HRMN 395-Week 6: Global Rewards and Culture
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Far from being the latest buzzword, employee experience is turning into the key element of the future-proof workplace. It’s time to change the outdat- ed twentieth-century mindset that dismisses employees as dispensable and infinitely replaceable and instead recognize that business is all about people.
The employer–employee relationship has changed. While the employer had the power in the last century, that balance is shifting in this century, and potential employees are being choosier about which opportunities they accept.
Just as user experience is driving the digital interface, and as customer sat- isfaction programs morph into the customer experience, we need to refocus our people strategies to improve the entire employee experience. Forward- thinking organizations are broadening their focus from engagement and culture to a holistic perspective that considers an individual’s experience before, during, and after a career within the company.
It’s not an isolated phenomenon: The 2017 Global Human Capital Trends report by Deloitte found the attention on employee experience is gaining momentum. While organizational culture, engagement, and employee brand proposition remain top priorities, employee experience ranks as a major trend:
• 80 percent of executives rated employee experience very important (42 percent) or important (38 percent), but only 22 percent reported that their companies excelled at building a differentiated employee experience.
• 59 percent of survey respondents reported that they were not ready or only somewhat ready to address the employee experience challenge.
The Cornerstone of a Global Employee Engagement Strategy
C o p y r i g h t 2 0 2 0 . W i l e y .
A l l r i g h t s r e s e r v e d . M a y n o t b e r e p r o d u c e d i n a n y f o r m w i t h o u t p e r m i s s i o n f r o m t h e p u b l i s h e r , e x c e p t f a i r u s e s p e r m i t t e d u n d e r U . S . o r a p p l i c a b l e c o p y r i g h t l a w .
EBSCO Publishing : eBook Collection (EBSCOhost) - printed on 9/19/2022 6:18 PM via UNIVERSITY OF MARYLAND GLOBAL CAMPUS AN: 2734783 ; WorldatWork, Dan Cafaro.; The WorldatWork Handbook of Total Rewards : A Comprehensive Guide to Compensation, Benefits, HR & Employee Engagement Account: s4264928.main.eds
Book: WorldatWork, & Dan Cafaro. (2020). The WorldatWork handbook of total rewards : A comprehensive guide to compensation, benefits, HR & employee engagement. Wiley.
Link: https://eds-s-ebscohost-com.ezproxy.umgc.edu/eds/ebookviewer/ebook/bmxlYmtfXzI3MzQ3ODNfX0FO0?sid=5c1f6c32-2f45-4d94- b419-a794c1415294@redis&vid=3&format=EB&rid=1
What Is the Employee Experience? 273
WHAT IS THE EMPLOYEE EXPERIENCE?
It starts before you even join an organization and continues long after. It’s inclu- sive rather than exclusive, and answers three critical questions for each person:
1. Future employee: Why would I come and work for your company? 2. Current employee: Why do I choose to stay at this company? 3. Former employee: What do I tell others about my time at your company?
The employee experience is the sum of all employee interactions with his or her employer, in and outside of work, and is influenced by many things, including:
• Relationships: Quality of the connections and interactions with cowork- ers, bosses, and customers.
• Workspace: The physical environment in which an employee works. • Culture: How an employer demonstrates its commitment to the physical,
emotional, and professional success, as well as the health and financial well-being, of its employees.
• Technology: The tools and technologies an employer provides to help employees get their work done.
Is Experience the Same as Engagement?
Well, not really. It reminds me of the statement, “All Hoovers are vacuum cleaners, but not all vacuum cleaners are Hoovers.” In a similar vein, “All employee experience programs consider engagement, but not all engage- ment programs consider the employee experience.” Clear?
Despite all the care, attention, and resources lavished on employee engagement programs since it first came to prominence nearly 30 years ago, the needle has barely moved. Engagement numbers remain abysmally low. Gallup reports that 87 percent of employees worldwide are actively disengaged and that employee disengagement costs in the United States alone run in the range of $450 billion to $550 billion annually.
The challenge is that engagement scores are a snapshot in time, often completed annually (or less frequently), and many factors influence the results. For example: “Did I get my bonus last week?” “Do I like my boss?” “Are we doing yet another reorganization?” Engagement scores are a lagging indicator of your employee experience efforts. If you aren’t investing in the holistic experience, then you’ll forever be playing catchup.
It’s time for a new approach – one that builds on the foundation of culture and engagement to focus on a more comprehensive employee experience, considering all the contributors to worker satisfaction, engagement, and wellness. This can help create a place where people want (not just need) to go to work each day.
The employee experience is not what you hope employees think about your company – it’s what they actually say to their family, friends, and, perhaps more importantly, to the world.
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274 The Cornerstone of a Global Employee Engagement Strategy
Why Now?
In researching our book, The Future-Proof Workplace, Dr. Linda Sharkey and I had the opportunity to interview leaders around the world about their experience of organizational cultures, both good and bad. We heard tales of inspiring work- places that enabled employees to thrive and of the toxic environments that crushed motivation and left careers in tatters. In our work with business leaders and teams around the world, we find too many companies are missing out – still operating according to twentieth-century mindsets, practices, and technologies.
