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Financial Impact Of Employee Experience

The term ‘employee experience’ is drawing attention from all around the world. Everyone is driving their focus towards employee experience as it is a key factor affecting customer experience. Employee experience is nothing but the sum of interactions an employee has with different people and different observations of the employee during their tenure at the organization. But recent studies have shown that employee experience (EX) plays a major role in affecting the financial performance of the company. That is why all the companies are investing more in it. Numerous studies reveal organizations, where employees are respected and provided with a good experience through a different combination of things, have a higher return on assets as well as higher sales.

Employees acting as the backbone of the company has a direct link with the financial performance of the company. A company can only succeed when its employees are working at their best. Many big companies have also started replacing chief human resources with chief employee experience officers.

Financial Results

According to an IBM report, organizations that score in the top 25 percent of employee experience have a 3x return on assets and double sales as compared to others. Return on assets shows how much profit a company is making concerning its asset, and should always be higher. Return on sales shows how easily can a company earn profit from the revenue generated. Both of these are equally important for a company and should always be on the upper side. This clearly shows the impact of EX on the financial performances of the companies. It is observed that when employees are not feeling appreciated, they are less likely to put in their full efforts which are observed in their overall performance evaluation.  It is only natural that when employees are having a good experience, they are more likely to work with full enthusiasm for the betterment of the company.

It shows that an increase in employee experience index can prove to be effective for the company as there exists a direct relationship between employee experience and the financial performance of the company.

 Numerous employee experience models have proved to be successful in the past-

1- Workday

This company has grown tremendously just because of focusing on employee experience. ‘my customers are not my topmost priority, my employees are’, says Dave Duffield, CEO of Workday. It has become a globally recognized company and is growing at nearly 30% per year and was declared as the best place to work. This is a clear example of how focusing on employee experience can do wonders for a company.

2-Wegmans

It is a grocery store chain known for its top-class customer experience performance. They invest $50 million in employee development programs each year to maintain their edge. This company witnessed an annual revenue increase from $7.9 billion in 2015 to $9.2 billion in 2018 only by improving its operations and continuously working towards employee development.

3-HP

HP has experienced exponential growth in their industry by emphasizing employee management by increasing training and adding new kinds of benefits for their employees. The stock price of HP increased from $10 in 2016 to around $26 in 2018. Now, this change may not be solely due to an increased emphasis on EX but again it would be wrong to say that EX didn’t have anything to do with that. This shows that a good EX not only improves the satisfaction level of employees but also have a major impact on the overall growth of the company.

Source: Forbes 

A thorough look at the employee experience index makes it pretty clear that all the top companies on the index have made it big in the market and they continuously focus on their EX to retain that position.

“To win the marketplace, you must first win the workplace,”-Doug Conant.

 Employee Experience Management

The fact that employee experience plays a major role in the success of the organization is more than clear now but the most important question is still unanswered. How to improve EX?

Improvement of EX starts with the acceptance of fact that it is not just an HR problem but a problem of the whole company and needs full attention. Different feedback tools can help companies to understand their employees better and work towards improving employee experience.

Many companies are using employee Net promoter scores to find out their satisfaction level. We have a more detailed blog on NPS, check it out to know how it works in-depth:

https://blog.survey2connect.com/nps-the-secret-for-a-successful-cx/

Employee feedback can prove to be helpful as it shows the actual image of your organization and pinpoints the areas which need to improve.

There are different survey methods for measuring employee experience: –

  •  Employee engagement survey

It measures the level of motivation employees has for the company to put in some extra effort. It shows the level of commitment of employees towards the company. A good employee engagement survey helps in creating the reports easily.

  •  Employee journey survey

This survey takes the feedback of every part of the customer journey starting from the interview process to the exit feedback with an onboarding survey in the middle.

This whole process of collecting feedback at different stages of employment helps in finding out the shortcomings in a particular stage and then it becomes easier to solve that.

  •  Employer improvement survey

This kind of survey gives the employee a chance to provide feedback about their employer which may be good or bad. It helps in identifying the weakness and strengths of the employer and tells how to improve them.

  •  Employee attitude surveys

This survey assesses an employee’s attitude towards the company. The attitude of the employee matters a lot for the betterment of the company and this survey brings that to light.

These are some of the feedback survey methods which can be used to understand your employees better and work towards providing a better workplace for them.

Feedback being the first step towards improving the EX, is also the most important one. It can be exhausting but with Survey2connect you get the opportunity to create different types of surveys matching with your needs and get a clear analysis of problems (if any) and you can start working on them as soon as possible.


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