HR strategy: employee engagement is the outcome, experience is the starting point

in Industry Insights, 17.06.2020

Engagement is the outcome, not the starting point

Everyone has, at some point in their professional lives, filled out an annual employee engagement survey. Surveys measure employee engagement, usually leading to hurriedly developed, short-lived initiatives that often fall short of meeting employee and corporate expectations.

The truth is that these scattered initiatives lack a holistic view of the employee’s day-to-day experience. We see companies listening to the echo (i.e. focusing on engagement) rather than starting at the source: employee feedback.

Our clients often assume that if they increase employee engagement, they will increase productivity and financial growth. And that’s mostly true.

But we also see HR teams struggling to implement human-centric, strategic and purposeful HR strategies, and it’s likely because they are looking in the wrong place. Engagement is the outcome, not the starting point.

Employee experience (EX) is the key: If you focus on employee experience, employee engagement is bound to happen. Focus on employee engagement alone, and you’ll come up short.

Evolving employee expectations

The employee experience encompasses each individual’s day-to-day reality and interactions with the organization and colleagues. “Employee” spans diverse HR stakeholders: candidates, employees, leaders and even alumni.

To attract, engage, develop and retain necessary talent, companies must deliver the right employee experience, one that feels personal, relevant and responsive to individual needs.

Today, this requires providing a technological component that empowers employees to collaborate and innovate. Equally important is the sociocultural experience you create to give employees a sense of purpose and shared values with the organization.

While individuals have always had high expectations of their employers, the nature of those expectations is now shifting, influenced by consumer interactions with brands. Failing to meet these expectations might result in significant dissatisfaction, turnover and talent attraction challenges.

Organizations need to design employee experiences that fit evolving needs, starting with the recruitment of talent and continuing through their journey to become longer-term employees (learning and development, performance management, rewards and recognition, etc.). Existing employees also need to be engaged or reengaged.

Through almost a decade of research and more than two million evaluations across multiple markets, KPMG’s Nunwood Customer Experience Excellence Centre has identified six fundamental components of an optimal experience:

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Source: KPMG Nunwood

 

What about the organizations in Luxembourg? KPMG’s financial sector remuneration survey shows that only 13 percent of participating companies assess employee experience, despite the clear connection between employee experience, customer satisfaction and increased revenue.

Where insight meets design thinking

For most organizations, (re)designing the employee experience requires a shift in mindset and deep cultural changes, recognizing that today’s employees think and act like consumers and want to be treated like “internal clients.” This means that the HR team needs to view employees through the same lens that client facing teams use with their customers, applying the same engagement strategies to boost attraction, motivation and retention.

Through hands-on experience with a variety of clients, we understand the challenges that employers are facing, and we know how to begin this transformation journey:

1. Empathize

What causes pain?
You see engagement scores declining, but your annual survey does not indicate where the experience begins to deteriorate or what to mitigate against. Unlike traditional approaches, focusing on employee experience requires you to genuinely empathize with the workforce to understand where the relationship between expectation and experience breaks down.

What sparks joy?
Recognizing pain points is important, but so is knowing what employees enjoy. This level of understanding enables HR to respond appropriately to factors that may seem disconnected.

Time to reflect
There is power in reflection, yet many do not create the space to do so. HR needs to facilitate introspective conversations with leadership to align business objectives and the people agenda.

Key questions to ask yourself

  • What do employees expect from their experience at our company?
  • What experience do we provide today?

2. Design

One size does not fit all
Employees behave differently across roles and job levels and even within the same role or experience level. Personas are just one of the tools used to provide a deeper understanding of a specific audience, defining a target population by focusing in on a single representative. By leveraging personas, HR can better understand the unique and diverse needs, motivations, and feelings of a stakeholder group. This insight equips HR with the tools to respond to each employee segment, fostering retention by tapping into what drives the daily decision to stay.

Tackling the moments that matter … most
Don’t try to fix everything at once. Identify target areas (“moments that matter”) for improvement and prioritize them based on critical impacts.

Designing for people, not processes
In our experience, companies that demonstrate a human-centered approach to solving business challenges are more likely to create a positive employee experience. Empowering workers to take ownership and allowing them to co-create solutions, for instance through a design thinking approach, has shown great results in both the design and adoption of the new solutions.

Key questions to ask yourself

  • Have we identified employees’ motivations and mindsets?
  • How can we tap into the moments that matter most?

3. Experiment

Experience never stops shifting
Experience is not fixed and, therefore, requires continuous improvement. Rather than limiting insight to annual engagement reviews, HR should always have a finger on the pulse of the employee experience. In parallel, technology enables companies to capture real-time, multichannel insights.

Bigger than HR
It should come as no surprise to employers that employee experience does not solely fall on the shoulders of HR. In fact, 78 percent [1] of all moments that matter are not driven by HR but by business managers.

Key questions to ask yourself

  • Does our organization have a roadmap to sustain a consistent experience?
  • Has our culture adapted to this new reality?

Takeaway

If your employees had the choice of whether or not to show up at work tomorrow, would they? What can you do to start positively influencing that decision?

In the organization of the future, HR will likely be the architect of employee experience and a service provider that delivers tailored working experiences that meet or exceed employee expectations. Our advice to employers today is to view innovation and transformation as a journey that absolutely must focus on treating employees in an entirely new way: as valued customers.

Are you already an HR architect? Do you wish to become one?

Our People & Change team is ready to accompany you through this journey.

Customer satisfaction has been in the DNA of our clients for a long time. Now they reach out to us because they want to offer the same kind of experience to their employees. We help them gain a competitive advantage by leveraging the insights of employee experience to improve their talent strategy.” — Sabrina Bonnet, People & Change Lead

[1] Source: Employee experience playbook, KPMG UK, March 2019