Heather Scallan, senior vice president of Global Human Resources at NTT Security told me, “It’s putting the employee in the driving seat. Successful businesses think deeply about their customer/client experience, and we need to think about our employees in a similar way. The competitive talent marketplace demands that organizations do everything they can to make the employee experience as positive as possible. It’s no longer just a differ- entiator; it is fast becoming a requirement.”
Understanding and improving the employee experience is critical for companies operating in a highly competitive global economy. The skills shortage across industries remains an ever-present challenge. As Dan Pink observed, “Talented people need organizations less than organizations need talented people.” Providing an engaging employee experience helps com- panies succeed in attracting and retaining skilled employees, and research shows a strong employee experience also drives a strong customer experience.
Sir Richard Branson has a reputation for building companies around happy and engaged workforces, and as Chris Boyce, CEO of Virgin Pulse wrote, “Your employees are your company’s real competitive advantage. They’re the ones making the magic happen – so long as their needs are being met.”
It’s common sense, but with an uncommon discipline.
DO YOU HAVE THE CULTURE YOU WANT OR DESERVE?
A strong employee experience influences more than just your engagement numbers or Glassdoor reviews. These are the lagging indicators of employee experience.
Jacob Morgan, author of The Employee Experience Advantage, shares that organizations that invest in their employee experience were:
• Included 28 times more often among Fast Company’s Most Innova- tive Companies
• Listed 11.5 times as often in Glassdoor’s Best Places to Work • Listed 2.1 times as often on the Forbes list of the World’s Most Innova-
tive Companies • Appeared 4.4 times as often in LinkedIn’s list of North America’s Most
In-Demand Employers • Twice as often found in the American Customer Satisfaction Index
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Do You Have the Culture You Want or Deserve? 275
His research goes on to report that those companies investing in their employee experience “had more than four times the average profit and more than two times the average revenue.” It makes a compelling case for action. If you aren’t actively focused on creating and nurturing your employee experience, you will end up with the organizational performance and reputation you deserve, not the one you want. In the age of smart phones, we are all aspiring paparazzi – just one click away from having your dirty laundry making headline news. Forget the six degrees of separation: In the twenty-first century, it’s closer to two degrees of connection. If good news travels fast, bad news travels even faster.
Who knew, the best companies are people-focused and invest in creating an environment where it’s possible (and even expected) that employees love their jobs? Are your employees in love with coming to work? Do you know what people are saying about your organization?
It’s Not about the Ping-Pong Table
It’s going to take more than bright colors, a ping-pong table, or the latest in standing desks to tackle the employee experience challenge.
Silicon Valley firms have long been held up as the poster-children for the new-age office, offering a myriad of perks and environments for their employees. Whether it’s gyms, professional kitchens with all-you-can-eat food, gaming facilities, music equipment and sound stages, bean bag chairs and slides, fancy coffee (with baristas), food trucks, or concierge services, no wonder people work long hours. Why would they want, or need, to be any- where else?
It’s certainly helped to attract the talent those Silicon Valley firms need. However, there is hope for the small and medium-sized enterprise. It turns out that these perks may be distractions from what is really creating the high-powered workplace of the twenty-first century.
The employee experience seeks to create the right environment around the needs of the workforce, rather than trying to fit the workforce around the needs of the work or the building.
Don’t Focus on Exit Interviews
In the past, employee engagement or culture initiatives have been the purview of human resources. It’s a “people problem,” so let the people team handle it. And they did, to the best of their ability, while also juggling learning and devel- opment, benefits programs, career mapping, and performance manage- ment – often as separate projects, each with their own measures of success.
While short-term gains were made, long-term impact was not achieved. As a result, every few years, each initiative was dusted off, rebranded, and relaunched. Unfortunately, credibility was eroded each time, with employ- ees rolling their eyes at yet another “unifying” drive.
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276 The Cornerstone of a Global Employee Engagement Strategy
The key to creating a powerful employee experience is to involve employ- ees in the process and move beyond the campfire songs and (de)motiva- tional posters. Instead, engage the very people at the heart of your business, seek out and listen to the feedback from your employees (see Sidebar 11.1).
At SendGrid Inc., the key was to identify the opportunities to improve experiences people were having as they tried to do their daily job. According to Pattie Money, chief people officer, “We identified the bottlenecks and bar- riers, where were systems breaking down and making the job harder than it needed to be, where were managers not building strong relationships or providing the right level of support. We then developed the training and tools to include in their management toolkit that enabled managers to bet- ter understand the experience of their direct reports and make the changes necessary to affect the experience in positive ways.”
Don’t just focus on exit interviews and why people are leaving. Also ana- lyze the new hire experience. Why did they choose to join your organiza- tion? Who turned down offers, and what influenced their decision? What is your onboarding experience like – was a computer and desk ready for your new hire on their first day? Did colleagues welcome them into the team and help them to integrate into the organization or did they eat that first lunch alone?
We have one client who ensures that a “welcome box” of donuts is on each new recruit’s desk on their first day, which helps to ensure that team mem- bers from far and wide stop by to say hello and start bringing the new hire into the fold. How willing are your employees to refer others to join your organization? Think of it as your internal net promoter score.
LinkedIn Corp. and Accenture plc both host HR hackathons, where employees help break down and rebuild the people and HR functions to reflect the work that they really do (and need to do). An effective employee experience isn’t a one-size-fits-all solution. Even though the trend is global, and the focus is organization-wide, successful approaches may vary by geog- raphy and region.
