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The Employee Experience Imperative: Q&A with David Johnson

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Earlier this year, David Johnson, principal analyst for Forrester, joined Cecile Alper-Leroux, Ultimate’s VP of human capital management innovation, for a comprehensive webcast detailing some of the disruptive trends reshaping the future of work. Today on the blog, he’s offering a deep dive into one of the most significant issues facing employers today — the employee experience — including common pitfalls and suggestions backed by the most up-to-date analyst research.

1. How does employee engagement/employee experience have an impact on business success?

In Forrester’s view, the engagement is an outcome of the employee experience. And employee experience is a combination of what each employee brings with them to work each day (emotions, perceptions, motivations, etc.) and what they experience while there. Our research has identified four outcomes of a better employee experience that significantly improve business results, including financial performance and growth.

2. How is employee experience linked to customer experience?

As far back as the service-profit chain theory in 1994, firms have understood that happier employees correlate with happier customers — and happier shareholders. Research by Aon Hewitt reveals a statistical correlation between employee engagement and revenue growth: a 5% improvement in employee engagement leads to a 3% increase in revenue. And many firms, like Maersk Line and Mercedes-Benz, quantify the impact of engaged employees on their own customer experience (CX) delivery and business outcomes and use the insights to guide investments in technology.

And there are many other studies that show these links. Insights from Forrester’s Customer Experience Index (CX Index™) prove that, with few exceptions, CX leaders outperform CX laggards in revenue growth because customers find it more effective, easy, and enjoyable to do business with them. Studies show that that this is most likely to happen when employees feel that they can get their work done, their companies do a good job of facilitating their success, and they have a strong personal connection to their work.

3. What are the key factors that drive employee engagement?

Recent studies show that the single most important factor in a positive employee experience is employees’ ability to make progress, every day, toward the work that they believe is most important. There are many reasons for this, but from a psychological perspective, it’s tied to safety. It’s also tied strongly to intrinsic motivation, which stems from the love of the work itself, and not necessarily pay or benefits. Adequate pay and good benefits matter, of course, but they are not the source of engagement. Intrinsic motivation is, and that is driven most by being able to make daily progress toward it.

Most companies fail by not thinking about the employee experience at the daily journey level. Thus, they’re not aware of what’s inhibiting their ability to make progress. If they’re not aware of those factors, it’s difficult to target them for improvement. This is why it’s so important for companies to be listening carefully to their employees about what they are experiencing and what they need to be successful. Gathering employee feedback, interpreting it correctly, and taking it seriously is vital.

4.Why do many employee engagement initiatives fail?

Part of the problem is that HR often leads efforts to improve employee engagement without the help of key groups like tech leaders, who significantly influence the tools and resources that help employees be more engaged (or not). Studies find that:

5. What can HR and business leaders do to improve employee experience and foster employee engagement in their organizations?

In Forrester’s view, the most important thing they can do is become more attuned to the factors that affect employees’ daily journeys. That requires gathering a lot more feedback from employees not only through surveys and discussions but also through structured exercises like employee journey mapping. These exercises can help them find not just obvious factors but also systemic factors outside of any employee’s individual control, like how the wrong metrics may have unintended consequences that make it harder for employees to succeed in their daily work.

This level of attunement requires not only listening but also building powers of analysis to strip away the noise and accurately identify the most important factor.

6. What tools and methods can HR and business leaders use to establish an employee experience benchmark and continue to improve?

The timing for this is excellent, as vendors are now able to use technologies like artificial intelligence (AI) and natural language processing (NLP) to analyze employee feedback from surveys, voice of the employee program interviews, and even email and verbal communications to gain more insight into how employees perceive their organizations and what can be done to improve their experience with their organizations.

But even without advanced AI and NLP technologies, gathering employee feedback through surveys, interviews, and journey mapping exercises — and using it to improve employees’ experience in their daily journeys — will pay significant dividends.

 

* Net Promoter and NPS are registered service marks, and Net Promoter Score is a service mark, of Bain & Company, Inc., Satmetrix Systems, Inc., and Fred Reichheld.

Sources:

“The Employee Experience Imperative” Forrester report, December 15, 2017.

“Engineer Your Technology Environment To Improve Employee Productivity And Flow” Forrester report, December 15, 2017.