Getting the Human Experience at Work Right
The agrarian economy came first. Then the industrial economy, followed by the service economy. In the present day we live in the experience economy. The experience economy was first described in 1998 by B. Joseph Pine II and James H. Gilmore. They argued that businesses must orchestrate memorable events for their customers and that memory itself - the experience - becomes the product. They claimed that more advanced experience businesses could monetize the "transformation" that an experience offers. Experience, they asserted, is an increase in the value added by the business above and beyond its inputs. Since it was first described, the concept of experience (and the experience economy) has expanded and been applied to other fields.
Today, experiences are the currency of the competition realm for businesses and organizations. According to Forrester, businesses with experience-based differentiation outperform others by nearly 80%. A recent MIT study shows that top performers in employee experience gain a 200% advantage in customer satisfaction and innovation, and a 26% increase in profitability. Persons in all the demographic segments are placing more value on experiences and relationships over things. If the line between customer and employee wasn't previously blurred, it is now nearly indistinguishable.
According to the Center for Generational Kinetics, 74 percent of Americans now prioritize experiences over products or things. Millennials, the largest demographic segment in the workforce, are taking the lead in placing this newfound value on experiences. They are spending more money and time with businesses and joining organizations to contribute to its proverbial purpose based on the quality of experiences provided.
Simply put, people expect superior customer experiences from companies they do business with. They expect the same of organizations they work for and with. And while the COVID-19 pandemic has consequences that may very likely change business and work forever, it has only increased the value of experiences. The events of 2020 remind us of the importance of empathy, of living life to the fullest, and of engaging in ways with organizations (and businesses) that improve our safety and longevity and enrich our happiness in life and work.
Organizations contemplating the future and devising strategies to gain (regain) or retain strength, trust, and competitiveness must remember that people are the heart of every business and that business performance is fueled from the inside out. What makes it possible for people to be at their best and create a meaningful impact nowadays is their experience of working for and with an organization. The quality of their interactions in turn determine how they feel and how they behave. This has always been the case, but it is only relatively recently that we have fully recognized its importance.
Organizations that get the human experience of work right are powered by something more significant than any disruptive force. They have the power of the people who revitalize the organization, completely unburdened and able to innovate, collaborate, and generate sustained performance and value, even in states of near-constant marketplace uncertainty.
How can organizations compete on the basis of experience and take full advantage of this business opportunity?
At first glance, getting the human experience of work right may seem straightforward and simple. We start by understanding the elements of experiences and how people perceive those experiences. We identify gaps between expectation and reality and prioritize the areas of improvement, and then close the gaps one-by-one to improve the experience. But is it really that straightforward and simple?
Understanding people’s experiences
Employee experience is an exchange in value between a person and an organization (which acts as a system). From the individual’s perspective, value is defined as the quality of experience they have with an organization from the first moment of contact through everyday work life to the days you part ways (and beyond) as they pursue their needs. As the party responsible for delivering the experience it’s up to the organization to stage experiences that emotionally resonate with the person and provide them functional and emotional value in a way that is relevant to them. The points of intersection or contact between the person and an organization are referred to as moments of interaction (which are enabled by touchpoints).
Through the end-to-end experience of work, there are a vast number of interactions and touchpoints. In the course of a day, people interact with other people as well as environments, processes (workflows, procedures, rituals, etc.), internal services, and physical and digital artifacts as part of a complex ecosystem of interlocking relationships, all influenced by a businesses’ purpose, culture, leadership, et al. (as depicted below in a simplified representation of the ecosystem).
To understand people’s experiences, we need to understand their interactions across this ecosystem. While listening sessions and tools such as engagement surveys obtain useful feedback from employees on culture, training, alignment to strategy, etc. we need a different kind of feedback data. We need feedback data that gauges the quality of interactions. To fully obtain information on interactions, we must tune to a different frequency - a frequency that sends clear signal about the quality of interactions. This allows us to understand how people perceive their experiences (beyond interactions with HR) and how their needs and goals evolve over time.
Identify the gaps between expectations and reality and prioritize the opportunities
The staging of the experience of work is broad and complex, as it spans multiple realms (social, digital, physical), internal functions (IT, HR, Workspace, etc.) and business structures (geographies and business units). In this, ecosystem leadership teams prioritize the allocation of scarce resources to the most prominent opportunities. Poor choices lead to wasted time and effort and limited impact on people's experience. In turn, this limits impact on business performance. A spiral of diminishing returns may be generated. Perhaps more urgent, it may result in a decline in employee belief in the organization’s commitment and ability to improve their experience. Leadership teams are typically focused on solving organizational needs and tend to reflexively adopt the organization’s perspective when prioritizing experience improvement opportunities. But because the employee is the equivalent of the customer in employee experience, we need to prioritize the most impactful opportunities as viewed from the perspective of employees first. We need to be people-centric and experience-led.
Close the gaps to improve the experience
Improving the experience of work (i.e. the employee experience) involves aligning senior leaders across the organization on the experience agenda and setting immediate and long-term goals and priorities which are derived from the employee’s perspective as discussed above. Cycles of experience innovation using human-centered design approaches follow. Leveraging initial employee feedback, ethnographic research (and other means of gathering qualitative information) is performed to gain crucial context and details. Root causes are identified, and insights about needs, unmet needs, motivations, etc. that inform design are developed as well. Each cycle also involves nested iterative cycles of ideation, prototyping and testing in a co-creative manner with employees and representatives across the business ultimately leading to implementation. Closing the gaps is by far the most intricate and laborious task but provides the greatest benefit. It’s most successful when facilitated by people with the most relevant expertise and experience who can also provide guidance on potential pitfalls.
From this point, the process described above is then repeated with a view to further prioritized improvements.