Sidebar 11.1 All Aboard the Employee Experience Train
This is all well and good, but where do you start? Dr. Linda Sharkey shared with me her advice for embarking on your employee experi- ence journey:
• Get the facts. Don’t rely on what you believe the current culture to be or what you hope for. Use a valid and reliable instrument to measure your culture so you know exactly where you stand.
• Define your desired state. Ask your current and former employ- ees what the culture needs to be to enhance the employee experi- ence. With this information in hand you can start to design your strategy to close the gaps.
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We Had It Backward 277
WE HAD IT BACKWARD
Twentieth-century HR was largely reactive, but twenty-first-century HR must become more intentional and proactive. The twentieth-century approach to business was to prioritize stakeholders as shareholders first, customers
• Pick one or two gaps and really work on them. It is likely address- ing just one or two will have a ripple effect and close other gaps as well. Make the employee experience approach and discussion part of your regular DNA – just like you would have financial and customer reviews, have regular fact-based culture and employee experience reviews.
• Become the “undercover boss.” Experience your recruiting and hiring processes. Do they live up to the employee experience cul- ture you aspire to have? Often these are the first experiences a candidate has of your company, and let’s be real, most recruiting processes are awful from a candidate perspective. Ghosting (never hearing back), automated systems that suck up resumes like a black hole never to be returned, multiple hoops and interviews (often with the same ill-prepared questions being asked) to “win a role” in the company. Be honest: If you recognize any of these symptoms as part of your recruiting process, if you are thinking “but we can’t possibly communicate with all candidates, there are just too many, ghosting is just a fact of life,” then you need to stop right here. This is the first place to start to improve your employee experience, and you didn’t need an assessment tool to uncover it. If you treated your customers as you treat your potential candidates, I am sure that there would be conversations happening at the highest levels!
GE regularly brought back former employees to take their pulse on how they viewed the company. Don’t shy away from the tough ques- tions, regularly ask “How can we continue to build a better employee experience?” and don’t be afraid of the answers.
Here is my approach for any leader seeking to improve their employee experience, and if you use these consistently, you will have a thriving employee and customer focused organization:
1. Ask. Learn to ask the questions of current, future, and past employees.
2. Listen. Really hear what is being said, not what you want to hear. 3. Think. Reflect on what is being said. 4. Respond. Most importantly, act. This is all fruitless spinning
unless you commit to take action. 5. Repeat. Make these behaviors part of you daily routine.
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278 The Cornerstone of a Global Employee Engagement Strategy
second and employees third. We now realize we had it backwards. If we put employees first, they in turn take care of our customers, and they in turn take care of our shareholders. It’s like the safety briefing on an airplane. You must put your oxygen mask on first before you can take care of others.
Today’s organizations need leaders who apply as much effort to the people portfolio as they do the rest of the other levers that drive organizational per- formance. An integrated employee experience is as valuable and can have as much (or more) of an impact as other elements of your corporate strategy.
Understanding the workforce in a more detailed way means we can under- stand individual aspirations, skill preferences and how these intersect with company values. As a result, we can truly align personal goals with company goals in a very clear way.
The employee experience is far more than an HR initiative: It is a busi- ness imperative. One that is influenced and needs to be driven from the top of the organization. Every leader needs to consider themselves a chief peo- ple officer. I believe that the employee experience is the next big area of investment for every organization. We may be experiencing a digital revolu- tion, but it’s those who embrace the people revolution who will thrive.
I dare you to act. If you can create a future-proof workplace that considers the employee experience, there will be no stopping you.
Recognition: A Key Driver of Engagement
In 2013, “employee engagement” averaged one tweet per minute. In 2020, Google rendered approximately 4.3 billion results for the term. Walk into a room full of human resources leaders and start droning on about all the wonderful benefits of engagement – you will likely be met with a fair amount of glazed-over stares.
We get it. HR practitioners around the globe have long since connected the dots between how engagement impacts employee retention, perfor- mance, and all the other metrics that lead to bottom-line success.
Although the “engagement crisis” may be considered cliché within HR circles, there is ample evidence suggesting that the situation will continue to get more dire. Economic conditions in many parts of the world are improv- ing, increasing the volume of unfilled job openings while the talent pool gradually shrinks, the skill gap across many industries widens and average job tenure declines.
The fact that global engagement levels largely remain stagnant year over year – they haven’t budged in the last decade – is just one of many indicators that the engagement and retention strategies of the past aren’t cutting it today.
The Missing Link for Multinational Corporations
Although it would be a colossal oversimplification to claim that one solution alone is enough to have a sustainable, lasting impact on performance, one fact remains true: Whether you’re looking at analyst data, academia, or
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Using Data to Find Global Insights 279
thought leadership from consulting houses, it’s unequivocally indisputable that recognition is one of the top drivers of engagement. Employees simply can’t be inspired to do their best work if they feel like the people around them routinely fail to acknowledge their contributions.
However, implementing an effective recognition strategy is more compli- cated for global organizations and not just because of time zone differences and linguistic barriers.
