It’s often said that a business’s greatest asset is its employees—for good reason. Unless you run a solo operation, it’s your team that delivers the services your customers pay you for, giving you a strong incentive to ensure their experience fosters satisfaction, retention, and productivity.
Here’s what employee experience is, why it’s vital in modern service businesses, and how improving it leads to a more engaged, loyal, and high-performing workforce.
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What Is Employee Experience?
Employee experience (EX) is the sum of what your employees think and feel about their roles and your organization. In many ways, it’s the internal counterpart to the outward-facing customer experience.
Every touchpoint along the employee journey shapes the overall experience—from the moment they’re hired and onboarded to the day they leave the company. Key factors that influence employee experience include internal services such as:
- Workplace culture: Interactions with leadership, management, and co-workers
- Training: Onboarding for new hires, along with ongoing training, advancement opportunities, and professional development
- Compensation: Pay, paid time off, and other benefits
- Incentives: Commissions, bonuses, profit-sharing programs, raises, promotions, referral bonuses, and internal recognition
- Tools: Internal and external technologies that employees rely on to perform their duties effectively
Why Is Employee Experience Important?
How an employee experiences their role and responsibilities directly affects their job satisfaction. And because employee satisfaction influences productivity and retention under the service-profit chain framework, the employee experience ultimately impacts a business’s ability to generate and grow profit.
According to the Harvard Business School Online course Transforming Customer Experiences, a poor employee experience often leads to lower job satisfaction, making employees more likely to be unproductive and disengaged. Under the service-profit chain model, a drop in loyalty and productivity can reduce the external service quality they deliver to your customers or clients. This decline may increase customer churn and limit your ability to retain and grow customer relationships and revenue.
A positive employee experience can have the opposite effect: satisfied, loyal, and productive employees who consistently deliver high-quality service. This, in turn, leads to stronger customer satisfaction and loyalty, which makes it easier for you to grow revenue and profit.
Getting the employee experience right doesn’t just help attract and retain top talent; it’s also key to maintaining satisfied customers.
How to Improve Employee Experience
“Improving employee performance requires striking a balance between top-down prescriptions and bottom-up solicitations,” says HBS Professor Ryan Buell, who teaches the online course Transforming Customer Experiences.
This means leaders can’t simply prescribe how to improve the employee experience. They must also solicit input from the people doing the work. The key is understanding which scenarios call for a top-down versus a bottom-up approach.
Here are three strategies to consider implementing, using a mix of both, that can boost your organization’s employee experience.
1. Build Trust with Your Employees
When employees feel trusted by management and leadership, they’re motivated to prove they’re worthy of it. This drive often leads to increased retention, creativity, and collaboration.
“Trust is the willingness to behave in a way that accepts vulnerability caused by the uncertain behavior of others,” Buell says in Transforming Customer Experiences. “When an employee is trying to decide whether to trust their leader, they want to see them as authentic, as having rigorous logic, and as being empathetic toward them—invested in them and their success.”
Buell notes that using bottom-up solicitations, rather than relying solely on top-down directives, can help you build trust with your employees. You can foster this trust by:
- Acknowledging when you don’t know the solution to a problem, which demonstrates authenticity and humility
- Asking employees for ideas and possible solutions, which builds empathy and shows that their input matters
- Incorporating the best of their ideas into your plan, which reinforces your credibility and shows you’re thoughtful in your approach
2. Minimize Friction in Employee Workflows
Every job comes with challenges. However, when employees consistently face friction while completing tasks, it can lead to frustration and a poor employee experience. Over time, this can lower productivity and motivation.
Reducing friction, such as adopting new technologies, streamlining internal processes, or restructuring teams, can improve productivity and engagement while reinforcing employees’ trust.
When identifying improvement areas, Buell recommends a bottom-up approach, when appropriate, by listening to the employees doing the work and asking how they think tasks or processes could be improved. Ignoring employees’ firsthand knowledge means overlooking valuable ideas and insights.
3. Connect Employees’ Values to Organizational Purpose
A company’s mission outlines the long-term goals and objectives, while employees’ values reflect the principles, motivations, and beliefs that guide their roles and careers. When these align, employee and organizational success become intertwined, increasing the likelihood that employees will consistently provide value to your organization.
While values can vary from person to person, Buell notes in Transforming Customer Experiences that most employees want to feel that their work is meaningful and appreciated by the organization. It’s also important for them to see progress and feel they’re continuously improving.
If your company’s mission statement doesn’t reflect employee values, consider incorporating language that acknowledges what’s important to your workforce. When assigning tasks, take the time to explain how everyone’s contributions help the company move toward its mission and goals, especially if those goals extend beyond just “making money.”
Set Your Employees Up for Success
When you invest in improving your employees’ experience, you enhance their skills, resources, processes, and tools, making them more effective in their roles. Over time, these sustained improvements enable employees to deliver higher-quality services to customers, boosting customer satisfaction, loyalty, and profitability.
If you’re new to the concept of the service-profit chain and how the employee experience impacts it, consider enrolling in an online course like Transforming Customer Experiences. You’ll learn how to design a service-driven value proposition for your business, understand the role of the service profit chain and customer journeys, and gain other valuable insights that will empower you to consistently deliver high-quality services to your customers.
Ready to transform your customer experience and build lasting loyalty? Explore Transforming Customer Experiences—one of our online leadership and management and entrepreneurship and innovation courses—and download our online learning success guide to learn more about how an online program can benefit your career.
