All great organizations share one characteristic: highly engaged employees. When employees are engaged — when they feel an emotional connection toward their work, colleagues and company —they invest more discretionary effort. Engagement is the fuel that sparks innovation, strengthens customer relationships, and drives productivity.

The data proves that engaged employees are a competitive advantage. Highly engaged employees generate 18% more in sales, and they are 14% more productive overall, irrespective of industry, location, company size or economic climate. That works out to be about one month of additional work per year for every employee. Because output increases with no additional overhead costs, it’s easy to see how engagement drives profits.

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Yet, despite the powerful connection between engagement and performance, too many companies fail to treat engagement as a business strategy. Gallup’s 2025 State of the Global Workplace Report found that only 21% of employees worldwide report being enthusiastic and engaged about their work. In the United States, just 32% of workers are engaged, while nearly half are doing only what’s required.

So, how can leaders boost engagement in meaningful, measurable ways? While compensation, flexibility and benefits all matter, I have found that the biggest impact can come from the simplest leadership habits — ones that are frequently overlooked.

Below are three underused but powerful practices that can elevate engagement, deepen trust, and enhance productivity across your workforce.

1. Prioritize intentional conversations

In many organizations, the pace of business leaves little time for leaders to have meaningful conversations with their direct reports. But skipping these touchpoints comes at a cost. According to Gallup, personalized conversations are the most effective way for managers to influence employee engagement.

These conversations are not status updates — they’re opportunities for active listening and connection. When leaders make time to hear their employees’ ideas, concerns and goals, they demonstrate that each person’s contribution matters. Employees who feel heard by their managers are 4.6 times more likely to feel engaged and empowered to deliver their best work. This practice also helps surface small issues before they escalate into major problems.

Engagement thrives when employees feel seen and heard. Intentional conversations build trust, reinforce transparency, and remind team members that their work has purpose and impact. In my own experience leading large teams, the most productive cultures are built not through town halls or emails, but through consistent, personal communication between leaders and their people.

2. Trust employees with autonomy

Trust is the foundation of engagement. When employees feel empowered to make decisions and take ownership of their work, they respond with higher levels of motivation and creativity. But too often, leaders confuse control with accountability. Micromanagement sends an unmistakable signal: “I don’t trust you.” That erodes confidence and engagement faster than any missed deadline. Instead, set clear expectations and give employees the flexibility to determine how they meet them.

For high performers, autonomy is a reward that fuels motivation. For those still developing, trust looks a little different. Clear goals, regular check-ins and consistent feedback help these employees build the confidence and capability to thrive, without the need for constant oversight.

Autonomy transforms accountability into pride. When people know they are trusted to deliver results, they become emotionally invested in their success — and the company’s. This sense of empowerment builds resilience, strengthens relationships, and unlocks the discretionary effort that drives exceptional performance.

3. Recognize and reinforce great work

Recognition is one of the most effective — and underutilized — tools in a leader’s toolkit. When leaders recognize and appreciate good work, employees are more engaged, more productive and less likely to quit. In fact, many workers say they would rather get recognition from a senior executive than a bonus or other monetary award.

Yet, according to a Gallup/Workhuman study, 81% of leaders don’t consider recognition to be a strategic priority. And, in Workplace Options’ 2025 Psychological Safety Study, lack of recognition was a top concern for employees around the world.

“Many employees feel undervalued due to a lack of recognition for their contributions,” says Dublin-based Clare Robinson, Senior Vice President of Global Infrastructure at Workplace Options. “When employees feel valued, organizations benefit from stronger engagement, higher performance, and greater innovation.”

Recognition doesn’t have to be elaborate or expensive. It’s about acknowledging contributions in real time — when the effort and impact are fresh. Send a handwritten note. Give a quick shout-out in a team meeting. Publicly highlight achievements that align with your company’s values. These gestures strengthen the emotional connection between people and purpose. Over time, these small moments of appreciation compound into a culture of engagement and loyalty.

The human equation behind productivity

It’s tempting to focus on efficiency metrics, automation, or new technologies to drive productivity gains. But the real differentiator in every organization is human energy — the discretionary effort employees give when they feel valued and inspired.

The best leaders know that productivity follows engagement. They build cultures where intentional conversations happen regularly, autonomy is respected, and recognition is frequent. These aren’t “nice-to-have” practices; they’re essential to sustaining a high-performing workforce in a competitive economy.

The bottom line

Employee engagement requires more than short-term initiatives or one-off educational programs. True engagement depends on the organization’s culture and its leadership mindset. When leaders listen actively, empower their people, and celebrate their contributions, they cultivate a culture of purpose and performance.

In my work with executives, I often remind them that engagement is contagious. When people feel heard, trusted, and appreciated, they don’t just work harder—they make everyone around them better. That’s how productivity scales.

If you want your organization to outperform the market, start by investing in your people. Build trust. Empower ownership. Recognize excellence. Do these three things consistently, and you’ll unlock the full potential of your workforce — driving engagement, performance, and profitability for years to come.

About the Author  

Donald Thompson is an award-winning CEO and multi-exit entrepreneur, honored as EY Entrepreneur Of The Year®, named to Forbes Next 1000, and a 3x Inc. 5000 Chief Executive. Currently the Managing Director of the Center for Organizational Effectiveness at Workplace Options, Thompson is a sought-after speaker on innovation, culture and growth. His books include Underestimated: A CEO’s Unlikely Path to Success, now available as an audiobook; The Inclusive Leadership Handbook: Balancing People and Performance for Sustainable Growth; and The Employee Engagement Handbook, coming in January 2026. He hosts the globally recognized podcast “High Octane Leadership,” and has published widely on leadership and the executive mindset. Follow Thompson on LinkedIn or contact him at info@donaldthompson.com for executive coaching and speaking engagements.