A tremendous amount of nuance exists internationally when it comes to recognition culture and preferences. For example, in Japanese culture, a notion exists that praise implies there is no room for further enhance- ment, which violates the spirit of kaizen (continuous improvement). In the Netherlands, if an individual gets formally recognized for performing basic job duties, a Dutch phrase exists to describe the sender of the recog- nition that roughly translates to “you need to be more cool.” Historically in Russian society, there’s a deeply rooted belief that community should supersede individual needs, so incorporating a touch of humor into moments of praise can be used to mitigate any potential awkwardness in the public recognition of an individual. And in Korea, a term for “recog- nized” doesn’t even exist.
However, as Razor Suleman, founder of I Love Rewards, explains, “Although recognition is vastly different around the world, we all have a deep biological human need to be appreciated.” And indeed, the science supports the idea that the need for recognition is universal. Regardless of an individual’s country of origin, there’s consistency from a neurological per- spective when recognition is received: Praise ignites a hit of dopamine in the brain, which is associated with a temporary emotional high and uplift in performance.
USING DATA TO FIND GLOBAL INSIGHTS
Dr. Natalie Baumgartner, chief workforce scientist of Achievers’ Workforce Institute (WFI), explains that using global data can help uncover the story it tells about the role of the employee voice and how different types of recognition can play in engagement and retention strategies.
“We’re able to analyze how social recognition across an organization, or even a department or location, impacts turnover, engagement scores, customer satisfaction – or really any metric that’s reliably being measured,” she said.
Although the WFI’s Insight Papers and correlation studies have identified trends unique to specific regions and countries around the world, the most fascinating findings they’ve uncovered have to do with the characteristics successful recognition programs hold in common. Namely, they discovered that high frequency recognition programs were consistently associated with the most significant increases in employee engagement and decreases in turnover.
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280 The Cornerstone of a Global Employee Engagement Strategy
Recognition Must Be Frequent
Here’s the thing; Nothing in life works unless it’s consistent: learning a new language, training a puppy, exercise. You’d never show up to the gym three or four times a year and expect bodily transformation. Recognition is no dif- ferent. In order to have a sustained, lasting impact on engagement, recognition must be frequent.
Regardless of the variance in cultural and societal norms surrounding recog- nition, it is clear that all the benefits of recognition are, unfortunately, extremely short lived – and much shorter than organizations previously assumed.
So, that begs the question: What’s the magic number? How often should employees be recognized?
According to Gallup, “Recognition is a short-term need that has to be satisfied on an ongoing basis – weekly, maybe daily.” Based on WFI’s 19 years of recognition data, organizations that average one unique recognition received per employee per month tend to experience the strongest measur- able impacts on engagement scores, regardless of the industry, geographical location or variances in employee demographics.
“One recognition per employee every 30 days seems to be the tipping point associated with the most predictable improvements to retention and other key metrics, such as customer satisfaction or performance scores,” Baumgartner said. “Recognition programs that average at least eight recog- nitions per employee per year can still move the needle on employee perfor- mance and engagement, but those programs with 12 recognitions per year – or more – represent the ‘sweet spot’ where we start to see true organi- zational transformation.”
But How Do We Get There?
The most vital consideration global organizations need to take into account to reach optimal levels of recognition frequency involves decoupling rewards from recognition.
Although program design recommends a blended approach – offering both social recognition and localized rewards – no organization in the world has unlimited budget to award employees every time they exhibit positive behavior. The good news is that studies show nonmonetary recognition can have just as powerful an impact as rewards-based recognition.
Professor Alex Stajkovic from the University of Wisconsin compared the impact of non-monetary and monetary recognition programs on job perfor- mance. At baseline, recognition associated with rewards tended to result in slightly higher performance increases than non-monetary recognition – 23 percent vs. 17 percent, respectively. However, when cost-benefit analyses are performed, non-monetary recognition often prove to be more cost effec- tive with maximizing budget.
Social recognition isn’t just good for optimizing reward spend. People are wired to crave meaningful praise. One study found that 66 percent of
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Using Data to Find Global Insights 281
people said their top motivator was appreciation vs. 15 percent who said financial reward. Furthermore, a values-based, peer-to-peer recognition that’s specific to why the demonstrated behavior was appreciated and that outlines the overall impact can foster a sense of connection and belonging that breaks down distance between departments, hierarchies and borders.
“When non-monetary recognition is normalized and employees view rewards as being separate from recognition, an organization has effectively fostered a culture of appreciation, which is why our recommendation for global organizations is to strive for at least 50 percent nonmonetary recogni- tion,” said Vanessa Brangwyn, chief customer officer at Achievers.
“At the point employees embrace the intrinsic value of the recognition itself and are no longer expectant of rewards, recognition levels will increase and serve to amplify your core values, so they are integrated into the daily workflows of employees,” she added.
Rehumanize the Workplace to Gain the Advantage
Creating a thoughtful, people-centric employee experience that has a measurable impact on success metrics outside of HR involves challenging previously held assumptions about employee motivation and embracing the truth that employees want to show up to work for a reason other than a paycheck.
The time has come for HR leaders to acknowledge that the collective mindset, expectations, and values of the workforce have drastically changed over the last decade and relying on top-down, infrequent, traditional recognition programs is not an effective way of aligning and engaging geo- graphically dispersed or siloed teams.
