Employee engagement and internal communications have never been more important.
With most companies facing major business disruptions in the current economic environment—including smaller firms that have not focused much on employee engagement and communications before—we recently invited consultant Rebecca Goldsmith of C-Level Stories to speak with Battery portfolio-company marketing leaders about the principles of employee experience that drive business value. Goldsmith is an expert in strategic company and leader communications and has worked previously with Google, LinkedIn, Samsung, Bristol Myers Squibb and many smaller technology companies.
Employee experience is the feeling a team member gets from all the interactions they have with their employer – including before and after their period of employment. It includes everything from the tone a company takes when talking about compensation or benefits to the way a person is treated as they are leaving the company.
The latter situation has certainly been in the news lately: Witness Airbnb announcing earlier this week that it was laying off 25% of its workforce, and once-highflying Uber slashing 14% of employees.
Larger companies, of course, have the resources to create sophisticated employee-experience programs that can help protect the companies’ reputations during downturns—and the budgets to help soften the blow if employees are let go. Airbnb Chief Executive Brian Chesky, for example, outlined his company’s downsizing move in a comprehensive, straightforward and empathetic statement this week. Airbnb offered displaced employees generous severance, paid COBRA health coverage for 12 months and gave them their company-owned laptops on their way out.
But even for smaller companies facing economic uncertainty and reduced corporate budgets, Goldsmith believes employee experience is an investment worth protecting. When done well, it can lead to measurable increases in business performance. One Gallup study, for instance, found that company work units ranking in the top quartile in terms of employee engagement outperformed bottom-quartile units by 10% in terms of customer ratings; 22% in terms of profitability; and 21% in terms of productivity. These top-quartile groups also experienced 25% to 65% less turnover, depending on several factors, and 37% less absenteeism than units in which employees said they were less engaged.
On the other hand, disengaged employees can present risks to a company’s brand value and reputation that can take years to repair, including through the loss of key talent.
What’s more, according to Goldsmith, many of these investments don’t cost a substantial amount of money; instead, they involve creating and maintaining a certain type of culture, with the “cost” borne by top executives who must spend the time relentlessly focusing on things like company values, firm narrative and effective communication with employees.
So, what are some of the specific investments in employee communications, engagement and experience that every company should be thinking about now, even in a time of belt-tightening? Goldsmith walked our group through several key areas during our session on “Employee Experience in a Box.” Here are a few that bear particular emphasis:
Everything starts with your company’s purpose, culture and values. These provide a solid foundation to guide all your decisions affecting your employees, from the moment they express interest in a job to their last day and beyond. Hold your teams and leaders accountable to your principles. Lead with them and make business decisions based on them. Celebrate people who embody them.
Keep a written record of your company narrative. This includes where you’ve come from and where you’re going as a business. It notes how you’re evolving over time and why. This story provides a framework for how you talk to your employees, customers and other stakeholders so the decisions you make are part of a rational continuum, even during times of unexpected turbulence.
Create opportunities for regular conversation with employees. Whether it’s an all hands Q&A or an engagement survey, make sure there are plenty of ways for your team to let you know how they think things are going. This is especially important as you grow from a small startup of 10 people in a room to a growing company of 100 or more. And after you ask for feedback from employees, always reflect that it was heard and whether it was acted upon.
Whether your company has 20 employees or 20,000 around the world, there’s no better time to focus on how you can make their experience at your company as engaging and productive as possible.
The information contained herein is based solely on the opinions of Rebecca Buckman and nothing should be construed as investment advice. This material is provided for informational purposes, and it is not, and may not be relied on in any manner as, legal, tax or investment advice or as an offer to sell or a solicitation of an offer to buy an interest in any fund or investment vehicle managed by Battery Ventures or any other Battery entity.
This information covers investment and market activity, industry or sector trends, or other broad-based economic or market conditions and is for educational purposes. The anecdotal examples throughout are intended for an audience of entrepreneurs in their attempt to build their businesses and not recommendations or endorsements of any particular business.
Content obtained from third-party sources, although believed to be reliable, has not been independently verified as to its accuracy or completeness and cannot be guaranteed. Battery Ventures has no obligation to update, modify or amend the content of this post nor notify its readers in the event that any information, opinion, projection, forecast or estimate included, changes or subsequently becomes inaccurate.