Employee Engagement: Bridging the Gap between Contract and Commitment

Broken commitment

Employee engagement has emerged as a crucial challenge and objective for managers today. Understanding its complexity requires us to differentiate it from related yet distinct concepts: mobilization, motivation, involvement, and commitment. More importantly, appreciating why engagement remains paradoxically elusive demands reflection on prevailing managerial practices and corporate mindsets.

1. Engagement: The Ultimate Stage of Employee Mindset

We often hear the terms mobilization, motivation, involvement, commitment, and engagement interchangeably, but they represent different facets of an employee's relationship to their work and organization.

• Mobilization is essentially operational: employees act and deliver outputs primarily because it’s their responsibility or because instructions were given. Mobilization is externally driven, a direct result of leadership actions or incentives.

• Motivation dives deeper. Adam Grant notably argues that motivation is linked to purpose, mastery, and autonomy. It remains mostly intrinsic and personal: employees perform tasks because they see meaning and find satisfaction or pleasure in their achievement.

• Involvement is about identification and participation. Employees align their personal goals or interests with organizational missions and willingly contribute to activities beyond their basic tasks.

• Commitment implies a sense of attachment and loyalty. Employees committed to their companies feel a strong emotional connection and choose to stay, even in difficult times.

But engagement is the apex of this pyramid—more profound than commitment itself. An engaged employee proactively cares about organizational success, becomes an ambassador, anticipates issues, and goes above and beyond. Engagement is beneficial both for individuals, in terms of professional fulfillment and personal satisfaction, and for organizations, driving sustainable competitive advantage.

2. A Persistent Paradox: Contractual Thinking Versus the Desire for Engagement

Despite this clear recognition of engagement’s profound benefits, a troubling paradox remains pervasive in many organizations. As John Kay observes in The Corporation in the 21st Century, companies increasingly adhere to a transactional, short-term mindset. Top management views employment primarily as a contract to be optimized. They aim to keep salaries aligned strictly to market benchmarks—often pushing downward—and are quick to cut staff when downturns occur. In other words, loyalty toward employees is strictly conditional, even while simultaneously proclaiming the strategic importance of engaged employees.

Why, then, do companies seek engagement? The answer lies in the unmistakable benefits engagement offers:

• Higher Productivity and Innovation: Engaged employees exhibit higher discretionary effort. They willingly invest cognitive, emotional, and physical resources. Linda Hill, in her research on innovation leadership, emphasizes how engagement enhances collaboration and creative energy, vital ingredients for sustained innovation.

• Reduced Turnover Costs: High turnover involves considerable expenses in recruitment, onboarding, and knowledge loss. Engaged employees stay longer, reducing such costs significantly.

• Increased Customer Satisfaction: Edgar Schein underscores the importance of organizational culture and alignment. Engaged employees internalize organizational culture positively, projecting genuine care toward customers, thereby driving stronger customer satisfaction and retention.

• Better Overall Performance and Resilience: Gary Hamel has long highlighted the power of human capital, noting that engaged employees foster organizational resilience and adaptability, especially vital during crises and rapid market changes.

Given these potent benefits, the paradox deepens further: management desires engagement, yet pursues practices that impede it.

3. Disengagement Today: A Growing Reality

Today, unfortunately, engagement remains alarmingly low. Studies by Gallup and other consultancies regularly indicate high disengagement rates globally. Tomas Chamorro-Premuzic notably points out that disengagement leads to lower productivity, increased stress, higher turnover, and diminished wellbeing at work. In his view, disengagement is often driven by managerial shortcomings—poor leadership, a lack of meaningful work, and dysfunctional organizational cultures.

Moreover, recent shifts amplified by the pandemic have intensified this disengagement, notably through remote and hybrid work arrangements. While remote work offers flexibility and autonomy, as highlighted by Luc Bretonnes in L’entreprise nouvelle génération, it also risks creating isolation, diminished cultural cohesion, and weakened emotional bonds unless actively managed. Indeed, the current workplace landscape has evolved rapidly, emphasizing even more explicitly transactional relationships.

4. The Emerging Antidote: Transactional Mindsets on Both Sides

This paradox has naturally triggered a reciprocal response. Employees, notably younger generations (Millennials and Gen Z), increasingly view employment relationships as transactional arrangements themselves. Loyalty is now perceived as conditional—no different from the transactional attitude companies regularly demonstrate. Employees increasingly say: "If the company gives me precisely what I’m paid for—no more, no less—I’ll reciprocate precisely with the effort I believe is appropriate." The willingness to provide additional discretionary effort beyond the contractual expectation fades rapidly.