If the end goal is to bolster overall performance and profitability, fre- quent, peer-led, nonmonetary recognition shouldn’t be viewed as just a component to overarching total rewards or engagement strategy – it must be the cornerstone.
Use Positive Psychology to Boost Performance
Positive psychology, when used as part of continuous performance manage- ment and a comprehensive talent strategy, has been shown to address many workforce challenges.
Positive psychology focuses on building positive emotions, enabling people to innovate, grow and inspire others. What are the concrete tools an organization can use to leverage this powerful framework within performance development and the employee experience? Here are some examples.
Build Gratitude into Check-ins
According to Martin Seligman of the Positive Psychology Center at the University of Pennsylvania, gratitude is the positive emotion “felt after being the beneficiary of some sort of gift. It is also a social emotion often directed towards the person (the giver of a gift).”
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282 The Cornerstone of a Global Employee Engagement Strategy
Expressing gratitude during manager/employee check-ins builds positive connections and establishes a strong frame of reference for the rest of the meeting. Here are some tips for building gratitude into check-ins:
• Allocate a few minutes within each check-in to discuss positive outcomes and behaviors. Even simple questions like, “What went well this week?” or “What are we celebrating today?” can set a positive tone.
• Discuss how teams have collaborated to move projects along and encourage employees to give their peers recognition.
Inspire Peer-to-Peer Gratitude to Build Connection
The check-in is not the only place to create gratitude moments. Showing gratitude should be encouraged up and down the organization, whether peer-to-peer or manager-to-employee. It must be sincere and authentic to create a sense of positivity for both the giver and the receiver. Some things to consider when giving gratitude:
• Leverage storytelling to fuel positivity. Instead of saying, “That was a great presentation,” you may want to elaborate and say, “When you presented the product strategy today, I was able to fully understand why we are changing direction based on the customer insight you provided. When you were describing the customer, I felt like I was there with the customer experiencing the same issues.”
• Avoid lengthy processes for an employee to express their gratitude. Make expressing gratitude simple, easy and inspirational, without un- necessary overhead.
Drive Learning with Feedback
Although positive emotions are less intense, they play an essential role in building resilience and regulating negative emotions. One way to use posi- tive emotions is in the process of giving and receiving constructive feedback. If not provided correctly, constructive feedback can have a detrimental impact on productivity and morale. Positive psychology researchers recom- mend the number of positive moments to negative moments should be three-to-one to build trust and connection. Here are some ways positive psychology can improve the process:
• Start from a place of positivity and goodwill. Implement a well-funded social recognition program that allows everyone to give and receive recognition for good work in the moment, as it happens.
• Feedback should be actionable, future-focused, and something an employee can immediately put to use. For example, instead of saying, “You did a terrible job connecting with the audience at last week’s presentation,” try, “Next time you present, try connecting with the audience throughout the presentation. I have several tools I can send you that may help.”
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Build Connections with Empathy
We’ve all heard the saying, “Put yourself in their shoes.” This is essentially a call for empathy – the ability to relate to the thoughts, emotions, or experience of others. When leaders display empathy, they reinforce a personal interest, reassurance, and acceptance of their employees. Here are some ways people leaders can use empathy in their check-ins:
• Focus on the discussion as well as the emotional response of the employee. 80 percent of communication is non-verbal, so pay attention to tone and body language.
• Before responding to questions and comments, pause to think about the other person’s perspective. For example, when an employee says they are frustrated about a particular situation, try to see the challenge from their point of view, instead of immediately perceiving it as a complaint.
Embrace Strengths
Positive psychology research shows when people leverage their strengths they are more engaged and energized by their work. Martin Seligman and other researchers have found “when work demands our engagement, such as using our strengths in new and innovative ways, we experience higher levels of hap- piness and lower levels of depression.” Consider the following tips to help employees leverage their strengths and increase positivity and engagement:
• Give each person a strengths-based assessment and review the results to col- laborate on how those strengths can be leveraged to meet business goals.
• Create a safe environment for openly discussing both strengths and weaknesses. In this type of environment, someone could say, “Mike, could I ask for your input on creating some good questions? Curiosity is not one of my strengths.”
Ensure Employees Have Focus Time
Flow is a mental state of focused attention so intense that a person nearly loses their sense of time. Being in flow amplifies performance, according to Steven Kotler, benefiting both the employee and the organization. It has also been shown to increase positivity and engagement.
A person is more likely to enter a flow state when they are working on tasks that both challenge them and leverage their skillset. Here are some ways to help employees increase their productivity through flow:
• Give employees focused time each day where they are not interrupt- ed. Research indicates that switching between tasks costs an individual as much as 40 percent of their productivity. Try blocking particular hours of the day as focus timed when meetings cannot be scheduled.
• When creating goals, balance challenge and skill. As people rise to manageable challenges, they gain the confidence to accomplish increasingly more difficult goals.
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284 The Cornerstone of a Global Employee Engagement Strategy
Embed a Growth Mindset into HR and Talent Processes
Gallup has found that one of the top benefits that employees want from their employer is the opportunity to learn and grow. Here is where growth mindset, a key concept from positive psychology, can help. According to researcher Carol Dwick, growth mindset is when a person believes that their abilities and skills and those of others can be improved with effort. To embed a growth mindset within your organization, consider the following:
• Human resources and talent processes should be evaluated to ensure they focus on learning and growth. For example, in the interview pro- cess, ask questions to understand if a candidate has a growth mindset. A former Starbucks executive said she asks candidates about challeng- ing work experiences to help discern whether a candidate is willing to learn from their mistakes.
