The Employee Experience

Defined

THE EMPLOYEE EXPERIENCE DEFINED | 2

In 2017, for the first time, Deloitte highlighted the Employee Experience in its Global Workforce Trends report; Inc., Harvard Business Review, Forbes, Entrepreneur, and other business magazines ran multiple stories about the Employee Experience; Futurist Jacob Morgan launched his best-selling book, The Employee Experience Advantage; and leading companies like GE and Adobe added C-level positions responsible for their Employee Experience.

Clearly, leaders recognize that the Employee Experience matters. In The Employee Experience Advantage, Jacob Morgan claims that the focus on the Employee Experience signals the next evolution of the workplace1. Jobs are evolving from a “get a paycheck” culture to a culture where employees want more from their work than a salary2. Companies want that, too. With multiple generations and remote employees in the workplace, an increase in job mobility, a small pool of trained workers in many industries, and an ever-competitive marketplace – companies want to build lasting, productive relationships with their employees. They want employees who are engaged. To that end, companies have invested in surveys, perks, and engagement programs. Bersin Associates3 claims that companies are spending over $1 billion per year on these efforts. Despite the investment, employee engagement rates haven’t moved. Gallup’s State of the American Workplace 2017 shows that the number of highly engaged employees has stayed around 30% for more than a decade. Mercer’s Global Talent Trends 2017 survey showed that a third of workers claim they expect to have a new job within a year. In this market, winning companies like Google, LinkedIn, Apple, and Adobe have shifted to a different approach than sporadic engagement programs4. These companies have realized it’s time to stop looking at end results (engagement) and time to start looking at the day-to-day activities that will lead to the results they want.

It’s time to change focus. It’s time for the next stage in the evolution of work. It’s time to invest in the Employee Experience.

The Employee Experience is the result of the connection, meaning, impact, and appreciation employees find in their jobs. The quality of the Employee Experience depends on how much these pillars are embedded in an employee’s cumulative day-to-day interactions with corporate values, coworkers, management, customers, work content, tools and technology, and even physical environment.

THE EMPLOYEE EXPERIENCE DEFINED | WHAT IS THE EMPLOYEE EXPERIENCE? | 3

What is the Employee Experience?

After surveying more than 750 employees at over 600 companies, studying industry research, and reviewing articles — one key definition has emerged:

The Employee Experience is:

It’s an outgrowth of a collection of day-to-day actions that hap-pen at the corporate, depart-ment, team, and personal level.

MotivatingA good Employee Experience builds employees’ intrinsic (internal or self-driven) motivation to do the job.

OngoingIt starts from the first day an employee enters the company and continues to evolve as the employee is with the company.

Culture-DrivenClose to half of the employees in our Employee Experience survey said that culture was the biggest determinant of the Employee Experience.

InteractiveThe employee and organization both contribute to each employee’s experience.

Employee-CentricEmployee Experience is personal and varied. To a certain extent employees drive their experience by opting in to the things that are most important to them.

Organic

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So, if an engaging experience is personal, variable, and ongoing, how can your company deliver a great Employee Experience? Invest in the four pillars of the Employee Experience: connection, meaning, impact, and appreciation, and customize that investment to the things that matter most at your company on an employee, department, team, and corporate level.

• A disparate set of engagement activities — Engagement activities like perks and surveys are often set up by companies for employees, but don’t enable employees to opt in to the things that matter most to them.

• A one-off program — As a cumulation of interactions, the Employee Experience isn’t something that happens with a one-off reward or competition.

• Top-down — Organizations can certainly influence the Employee Experience, but trying to dictate it often leads to toxic culture. Many times, it’s an outgrowth of an interactive, evolving process.

• Generalized — Different employees in different jobs and different mindsets are going to experience their work in different ways. Customizing your experience efforts for what matters most to your company, department, team, and employee is critical.

The Employee Experience isn’t:

When asked what factor influences their Employee Experience the most, nearly half of employees chose culture.

Physical environment - 22%

Technology and tools - 29%

Your company culture - 49%

22%

29%

49%

Employees in culture-driven workplaces report a more positive Employee Experience.

— YouEarnedIt Market Research, 2017

THE EMPLOYEE EXPERIENCE DEFINED | FOUR PILLARS | 5

Why Connection, Meaning, Impact, and Appreciation?

Motivation research clearly shows the four pillars of the Employee Experience build an employee’s motivation and give them positive reinforcement to engage with their job:

• Connection: Feeling connected to my manager, colleagues, company, and community.• Meaning: Knowing my company, and the work I do, has meaning and purpose.• Impact: Knowing the work I do impacts my colleagues and my company for the better.• Appreciation: Feeling acknowledged and appreciated for my contributions.

