Employee Experience: New Idea or New Label?

A seemingly “new” concept in the HR world is employee experience. In fact, many are touting the role of Experience Architects (I guess this replaces the Director of Employee Engagement) as a key function of HR departments. This blog will answer a few questions. What is this employee experience concept that seems to be gaining traction? Where did it come from? And most importantly – should you be changing your HR strategy because of it?

What is Employee Experience?

Employee experience is exactly what it sounds like – the experiences of an employee who has been working for an organization, including their feelings, attitudes, perceptions, and observations. Most HR professionals probably react with, “yeah, but how is that different than what we have always focused on?” It’s not that different. To understand the distinction being made, we must first understand how we got here.

Where Did the Concept Come from?

The idea of employee experience is most closely related to the traditional employee survey. So, let’s review the evolution of what the employee survey has been called over the years. Here are just some of the labels over the past few decades:

  • Job Satisfaction
  • Job Involvement
  • Loyalty
  • High-Involvement Management
  • Commitment
  • Engagement
  • Employee Experience

The skeptic in me believes that these new labels are clever marketing from employee survey vendors to re-brand and re-package a product to increase sales. Yes, there have been some incremental changes to how employee attitudes and experiences are summarized in an overall index (e.g., adding the idea of going above and beyond for the organization in an Engagement index). However, the items included in a traditional survey have not changed that much since Job Satisfaction. Believe it or not, no one has invented a magic set of survey items that have revolutionized the employee survey.

Employee Experience – Its Value

At SMD we have been using the label, “employee experience,” for many years and we deem it valuable for two reasons.

Measurement across employees’ entire lifecycle due to differences in new hires vs. tenured employees

We discovered several years ago through our research that the drivers (predictors) of voluntary turnover for new hires are completely different than the drivers for more tenured employees. So, we built a measurement approach that includes entrance and onboarding surveys to better understand the employee experiences as new hires. The goal of these surveys wasn’t to measure how “engaged” an employee was at 30 days of employment, it was to understand their experiences. To us, the concept of understanding experiences was a more inclusive label to define our measurement approach. This was not a marketing ploy; it simply was a better descriptor of what we are measuring.

Research shows four survey categories outrank engagement for their impact on business outcomes

We are scientists first and foremost and our entire approach is based on facts and data. Every year in the fall we conduct a huge study that identifies the employee experience drivers of actual business outcomes. Last year our study represented 850,000 employees across 54 organizations (small to very large). Below is a table that summarizes our finding from 2018.

As you can see, four survey categories (Management, Job Fit, Senior Leadership, and Safety) are better and more consistent predictors of real business outcomes (e.g., turnover, customer satisfaction, financial performance) than Engagement. What does that mean? Engagement (as measured by a five-item survey index) is not a great proxy for all business outcomes.

Should You Be Changing Your HR Strategy?

The point is that the broadly defined employee experiences measured by the entirety of the survey is not adequately captured by engagement. So, we prefer to call our survey a measure of employee experience. This isn’t a big deal because we are basically quibbling over semantics. The big deal is that an organization must use analytics to connect employee survey data to their actual outcomes.  Otherwise you may be working on things that really don’t matter and won’t help your organization achieve its goals. So, the answer to the big question is maybe. If your organization is tying survey data to a goal like turnover reduction, then the semantics don’t really matter. If you continue to focus on your employee engagement score but your turnover is rampant and your customer/patient scores are low, it’s time to look at what employee experiences are and how you can measure those to impact business outcomes.

Final Thoughts

The bottom-line is “yes;” employee experiences are important. They are at the core of everything we do in HR – in fact our study proves this: over the past 5 years we have conducted the study, employee experiences have been a statistically significant predictor of real business results 100% of the time. So, at SMD we are on board with this “new” idea (we have actually used the label for years). Just don’t let the semantics fool you into thinking you are doing something different if you don’t actually change the manner in which you draw conclusions – using analytics to link employee data to real outcomes.

Unsure if your organization and/or your vendor is measuring employee experiences the right way? Join our upcoming webinar: Which Employee Experiences Move the Business Needle? Study Reveals the Answers on Oct. 31 at 2 p.m. EST.