• Have leaders add “yet” to statements of limitation. For example, “We can’t do this – yet.” Just adding this one word helps overcome the per- ception of negativity in the face of challenges.
• Leaders should be encouraged to use inclusive language such as “we” and “us” to create a sense of shared purpose and community when speaking with their teams.
Trigger Resilience and Grit During Goal Setting
Angela Duckworth, noted researcher from the University of Pennsylvania and TEDx speaker, defines grit as the “perseverance and passion for long- term goals.” Resilience is the optimism to continue even when you’ve expe- rienced failure. Both resilience and grit can be used to facilitate organizational and employee growth.
• Goals should be reviewed continuously throughout the year and adjusted as needed. Short-term, achievable goals tied to the longer- term corporate strategy help employees foster grit and motivation. For example, one goal could be to focus on three new marketing cam- paigns for new customer acquisition, which is tied to a corporate goal of increasing revenue by 10 percent.
• When you experience challenges in meeting a goal, consider bringing the key players together for collaboration, reflection, and an open discus- sion to dig into what happened and how to keep things moving forward.
AMPLIFYING THE EMPLOYEE EXPERIENCE THROUGH TARGETED ENGAGEMENT EFFORTS
One in three employees in the United States will leave their jobs this year to work for another organization, according to projections from the Work Institute.
As business leaders and human resources professionals are keenly aware, each time an employee chooses to leave their organization, the business
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Amplifying the Employee Experience through Targeted Engagement Efforts 285
must invest in funding recruitment efforts and training of the replacement hires. In addition to these overhead costs, high turnover rates lead to a decrease in overall employee effectiveness and productivity.
As organizations continue their search to uncover the reasons for these increasing turnover rates, new research conducted by market and strategy research firm Chadwick Martin Bailey (CMB) suggests that the role of employees’ psychological benefits should not be overlooked.
CMB, a subsidiary of ITA Group, found that a consistent employee experi- ence amplified by targeted engagement efforts during the critical one-to- two-year tenure range will position businesses to effectively retain the talent they need to ensure organizational success.
Up the Engagement Ante
Through their research, CMB explored what organizations must do to con- nect with and engage employees on a deeper psychological level. Through a survey of 1,466 workers of varied tenure and roles across nine industries, CMB’s findings validated the impact of what they call “psychological bene- fits” on employee engagement.
The survey results show that there are five key psychological benefits that motivate employee advocacy:
• Personal identity • Social identity • Cultural identity • Emotional benefits • Functional benefits
Out of these five, the three identity benefits – personal, social, and cultural – play an especially vital role in inspiring stronger employee engage- ment and retention. Personal identity is particularly notable, as it focuses on an individual’s self-esteem and pride in working for an organization. Organizations can support this benefit by aligning and reinforcing a sense of shared purpose across employees.
Leadership should begin fostering these important psychological benefits from the time talent is recruited and continue throughout the onboarding process and beyond.
Focus on Improving the Employee Experience
The new research by CMB shows that organizations effectively reinforcing the psychological benefits are approximately three times as likely to have an engaged and loyal workforce. In an effort to bring greater consistency to the employee experience, organizations should consider focusing specific, targeted engagement efforts on employees who have been with the organization at least one year, but less than three years.
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286 The Cornerstone of a Global Employee Engagement Strategy
Essential steps to improving the employee experience among this segment include:
1. Meeting them where they are. Take time to understand the needs and desired support of people with one-to-three years of tenure. Use this feedback to guide your decisions about what type of programs, initia- tives and other support your organization will offer.
2. Capitalizing on known onboarding success. Often, employees are simply struggling to adjust to the lack of consistent support they may have felt during initial onboarding. Consider expanding the onboarding pro- cess through initiatives like extended welcome programs, roundtable conversations specific to employees at different stages of the employee journey or periodic celebrations for smaller achievements.
3. Reinforcing people-to-people connections. To support emotional connec- tion and cultural cohesion, create more opportunities for team members to connect with their peers outside of their departments or projects, such as through employee resource groups, interest clubs, organization-sponsored events, mentorships, or volunteer opportunities.
4. Helping them grow internally before they get the itch to look externally. Getting ahead of employees’ desire to search for other professional opportuni- ties is crucial in the one-to-two-year tenure period. To help them see that you’re supportive of their long-term aspirations, consider creating a hierarchy within your hierarchy to enable smaller promotions or investing in building skills for future managers.
Why Onboarding Is Important
When employees first land a new job, they are eager to connect with their organization and peers. CMB’s research found that this eagerness also leads to a peak in pride and self-esteem levels during the first year, when employ- ees are most likely to report sentiments such as, “Working at my company makes me feel good about myself,” and, “I am proud to tell people that I work for my company.”
Organizations that report recent successes in improving engagement often credit their ability to tap into this eagerness, typically by making investments in the onboarding process. This could include developing social network channels specific to new hires or checklists to aid leaders in supporting continued onboarding throughout the first day, week, and month on the job.
