During the research process for my book, Exceptional Talent, it became clear that the importance of the concept of Employee Experience was growing rapidly.
To talk us through the reasons behind this and to break down the key elements of the employee experience, I’m delighted to welcome eminent futurist and best selling author Jacob Morgan to the show.
Jacob has recently written a new book called “The Employee Experience Advantage” which is based on detailed research into over 250 global employers.
In the interview we discuss:
• The three systems that make up The Employee Experience
• Corporate culture as the “side effects” of working for a particular organization
• The four attributes of physical space
• Tools to get the job done
• The ROI of having a great Employee Experience
• The future of HR
Jacob also give us some examples of employers who are doing great work shaping their Employee Experience and the trends we can expect to see in the coming few years
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Transcript:
Matt Alder [00:00:00]:
Support for this podcast comes from Format. Format are the market leaders in providing award winning career sites to employers such as npower, View, Atkins and Muller. The secret to the great results Format delivers for its clients is complete focus on the candidate experience, including long term passive candidate engagement, while at the same time ensuring rock solid and completely seamless integration with the ags. To download Format’s free ebook on planning and implementing a new careers website, go to www.bit.lycareers website or to find out more about their services, go to www.format.com and format is spelt with the number 4, then M A T.
Matt Alder [00:01:10]:
Hi everyone, this is Matt Alder. Welcome to episode 92 of the Recruiting Future podcast. During the research phase for my new book, Exceptional Talent, it became clear that the importance of the employee experience is growing massively. To talk us through the reasons behind this and to break down the key elements of the employee experience, I’m delighted to welcome eminent futurist and best selling author Jacob Morgan to the show. Jacob has recently written a new book called the Employee Experience Advantage, which is based on detailed research into 250 companies. I’m sure you’ll enjoy listening to his insights.
Matt Alder [00:01:53]:
Hi Jacob, and welcome to the podcast.
Jacob Morgan [00:01:56]:
Thank you for having me.
Matt Alder [00:01:57]:
My absolute pleasure. Could you just quickly introduce yourself and tell everyone what it is you do?
Jacob Morgan [00:02:04]:
Sure. So my name is Jacob Morgan. As you already mentioned, I’m an author, speaker and futurist. And basically my goal is to help organizations understand how the world is changing and what they need to do to prepare for the changes that we’re starting to see. And so my role is broken down into a couple different areas. I do around 40 talks a year. I write books on the subject, do some advisory work, some work with various vendors around webinars, white papers, stuff like that. And then I also have my own podcast and I create a bunch of articles and videos and basically as much free content as I can to help people understand how the world of work is changing.
Matt Alder [00:02:49]:
And could you sort of tell us a little bit about how you get your insights and do your research?
Jacob Morgan [00:02:54]:
Well, mix of things. To be honest, the podcast has been a huge help for me over the past. I think my podcast came out three years ago, the first one. Since then I’ve interviewed probably 160 senior level executives at global organizations. Everyone from the Chairman of the Board at Yahoo to the Chief Technology Officer at Xerox to the Chief HR Officer at Cisco. Having these one on one conversations has been really a wonderful thing for me. I originally started the podcast just because I thought, I don’t know, it would be fun, but it’s actually been a wonderful learning tool for me, so the podcast has been great. For my recent book on employee experience, I also hired five researchers and two data scientists and we actually analyzed 252 companies from around the world. So there is some actual quantitative data that I’ve been doing. And then just from a lot of the talks that I give and the organizations that I advise, I learn a lot. And so I’m always amazed by the things that I learned from the various projects that I’m involved in. So all those have been wonderful sources of learning and information for me.
Matt Alder [00:04:05]:
Now, I want to get to talking about your book shortly, but sort of more generally speaking, from, you know, the research that you do and all the people that you’ve, that you’ve spoken to, what are the sort of key trends that you’re seeing people talking about when it, when it comes to the future of work?
Jacob Morgan [00:04:25]:
Oh, there’s so many of them. You know, it really depends on the audience. The future of work is a very big, broad and nebulous concept that can pretty much mean everything. But you know, some of the main things that we of course hear in media outlets and publications today are around robots and automation and so what impact that is going to have on jobs. We of course hear about universal basic income, we hear about the gig and the sharing economy. We hear about how organizations are redesigning their physical spaces. We hear about the new generation of worker millennials, Gen Z and this multi generation workforce. And we also hear about things just in general around technology, the potential that virtual and augmented reality might have, wearable devices, the Internet of things, all that wonderful stuff. We hear about soft skills and new management and types of leadership that organizations need to focus on. And basically all of the conversations stem from the fact that we need to rethink everything we know about work and rebuild everything we know about work for the modern age. So that’s a lot of stuff. As you can imagine.
Matt Alder [00:05:39]:
That is a lot of stuff. And much as I’d like to discuss all of it, I think we’re going to probably have to, we’re going to have to sort of pick a topic for the rest of the conversation. So probably the best topic to pick is the theme of your book. So can you tell us the title of the book and why you chose this particular topic to take this Kind of deep dive into.