Why these four pillars?

Behavioral science shows that employees perform best when they have positive “intrinsic” (internal) motivation — meaning that they get so much pleasure from doing their work that their work itself is a set of rewards. In other words, they do best when they like their jobs.

Intrinsic motivation isn’t just a nice-to-have; it has tangible results. One study found that employees’ intrinsic motivation levels have a direct correlation to companies’ rankings on "Best Places to Work" lists5 .

However, building intrinsic motivation is tricky. Using “extrinsic” (or outside) motivation tools like bonuses, incentives, perks, or competitions is straightforward. While those extrinsic incentives can work for short-term performance boosts or to gamify mundane tasks, the London School of Economics has found that extrinsic motivation can ruin an employee’s intrinsic motivation if the perks are applied to work an employee enjoys doing anyway6. (See Recognition and Rewards Systems that Work for more on the science of motivation.)

What does work? Connection to a team and to management, feeling like your work matters, and giving and receiving appreciation. Investing in the four pillars is an investment in your employees’ motivation.

APPRECIATIONCONNECTION MEANING IMPACT

THE EMPLOYEE EXPERIENCE DEFINED | CONNECTION | 6

ConnectionFeeling connected to managers, colleagues, company, and community

“Employee Experience is engagement and bonding between the company and employees themselves…. Engagement between all employees across the whole company is the most essential element for Employee Experience.” – Jay, Software Industry

Matthew Lieberman, a neuroscientist at UCLA and author of Social: Why Our Brains are Wired to Connect, describes human connection as a superpower that makes us more productive, happier, and healthier. His experiments show that when people feel lonely or socially isolated, the parts of the brain that feel physical pain light up. When we have the ability to connect to someone we care about? The pleasure centers light up. That pleasure of connection is so important, in fact, that its impact on your employees is greater than a boost in salary.

That connection leads to measurable company benefits. A Harvard Business Review8

study showed that when a group of bankers were forced to back each other up during scheduled time off — the whole team was more productive and motivated. Another study on managerial trustworthiness9 showed that a connection to a manager was one of the two biggest factors in building intrinsic motivation. Gallup10 shows that employees who could connect their work to company goals were 3.5 times more engaged.

More than half the workforce believes connection isn’t important enough to their companies.

When it comes to the Employee Experience, 93% of employees say connection matters, but companies aren’t keeping up. Among employees surveyed, 55% — more than half the workforce — believe connection isn’t important enough to their companies.

If you have a friend that you see most days at work, it’s like earning $100,000 more each year7.

— YouEarnedIt Market Research, 2017

55%

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Yet connection doesn’t always happen naturally in today’s work environments. It is difficult for geographically dispersed teams and remote workers to have casual hallway conversations. There are five generations in the workplace today — and cross-generational connection sometimes feels awkward. Some companies and industries have (inadvertently) celebrated the individual contributor to a degree that discourages team connections.

While you can’t force your employees to be friends, you can set up an environment that encourages employees to connect. Here are some ideas:

• Communicate your core values.

Having a clear set of core values helps employees connect to the company, its mission, and the community.

• Encourage regular one-on-ones. Many studies show that employees leave managers more than companies. Regular coaching sessions between a manager and employee strengthen that connection.

• Recognize teams.

Instead of just recognizing heroic individual efforts, recognize teams that work together and back each other up. Public acknowledgement can create positive peer pressure to work together.

• Create cross-team collaborations.

Even if work projects don’t lend themselves to working across a team, asking employees from different groups to work together on company or department kickoff meetings, volunteer projects, or cross-team learning opportunities can strengthen connections across an organization.

• Build trust.

Open communication, transparency, and making it safe for employees to share ideas builds trust between managers, teammates, and executives. That trust is at the core of solid connections.

— YouEarnedIt Market Research, 2017

THE EMPLOYEE EXPERIENCE DEFINED | MEANING | 8

MeaningKnowing my company, and the work I do, has meaning and purpose

“The Employee Experience involves feeling [like I’m] part of a mission... without a vision and mission, I think an employee loses his excitement in the long run.” – Leonard, Technology Industry

Employees who derive meaning from

their work:

• are more than 3x as likely to stay with their organizations

• had 1.7x higher job satisfaction

• were 1.4x more engaged at work11

Having a sense of meaning or purpose is a basic human need. Increasingly, employees want to find that purpose inside of their work. What happens when you help them get it? Your whole business is transformed.

