I start with these questions: Does it matter if employee engagement is a means to an economic end, such as raising the share price, or an end in and of itself? Are the nature, level and depth of engagement the same in both cases? Or is one more “authentic” than the other?

The issue was raised, implicitly, during a conversation with Michael Beer, Professor Emeritus, Harvard Business School. We were talking as part of a series of interviews I’m conducting with leading figures in Organizational Science and Leadership Studies for the journal Organizational Dynamics.

Beer was a pioneer in the early study and implementation of employee engagement programs and is the author of numerous engagement-related books and articles, including the classic, The Critical Path to Corporate Renewal and the recent, High Commitment High Performance: How to Build A Resilient Organization for Sustained Advantage.

He has spent the last thirty years studying the characteristics of those organizations that are able to succeed and sustain themselves over a long period of time, despite changes in business conditions, markets and technology.

Such long-term success is not easy to do and it’s not getting any easier. Just to get a sense of the dynamism of the marketplace, even for the largest companies, I took a quick look at the Fortune 25 largest companies last year, 2011, and compared them to the same list twenty years earlier, in 1991. Twenty years, I thought, ought to fit the definition of sustained success.

Twenty years appears to be an eternity in business. Across that span, there was almost a complete turnover of the list of the Fortune 25 top companies. Eighteen, or 72%, were new to the list. Even going back just ten years, to 2001, the turnover was 40%.

What happened? Some companies were swallowed up, some went bankrupt, others jumped ahead as a result of mergers and acquisitions and some simply performed poorly. Sustaining high performance is incredibly difficult, and the difficulty appears to be compounding.

What does this have to do with engagement and authenticity? For Beer, the question itself is rooted in a larger question: what is the objective of your firm? Or to put it in a slightly different way: for whom are you in business?

According to Beer, for most companies the answer to the latter question is shareholders, and shareholders only. Their objective, he told me, is simply “to increase the value of the company in capital markets as quickly as you can.”

This has implications for engagement. “The only reason these shareholder value firms are in the engagement game,” he added, “is to create more productivity and higher performance alignment.”

That’s not in itself a bad thing for Beer; he understands that “more productivity and higher performance” is necessary for success. But in studying companies that have shown sustainable success over the long term, he also sees that, by itself, the drive for productivity and performance is not enough. It can’t produce the resiliency and flexibility needed when markets, business conditions and changes in technology change the playing field on which firms operate. So it shouldn’t be surprising, then, that firms solely focused on shareholder value rise and fall with increasing regularity.

The resilience, flexibility and adaptability needed to sustain success over a long period of time require more than a single stakeholder focus on shareholders. It requires a “multi-stakeholder” perspective, according to Beer. That means that “employees, customers, community and society are considered in all decisions. Top management attends to multiple outcomes [Beer emphasis], not just financial performance in evaluating the performance of the enterprise and its managers…  The organization is explicitly designed to produce economic, psychic and social value for each party…”[1]

In firms that take a multi-stakeholder perspective, employees are deeply involved in the development and execution of strategy.  As a result, they become highly engaged and are deeply committed to the firm. 

There’s an implicit bargain at work here. “In effect,” Beer writes, “the enterprise cedes substantial influence over goals and process to employees in return for dedication and commitment to the community and its purpose. This is what aligns employees hearts and minds [Beer emphasis] with the enterprise’s mission and values.”[2] In essence, Beer is laying out a set of parameters, or markers, of what makes for engagement that is authentic.

Which brings us back to the idea of inauthentic engagement and its relation to the objective of the firm. The issue: can engagement be authentic in firms whose sole purpose is to maximize shareholder value and who therefore see engaging employees as simply a means to increase productivity and performance? Isn’t engagement in that case simply a form of manipulation and therefore ultimately inauthentic? Do employees in these firms, at some level, understand or sense that engagement activities are ultimately being done in someone else’s interest and not their own? And if so, are whatever gains made by these firms’ employee engagement programs unsustainable?

I don’t have the answer to those questions. But I also don’t see them being asked. Not frequently or widely enough. And too rarely by the “employee engagement industry” and its advocates and practitioners.

These questions are pondered only by the few, by those who have seen what authentic engagement really is, what it can do and why it is a necessary pillar for long-term sustainability and success. And they are answered only by those who have the courage and boldness to think for the long term.  By researchers and practitioners like Michael Beer.