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10 Reasons Why Employee Experience Is Important

Why is employee experience important? Do you know? No worries if you don’t. We’ve got you covered. But be aware it’s vitally important. Read on…
Written by: Penny Swift
why is employee experience important
Published: February 6, 2024
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The employee experience (EX) that those working within an organization have is a potentially critical determinant of its success. EX is a multifaceted concept that encompasses all interactions an employee has with their employer, from recruitment to exit. Given the profound impact of the employee experience on a company’s bottom line, there is no doubt that improving it can become a strategic advantage.

We are going to explore the reasons why the employee experience is so vitally important. We will also offer practical advice on how to deliver an exceptional EX in your organization.

First, we’re going to share some insights.

Employee Experience Impacts Profit

Gallagher’s State of the Sector 2022/23 report on internal communication and employee experience reveals that 74% of their survey respondents believe the purpose of internal communication is to support company culture and create a sense of belonging. This is, of course, a vital EX touchpoint. The working environment, career and personal support, rewards, recognition, and benefits, and physical, emotional, and financial wellbeing are others. 

purpose of internal communication

The report also stresses the value of collecting data to prove return on investment (ROI) to leaders — to encourage them to invest in their employees.  

Nick Jones, Gallagher’s head of Creative Communication Consulting practice, asks whether we are “failing to deliver the sense of purpose and meaning that people desperately want at work?” His answer is yes. 

“Prioritizing ‘purpose’ as highly as ‘profit’ will not only improve the world around you; it will make you a destination for a generation of talent that values authenticity over everything.” Nick Jones

In other words, profits are vitally important, but so is providing employees with a sense of purpose. 

In an article in Harvard Business Review, Research: How Employee Experience Impacts Your Bottom Line, the authors show how EX drives revenue and profit. They state that their analysis of operating profits showed that a shift in employee experience could result in a 45% increase in profits per person per hour — from $41 to $59. This represents an increase in revenue of more than 50% and profits by nearly as much. They also show that it’s possible to increase return on investment (ROI) by as much as 150%. 

But, what exactly is employee experience? 

What is Employee Experience?

In essence, the term “employee experience” refers to the series of interactions and experiences that an employee has with their employer from the point of initial contact, through the onboarding experience, to the eventual off-boarding process or retirement. It encapsulates every touchpoint along the employee journey — recruitment, orientation, job satisfaction, employee benefits, work environment, and even departure.

The concept evolved over time in response to the ever-changing nature of work and the gradual transition to a more employee-centric workplace. While the precise origin of the term employee experience is challenging to pinpoint, it gained prominence in the early 21st century. This coincided with the growing strategy to enhance employee well-being, engagement, and employee satisfaction became increasingly crucial for organizational success.

It’s similar in spirit to the customer experience — a holistic perspective that encompasses not just traditional HR considerations, but every interaction an employee has within an organization from digital tools to business processes. And, like the customer experience, it’s universal.

Futurist and best-selling author, Jacob Morgan, explains that “Employee experience is creating an organization where employees WANT, not NEED to show up to work.” He simplifies employee experience by identifying The Employee Experience Equation, which is culture x technology x physical space.  

employee experience equation

Ultimately, the goal is to craft an exceptional employee experience, however, the organization does it. For example, a company with good employee experience has inclusive leaders who develop a work culture that fosters collaboration and respect. They might have state-of-the-art technology, relaxed dress codes, hybrid work or remote work options, or flexible hours and they prioritize employee well-being, workforce development, and growth opportunities. They may also have invested in a modern intranet to streamline internal communication.

Why is Employee Experience Important?

Understanding why employee experience is important is crucial for businesses that are aiming for success. In the contemporary workplace, providing an exceptional employee experience is no longer an option. It’s a vital need.

A 2023 case study of 534 South Korean employees illustrates its universality. It shows that a positive employee experience fosters job satisfaction, and contributes to individual psychological well-being within the organization. This, in turn, enhances concentration and job satisfaction. 

An interesting finding they made is that the effect of EX on “organizational commitment” varies and is dependent on each employee’s level of “mental toughness.” This is a personality trait that describes a person’s capacity to cope with work-related stress, pressure, challenges, and opportunities. What this means is that improving mental toughness can improve organizational commitment and employee satisfaction.  

So, why is employee experience important? Here are 10 reasons. 

#1 Stimulates Employee Engagement

A good employee experience plays a vital role in stimulating employee engagement. Employees who are more engaged in their work show higher satisfaction levels, perform better, and demonstrate greater loyalty towards their organization. Effective onboarding experiences, clear communication channels, and inclusive leaders are key elements in maintaining high levels of engagement within the workforce.