Meaning is particularly important for the millennials who make up more than half of all workers. More than 50% of millennials say they would take a pay cut to find work that matches their values, while 90% want to use their skills for good12. In her “Open Letter to Management,”13 Elizabeth McLeod summarized millennials’ desire for job meaning with this statement: “I was raised to believe I could change the world. I’m desperate for you to show me that the work we do here matters, even just a little bit.”

Meaning had more impact on Employee Experience than salary, benefits, or even opportunities for career growth.

Among employees surveyed, 93% of employees say meaning matters to them, while 52% — more than half the workforce — believe meaning isn’t important enough to their companies.

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How can you help employees get meaning at work? Meaning comes from connecting to something bigger than ourselves. In healthcare, a service industry, or a non-profit, that meaning may seem obvious. But in others, meaning may come just from knowing how their work contributes to a bigger company goal.

Here are some ideas for showing employees how their work contributes to the greater good.

• State your company vision, mission, and values clearly — and recognize employees who live up to them.

Meaning and purpose aren’t always about big social changes. Sometimes, just knowing that their work matters to the company gives employees a sense of meaning or purpose.

• Highlight the ways that your employees are making your customers’ lives better every day.

Bring a happy customer in to talk to your employees, read a testimonial or positive Yelp review in a team meeting, or take your employees to a customer site to see their own work in action.

• Set up group volunteering or giving opportunities.

Doing good as a group both builds your team and makes your employees feel better about working in a place that helps them give back.

• Encourage employees to recognize and give back to each other. Knowing that your work positively affects your coworkers (sometimes in ways you might not have anticipated) offers a great sense of meaning. But it’s also good for the recognition giver. Studies show14 that giving to each other not only builds a team — but also builds productivity and purpose. It’s even more effective than just giving bonuses directly!

When we show up, log on, or sign in to work every single day, we don’t just want to perform random, meaningless tasks. We want to know how our work helps our colleagues, company, and careers move forward.

Having clearly defined goals — which your employee can use to measure their impact — is one of the most critical factors in building an employee’s own intrinsic motivation to do their job16. The downside? This link doesn’t happen without company support and focus.

Only 44% of the employees in Gallup’s survey could see this connection — which means more than half of employees said they don’t know what they are supposed to do every day. How can your employees drive your business forward (or get a sense of their impact) if they don’t know what they are supposed to do?

THE EMPLOYEE EXPERIENCE DEFINED | IMPACT | 10

ImpactKnowing the work I do impacts my colleagues and the company for the better

“Improving the Employee Experience is less about perks and salary and more about making sure employees feel their work is important and that they have the tools to do their job well.” — Meghan, Healthcare Industry

Half the workforce believes impact isn’t important enough to their companies.

Employees who can link their goals to their organization’s goals are 3.5 times more likely to be engaged15.

Among employees surveyed, 94% of employees crave to know the work they do impacts their company, but only 50% believe their company considers it important.

— YouEarnedIt Market Research, 2017

12

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How do you build a culture that shows employees their impact? Here are a few ideas:

• Regularly recognize behaviors that drive your business forward.

Giving regular, positive recognition tells employees and teams which work aligns with corporate goals and what they should be doing. Plus, positive reinforcement builds positive behaviors. When people know what they’re doing well — they’re more likely to do more of it.

• Democratize recognition.

Encouraging employees to recognize each other’s good work sets them up to look for ways to collaborate and have impact on each other’s projects. Plus, it helps managers and executives catch positive behaviors they might not have seen otherwise.

• Create a culture of continuous feedback.

Whether it’s regular coaching in one-on-ones, public statements of goals and values, or peer-to-peer recognition — help employees see how their behavior is impacting the team, department, and organization. This continuous feedback gives employees regular, ongoing reviews of their performance, so they can change behaviors to have more impact in real time — rather than waiting for a performance review once a year.

• Tie recognition to core values.

A 2015 Society for Human Resources Management (SHRM) study17 found that connecting recognition to corporate values resulted in 68% higher retention rates than just using recognition on its own.

— YouEarnedIt Market Research, 2017

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The expression of positive feedback outweighs that of negative feedback by a ratio of 5.6 to 119 for winning teams.

AppreciationFeeling acknowledged and appreciated for my contributions

“Employee Experience means knowing our company has our best interests at heart. ... As an employee I would like to be appreciated more, as well as have a company that’s concerned about the wellbeing of their employees.” — Porcha, Finance Industry

Over half the workforce believes appreciation isn’t important enough to their companies.

81% of employees said they’re more motivated to work harder when their boss shows them appreciation20.

Everyone wants to be appreciated. We all want to know our work is being seen, noticed, and that it matters. Targeted, authentic ap-preciation is a powerful force — both for the person getting it and the person giving it. And that appreciation can transform culture with tangible business benefits.

