Have you asked yourself what benefits a company will receive when investing in employee experience – outside of an altruistic and humanitarian worldview (as certainly yours)?
Research shows: employee experience (in the following EX) results in strong company performance. Hence, we suggest to start a new way of working here. This article is dedicated to this topic and describes how employee engagement and thoughtful remote work arrangements drive ultimately performance.
In cooperation with our clients, we’ve started to regularly survey which challenges of remote work affect them most. Across hierarchical levels, it is remarkable how the perception of the situation itself has changed over the last three months. While in April isolation and loneliness was still very challenging for individuals, it now seems to be most difficult to keep the team cohesion and spirit high and to maintain efficient work by facilitating informal exchanges. Latest IAB assessments (Institut für Arbeitsmarkt- und Berufsforschung) support this while showing that 59% of the working adults see team collaboration as more challenging for employees when working remotely.
Why should companies look closely at these and related indicators? Both of the factors mentioned are levers for, again the result of strong employee retention. And this in turn contributes strongly to the success of a company.
21% higher productivity and other outranking effects in companies with very high employee engagement.
“Engagement is not an exercise in making employees feel happy — it’s a strategy for better business outcomes”, states Gallup 2019. Engaged employees are more into their work and feel higher commitment. This causes overall higher personal work contribution.
Gallup assessments, conducted over decades, show clearly the strong correlation between employee engagement and core performance indicators, in particular 41% lower absenteeism, 41% fewer quality defects as well as patient safety incidents, and 21% higher profitability for highly engaged workplaces.
Shawn Achor makes in a meta study (HBR) the link between business outcomes to the feeling of “happiness at work”. Latter is according to the American psychologist Martin Seligman a key element of a fulfilling life, and also in remembrance of a publication in the Psychological Bulletin of 2005 on how happiness leads to success (more detailed consideration in a subsequent Tuesday Read of the Virtual Academy.) According to their results,highly satisfied employees have shown 31% higher average productivity, 37% more success in sales, and 3x higher creativity.
To cite another source: 2017 published the HBR compelling results based on an analysis of 250 companies around the world: “experiential organizations” that invested most heavily in employee experience (the top 6% analyzed), show business advantage along several performance measures:
- Their average profit exceeds 4.2 times, average revenue twice the one of those that don’t
- Their productivity suggests to be higher since these companies were 25% smaller in average then those that don’t
- Their stock price developments outrank significantly the S&P 500, the NASDAQ, Fortune’s 100 Best Companies to Work For, and Glassdoor’s Best Places to Work (2012-2017)
- They are included more often in significant rankings, e. g. 28 times as often among Fast Company’s Most Innovative Companies, 2.1 times as often in Forbes’s list of the World’s Most Innovative Companies
And Aon Hewitt shows: Organisations in the top quartile for engagement (where more than 7 out of 10 people are engaged) recorded the following compared to an average company:
- 4% growth in sales (companies in the bottom quartile declined by 1%)
- 2% increase in operating margin (versus a 3% decline for bottom quartile companies)
- 4% increase of total shareholder return (versus bottom quartile companies were down 8%)
Thoughtful remote work arrangements have positive effects on employee engagement.
Now two questions arise, which we would like to answer here in first steps:
- How can the topic EX be addressed in remote work setups?
- How can remote work contribute to higher EX?
Let’s start with the latter. Interesting is the following evidence: Employees who work remotely are more engaged. According to Gallup, “the optimal engagement boost occurs when employees spend 60% to 80% of their time working off-site”, or 3-4 days out of a 5-day working week.
As to read in our Tuesday Read Facts you need to know about Remote Work to learn from COVID-19, the IAB distilled that 45% of employers see a productivity increase when offering home office arrangements.
What are the reasons from an employee perspective? Some of them are mentioned in the following:
IAB results show that flexibility and compatibility of family and career are key advantages for the employees (52% replied this would be a positive effect). Hence, the ability to manage a workday balancing both, family and work, gives people a new flavour of well-being.
Regarding gender diversity, the following aspect seems interesting: in a large-scale study of 323,500 U.S. adults, it was found that „53% of stay-at-home mothers say having flexibility in their hours or work schedule is a ‚major factor‘ in their ability to take a job“.
The Buffer report 2020 (U.S.) showed that nearly all (98%) of the surveyed 3,500 remote workers from around the world would prefer to keep up working from the home office. Main reasons are the ability to be free to determine schedule (32%) and location (26%), and to be flexible with family arrangements (11%).
As remote work is unavoidable, companies should analyze their employees’ engagement.
We have developed an engagement model framework with regard to remote & virtual work, according to which an analysis of the status quo can be made. Together with our clients, we “take stock” along the following five areas in order to gain a deeper understanding of the degree and quality of employee engagement in the company:
Contribution: Understanding your specific contribution to the larger goals of your organisation.
Transparency: Clarity and openness with which leadership communicates decision-making and makes information available.
Autonomy: Ability to shape your work and environment in ways that allow you to perform at your best.
Belonging: A sense that I can fully be myself and can connect socially to my colleagues.
Well-Being: To have the time, space and opportunities to manage mental and physical health.
What’s next?
Remote work environments that are able to address these dimensions are more likely to bring out the best in their employees!
You’re interested in how to analyse your team or organisation along these five dimensions of engagement, and want to get deeper insights? Read more in one of our next Tuesday Read blog posts.
And then there is the question of how to tackle the blind spots that have been identified. The Virtual Academy framework also helps you to do this. Find our article published in CAPITAL (German) and translated to English here. We will discuss it further in the next blog posts.
Stay tuned:) We are looking forward to seeing you soon!
Advantage is built on employee engagement.
The Virtual Academy conducts all courses based on an underlying strategic perspective. There are two compact courses that teach your leadership how to excel as a virtual leader, and another how to work in teams efficiently. Ultimately, they will help you boost your company’s productivity.
