The Essential Metrics of High-Performance Employee Experience

i4cp’s ongoing research on high-performance employee experience (EX) looks at the practices currently employed in leading companies, with the added perspective of the role that the COVID-19 pandemic has played.

Metrics are a critical element of developing employee experience objectives and strategies for reaching them, but what is essential when it comes to assessing EX? What are the must-have metrics?

The simple answer is that there are certainly the obvious metrics that every organization ought to keep an eye on such as talent attraction, retention, and turnover. But employee experience is nuanced; much depends on the organization, its culture, and the degree to which culture is aligned to the employer brand. One size does not fit all. And just because something can be measured doesn’t necessarily mean it’s always productive to spend time and resources doing so.

Considerations about EX metrics—what is measured and tagged for immediate action or earmarked for further investment, etc.—should begin with a conversation about the what, why, how, who, and when:

• What should we measure and why?
• How should data be gathered?
• Who should the data be shared with and how often?

Determining how the data is gathered is as important. The most effective methods of collecting employee experience data may vary widely from one organization to another. Ideally, a combination of data sources will help drive meaningful results, but it’s important to consider the options thoughtfully and invest time and other resources on the collection approaches that make the most sense for your organization.   

What should organizations measure? Start with talent mobility.

The good news is that analysis of the i4cp survey data found that some of the most common measures of employee experience cited by participants are also highly effective, and in some cases also drive better market performance. Tracking employee promotion/movement through the organization, which topped the list, is closely followed by talent attraction and retention of that talent.

This finding about employee promotion and movement echoes earlier i4cp research on talent mobility, which has compellingly found that organizations that embrace talent mobility as a core part of their business strategies clearly outperform those that do not.  

Building a culture of talent mobility is an unquestionably distinct advantage that differentiates high-performance organizations and contributes substantially to positive employee experience. The benefits range from engagement and retention of top talent to building diversity into leadership pipelines, and broadening and deepening the skills of the company’s overall talent pool to ensure it can meet its human capital needs for the near and long term.

High-performance organizations are also more likely to reward managers for developing their direct reports, to define talent mobility broadly, track their top talent, and make internal talent aware of job openings and rotational opportunities across the enterprise.

One final point about talent movement: we asked survey respondents to rank by perceived importance and impact on employee experience a list of 12 benefits and rewards that are offered to their workers (e.g., compensation, recognition, leadership development, wellness programs, etc.). These elements were rated from 1 to 12 in the context of before and since the COVID-19 pandemic. "Advancement opportunities" was not ranked highly overall--it came in at position 6 prior to the pandemic, and dropped down to position number 9 since the start of the pandemic (read more about this here). 

What's important to note about this is that our analysis found that offering advancement opportunities is the only element that showed any correlation to market performance--the correlation is significant and showed up as a factor in employee experience since the COVID-19 pandemic began. 

Belonging = better business performance   

The power of fostering sense of connection enterprise wide is borne out in the analysis of the data, which found that employees’ sense of belonging—feeling seen, heard, valued—is among the most common and effective metrics in assessing employee experience.

High-performance organizations are 1.5X more likely to measure this than lower performers. And not only is a sense of belonging essential to effectively delivering on employee experience, it is highly correlated to market performance—belonging is good for business.

Belonging doesn’t happen by osmosis. Getting to the feeling that one truly belongs as part of a team and an organization depends largely on the development of genuine connections with colleagues. Ensuring that the environment is purposefully structured to help make that happen and the organization’s culture sustains it—whether its virtual, in-person, or a blend of both—is critical

This process should start even before a job offer is extended and accepted. High-performance organizations know that an on-point candidate experience begets positive employee experience. They take steps to ensure that the talent they bring into their organizations receives the clear message that they are important and matter to their new colleagues even before their first day on the job.

i4cp’s research on quality onboarding demonstrates that the early experiences of new hires and their ability to establish relevant network connections is vital to performance (e.g., time to contribution, retention, and promotability).

And our research on collaboration has found that leaders in high-performance companies are 8X more likely to help their team members build strong networks.

Those networks play a vital role in strengthening employees’ connectedness to one another and to the organization and its mission—incentivizing and rewarding leaders for actively supporting this is a definite next practice that has a direct hand in influencing employee experience. 

Additional metrics closely rounding out the top ten of those that are most commonly used to assess employee experience are diversity of hires (48%), employees’ ratings of their opportunities to do meaningful work (47%), employee referrals of qualified candidates and regrettable voluntary attrition (both 45%), offer acceptance rates and diversity of leaders at all levels of the organization (both 40%) and employees’ ratings of their managers (38%).

Worthy of note: while fewer organizations (29%) track participation in employee groups such as ERGs or BRGs as an indicator of employee experience, this is a measure that is very highly correlated to market performance. 

Moreover, high-performance organizations are 2.5X more likely to use this metric to gauge EX. Tracking diversity of leadership at all levels of the organization as a measure of employee experience is currently being used at 40% of organizations—this metric is also very highly correlated to market performance.