It’s important to bring this appreciation into your employees’ daily jobs. "Most of our wak-ing hours are spent on the job, and gratitude, in all its forms, is a basic human requirement," says Robert Emmons, author of The Little Book of Gratitude: Creating a Life of Happi-ness and Wellbeing by Giving Thanks, and a leading researcher on the subject. "So when you put these factors together, it is essential to both give and receive thanks at work18."

96% of employees rank appreciation as important to them, while 53% believe it isn’t important enough to their companies.

53%

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The strategic application of appreciation shifts team dynamics. When different groups of employees were given a bonus to pass on to their teammates to say “thank you,” their teams performed far better (in some cases more than 47% better) than when the company gave each person the bonus directly21. How do you build appreciation into your Employee Experience?

• Make appreciation detailed and specific.

Just telling an employee or team they’re doing a good job is okay — but calling out details resonates more strongly. Recognize the time they’ve put in, the sacrifices they make, or areas where they’ve stretched to get something done. That way, the employee or team member knows what they did that mattered — so they can do it again, if needed. Also, take time to recognize an entire team’s effort. It encourages teams to collaborate and support each other to reach a common goal.

• Keep appreciation authentic and personal.

Different employees and different cultures express and receive recognition in different ways. Giving a gift card to a steakhouse to a vegan, for example, is going to fall flat. So, take time to empathize with your employee or team and show recognition in a way that matches who they are.

• Make appreciation a regular occurrence.

Employees don’t want to wait for their annual performance review to hear what they are doing well. Frequent appreciation helps employees know which parts of their work make a difference. And if you add appreciation and rewards for the mundane day-to-day tasks, it makes them much more appealing and more likely to be completed.

• Make appreciation public.

Publicly appreciating employees who live up to core values or are performing well can create positive peer pressure for other employees. And to quote Harvard Business Review22, “Positive Peer Pressure is a powerful ally to change.”

• Make appreciation a team activity.

Setting up a structure for employees to recognize each other is a cornerstone for building a culture of appreciation. One-way appreciation coming only from management is ineffective. Managers rarely have visibility into what each employee is doing minute to minute, and employees gain a lot by giving appreciation to each other.

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• Perks aren’t impactful. 65% of respondents said perks (defined as health and wellness programs, time off, overtime, volunteering, free meals, and service and birthday awards) do not or only somewhat influence their Employee Experience.

• Employees connect their experience with engagement. Only 8% thought that they weren’t related.

• Culture matters. 50% of respondents identified culture as the most important factor in their Employee Experience — more so than physical environment and "technology and tools."

• Companies aren’t aligned with their employees on the importance of connection, meaning, impact, and appreciation. Less than 50% of respondents said their companies thought these were very important.

• Connection, meaning, impact, and appreciation matter to employees. Less than 7% said any one of them was not important.

• Only 1 out of 10 respondents said their Employee Experience was “awesome” and that their companies were great at engagement.

• There is a correlation between investing in culture and employee ranking of Employee Experience. Of companies whose employees ranked their experience an 8 or higher, the average company spent close to $2500 per month on culture, and 27% spent more than $5,000 per month. Of companies whose employees ranked their experience at 7 or less, the average company spent less than $1000 per month on culture, and only 9% spent more than $5,000 per month.

What Employees Say About the Employee Experience YouEarnedIt surveyed 750 respondents across a variety of professions, industries, and locations to gather their opinions on the Employee Experience. Here’s what we found:

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Connection:“We all interact in a fun and professional mix, and we really do end up feeling like a family.”

Meaning: “Our organization focuses on health, social, and philanthropy as the three pillars of employee engagement. These areas were identified as highly valued by our employees, making them a natural platform to center employee engagement upon.”

Impact: “My employer truly values each and every one of us. Our opinions and thoughts are considered by everyone up to the Executive level. I have never been employed by a company more compassionate and loyal to their employees.”

Appreciation: “I am often praised and recognized by my colleagues and supervisor.”

Here are four examples of what employees said their companies did to provide an exceptional Employee Experience:

THE EMPLOYEE EXPERIENCE DEFINED | CRAFTING YOUR COMPANY’S EMPLOYEE EXPERIENCE | 16

• Use a flexible Employee Experience platform. Investing in a single engaging platform that supports the four pillars of the Employee Experience, provides key analytics and insights, and can be customized to fit your culture will automate much of your Employee Experience design.

• Create a culture of real-time feedback. Employees want real, authentic coaching from managers and executives so they know what they’re doing well. Having a system for real-time recognition gives your management the insights they need for that coaching.