#2 Improves Retention and Reduces Turnover

Employee experience is also closely related to retention and turnover rates. A positive work environment encourages employees to stay longer with the company, reducing the costly process associated with hiring and training new staff. Companies that value employee experience and create a fulfilling employee journey have been shown to have significantly lower turnover rates.

#3 Attracts Top Talent

Top talent is naturally attracted to organizations that prioritize employee satisfaction. By focusing on creating a great employee experience, companies not only retain their current top performers but also send a strong message about their culture and values to potential candidates. In today’s competitive labor market, providing an outstanding employee experience is key to attracting and hiring the best in the industry.

#4 Enhances Customer Experience

An exceptional employee experience translates into improved customer service. Engaged employees are more likely to go the extra mile to ensure customer satisfaction, resulting in an enhanced customer experience. Moreover, when employees feel valued and motivated, they become ambassadors of your brand, creating a stronger customer connection and helping to build brand awareness.

#5 Encourages Innovation and Creativity

Companies that offer an enriching employee experience create a conducive environment for innovation and creativity. By allowing employees to freely express their ideas and giving them the right digital tools, businesses keep pace with rapidly changing trends and technologies, drive performance, and remain competitive in their niche.

#6 Drives Higher Productivity

When employees feel happy and content at work, they are more productive and contribute more towards the company’s goals. Ensuring a conducive workplace for employees, whether they are in-house, remote, or hybrid workers, can significantly increase productivity levels.

#7 Develops Brand Reputation and Employer Branding

A positive employee experience makes a company more attractive to not only potential employees but also customers. The experience employees have working for a company plays a significant role in shaping the employer’s brand in the market. This, in turn, helps to build a strong reputation, attracting more business opportunities and high-performing candidates.

#8 Reduces Absenteeism and Presenteeism

Positive and supportive workplace environments reduce the rates of absenteeism and presenteeism when employees are present at work but fully productive. Employees who feel positive about their work are less likely to take sick leaves or show up to work while sick. By focusing on creating a good employee experience strategy, businesses can ensure their employees are present and healthy, both physically and mentally.

As confirmed in the PricewaterhouseCoopers (PWC) report, The benefits of investing in People, a positive employee experience increases the productivity of organizations and reduces absenteeism and turnover. 

#9 Improves Employee Well-Being and Health

Workplace practices and culture significantly impact employee health and well-being. A positive workplace environment contributes to lower stress levels, improved mental health, and overall well-being. The inclusion of well-being programs as part of the employee experience also signals to the workforce that the company genuinely cares about the physical and emotional health of those who work for them. 

#10 Increases Organizational Agility and Adaptability

A superior employee experience feeds into organizational agility and adaptability. Employees who are engaged and satisfied with their work are more likely to demonstrate flexibility and adapt to changing business processes and conditions. This adaptability is paramount in the contemporary business world that is characterized by constant changes and disruptions.

why employee experience is important

How to Deliver an Outstanding Employee Experience

Creating an exceptional employee experience demands more than implementing a random assortment of perks and benefits. It entails encouraging employee engagement and creating an environment in which they feel valued, supported, and motivated. Here’s how you can accomplish that.

Prioritize Employee Well-being

Prioritizing the well-being of your employees is a key to delivering a positive employee experience. This includes physical, mental, and emotional health. Promoting healthy lifestyle choices, providing comprehensive healthcare benefits, offering mental health resources, and fostering a work-life balance all matter.

Research published in Personnel Psychology in January 2023 shows that organizations that prioritize employee well-being can drive performance. At the same time, they can effectively counteract the negative impacts of work-related stress. 

An effective well-being program can range from activities for physical wellness like gym memberships to mental health supports such as counseling or therapy sessions. Moreover, organizations should consider special arrangements for remote work or hybrid workers. The employee experience should be conducive to their needs, with adequate tools and technology to make remote work more efficient.

The promotion and endorsement of an employee well-being program should come from inclusive leaders because their influence can dramatically affect behavior change.

Foster a Positive Work Culture

Creating a positive work culture is another crucial aspect of delivering a good employee experience. A toxic, hostile, or indifferent work environment can drive away even the most talented and dedicated employees.

To foster a positive work culture, consider the following ideas:

  • Conduct regular workshops on empathy, respect, teamwork, and conflict resolution. These can help employees interact better with each other and resolve their differences more maturely.
  • Promote diversity and inclusion. People from different backgrounds bring novel ideas and perspectives that can significantly benefit your company’s creativity and innovation.
  • Welcome feedback and criticism. Employees should feel free to express their thoughts and suggestions without fear of backlash.

