Collaboration. Engagement. The Consumerization of the Enterprise. Today, global businesses are beginning to realize that driving and sustaining an engaged workforce is a necessity to increase efficiency and profits. Yet four out of ten employees worldwide are not engaged, according to an AON Hewitt study, and this lack of engagement is crippling business growth potential.

Software Isn't the Answer

Companies are under immense pressure to find new, effective ways to engage employees -- and keep them engaged -- to spur growth, reduce turnover, preserve talent and maintain a competitive advantage. Many have turned to software to help create the spark and transform into true digital operations, but a large number of these projects are failing.

Why? Because despite enormous investment in enterprise applications, adoption remains low: this year alone, Gartner claims businesses will spend nearly US$ 300 billion on enterprise software, yet according to a survey by The IT Adoption Alliance, usage of this software is only about 50 percent. That means that some US$ 150 billion will be essentially wasted on software investments.

In the meantime, employees are for a variety of reasons becoming even less engaged. One of the primary causes of employee disengagement is failure of the organization to provide proper recognition for performance, desired behaviors, compliance and contributions.

Another issue: there are many behaviors employees must perform to support a sustainable, efficient workforce, yet businesses have no scalable way to explain the necessary steps to reach optimal performance, nor do they have the tools to reward employees for completing these tasks. 

Why Gamification? Why Now?

shutterstock_63543028.jpgWhile 70 percent of business transformation efforts currently fail due to lack of engagement, gamification provides the antidote that can help stop to the hemorrhaging. According to Gartner, gamification addresses engagement, transparency of work and the connection between employees’ actions and business outcomes, which is why the firm predicts gamification will be the primary mechanism to transform business operations for 70 percent of Global 2000 firms by 2014 and 40 percent of Global 1000 companies by 2015.

Regardless of employee demographics, gamification programs can be customized to incentivize their behavior. For example, younger workers specifically demand more frequent feedback and recognition. Cindy Ventrice, employee engagement researcher and author of Make Their Day notes,

Those 25 and under have a significant preference for daily feedback. This is challenging for managers. Gamified enterprise software can provide a portion of the feedback required to keep these employees engaged. This gamified system also allows managers to track and reinforce critical behaviors and provide the personal recognition that employees also crave.”

But providing an engaging environment must be cost-effective. Gamification resolves this challenge as well.

Research has shown that once basic needs are met, additional cash rewards do not help motivate employees. In her research, Ventrice found that when employees were asked to estimate the dollar value of workplace recognition, 57 percent reported that the most meaningful recognition cost the organization nothing.

Instead, employee engagement and motivation is better driven by manager and peer recognition. But being named Employee of the Month just doesn't cut it in today’s digital world. Global organizations -- from consulting firms Capgemini and Deloitte to major oil, retail and finance businesses to big technology firms -- are investing heavily in gamification systems to drive employee productivity and engagement.