An underlying reason that these strategies work is because they are tap- ping into the identity benefits. When organizations go to greater lengths to build on this inherent excitement, they’re nurturing those critical feelings of pride and self-esteem. These positive feelings lead to high levels of engage- ment but can also lead to an unfortunate consequence if organizations aren’t prepared to offer greater support for the long-term.
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Amplifying the Employee Experience through Targeted Engagement Efforts 287
Avoiding the New-Hire Reality Slump
While it’s encouraging to see such positive feelings and strong levels of engagement in new hires, the research also revealed a concerning trend known as the “reality slump.”
This term refers to the period in which psychological benefit perfor- mance noticeably drops in the one-to-two-year tenure range across all gen- erations and income levels. Oftentimes, employees never fully recover from this dip. Because psychological benefit performance drives employee engagement and retention, this is a critical takeaway for organizations looking to keep their top talent.
During this time, employees are most likely to express interest in exploring roles at other organizations, making them at-risk for turnover. For organiza- tions, these feelings can be costly. According to insights from the Work Institute, the cost of turnover is estimated at 33 percent of a worker’s salary, and many sources cite the costs at much larger figures. By understanding and investing in engagement opportunities that more consistently support employees’ psychological benefits after the initial onboarding phase, organi- zations can help mitigate the risk of this occurring among their own new hires.
According to Thomsons, 82 percent of organizations report that their number one global benefits strategic objective is to attract and retain talent. Given this focus, investing in talent personally and professionally to reinforce support for psychological benefits has never been more crucial.
Armed with the knowledge that employees with one or two years of tenure are particularly at-risk to disengage, implementing strategies that positively impact employees’ key psychological benefits consistently through- out the employee experience can be the key to avoiding a spike in disen- gagement and voluntary turnover (see Sidebar 11.2).
Sidebar 11.2 Case Study: Humana’s Career Framework
By Stephanie N. Rotondo, WorldatWork
An emphasis on creating personalized consumer experiences that con- tribute to their members’ best health is at the heart of Humana Inc.’s evolution from a traditional insurer to a senior-focused health care company. From just under 10,000 associates in 2003 to over 40,000 associates in 2019, it became apparent that just as their business strat- egy had evolved, so must their job architecture.
As Humana undertook the process to define their ideal state, one concept was clear to them: the consumer experience cannot exceed that of the employee experience. To deliver meaningful experiences for their consumers, they needed to ensure that the foundation for tal- ent development, performance management, visibility to career oppor- tunities and growth were strengthened for their associates.
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288 The Cornerstone of a Global Employee Engagement Strategy
At the outset, Humana’s job architecture was “showing its age,” said Mark Stone, associate vice president of compensation. Because the com- pany no longer fell into a traditional model, its job roles had evolved. “They were not just the typical insurance jobs of a decade-and-a-half ago.”
Furthermore, the needs of Humana’s customers had changed, as well as the skillsets necessary to address those needs.
But the needs of the company’s associates were not being met. According to Stone, associates had limited visibility to the next steps in their careers or the skills they might need to grow their careers.
Instead of tasking human resources, or even just the C-suite, with solving the problem, Humana went right to the source: the associates themselves.
“We wanted to know, from their perspective, what did [the associ- ates] need to create the culture we wanted,” said Brian Fisher, director of compensation.
What they discovered was that associates didn’t consistently have answers to four fundamental career questions:
• How do I grow my career? • How do I develop valuable skills? • How is my contribution reviewed? • How am I rewarded?
“If an associate can answer those questions, it can improve their experience,” Fisher said.
Keeping in mind the perspectives of culture, marketplace and busi- ness needs, solutions were discussed, first with leaders within the com- pany and then with associates, where iterations of the solutions unfolded.
“Very few decisions were made in a vacuum,” Fisher said. “This wasn’t, from an HR perspective, an off-the-shelf kind of
approach,” said Michele Phlipot, senior organization effectiveness pro- fessional in compensation. “It was co-created [with leadership and associates], something that belonged to everyone.”
And thus, Humana’s Career Framework was born, a framework that narrowed down job families and skillsets based on consumer-driven and market-based needs. It led to a more consistent and intuitive approach to creating jobs, which were developed around needed skillsets. From there, associates were better able to understand the opportunities that existed.
“From a business perspective, we’re defining our jobs based on the needs of our consumer,” Fisher said. With the framework in place, “We can more readily recruit and also reward for those skills in a much more effective way.”
But Humana also recognized that leadership needed to be prepared for the new conversations they were about to have with employees. As such, they created digital tools to help leaders engage and dynamically
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PERSONALIZATION OF THE EMPLOYEE EXPERIENCE
Going beyond the fundamental expectations employees have had for many years, there is another workplace revolution underway: personalization of the employee experience.
“Having the ability to personalize work commitments is a priority for many employees, and companies need to start by taking a ‘whole person’ approach and increasing the flexible work options available to their work- force,” said Tim Morrison, HR business partner at Mercer as well as a bound- ary umpire for the Australian Football League (AFL).
“With intense competition to attract top talent and ensure staff loyalty, it is necessary that companies progress and look towards the future,” he said, adding that as an employee and an umpire, he is constantly juggling two careers – and flexible work options enable him to manage both.
