How to measure employee experience?
In the last couple of years, employee experience has become very popular. A Google search for employee experience results in more than 4.5 million hits. Many claim that it is currently one of the biggest HR trends. And firms that invest in employee experience seem to perform better than firms that don’t.
So employee experience clearly seems very important. But what do we actually know about employee experience? There are a lot of different views on what it is, and what the elements of employee experience are. And how can we measure it?
In this article, I will focus on the measurement of employee experience. My research on employee experiences with HRM shows several similarities to employee experience. So below I will explain our findings and how they may be useful for the measurement of the concept.
What are we measuring exactly?
The first step towards accurate measurement is having a clear definition. First, we need to agree on what we are talking about. Let’s take a look at how employee experience (EX) is defined. Erik van Vulpen already discussed a wide range of definitions in his article about employee experience. I’ll give a few examples. Jacob Morgan argues that EX consists of three environments that matter most to employees: the physical, cultural, and technological environment. Dary and colleagues define EX as work complexity and behavioral norms. And Maylett and Wride (2017) define EX as the sum of the perceptions employees have about their interactions with their organization.
Many authors emphasize the importance of various ‘touchpoints’ of employees in their time at an organization. EX is their experience at each of these touchpoints, from pre-employment to post-employment. This is similar to the HR cycle. This contains recruitment, selection, onboarding, employee development, career management, performance management, and exit.
When looking at the definitions, I see two different approaches. Some define EX more in terms of the work environment (e.g., touchpoints, technology, culture, etc.). Others are defining EX as the experience itself. Both are of course very important. But for measuring it is important to distinguish between the two. Let me explain why.
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Our research on HR shows that there is a difference between the way HR practices are offered and how they are perceived by employees. The HR practices that were offered and how employees experience them only correlated weakly. So not all practices reach the employees. Some managers do not implement all practices well. Or even if implemented well, two employees can have different experiences of exactly the same work environment. They may have different needs, different previous experiences, or different personalities. We also know that how employees experience work drives their satisfaction, engagement, and performance (Guest, 1999). More than the actual initiatives that are implemented.
So it is important to realize that there is a difference between what you offer as a company, and how employees experience this. And their experience is highly dependent on managers, and on the employees themselves. But what does this mean for measuring EX?
How to measure EX
My colleagues and I conducted a systematic review of almost 500 strategic HRM studies (Boon, Den Hartog, & Lepak, 2019). In this review, we examined how researchers measured systems of HR practices. We found that in academic research there is also a trend towards measuring employee experiences of HRM. Between 1991 and 2017 the share of studies that measured employee perceptions of HRM went up from 6% to 50%. We found that measuring such perceptions is challenging and we need more clarity to improve measurement.
I will give a few recommendations for measuring EX based on our findings:
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1. Determine the elements and outcomes of EX
The first important step is to clearly define the concept and to clarify the boundaries. For EX this means that you need to determine what to include, and what lies outside the boundaries of EX. Are you focusing mainly on the HR cycle (or touchpoints)? Do you also include leadership? Culture? Technology? And maybe other factors?
When you have decided what to include, you can determine what you see as outcomes of EX. In a previous article on HR strategy implementation, I discussed an HR implementation model developed by Nishii and Wright (2008) and Purcell and Hutchinson (2007). This model distinguishes between intentions, what is actually implemented, and what employees perceive. And the resulting employee outcomes.
In our research, we found that the different steps in the model are different in nature and should be measured differently. To clarify what exactly you would like to measure, you could place different elements or definitions of EX in this model. I would like to highlight three parts:
- Intended: This is what the organization offers employees to increase EX. As an organization, you could offer a range of HR practices and certain technology, etc.
- Perceived: This is EX; how employees experience what you offer.
- Employee outcomes: This is the desired outcome. What is the result you aim for when EX is positive? And which ‘employee outcomes’ are relevant for your company? Engagement? Satisfaction? Or something else?
You can measure employee experiences with what you offer and the employee outcome (e.g., engagement). Then, you can calculate statistical relationships between them.
2. Try to avoid confounding EX with its outcomes
But how to measure the different variables? You may want to ask employees directly how they experience the things you offer them. Or whether they are satisfied with them. But this can be problematic. Often their general feeling of (dis)satisfaction will influence the judgment of all elements. So such scores will measure something close to the outcome. For example, engagement or satisfaction. This confounding of EX with its outcomes will make it difficult to use the data. You don’t know exactly what you have measured. And correlations between EX and outcomes will be very high.
To avoid this, you can use descriptive instead of evaluative measurement. Descriptive questions refer to something in an objective way. For example by asking employees whether they receive development opportunities. Evaluative questions contain a value judgment or refer to a feeling. For example, asking whether employees are satisfied with the development opportunities. With descriptive questions, there will be less overlap with employee outcomes.
3. Don’t combine different elements in one overall score
It could be tempting to combine several elements in one overall EX score. Such a score would combine perceptions of HR, leadership, culture, etc. However, when using an overall score, you don’t know which part of EX is responsible for the effect that you find. Does an average score mean that employees are moderately happy with each element? Or are they happy with some and unhappy with others? And if you find a positive relation with engagement, what is responsible for this effect? Leadership? Culture? HR?
So it is important to distinguish between different elements of EX. That way you can later see which element is more predictive than others for positive results. An overall EX score may give you a broad idea of whether employees like to work at your company. But it gives you little to act on when trying to improve EX.
Also, different elements of EX may strengthen or weaken each other. So it is better to keep the elements separate. Then you can test whether some combinations work better than others. Or two equally effective elements may differ in cost. Then you could implement the one with the lowest cost.
When measuring EX like this, you will collect a lot of data on various aspects of the work environment. And on the outcomes you are interested in. You can see whether what the company intends to offer actually reaches employees. And you can identify the strongest correlates of EX. That way you know what to invest in when aiming to enhance EX.
You can also use the data in other ways. For example, to identify different types or profiles of employees that have different needs.
So distinguishing EX from the desired outcome is important for organizations. EX is not an outcome in itself. However, it can help to predict outcomes you are interested in, such as engagement or satisfaction. Accurate measurement of EX will help you to get a clear view of what you need to invest in to increase EX. And it can help you to better meet the needs of employees.