A new study shows a positive employee experience results in a positive financial impact for companies. CLOs can help create that positive experience by encouraging feedback, recognition and growth.
A new study shows a link between a positive employee experience and a positive financial impact for companies. The Employee Experience Index, or EXI,
surveyed more than 23,000 workers across a number of countries and was conducted by human capital management solutions company Globoforce and information technology company IBM. After analyzing the data, the EXI teams found that they could measure employees’ personal experiences at work in terms of belonging, purpose, achievement, happiness and vigor.
“These five dimensions reflected core ideas on what makes a positive experience at work,” said Greg Stevens, head of analytics of the WorkHuman Research Institute at Globoforce. “We found these same five dimensions regardless of country, industry or job level.”
Stevens said companies will only succeed if they acknowledge the core needs and experiences of the humans that work there. “Experience is no longer a nice-to-have, but an imperative in today’s increasingly competitive markets,” Stevens said.
The study found that if employees aren’t feeling appreciated, only 38 percent report having a positive experience. Further, when employees don’t feel their work lines up with their core values, only 30 percent report having a positive experience.
“That’s two-thirds of your workforce that are not bringing their best selves to work, which shows up through lower performance, less discretionary effort and more turnover,” Stevens said. “When employers do have these human practices in place, the number of employees having a positive experience rises to 83 percent and 80 percent respectively. Our recent research shows this leads to a more positive bottom line.”
Organizations that scored in the top 25 percent on employee experience report seeing nearly three times the return on assets and more than two times the return on sales, compared to organizations in the bottom quartile, according to the study.
Cheryl Allen, vice president of human resources at Kaplan Professional, an education services company, agrees that creating a positive employee environment has a financial impact.
“We know that a positive employee experience, based on a number of different areas of feedback from employees, really increases our retention,” Allen said. “That allows for a more productive return on that learning curve as we’re doing our training and it also allows for better innovation and creativity.”
Stevens said the responsibility to ensure employees feel happy and valued falls on senior leaders. In addition to creating a clear picture to show where an organization is headed, leaders should demonstrate and actively show the importance employees have on the success of a company. Stevens said having open communication between managers and employees is vital.
“By aligning our learning and development plan to the organizational strategies as well as input from managers and employees, we’ve really been able to move the needle on some of our competencies and just the overall culture that had provided a more positive employee experience,” Allen said. “We’ve seen results in increased retention and engagement scores that have been the result of those efforts.”