It’s time to start a revolution!

With employee engagement failing in many companies, time for EX to become the new CX

Brian Solis
Brian SolisPrincipal Analyst
As Principal Analyst and futurist at Altimeter, I study disruptive technology and its impact on business and society. In my reports, articles and books, I humanise technology and its impact on business and society to help executives gain new perspectives and insights. My research explores digital transformation, customer experience and culture 2.0 and "the future of" industries, trends and behaviour.

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If you follow the trends in business modernization, you can’t help but follow the massive waves of digital transformation and innovation across the globe. In all of my research on these fronts, I’ve learned that the number-one catalyst driving these trends is customer experience (CX).

At the same time, it’s often said that happy employees equal happy customers.

If you look at the U.S. as a proxy, for example, 70% of American workers are not engaged or actively disengaged, according to Gallup. Also, according to Gallup, actively-disengaged employees cost companies US$450-550 billion in lost productivity each year. In my view, to connect the dots between happy employees and happy customers, the next big thing in corporate evolution beyond CX must now be EX-employee experience. And, employee experience must start with employee engagement.

Allow me to explain.

Customer experience is defined as the sum of all engagements a customer has with your brand throughout their journey and lifecycle. It’s not just about individual touchpoints, technologies, branding, policies, customer service, sales, etc. It’s how someone feels about your company and what they say when you’re not in the room.

While there are many definitions for employee experience, you could apply that same CX spirit to employee experience. As such, EX is the sum of all engagements an employee has with the company in their work, every day and throughout their tenure. It’s how employees feel about working at your company at the end of the day, week, month, year, etc.

We can’t leave this discussion without defining the experience. It’s personal. I define experience as an emotional feeling, sentiment and reaction in a moment.

The dots between customer experience and employee experience are directly connected through employee engagement and how leadership and purpose shape how employees feel about work and their role in it.

 

EX starts with EG – employee engagement

I recently led a research effort in partnership with Jostle to study the state of employee engagement. As a result, I identified what I called an employee “engagement gap.” And, it was significant.

Of the executives we surveyed, 99% believe that their employees have a major impact on the company’s success. At the same time, they believe that current employee engagement programs contribute to that success. Even so, executives and HR underestimate the importance of, or misunderstand the practice of, employee engagement, and what’s needed to foster “engagement.”  For instance, executives ranked the priority of employee engagement at 8.3 out of 10, which would deem it very important to them. However, employees rated engagement at a dismal 5.5.

We then cut the data to see if the presence of an employee engagement program at the company had an impact on engagement. Turns out that those programs do make a notable difference – the average was 5.9 for those with a program, and only 4.7 for employees without. That’s a solid 25% boost. The problem is that 5.9 out of 10 is still only a 59% – a D- at a lenient academic institution. Essentially, most businesses in our survey are failing, with or without a program.

 

Employee engagement is more than an internal communications program.

I used to joke that employee engagement programs were nothing more than corporate propaganda. Now it feels a little bit too real

Most employee engagement programs have a variety of elements to them, ranging from newsletters and town hall meetings to employee recognition and 1-1 meetings. However, these communications channels are only as good as how well they are used. Is real, meaningful communication happening in these ways? Do they make employees feel valued or engaged? So we asked how engaging employees and executives feel these channels are.

 

Technology as an EX backbone

Though often considered a cornerstone of employee engagement programs, intranets and enterprise social networks (ESNs) are not delivering engagement for either executives or employees. Only 15% of employees see the value in them. To say that there’s room for improvement would be a gross understatement.

Why are these communications channels, generally run by the internal communications group, such poor performers? And, what, if anything, is working?

Work must have a purpose to be engaging and engagement programs must encourage the alignment between purpose and performance.

The most dramatic impact we saw on engagement figures was a belief that their work mattered. We asked employees about this in terms of how their work mattered to the company, their customers, or to a larger cause. In our survey, we asked employees to rate their own levels of engagement in the workplace. We found a very strong correlation between feeling that their work matters and their level of engagement. Most notably, those employees who do not believe that their work matters to the company have the lowest engagement figures, less than 3 out of 10. That’s a very toxic number. While believing that your work does matter is not a panacea (they rank at an average of 6.2, positive, but not ecstatic), it is by far the most dramatic engagement indicator we saw in this data.

The strong suggestion here is that employee engagement programs should focus on helping employees believe their work matters. Helping employees understand how their work fits into the big picture and the progress made individually and jointly toward that purpose will have a greater impact on their level of engagement than recognizing them in meetings, ESNs, corporate messaging apps, Intranets, and any other technology or platforms deployed to support these. On the other hand, using internal communications technology to openly and authentically share and communicate about what is going on helps people feel that their work matters.

 

Employee engagement is intentional and it shapes corporate culture

True employee engagement is defined by many factors that tend to get overlooked in favor of platforms, channels, and technology. At the same time, engagement is not about communicating updates, promoting activities, pointing to performance, introducing or explaining programs, etc. It is also not about checking boxes on a communications checklist. It’s about imbuing the company culture with a sense of being driven by meaningful outcomes. Employees must feel vested in the intentions and the outcomes of the organization. They must believe their work matters.

It is a matter of using those communication channels to say something that matters or seeking out new ones when they fail. You need to demand that your communications channels are bringing people together around a common, clear purpose. When they fail, and the majority of them are failing, executives must seize that opportunity to figure out why. They cannot accept a failure to communicate meaning and purpose. They cannot accept a failure of a culture where people feel as though they don’t belong.

If indeed happy employees (EX) equal happy customers (CX), then employee engagement matters now more than ever. And, the purpose is the essence of why employees are driven to collaborate and excel. Linking engagement to purpose brings executives and employees together around a common cause or good. Without purpose, there’s no meaningful foundation for employee engagement.

Assess the state of your employee engagement program now. I promise you, it’s going to reveal startling, but honest employee sentiment. The role of your employee engagement program moving forward is to close the engagement gap and ultimately connect the dots between purpose and work.

If you’d like more detailed advice on how to link engagement to purpose in order to bring executives and employees together download our “guide to digital transformation” or contact us today.

 

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