Heidi K. Gardner's work on collaboration highlights the critical role of trust and relational quality, both undermined by purely transactional mindsets. In short, if the contractual and transactional approach persists among employers, employees themselves will embrace similar logic. Both parties then face the risk of perpetual minimalism, preventing the realization of engagement’s full potential.

5. Rethinking Managerial Mindsets and Practices: The Path Forward

So, how can companies overcome this paradox and truly encourage genuine engagement?

• Build Psychological Safety and Authentic Trust: Drawing from Edgar Schein's and Amy Edmondson’s concepts, organizations must deliberately create climates of psychological safety. Employees should feel safe to express themselves, innovate, make mistakes, and offer constructive dissent without fear of negative consequences.

• Revise Leadership Models: Linda Hill emphasizes leading from behind—encouraging leaders to step back, coach, empower, and trust employees. Herbert Simon and James G. March also emphasized how leaders should foster learning and adaptive systems rather than mere control mechanisms.

• Embrace Flexible but Meaningful Remote Work: Remote work shouldn’t merely be a cost-saving strategy. Luc Bretonnes advocates for carefully structured remote or hybrid models that foster genuine autonomy, meaningful work, and strong team cohesion, even from afar. This model leverages the benefits of autonomy and flexibility without isolating employees or reducing engagement.

• Revisit Compensation Philosophy: Rather than simply minimizing salary expenditure, compensation structures should reflect fair distribution and recognition of individual and collective contributions. Adam Grant argues that employees deeply respond to fairness and perceived equity, and this strongly motivates intrinsic, discretionary effort.

• Foster Organizational Purpose and Identity: Employees today seek meaning beyond salaries. Companies must authentically articulate their social purpose and organizational identity. Employees engaging emotionally with a genuine organizational mission and culture become naturally more committed and engaged.

Ultimately, resolving the paradox means companies must consciously choose a paradigm shift. They must acknowledge that meaningful relationships cannot remain transactional. Genuine engagement, trust, and collaboration are not contractual—they’re relational and cultural, demanding deliberate nurturing.

Only when management decisively shifts from a purely contractual mentality toward a deeper relationship-oriented culture can organizations achieve authentic employee engagement. And only then will they fully reap the powerful benefits that genuine engagement brings—benefits that transcend mere economic transactions and transform companies into thriving communities built on mutual trust, respect, and shared purpose.

Here is the detailed list of each referenced book and author in the article:

1. John Kay

   • The Corporation in the 21st Century (1996) (On transactional relationships and short-term thinking in corporations.)

2. Adam Grant

   • Give and Take: A Revolutionary Approach to Success (2013)

   • Originals: How Non-Conformists Move the World (2016) (On intrinsic motivation, fairness, and equity at work.)

3. Linda Hill

   • Collective Genius: The Art and Practice of Leading Innovation (2014, co-authored with Greg Brandeau, Emily Truelove, and Kent Lineback) (On leadership, creativity, innovation, and team engagement.)

4. Edgar Schein

   • Organizational Culture and Leadership (2016) (On organizational culture, psychological safety, trust, and employee alignment.)

5. Gary Hamel

   • The Future of Management (2007)

   • Humanocracy: Creating Organizations as Amazing as the People Inside Them (2020, co-authored with Michele Zanini) (On human-centric management, resilience, and engagement.)

6. Tomas Chamorro-Premuzic

   • Why Do So Many Incompetent Men Become Leaders? (And How to Fix It) (2019)

   • The Talent Delusion: Why Data, Not Intuition, Is the Key to Unlocking Human Potential (2017) (On the impact of poor leadership and management practices on employee engagement and productivity.)

7. Heidi K. Gardner

   • Smart Collaboration: How Professionals and Their Firms Succeed by Breaking Down Silos (2016) (On collaboration, trust, and relational quality in organizations.)

8. Herbert Simon and James G. March

   • Organizations (1958) (On organizational learning, decision-making, adaptive systems, and organizational behavior.)

9. Luc Bretonnes

   • L'entreprise nouvelle génération (2020) (On new forms of organizations, remote work, flexible management, and cultural transformations needed for engagement in the modern workplace.)

10. Amy Edmondson (added for psychological safety, explicitly referenced in the French translation)

    • The Fearless Organization: Creating Psychological Safety in the Workplace for Learning, Innovation, and Growth (2018) (On psychological safety as a critical enabler of employee engagement and organizational learning.)