• Offer employees a variety of ways to opt in. Some employees will be self-motivated and perform well with spontaneous appreciation, while others will want a clear definition of what they can do to get appreciation. Use a combination of recognition, rewards, and incentives so employees have a variety of appreciation and connections.

The experience your

company designs will

ideally invite individual

employees to engage

with their work in

targeted ways.

“[Employees] differ in their level of interest in communicating and participating and in the kind of compensation and rewards they value. Companies should be able to provide experiences designed to appeal to these different segments.” — Denise Lee Yohn, author of “Extraordinary Experiences: What Great Retail and Restaurant Brands Do” 23

Every company is unique; every team is unique; and every employee is unique. A well-designed Employee Experience leverages unique traits as strengths for the organization. By investing in the Employee Experience, you reap the benefits of highly engaged employees: better retention rates, higher productivity, better metrics on safety and attendance, a better customer experience, and just more enthusiasm at work.

Keep these tips in mind to create an experience that invites employees to opt into their work and they will benefit from an experience full of connection, meaning, impact, and appreciation that matches both your brand character and your employees’ personae.

Crafting Your Company’s Unique Employee Experience

THE EMPLOYEE EXPERIENCE DEFINED | CRAFTING YOUR COMPANY’S EMPLOYEE EXPERIENCE | 17

• Connect your Employee Experience to your brand and corporate values. Invest in experiences that match your company’s unique character. Communicate your corporate objectives and mission clearly. Help employees know every day how they can move the company forward.

• Give employees a voice. Include employees’ opinions in the Employee Experience design, ask them to show appreciation, let them contribute to rewards programs, and offer them a forum for their thoughts to encourage them to opt in.

• Keep it simple. Employees are already overwhelmed. When you design an Employee Experience, keep as much as you can in one place, platform, or program so it’s easy for employees to engage with it.

Contact YouEarnedIt to see how

we can help you build an

engaging Employee Experience.

YouEarnedIt helps you increase employee engagement, amplify company culture, and improve bottom-line results.

Request a demo

THE EMPLOYEE EXPERIENCE DEFINED | END NOTES | 19

1. Morgan, Jacob. The Employee Experience Advantage © 2017

2. https://hbr.org/2017/01/what-matters-more-to-your-workforce-than-money

3. http://joshbersin.com/2015/09/a-new-market-is-born-employee-engagement-feedback-and-culture-apps/

4. https://medium.com/jacob-morgan/these-are-the-top-companies-for-employee-experience-356b2e0bd69

5. https://www.researchgate.net/profile/Yoon_Jik_Cho/publication/242099374_Employee_Motiva-tions_Managerial_Trustworthiness_and_Work_Attitudes/links/02e7e52ccb6c00db57000000.pdf

6. http://www.lse.ac.uk/website-archive/newsAndMedia/news/archives/2009/06/performancepay.aspx

7. https://www.theatlantic.com/health/archive/2013/10/social-connection-makes-a-better-brain/280934/

8. https://hbr.org/2009/10/making-time-off-predictable-and-required

9. https://www.researchgate.net/profile/Yoon_Jik_Cho/publication/242099374_Employee_Motiva-tions_Managerial_Trustworthiness_and_Work_Attitudes/links/02e7e52ccb6c00db57000000.pdf

10. http://www.gallup.com/reports/208811/re-engineering-performance-management.aspx

11. https://www.nytimes.com/2014/06/01/opinion/sunday/why-you-hate-work.html

12. https://www.fastcompany.com/3046989/what-millennial-employees-really-want

13. https://www.linkedin.com/pulse/why-millennials-keep-dumping-you-open-letter-lisa-earle-mcleod

14. http://journals.plos.org/plosone/article?id=10.1371/journal.pone.0075509

15. http://www.gallup.com/reports/208811/re-engineering-performance-management.aspx

16. http://journals.sagepub.com/doi/full/10.1177/0734371X11421495

17. https://www.entrepreneur.com/article/251722

18. https://www.fastcompany.com/3065948/the-science-of-gratitude-and-why-its-important-in-your-workplace

19. https://hbr.org/2012/01/why-appreciation-matters-so-mu

20. https://www.glassdoor.com/employers/blog/employers-to-retain-half-of-their-employees-longer-if-bosses-showed-more-appreciation-glassdoor-survey

21. http://journals.plos.org/plosone/article?id=10.1371/journal.pone.0075509

22. https://hbr.org/2010/04/positive-peer-pressure-a-power

23. https://hbr.org/2016/12/design-your-employee-experience-as-thoughtfully-as-you-design-your-cus-tomer-experience

End Notes