Unlike with customer experience, it’s a bit harder to tie employee experience directly to overall business performance. Yet, its connection to organizational growth is undeniable.
While there have been rough attempts to tie EX to profitability, it only backs up what we all know intuitively: All things being equal, companies that invest in their employees get better results.
But investing in your employees doesn’t just mean “make them happy”. That’s important, but world-class employee experience goes far beyond that. It’s about feeling valued, being driven to succeed, feeling no desire to look for work elsewhere.
So before we launch headlong into this new year, we need to step back and ask ourselves: How successful were our EX efforts? And crucially, how successful were we trying to be?
What makes high-quality employee experience?
While there is some data to analyze, empirical judgements and observations are crucial when evaluating EX. It’s important to consider what your company is actually doing, not just how employees feel about it.
Some of the areas to look at when it comes to measuring employee experience are:
- Employee turnover and retention
- Opportunities and training
- Benefits and compensation
- Engagement & work satisfaction
Employee experience can span the physical workspace, the company culture, resources available and more. There are multiple tools and approaches available to help us uncover insights into each of these areas.
Measurable metrics you should consider
Employee Net Promoter Score
The eNPS is an excellent predictor of employee retention. It asks a simple question: Would you recommend this workplace to others?
It’s normal for most answers to fall in the neutral section, rating either 7 or 8 out of 10. Like customer Net Promoter Score, it’s the outliers—the detractors at 6 or less and the promoters at 9 and 10—which are most crucial. They tell the real story of what proportion of your team is excited and happy to work for you.
Unlike many metrics which function as lagging indicators (i.e. they tell the story of sometime in the past) eNPS can provide a clear, current snapshot of your employee experience. As for the neutrals, try to identify what’s required to bump them up to promoters—and implement!
Employee engagement scores
Engagement is one of the foundations of any high-quality experience—and it’s one of the easiest to measure. Want to learn how engaged teams and individuals are? Ask! Conducting surveys is one of the most simple and direct ways to get the answers you need.
Engagement scores are usually rated from 0 to 100, where higher is better. Generally a ‘good’ score is anything above 65 or 70. If most of your workforce is considered quite well engaged, that’s a huge and understated competitive advantage.
If your employees regularly score below 30 or 40, you need to undertake a serious investigation to understand what’s going wrong. Whatever the reason—burnout, boredom, salary—low engagement is a red flag for retention issues.
While there are exceptions, a higher turnover of staff rarely indicates a stellar employee experience. As many as two-thirds of those who leave their job cite toxic company culture or bad management as the primary cause.
With only a little analysis, you can remove outliers (e.g. those relocating for their spouse’s work, or retirement) and see what your real turnover rate is. Retention is often viewed as a logistical problem: replacing team members disrupts progress and can cause bottlenecks. But there’s a strong financial element too: hiring and onboarding a new employee can cost 33% of their annual salary, versus effectively 0% if team members stay put.
Empirical markers for EX
Employer rating websites
While eNPS and engagement scores are extremely reliable for current staff, it would be negligent to ignore the voices of former employees—especially the recently departed. In some cases, websites like Glassdoor can shed light on internal dynamics which employees might not share in a survey—for example, cases of abuse of power by senior leadership.
While regular audits of these sites are recommended, we must remember that usually it’s the most extreme views that are posted to review platforms. If there’s particularly excellent or scathing feedback, it’s only one element of the story.
While it’s useful to hear directly from employees, we can derive much about the EX by what the company is actually doing.
Companies with exceptional employee experience provide opportunities for current team members to grow. The rate of internal promotions can be calculated by dividing the number of employees by the total number of open positions within the organization
The value of internal promotions is often overlooked. In many cases, employees feel they need to leave to get promoted or get a raise. We all know that today’s jobs are no longer “forever” jobs like the old days, but no job should come with zero opportunities for advancement.
Many companies open up external applications to provide competition for existing employees. In reality, if you have team members who actively want to progress within the company, you should encourage them! It’s a good idea to add internal hires/promotions to your EX reporting.
Closely related to this is internal referrals. This is a valuable KPI that shows ambassadorship in practice: if your employees are actively recommending your company, with their reputation on the line, then we can infer a strong EX.
OKRs—a simpler way to evaluate EX?
A popular goal-setting framework for both individuals and teams is Outcomes and Key Results (OKRs). The idea is simple:
- Set ambitious goals that will motivate the team and provide ‘big picture’ aspirations
- Create small, actionable steps which, if completed, will lead to these goals
The small steps allow employees to see how their daily actions contribute to the broader success of the business, providing a huge source of daily inspiration and purpose—something that has been identified as crucial for long-term engagement and retention.
In terms of evaluating success, we simply look at the results. Are we regularly meeting these small goals on time? If so, are the ambitious goals being fulfilled as predicted?
Teams which are consistently knocking it out of the park and achieving major successes for the company, through their smaller daily contributions, are extremely likely to be engaged and fulfilled. If your teams are failing to meet OKRs, this could be a warning sign of poor EX.
No matter which approach you take, it’s vital to make some effort to measure and evaluate the employee experience, just as you would with customer experience. Relying on anecdotal evidence or outdated assumptions (e.g. that remote workers are inherently less productive than those in the office) can result in unfair assessment of employees.
Sogolytics is a powerful experience management platform. We help you understand your employees, increase engagement, and prioritize your people with the help of technology that makes surveys, pulses, eNPS, 360s, integrated analytics, and presentation-ready reports a breeze.