they must emphasize emotional intelligence and sharpen active listening skills. Offering one-on-one coaching and establishing regular peer-to-peer support networks can go a long way in fostering a supportive environment.
Instead of waiting for an annual performance review or sporadic survey results to trigger change, consider creating “manager mentoring circles.” These informal gatherings allow managers to share challenges, brainstorm solutions and exchange practical ideas for boosting engagement. You could even introduce a playful element with gamification: managers earn badges or recognition for hitting engagement milestones.
3. Look Beyond Tokenistic Initiatives
We’ve all experienced those fun, one-off events—a pizza party here, a team outing there—that provide a temporary lift in spirits. While these activities create momentary joy, they rarely address deeper issues. Real, lasting change happens when organizations examine what employees truly need to feel valued and motivated.
Start the process by hosting open discussions or focus groups with your teams. Create a safe space for employees to share their thoughts and concerns. Perhaps they seek clearer career growth paths, regular feedback, or transparent communication about their roles. Sometimes, what’s needed is not another fun event but a genuine, substantive investment in mentorship or improvements to the performance management system.
The outcome can be striking: increased trust, higher morale and an overall boost in team performance. By shifting from one-off initiatives to a continuous “listening and learning” mindset, companies create environments that adapt to their people’s evolving needs. Pizza parties are great too. But you need to plan on sustaining the energy far after the streamers and balloons come down.
4. Don’t Look At HR As The Sole Driver
For too long, engagement responsibility has been siloed within the HR department. But true engagement should be woven throughout the entire organization—engagement is a company-wide mission that requires constant attention from every level, including top leadership.
Business leaders and CEOs must roll up their sleeves and actively champion engagement. Instead of having sensitive engagement metrics tucked away in HR reports, these numbers should be integrated into the core business dashboards that guide day-to-day decision-making. When leadership recognizes employee engagement as an essential business metric, it becomes clear that it’s directly tied to the company’s overall success.
Another effective strategy is to appoint engagement champions across different departments. These aren’t just HR representatives; they’re respected leaders chosen for their ability to rally their teams and keep engagement front and center. Some companies even hold regular “engagement huddles,” where recent insights are discussed, challenges are confronted, and next steps are mapped out clearly.
Take the example of industrial packaging giant Greif — to bolster employee engagement created the Greif Champions Program, which recognizes global colleagues quarterly for demonstrating company values and ties employee recognition to its culture, fostering performance, pride and loyalty.
Ultimately, organizations should embed engagement discussions into daily operations rather than treating them as isolated HR projects. This approach demonstrates that when engagement is a shared responsibility, it can genuinely transform corporate culture.
Realizing The Engagement Dividend
The numbers are undeniable—disengaged employees cost the world a mind-boggling $8.8 trillion. However, the most promising solution lies with our managers. When they are supported, engaged, and equipped with the right tools, they create a ripple effect that empowers employees to give their best. Yet, organizations often get caught up in collecting data through endless surveys without translating that information into meaningful action.
Building a genuine culture of engagement is not about ticking boxes on an HR checklist but creating a workplace where excellence is the default state. It’s about committing to continuous listening and learning, and making tangible changes based on that information. When companies prioritize the right metrics, invest consistently in their managers, and move beyond superficial activities, they unlock the vast potential hidden within their workforce.
Ultimately, the lost money isn’t an abstract figure; it’s a wake-up call. That enormous potential is waiting to be unleashed if companies are willing to invest in their most valuable asset: their people.
This isn’t merely about improving performance on paper. It’s about creating a culture and an environment where every team member feels heard, valued and excited to contribute. It’s about breaking free from the stagnation of annual surveys and dusty reports and engaging in real-world actions every day. When data isn’t just collected but actively used to drive change, the difference in workplace culture can be truly transformative.