Interestingly, employees’ ratings of the physical space/work environment as a contributor to employee experience was cited by just 23% of survey participants. This may be a reflection of the shifting priorities wrought by the COVID-19 pandemic and the mass migration of workers from offices to remote work. But clearly, culture and more subtle elements such as belonging, inclusion, and meaningful work are coming into much sharper focus as strategic priorities than ever before.

What do organizations that rate highly with their workforces measure?

The metrics that i4cp cites as most effective are those that are currently used by organizations that received high ratings from their people about their overall impressions of their employee experience.

Our analysis found that high-performance companies are 3X more likely to be rated by their employees as “excellent” at delivering on employee experience. Again, the graphic below shows that making talent mobility a priority and measuring progress against it tops the list of the most popular measures to assess EX—and it’s the most effective.

In the follow-up interviews we conducted, we found that some organizations are assessing EX by using a set of employee engagement metrics created by vendors, such as the Qualtrics measure of five factors: intent to stay, engagement with the work, discretionary effort, pride in the organization, and willingness to recommend the company to family/friends. Each of these elements provides a score which when combined provides an overall metric of employee engagement.

Other organizations are creating their own tailored approaches to assessing employee experience rather than working within a framework of fixed engagement metrics (e.g., one organization we spoke with is focused on measuring leadership trust as an indicator of employee experience, and taking action to move that particular needle).

Identifying and tracking trends

At Nestle’ USA, the focus is on constantly scrutinizing data to identify trends rather than sticking to a rigid set of employee experience metrics.

“We share insights with the executive leadership team rather than metrics,” says Laurel Catlett-King, VP of Integrated Talent Management.

The analytics team is tasked with providing leaders with insights into people—this involves constant scanning of data tied to top HR priorities around things like movement, the types of people who may leave the organization and why, from what roles or functions, etc.

“We ask them to continuously scan the data and pull out the three or four things that we need to put on everyone’s radar. And then we look at what we already have in place or in the pipeline to solve for that—or we may need to shift a priority,” says Catlett-King.

Those insights are published internally via what is called “The Thread,” which is available to the top 160 leaders. The Thread is also accessible by all HRBPs, who can pull their own baseline data whenever they need it. This self-service functionality allows the people analytics team to focus on the continuous data scanning, identification of trends, and leveraging predictive data to assist with initiatives such as workforce planning.

“We call it ‘pulling the thread’ -- sharing those insights with our executive leadership team and HR business partners, so that they can share that information with their business leaders. That’s where we’re spending our time rather than on producing a complex dashboard that looks cool and has a bunch of bells and whistles, but no one is going to look at it. Continuous scanning allows us to identify and quickly address issues and then move on to the next thing,” says Catlett-King.

The best (most effective) channels for collecting EX data

Old reliable (the annual all-employee survey) still dominates the list of methods organizations use to gather insights into employee experience. But i4cp’s research on corporate culture has found that over-reliance on the annual employee survey, especially as a single source of insight into employee opinion, is tantamount to navigating the road ahead by focusing solely on the rearview mirror:

“While the year-over-year benchmarking data can provide longitudinal clues to the health of the culture, if the organization is relying solely on the engagement survey—which many are today—as a measure of culture health, it’s likely a false proxy. Organizations need to use this as just one data source and combine it with the other sources of sentiment,” says i4cp’s CEO, Kevin Oakes, in his soon-to-be published book, Culture Renovation: 18 Leadership Actions to Build an Unshakeable Company

The ways to listen to people about their experiences should be as varied and diverse as the people who make up the workforce. What is your company’s style? What’s most authentic to your organization and its culture when it comes to communication? Are town halls better for gathering employee sentiment? What channels should be tuned into that are currently overlooked? If your company is intractably wedded to the annual employee survey, what other approaches of gathering employee sentiment can be added to complement that?

In addition to the data gathering listed in this graphic below, consider conducting a culture audit, which only 16% of survey participants reported is currently in use at their organizations, but this method is highly correlated to market performance, making it a next practice.

The same is true of monitoring your organization’s internal social channels—doing so is correlated to market performance, which is no surprise because it’s a great indicator of connectedness and internal network strength, but only 14% of survey participants reported that their companies are doing this.

How often should EX data be shared and with whom?

Overall, most organizations are sharing the employee experience data they are gathering too narrowly and too infrequently to be effective at driving improvement. 

Our analysis found that employee experience data sharing is much more effective when it is done on a predictable schedule and with the people who are best positioned to have direct impact: frontline supervisors and first-line managers. Sharing EX data frequently with both roles is highly correlated to market performance, and the ideal cadence is monthly or quarterly.

Reporting employee experience data to the senior leadership team and board of directors is also important, because it’s a window into the overall health of the culture and the strength of the brand—both carry a lot of weight in terms of the future of the organization and its ability to innovate and be agile in both good and challenging times. This relies on the current and future state of your workforce and the degree to which employees believe they play important parts in the success of both.