Employees are an organization’s most important asset, and no other area has such a profound and broad-based effect on an organization’s top and bottom line. Therefore, every organization should focus more on their employee experience.
Prioritizing employee experience pays off
The employee experience has yet to be incorporated into the strategic agenda of most companies. This is the conclusion of Ennova’s international survey, where we asked over 500 HR managers about the extent to which their organization works with different elements within employee experience.
EX maturity is generally low. Only about one in five companies regard employee experience as a top-3 strategic priority, 14% of companies measure employee experience continuously, and 11% attempt to mobilize the company to be better at creating a good employee experience.
When companies have to define the strategic agenda, the primary focus is thus not directed at the employee experience but towards other areas, such as growth, product launch, costs and customer experience, which have a clearer and more directly-measurable effect on the top and bottom lines.
However, it does not need to be this way. There is an impressive amount of financial benefits to be reaped from prioritizing and focusing on employee experience.
The following +8 different dimensions affect the day-to-day top and bottom lines at your company:
- Sickness absence
- Staff outflow
- Retention of key employees
- Onboarding speed
- Ability to innovate
- Rates of sale
Through analyses for many different companies, we have factually demonstrated the positive financial effects of putting employee experience in focus. For example, the analyses show time and again that there is a connection between an employee’s engagement and his/her ability to generate profitability.
Source: anonymized Ennova case based on survey data with 45,000 employee repsonses
over three years combined with financial data
The example shows that employees with a high level of engagement deliver 38% more profitability than employees with low engagement.
Would you like to learn more? Read more about the survey here.
We also see a direct effect on the bottom line. In a company with 16,500 employees and a churn rate of 7.5%, the costs associated with this are DKK 433 million a year, consisting of recruitment and onboarding costs as well as a temporary drop in productivity.
Our definition of an employee experience is the sum of all the experiences that a person, whether a candidate, employee, manager, freelancer, alumni, etc., has with an organization during their working and personal life (imposed, observed, felt and sensed) – from the time when they hear of the organization, are hired, have a daily life at the organization and until they quit, become an alumni and are potentially later re-hired.
Being best at managing employee experience generates success
A comprehensive survey which investigates the effect of a long-term focus on working with employee experience shows that organizations with a focus on employee experience have more than quadrupled their average profit and more than doubled their average turnover.
The financial effects of EX are therefore considerable. However, many organizations still struggle with fitting EX on the agenda, while lacking a systematic and practical approach to this discipline which could take employee experience to the next level.
With the book “Mastering Employee Experience” you get sound insight into the different disciplines and areas, showing you where and how you can start your organization’s EX transformation.
Curious about how you can work with employee experience? Get a free extract of the book “Mastering Employee Experience”.