Creating an Exceptional Employee Experience During a Time of Economic Uncertainty
Here is the video of our founder, Pavla Bobosikova, talking about the importance of improving employee experience during an economic downturn: Employee experience is a...
Employee experience is a concept that sometimes gets neglected or thought of as "too fuzzy." However, exceptional leaders know that employee experience directly impacts the business's bottom line across areas such as productivity, onboarding effectiveness, absenteeism, and employee turnover.
It is no secret that exceptional employee experience can help you save money. Low engagement costs the global economy an estimated $7.8 trillion, accounting for 11% of GDP globally.
As Gallup puts it, "Well-being at work isn't at odds with anyone's agenda." AllVoices offers an engagement calculator that lets companies calculate their estimated savings by improving employee experience at their company. A company of 100 employees can lose half a million dollars by not paying attention to employee experience; these are conservative estimates. Regrettable attrition is particularly costly for most companies and roles. If an employee leaves within the first two years, an employer can lose 50-150% of an employee's salary.
More importantly, creating an exceptional employee experience can help your company make more money. Companies with outstanding employee experience report 23% higher profits. Why? Three reasons:
Lower absenteeism and turnover
Higher customer loyalty.
Put simply, happy employees make happy customers.
Today's economic environment is leading to a workplace talent crisis. Companies have had to let go of or make drastic changes to the work experience for their employees. These changes can be costly and lead to a poor overall experience for those remaining employees. Creating and maintaining an exceptional employee experience during economic uncertainty is critical.
What Is Employee Experience?
Employee experience is how employees internalize and interpret their interactions with their organization and the context underlying them. The different categories of Employee Experience, depending on the school of thought, are DEI, opportunities for growth, collaboration, communication, workload, trust in leadership, alignment with company values, clarity on company direction, and relationship with the direct manager.
Why Does Employee Experience Matter?
Besides the human component that prioritizing people's happiness is an inherent good, a positive employee experience breeds happy employees, which builds a more robust work culture and impacts business performance (Gartner).
Employee sentiment also impacts the bottom line. Happy employees are more productive, take fewer sick days, and stay with a company longer. Employee happiness is directly linked to customer loyalty.
2022 has had a total of 2.12 Mil Layoffs so far
The list of companies having to do layoffs continues to grow in 2022. In our 2022 State of Layoffs study, we found North America had more layoffs in Q2 2022 than at the height of the pandemic (Q2 2020)—the choice to turn to layoffs again in 2022 results from slower economic growth and rising labor costs.
Layoffs are complicated, and these decisions heavily impact people's lives. Ultimately, they occur because a company has failed to address its position in the current market conditions - which is no simple task.
Difficult times are when the most focus should be on the employee experience, both those who stay and those who leave.
During layoffs, three things happen that impact the company: employee morale drops, trust in leadership waivers, and everyone wonders if they will be affected if a second round occurs.
Better.com is an example of how not to do layoffs. CEO Vishal Garg admitted, "We made $250 million last year, and you know what, we probably pissed away $200 million." Garg is criticized for his arrogant leadership style and careless handling of the layoffs.
When layoffs are the only answer, they must be done right. The Hard Thing About Hard Things by Ben Horowitz highlights the need for visibility, accountability, and communication when layoffs occur. These traits allow for the cultural continuity required to survive a round of layoffs as a company.
How exactly do leaders make this happen? Prioritize maintaining culture by focusing on clear communication, supporting those impacted, and strengthening the relationship within the remaining team.
Your People team and management need to have answers prepared ahead of time. There should be no room for speculation and uncertainty surrounding the circumstances of the layoffs.
Remember that those laid off can remain champions of your company if the situation is handled with discernment.
So, what happens now?
Companies must start investing in tools that will add value by improving the employee experience and ensuring that employees have a voice, even in downturns.
The key is to focus on what matters—not just your company's bottom line but also your employees' happiness and well-being.
Here are some ways you can create an exceptional employee experience during this time of economic uncertainty:
Invest in people processes and tools to collect employee sentiment and understand how people feel about their jobs. Make sure there is an avenue for employees to share feedback with management. Feedback lets you learn what's working well and what could be improved.
Provide opportunities for career development beyond their current roles so they feel like they're growing within your organization. Growth opportunities help them feel like they're progressing toward their long-term goals and keep turnover low during hard times when people may feel like they need more change than they can at their current jobs.
Give employees regular opportunities to give feedback on their experience working for your company.
Make recognition a constant practice within your organization.
Improving Employee Experience In Your Organization
So how do you create an exceptional employee experience during economic uncertainty? Well, you can't improve what you can't measure. It helps if you use the right tools (eNPS), have the right processes, and use data to make informed decisions. You also need to be proactive and engage your employees in ways that are meaningful for them.
Create a Culture of Feedback to Improve Employee Experience
The best way to build a company culture is to implement systems that allow people to be successful. As an employee, you want your manager to support you and help you reach your goals. As a manager, you want your employees to achieve their goals and be happy.
If you have a good culture, everyone wins!
Establish a culture that is safe to give and receive feedback
Every 1:1 employee and manager gives a piece of constructive feedback
Ensure that everyone in the company is aware that feedback is welcome.
Communicate changes and policies and why it is happening based on survey feedback.
Collecting feedback — Using tools like eNPS (employee net promoter score) to gather data about your company.
Acting on feedback — Being proactive with feedback and communicating action plans to employees. Tying action to core values.
Feedback loops — Consistently use quantitative and qualitative data from feedback tools to refine employee experience.
Feedback is extremely valuable. Traditionally, feedback was self-reported data only shared between the employee and the HR team. We are now moving towards embracing passive and active feedback to provide more accurate and rich employee experience insights for leaders.
The current economy is a good reminder that the best way to ensure the success of your business is to hire and retain the right people.
The good news is that many ways exist to attract and retain great employees. The bad news is that many companies compete for the same talent.
Your people improve your business.
The more effectively you attract and retain top talent, your business will perform better. Even during economic uncertainty, having the right people and a good experience will keep your business thriving.
Use data to improve your people.
There are many ways to measure employee engagement, but what matters most is how engaged employees feel about their jobs and employers. Ask them if you want to know how engaged your team members are!
Happy employees, and engaged employees, will lead to creating better business outcomes for organizations.