Positive employee experience tied to better profits
- Organizations that score in the top 25% on employee experience report that they see nearly three times the return on assets as those in the bottom quarter, according to research from IBM Smarter Workforce Institute and the Globoforce WorkHuman Analytics and Research Institute. The same group also reports having twice the return on sales, which is the efficiency at which organizations generate profits from revenues.
- Based on data from multiple business sources, the study confirmed the link between employee experience and a company's profitability. From the data, IBM and Globoforce created an Employee Experience Index to quantify positive employee experience. Ratings were based on five factors: belonging, purpose, achievement, happiness and vigor.
- When asked to what extent senior leaders should go to improve the employee experience, 71% of respondents said "somewhat" or "very" to "extremely more." Respondents' answers were split when asked to what extent should companies go to get workers to "switch off" when not at work: half said "not at all" or "slightly," 28% said "somewhat" and 22% said "very" to "extremely." But when asked to what extent organizations should go to recognize workers' achievements, the majority (49%) said "very" to "extremely," while 38% said "somewhat" and only 12% said "not at all."
The process of building a positive employee experience beings with the pre-employment stage. Are there any hints of bias in job ads that could reflect negatively on a company's brand or culture and possibly turn off applicants? Are job interviews transparent and upfront about duties, pay, expectations, advancement and work schedules? Those who accept a job offer, only to find out that the position isn't what they expected, will remember the experience.
Employee experience has become one of the biggest trends in HR in 2018, and even those with poor ratings can reverse climb by knowing and understanding what keeps workers productive and motivated. Trust and inclusion are central to a positive employee experience and executives who lead with transparency and frequent communication can help to foster that trust. Although inclusion is often paired with diversity as a concept, it also applies to workers' need to feel accepted in an organization as valued team members.
Common values among the broad base of employees include meaningful work, recognition for achievements, flexible work options and development opportunities. Employers who offer workers these experiences will be strong competitors in attracting and retaining talent, especially in today's tight labor market. The statistical tie between fully-engaged workers and profitability, demonstrated in the IBM/Globoforce research, is even more incentive to elevate the employee experience.