McKinsey Quarterly Report

More than half of employees report being relatively unproductive at work. New research into six types of employees shows how companies can re-engage workers while amplifying the impact of star performers.

The pandemic has forced major changes in how, when, and where people work. It has also bedeviled employers. Due in part to new hybrid and remote-working models, companies are struggling to find objective ways to gauge employee effectiveness—a critical challenge as labor costs have increased and worker productivity has declined.¹

According to new McKinsey research, employee disengagement and attrition could cost a median-size S&P 500 company between $228 million and $355 million a year in lost productivity (see sidebar, “Methodology”). Over five years, that’s at least $1.1 billion in lost value per company (Exhibit 1).

These are big numbers that strike at the heart of value creation. To address the problem, corporate leaders first have to grasp that their workforces are not monolithic when it comes to employee experience and that the tactics to increase performance require a more segmented approach. Leaders can then apply differentiated strategies to groups of employees that boost levels of satisfaction and commitment, performance, well-being, and, ultimately, retention and engagement.

Our latest research identifies six distinct employee groups, or archetypes, across a spectrum of satisfaction, engagement, performance, and well-being. These workers range from the highly dissatisfied and actively disengaged—who comprise more than 10 percent of an average organization and who we believe are destroying value—to a group at the other end of the spectrum that we call “thriving stars.” At about 4 percent of an average organization, these super-engaged workers not only perform at high levels themselves but also appear to spread their positive engagement and commitment to others. In between these two poles is a vast middle of workers who experience varying levels of engagement and satisfaction that affect their performance and sense of well-being.

For leaders engaging with these new survey findings, it’s important to note that respondents’ self-reported performance is a useful and revealing way to measure performance, but it’s not the only one. With hybrid patterns here to stay,² executives should seek to provide the best possible experience regardless of working model, including offering structure and support around activities best done in person or remotely. This includes helping managers measure performance based on outputs and objectives completed rather than on input factors such as time spent or location.

The central challenge for organizations is to move as many workers as possible away from the highly dissatisfied group (which is probably larger and more destructive than most C-suites realize) and toward greater engagement and commitment. Such a strategy would give workers the opportunity to develop their skills, reducing dissatisfaction and attrition rates and bringing clear financial and organizational benefits over the long term.

In this article, we describe the six worker archetypes that we believe are present in every organization and how big a slice of the workforce pie each archetype represents. We then analyze how the factors that shape a company’s employee value proposition (EVP) and employee experience affect satisfaction, commitment, and performance. And we suggest actions companies can take to augment these levels across their workforces.

Employee archetypes and the satisfaction spectrum

In our prior research on talent trends since the Great Resignation began, we focused on factors that drove people out of work and how companies could retain them amid a uniquely challenging global economic environment.³ Here, we expand our inquiry to look at the engagement factors that enhance employees’ satisfaction, performance, and well-being, which are crucial components for sustained organizational performance.

Read the full article here.