Employees are the heart of every organization; without them, an organization can not function. That’s why it’s so important to show appreciation and treat employees with respect. But when organizations think about how they interact with and approach their employees, that’s when some confusion comes in. Even though the words sound the same and there is some overlap, employee engagement and employee experience are different concepts. It’s time to go back to basics.
Brad Denny, principal at Deloitte Consulting and co-author of “From Employee Experience to Human Experience,” explains the difference well: “Employee engagement was very top-down, the organization deciding what employees needed. Employee experience, by contrast, brings employees into the conversation to look at the work itself, finding out what employees need to do their work, to make them successful.”
At its core, employee engagement is about finding ways to drive workers’ commitment to the goals of the organization. There are four key elements to engagement:
Enablement – providing the tools to get the job done
Energy – physical, mental, emotional, and spiritual
Empowerment – the transfer of power from manager to employee
Encouragement – a word, a bit of recognition, a gesture of appreciation, or a display of gratitute
On the other hand, employee experience can be thought of as the follow-on to employee engagement in the evolution of employee-support paradigms.
“The Employee Experience Index,” a research report from IBM® Smarter Workforce Institute and Workhuman, defines and measures five components of the human experience in the workplace: belonging, purpose, achievement, happiness, and vigor. Here’s the bottom-line argument for investing in employee experience from the report: “Employees with more positive experiences at work are much more likely to report significantly higher levels of discretionary effort.”
There is timeless business advice: “To succeed as a business, treat your employees well.” But according to Jim, “what is new and different with employee experience is that organizations need to be intentional about purpose, what they want their employer brand and culture to stand for, how they convey brand through each stage of the employee life cycle.” And by employee life cycle, that includes everything from recruitment pipelines through onboarding, learning and development through career pathing, and all the way through an exit interview.
Companies that put thought and resources into employee experience will reap a number of critical benefits. But “retention is the top objective behind engagement investments,” according to the APQC survey report, “Engagement & The Employee Experience.”
The ROI of employee experience may be seen and felt in ways that may not be traditional to management. The Gallup report notes that in organizations where at least 80% of employees are made to feel their job is important, there was a 64% drop in safety incidents. Jim notes, “when management clarifies employee roles, they understand how they can influence safety.”
“The Financial Impact of a Positive Employee Experience,” a follow-up report from IBM and Workhuman, shows organizations that score in the top 25% on employee experience see nearly 3x the return on assets and 2x the return on sales compared to organizations in the bottom quartile.
Employee experience and employee engagement both matter. The challenge organizations continually face is how to improve in each of these areas – especially against the backdrop of a global pandemic and social and racial unrest. When you get back down to basics, putting your humans first will always improve the bottom line. It’s up to leadership to show through words and actions that engagement and experience are top priorities.