An organization that upholds these values can provide a better emotional environment for its employees. This will positively influence their overall employee experience.

Provide Growth Opportunities

The chance for career growth affects an employee’s motivation and satisfaction at work. Providing challenging tasks, skills development opportunities, and clear pathways for promotion are integral to maintaining an engaged and ambitious workforce. The lack of these can result in employees feeling stuck or undervalued in their roles.

These initiatives can include mentoring programs, regular training sessions, workshops, conferences, and educational incentives. Moreover, business leaders should encourage employees to take on new responsibilities and provide supportive resources to help them succeed. This not only enhances the individual’s career growth but also contributes positively to the employee experience and to a company’s success as a whole.

Remember, every employee’s journey is unique. Current employees, new hires, and even those in the onboarding experience can benefit from growth opportunities. It’s the responsibility of any HR leader to ensure these opportunities are accessible and beneficial to all employees.

Recognize and Reward Achievement

Recognizing and rewarding achievement is an essential part of providing a great employee experience. It shows appreciation for the employee’s effort, thereby reinforcing it, inspiring others, and contributing to overall job satisfaction.

Recognition can be as simple as verbal praise during a team meeting or a written acknowledgment in a company newsletter. Rewards, on the other hand, can range from financial bonuses to promotions or professional growth opportunities.

However, it’s crucial to appreciate that what constitutes meaningful recognition or reward varies among individuals. Some employees may enjoy public recognition, while others prefer private appreciation. It’s therefore essential to customize recognition based on employee preference to ensure it’s meaningful and effective.

Empower Employees

Empowering employees means giving them the resources, autonomy, and encouragement they need to make informed decisions at work. When employees feel empowered, they are more likely to be proactively involved in their work and feel a sense of ownership over their responsibilities.

Empowering employees often involves entrusting them with more responsibilities. You can do this by giving them the autonomy to take initiatives, supporting their ideas, and providing them with suitable tools to manage tasks effectively. This can significantly impact employee engagement levels and contribute to a better employee experience.

Encourage Open Communication

Open communication fosters trust and transparency in a workforce. It ensures that employees don’t feel left in the dark about important matters that impact their work, thus reducing unnecessary stress and anxiety.

To encourage open communication, internal business processes can be made more transparent. For instance, leadership can share updates about significant organizational changes, financial performance, or strategic plans with all key stakeholders.

It’s also essential to give employees various channels to express their ideas, concerns, and suggestions. Whether it’s via team meetings, suggestion boxes, or digital tools like email blasts or modern intranet systems, ensuring that employee voices are heard significantly enhances the employee experience.

Having effectively explored how to deliver an outstanding employee experience, it’s worthwhile to note that any approach should be tailored to meet the unique needs and demands of your workforce. Nonetheless, prioritizing employee well-being, fostering a positive work environment, providing growth opportunities, recognizing achievement, empowering employees, and encouraging open communication provide a robust framework to guide your efforts.

deliver an outstanding employee experience

How Can Cerkl Help You Improve Employee Experience?

Cerkl Broadcast offers an exceptional experience platform that is designed to increase employee engagement and improve employee experience. Features that are particularly useful for improving EX include personalized communication tailored to meet individual employee needs and the ability to schedule communication so that it is received at the best time possible. Broadcast also facilitates employee engagement through various feedback mechanisms including surveys and offers ways that leadership can recognize employee achievements publicly and privately. 

Broadcast’s feedback and analytics tools allow organizations to measure the effectiveness of internal comms strategies, including EX. This enhances the planning process with data-driven insights that you can use to effectively adapt and improve strategies when necessary. 

Ultimately, Broadcast will help you to increase productivity levels and improve your bottom line.  

What’s Next?

An excellent way to assess how effective your current internal comms plan is for improving the employee experience is to undertake an audit. We offer a quick, easy, strategic internal communications audit that is absolutely free. Then, if you need help improving your communications strategy you can schedule a chat. 


Why is good employee experience important?

Good employee experience is crucial as it enhances job satisfaction, fosters employee engagement, and contributes to overall organizational success by attracting and retaining top talent.

What is the impact of employee experience?

The impact of positive employee experience includes increased productivity, higher levels of innovation and creativity, lower turnover rates, and improved organizational resilience in the face of change.

What is workplace experience and why is it important?

Workplace experience encompasses the overall environment, culture, and physical space where employees work. It is important because a positive workplace experience contributes to employee well-being, employee satisfaction, and collaboration, ultimately influencing organizational performance and reputation.

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