Employee experience a key driver of performance, says McKinsey

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Employee experience a key driver of performance, says McKinsey

Providing excellent employee experience requires a profound reorientation away from a traditional top-down model, according to McKinsey and Company. Instead the authors of a paper on the matter say organisations need to move to a model based on the fundamentals of design thinking.

Employees who report a positive employee experience are 16 times more engaged than those who report a negative experience. McKinsey's research highlights the importance of employee purpose, especially so in a new age of workplace upheaval and disruption.

According to authors Jonathan Emmett, Asmus Komm, Stefan Moritz, and Friederike Schultz, organisations that offer excellent employee experience will gain a significant advantage.

“This shift allows a company to put its workers first by exploring and responding to how they view their employee journeys, then delivering tailored interventions that focus on critical moments that matter to maximise satisfaction, performance, and productivity. In doing so, companies can become more inspiring, collaborative, and centred on creating an experience that is meaningful and enjoyable.”

According to the authors, there are nine primary elements that determine an employee's experience, and in turn their performance:

  • People and relationships
  • Teamwork
  • Social climate
  • Work organisation
  • Work control and flexibility
  • Growth and rewards
  • Purpose
  • Technology
  • Physical environment

These elements span over three categories; social experience, work experience and organisation experience, with McKinsey research showing that employees at leading EX companies have a 40 per cent higher level of discretionary effort.

A systematic approach to building high levels of EX is suggested by the authors, outlining three steps based on the fundamentals of design thinking:

  • First, establishing an EX baseline that articulates the direction and scale of ambition for EX and its value is recommended. In building this baseline, decisions supported by data and assessment tools are said to be the most beneficial.
  • Second, transforming core EX journeys following a “discover, design, deliver” cycle and leveraging digital tools will aid in the growth of a company’s EX.
  • Finally, enabling EX transformation through implementing relevant systems that allow for organisational scale, such as data, measurements and systems is recommended. Utilising HR as a central partner, this step provides the forethought and planning necessary to reach the higher levels of EX.

In following these steps, organisations are better able to capitalise on the shift in work, with changes to employees wants and needs.

“Focusing on employees is long overdue. Organisations can seize this moment to do and be more for their people, as well as for their shareholders and customers,” the authors say.

“How each company manages this opportunity may shape its perception as an employer — both internally and externally — for years to come.”

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