And Morrison isn’t alone in his need: Mercer’s “2017 Global Talent Trends” research found that, as a direct response to the “era of the individ- ual,” more than half of employees (56 percent) are looking for more flexi- ble and personalized work arrangements.
“Globalization and technology are making the world smaller and shaping employees’ expectations of when and how they want to work and what is of most value to them,” said Michele Glover, people and culture leader, Mercer Pacific. “People want their employers to help them invest in themselves and this can mean different things to different people, such as Tim working as an HR business partner and AFL umpire. This type of personalization is what it’s all about for people – meeting them where they are in terms of their life stage and interests.”
explore the new job structure. These tools provided both a vehicle for leaders to map associates from their previous role to a new job, but most importantly, the tools served to introduce leaders to the new structure and educate along the way. On top of that, conversation guides were created to prepare leaders for one-on-one conversations with their associates.
“We really tried to create a consumer-grade experience through- out,” Fisher said.
Phlipot noted that there are ongoing efforts to measure and assess the framework to ensure that things are on the right track.
“We know that we are better positioned from a skill perspective,” Stone said, adding that “continued measurement is needed.”
“We believe our associates are now in a better position to answer those four fundamental questions, thus improving the associate expe- rience,” Fisher said.
In turn, Humana aims to improve the experience of the consumer.
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290 The Cornerstone of a Global Employee Engagement Strategy
While some employers still expect employees to make work work for their individual circumstances, there are some looking to the future of work, tak- ing a whole person approach and increasing the flexible work options they offer. Mercer’s research revealed that one in two employees surveyed expressed concern that flex working would negative affect their promotion opportunities.
“Clearly there is more work to be done to create a culture where flexibility is not seen as a benefit, but as an opportunity for workforce optimization and personalization,” Glover said. “By embracing flexible working and dem- onstrating there are career pathways, employers will not only attract and retain talent, they will cultivate a thriving workforce.”
A Good Employee Experience Benefits Business
Optimizing employee experience can boost your organization’s bottom line. That concept was reinforced by the chief finding in Globoforce’s WorkHuman Analytics and Research Institute and IBM Smarter Workforce Institute’s study.
The Financial Impact of a Positive Employee Experience developed an “Employee Experience Index” by surveying 22,000 workers in 43 countries. It found that organizations that scored in the top 25 percent in the index report nearly three times the return on assets compared to organizations in the bottom quartile. Further, organizations that score in the top 25 percent report double the return on sales compared to organizations in the bot- tom quartile.
“We have robust evidence that the employee experience matters from a bottom-line perspective,” said Greg Stevens, analytics manager at Globoforce’s Human Research Institute.
So, what defines employee experience? Globoforce and IBM, through sta- tistical analyses, identified five components:
• Sense of belonging • Sense of purpose • Sense of achievement • Happiness • Vigor
“We have 10 items that measure those five components, so two questions per component, and that formed the eventual scale that we validated,” Stevens said, “so that it was truly representative of what people said their employee experience was around the globe.”
Improving the bottom line is certainly a desirable, direct effect from opti- mizing the employee experience, but another positive outcome is increased retention, which indirectly contributes to the bottom line. The study found that a positive employee experience leads to a 32 percent increase in perfor- mance and a 52 percent decrease in terms of people’s likelihood to leave. There is also a 73 percent increase in those people who are likely to go above and beyond their assigned tasks.
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Personalization of the Employee Experience 291
Stevens said the study also aimed at finding workplace practices that lead to the bottom-line improvement. The study found six main drivers:
1. Meaningful work. The extent to which you see your work connected to the core values of your organization. You feel your organization makes good use of your skills and ability, so there’s a degree of fit there that is meaningful.
2. Empowerment in voice. The extent to which you feel like you are heard in the organization and you have a chance to participate in decisions that affect your life.
3. Recognition feedback and growth. It’s less about annual performance reviews than it is about expanding a continuum of performance that centers around continuous conversations, development and opportu- nities for growth.
4. Co-worker relationships. The connection is more and more important in today’s human workplaces. Organizations rely less on organizational hierarchies and your work is done more in terms of teams and net- works. So those are increasingly important.
5. Organizational trust. The expectation that your organization will behave responsibly and that it will act with integrity.
6. Work–life balance. Appreciating the fact that who you are doesn’t have to change when you walk into the office. You can bring more of yourself to work, but also have more time to nurture connections that you have outside of work.
Employers can instill this workplace environment that fosters the optimal employee experience by combining a variety of different practices, Stevens said. An example is an employee recognition program, which hits on the basic driver of feedback, recognition, and growth.
“That gets you a positive experience above and beyond having no recog- nition program. But what really supercharges it is when it is tied to core values,” Stevens said. “So, you’re integrating more of the meaningful work component. Those two combined leads to the most beneficial outcomes to supercharging the employee experience.”
From a global standpoint, meaningful work was either first or tied for first across every country as the main driver for a positive employee experience. However, it doesn’t just stop at meaningful work. To get the best results, it’s important to have multiple drivers.
“If work is meaningful, it’s good, but if no one sees you experiencing that meaningful work, if you have a lack of connection, if you don’t feel like you’re appreciated, it can really derail the positive benefits,” Stevens said. “So, it’s critical to have an integrated approach to thinking about meaningful work.”
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