The benefits of optimising your employee experience

In Deloitte’s 2019 Global Human Capital Trends report, 84% of survey respondents rated employee experience as important, with 28% identifying it as one of the three most urgent issues facing their organisation.

94% of employers in Willis Towers Watson’s 2021 Employee Experience Survey said enhancing the employee experience will be an important priority at their organisation over the next three years compared with just 54% that indicated it was important to their organisation prior to the Covid-19 pandemic.

And with benefits like these, it’s easy to see why.

Businesses who invest in employee experience (EX) benefit from…

… increased revenue and profits

Author of The Employee Experience Advantage, Jacob Morgan analysed 250 organisations and found that the best organisations for employee experience outperform companies that don’t invest in employee experience across a range of business metrics1 including:

  • 4.2x higher average profit
  • 4x more profit per employee
  • 2.1x higher average revenue
  • 2.8x higher revenue per employee

MIT sees that employee experience (EX) leaders have 25% higher profits than their less-EX-focused competitors.2

The happier your employees, the lower your operating costs… Gallup reports that disengaged employees can cost companies between $450 and $550 billion dollars a year.2

… lower employee turnover

IBM found that while only 21% of employees would leave a company with great employee experience, nearly half intend to leave companies with lacklustre employee experience.2

Jacob Morgan found that the best organisations for employee experience have a rate of staff turnover that is 40% lower than the average organisation.3

… increased productivity

According to a study by the Social Market Foundation, happy employees are 20% more productive than negative ones.2

All else being equal, employee experience leaders are 25% smaller than employee experience laggards, suggesting that employees of EX leaders are far more productive.2

… more engaged employees

According to Gallup, better employee experience leads to greater employee engagement.2

The benefits of improving employee engagement are also well researched and are summarised later in this article.

… more satisfied customers

MIT research shows that businesses in the top quartile on employee experience have double the customer loyalty of those companies in the bottom quartile.2

Customer experience leaders have 1.5 times as many engaged employees as customer experience laggards.2

… increased innovation

MIT found that EX leaders’ employees innovated twice as often as employees from EX-lagging businesses.2

Organizations that invested most heavily in employee experience are included in Fast Company’s Most Innovative Companies list 28x more often than employee experience laggards.2

EX leaders appear 2.1x more frequently on Forbes’ list of the World’s Most Innovative Companies.2

The benefits of improving employee engagement

Employee engagement is perhaps the most measured indicator of employee experience. As such, a lot of research has been done to measure how engaged the workforce are and the impact of having employees who are highly engaged.

As of January 2020, 68% of the global workforce were either disengaged or actively disengaged at work making employee experience improvement a clear priority.

Employee engagement affects just about every aspect of your organisation. Gallup analysis shows that those scoring in the top quartile on employee engagement significantly outperformed those in the bottom quartile on these crucial performance outcomes:

  • 81% lower absenteeism
  • 64% fewer safety incidents
  • 41% fewer defects (quality)
  • 14% higher productivity
  • 10% higher customer ratings
  • 18% higher sales
  • 23% higher profitability

Employee engagement and employee retention

Engaged employees are 87% less likely to leave their companies than their disengaged counterparts. [Driving performance and retention through employee engagement. Corporate Leadership Council]

A 2016 Gallup study drew the connection between consistently low engagement and team performance and suggested that when an employee’s engagement needs are not met, there is a higher likelihood of turnover

Employee engagement and productivity

In 2014, Gallup conducted a study of 1.5 million employees working at more than 80,000 businesses. They found that improving employee engagement led to a 22% jump in productivity.

The Workplace Research Foundation reported a 38% increase in individual productivity where engagement levels were improved.

Employee engagement and profitability

Research has shown that a 10% increase in investments towards engagement can lead to more than $2,400+ profit increase per employee per year.

Employee engagement and absenteeism

Studies have repeatedly shown that teams who have positive levels of engagement see a drastic reduction in the number of sick days. One piece of research suggested that absenteeism could be reduced by up to 41% where engagement fell in the top 20%.

Employee engagement and innovation

Engaged employees are 44% more innovative.

The role of management in employee engagement

Employees with highly engaged managers are 59% more likely to be engaged than employees supervised by actively disengaged managers.

Interested in seeing some of these benefits in your agency?

We specialise in embedding a Communicate > Listen > Understand > Act mindset in agencies to help them understand and improve their employees’ experiences (new and existing employees). If you’d like to learn more, get in touch today.

Not ready to get in touch yet? Learn more about the services we provide, read our client testimonials or explore more articles on the blog.

Don’t be a stranger, connect with Lynne on LinkedIn to receive regular insight about how agencies can engage, retain and attract talented employees.

Sources
  1. The Employee Experience Advantage, by Jacob Morgan (Wiley 2017)
  2. Why Invest In Employee Experience? Six (Proven) Reasons
  3. Interview with Jacob Morgan

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