No, Your Employees Probably Aren’t Happy. And Your Company Will Pay for It.

Employee experience is crucial for an organization’s growth and success, but most just give it lip service.

October 24, 2023

Tiffani Bova,

Everyone knows that happy employees lead to happy customers and growth, so most companies say employee satisfaction is a big part of their mission. The reality is that employee experience, EX, is usually an afterthought, says Tiffani Bova.

Bova, the former global growth evangelist at Salesforce, is among Thinkers50’s list of the world’s top management thinkers. She was born and raised in Hawai‘i and graduated from Punahou School. She says companies tend to do what they need to for the customer and assume “the employee will figure it out.” She says the pandemic shined a light on that EX disinvestment.

What follows is an edited excerpt from her latest book, “The Experience Mindset: Changing the Way You Think About Growth.”

A majority of employees have been disengaged from, or indifferent toward, their work for decades. They’re frustrated by inadequate pay, limited career advancement opportunities, unrealistic productivity expectations and long commutes that have become increasingly unnecessary.

As shown in the first chart, employee productivity and compensation were in alignment until the Digital Revolution, and have diverged wildly since. Between 1948 and 1979, productivity (measured as how much total income is generated in an average hour of work) and compensation (employees’ average pay) rose in close tandem.

Productivity and Hourly Compensation Growth, 1948-2020

The gap between productivity and a typical worker’s compensation has increased dramatically since 1979.

Between 1979 and 2020, productivity went up 61% while compensation only went up 17.5%. With productivity increasing, it is only natural to assume that income increased for businesses as well, and you’d be right. But that money wasn’t making it into the pockets of most employees. Instead, it went to the C-suite, other corporate and professional employees, and higher shareholder profits – not to a majority of their employees.

Beyond compensation and productivity, companies need to pay attention to employee engagement when considering how to improve EX. Engagement is currently at a miserable 32% – and hasn’t budged in the U.S. since 2007.

U.S. Employee Engagement Trend, Annual Averages

The engagement element that declined the most from early 2021 to 2022 was employees’ level of agreement that they have “clear expectations, the right materials and equipment, the opportunity to do what they do best every day, and a connection to the mission or purpose of their organization.”

The percentage of actively disengaged employees – that is, workers who are disgruntled and disloyal because most of their workplace needs are going unmet – is slowly climbing and was at 17% in 2022. Even more telling is that from early 2021 to 2022, there was an 8-point decline in the percentage of employees who were “extremely satisfied” with their organization as a place to work.

Unhappy or disengaged employees can still “do their jobs,” check the appropriate metric boxes and get paid. They may also be miserable.

Disengagement shows up in places like a disinterest in collaboration and an unwillingness to go above and beyond or take on extra work. That ends up negatively impacting employees who are actively engaged.

Digital productivity can also mask engagement issues. So much of the inner workings of any business – the tedious, mundane tasks – are now handled by technology and automation, which can result in higher productivity numbers. That doesn’t mean your employees are engaged.

Lack of engagement means employees are less likely to invest discretionary effort in organizational goals or outcomes. They are also more likely to quit or be fired due to poor performance, further exacerbating the talent crunch. Those lost employees are expensive to replace.

It is no surprise that organizations that are the best in engaging their employees achieve more than four times the earnings-per-share growth of their competitors. If you don’t have employee engagement, how could you possibly expect to see high productivity, innovation and organizational agility? How can your company expect to provide superior EX when employee engagement is so dismal?

Focus on EX: Employees are begging for it, your customers are feeling the consequence of its neglect via poor service, and it’s showing up in your bottom line.