Employee Performance Management: Trends
Some of the key trends driving the US employee experience/performance management industry include employing people analytics/using artificial intelligence to enhance employee experience, finding leverage and developing trust, and adaptation of customer experience successes to influence employee experience strategies.
Employee Performance Management
- The increasing transparency catalyzed by the digitalization age plus influence from millennials has resulted in employees expecting engaging and enjoyable work experience.
- Therefore, seeing how important it has become to improve the experience of employees, businesses are now focusing on ways to prioritize and better the employee experience.
- Companies are no longer only focused on creating better customer experiences but also better employee experiences.
- Organizations are shifting from corporate-centric practices to a more humanistic approach in order to focus on employee performance management to stimulate growth and satisfaction.
- Focusing on employee experience integrates three core dimensions — engagement, culture, and performance management.
1. People Analytics/Artificial Intelligence
- 84% of leaders surveyed in the 2018 Deloitte Global Human Capital Trends report said analytics was one of the most important trends.
- Other than reducing work pressure, AI will also help in intercepting and anticipating employee needs since it offers three key benefits — personalization, insights, and automation.
- Personalization reinforces engagement and helps create a strong company culture.
- Insights, on the other hand, can help individuals to gauge employee sentiment and make better decisions about how to keep their workforce engaged.
- And automation relieves the burden of mundane, repetitive tasks on employees and frees them up to work on more complex, intellectual tasks.
- To prove how this trend is driving the market, 70% of respondents of the 2018 Deloitte Global Human Capital Trends report said that they are currently in the middle of major people analytics projects that will be fueled by AI and robotics.
- United Parcel Service (UPS) and Bank of America are some of the companies that have successfully implemented people analytics.
- UPS trucks are fitted with more than 200 sensors that gather data on everything from whether the driver is wearing a seat belt to how many times the driver has to reverse or make a U-turn.
- As a result of the monitoring, the company provides feedback and training where needed something that has led to a reduction of 8.5 million gallons of fuel and 85 million miles per year.
- Moreover, UPS drivers now make an average of 120 stops a day compared to the previous less than 100 stops and as a result, the same drivers with the same trucks are now able to deliver more packages than before.
- On the other hand, Bank of America discovered that its more productive workers were those allowed to take their breaks together, in which they let off steam and shared tips about dealing with frustrated customers.
- The bank then decided to implement collective breaks, after which performance improved 23% and the amount of stress in workers’ voices fell 19%.
2. Leverage and Trust
- Research by Bain and Company reveals how companies construct their teams is very critical to their productivity.
- By extending trust to employees, it leads to improved productivity and supported employee growth and development.
- Although the trust concept has been in the scene for quite some time now, many companies still fail to employ it. They continue to insist on their processes and rules. This is harmful because organizational rules and processes often prevent people from getting things done or improving in their role.
- That is why few companies such as Netflix avoid a common process issue and expense management by trusting its employees to act responsibly.
- An article by Forbes says that in 2019, trust will be the most crucial aspect in many businesses because leaders who are able to build trust will stand to benefit the most.
- How companies like Apple and Google dedicate 95% of their top talent to key business functions, as opposed to spreading top talent across many areas proves how this trend of trusting employees is driving the market.
- Apple, Google, and Netflix are 40% more productive than other companies by using a mix of employee performance management strategies that focus on organizational structure and trust-building.
- Moreover, after finding leverage and trusting employees, it took 600 Apple engineers and fewer than two years to develop, debug, and deploy iOS 10 in contrast to 10,000 Microsoft engineers who took more than five years to develop, debut, and ultimately retract Vista.
3. Customer Experience Successes
- After years of focusing on customer experience (CX), organizations have now realized that employee experience (EX) is also equally important.
- Companies that lead in customer experience have 60% more engaged employees.
- For some time now, companies have been focused on improving employee engagement, that is creating the right conditions for all members of an organization to give of their best each day and stay committed to their organization's goals and values coupled with a sense of their[employees] own well-being.
- However, 83% of HR leaders agree that the employee experience is crucial for the success of their organizations and as a result, companies have been forced to rethink their strategies.
- They have moved from the usual trying to engage employees and creating human-centric workplaces to include employee experience in their focus.
- Companies now use sophisticated analytics that not only helps them improve employee experience but also correlate their investments in EX back to bottom-line results like reduction in turnover, profit/revenue growth, and customer service/satisfaction scores.
- Studies have shown that investing in EX not only impacts the customer experience but can also generate a high ROI for a company.
- Employee experience is more than simply the job or task an employee does. It is emotional and contains both high-impact moments and delicate, nuanced moments that build over time.
- Therefore, to increase meaningfulness and the positive impact of employee experiences, organizations have now turned to the CX tactics that they have learned over the years to help them develop more thoughtful approaches.
- Airbnb and Taco Bell are some of the companies that have adapted CX successes to influence EX strategies.
- Taco Bell puts employees first by always providing them a way to contact management. It has a network of 1-800 numbers to field complaints, answer questions, and also alert management of potential red flags for its 175,000 plus employees and the metric of success is proved by how Taco Bell has grown to be a fast-food giant.
- “Belong Anywhere” is Airbnb's mission statement and it extends beyond customers to also include employees. The company has worked/works to create a culture that sets employees up for success in their personal and professional lives, from having a flexible, open office space to being transparent with the goals of the company.
- The company's $2.6 billion revenue in 2017, popularity, and success in general heavily relies on employee experience.