Jacob Morgan [00:06:03]:
Sure. So the title and the subtitle is actually rather long, so just be prepared. The full book title and subtitle is the Employee Experience. How to Win the War for Talent by Giving Employees the Workspaces they Want, the Tools they need, and a Culture they Can Celebrate. So very short title there. Indeed. And the reason why I wrote this book is because I noticed that many organizations around the world, they’re constantly trying to invest in things like employee engagement initiatives. And we always hear how poorly these efforts are going. And so we’ve never seen more investment in things like employee engagement. Yet for some reason, the scores remain abysmally low. And so I became very fascinated with how does that make any sense? How are we dumping tons of money into trying to create a great organization and not getting any results on the other end? And that’s ultimately what led me to write the book and to explore why we have this problem and what we need to do to solve this problem. And what I realized is that for many organizations around the world, this concept of employee engagement is really about forcing employees to work in outdated workplace practices, but giving them perks while they do so. And so you do this as a way to kind of distract employees from the reality of their job and their work environment. But I’ve also noticed that we’re starting to see a new type of organization emerge, which in my book, I call the experiential organization. And these are organizations that actually change the core workplace practices that employees work in. So they change the system. They don’t just focus on perks and fun stuff of that nature. They focus on genuinely changing the systems in which employees work. The three systems that an organization can change are the corporate culture, the physical space, and the tools that employees are using to get their jobs done. And so that’s ultimately what I explore in the book. What those three things are, how organizations are designing for them, what the ROI is, and all sorts of fun stuff around that.
Matt Alder [00:08:11]:
I mean, that sounds absolutely fascinating, and it’s obviously a very timely. It’s a very timely book to come out. Maybe we can sort of dig into those three themes a bit, a bit more. So I think the first one was culture. Talk to us a little bit more about that.
Jacob Morgan [00:08:30]:
For me, the simplest way to explain culture is the side effects of working for your company. And I always tell the joke where when I was writing my book, there was a show that came on tv, and in the middle of the show, there was a commercial for a prescription drug. And the side Effects for this prescription drug were just horrendous. Skin discoloration, weight loss, hair loss, bleeding from the eyes, nausea, just these terrible things. I draw the analogy between the side effects of taking a prescription drug versus the side effects of working for your company, because oftentimes those side effects are the same. In other words, you work for a company and you feel stressed out, you gain weight, you lose hair, you know, bleeding from the eyes, maybe in some cases. And so for me, the corporate culture is all about the side effects of working for your company. And the side effects don’t have to be bad. The side effects can be good. So it’s all about, what are the side effects? If people work here for a period of time, what are those side effects going to look like? And so I encourage organizations to try to understand and define what that means for me. For what I discovered is the corporate culture comprises around 40%. Well, not around 40%, but 40% of an employee’s overall employee experience. And there were 10 factors that comprise corporate culture. I won’t go through all 10, but these are things like positive brand perception, investing in diversity and inclusion, having managers that act as coaches and mentors, feeling like you are treated fairly at work. All of these things contribute to the corporate culture.
Matt Alder [00:10:04]:
I mean, that’s really interesting. I don’t think I’ve ever heard culture described as the side effects of working somewhere before. But you know, that, that makes, that. That makes perfect sense. I think that’s a. That’s a fantastic way of, of expressing it. So what about physical space? What do you tell us what you mean by that and what, you know, what. What could be changed?
Jacob Morgan [00:10:27]:
So the physical space comprises 30% of an employee’s overall experience. And there were four attributes that I looked at for physical space. These were things like workplace flexibility, organizations that are creating multiple floor plans for their employees, not just, you know, open or closed. And what I found for physical space, there’s been a lot of interesting research that’s been done that shows that the physical space acts as kind of a symbol of your company, represents your brand, what your organization stands for. So the physical space is not just a building. It’s a symbol. It’s a representation of your company. And it’s also something that helps employees feel connected to the mission and the purpose of the organization. So for me, the physical space is exactly what it sounds like. Everything from the art that hangs on the walls to the cubicles, to the open floor plans, to the dogs that you might have running around in the office, the free Food that you might give to your employees. All of these things represent the physical environment and the physical space of the organization. And there’s no surprise, there’s no secret why this is important. I mean, we all want to work in environments that look good, that feel like they engage and empower and inspire us. So the physical environment is definitely something that organizations are, I think, starting to pay more attention to, which is a good thing.
Matt Alder [00:11:45]:
And the third one you mentioned was tools. Presumably the sort of tools that people are using to do their jobs. Tell us a bit more about that.
Jacob Morgan [00:11:53]:
Yes. So the third environment is the technological environment. This refers to anything that employees use to get their jobs done. Devices, hardware, software, apps, all that sort of stuff is part of the technological environment. This too comprises 30% of an employee’s overall experience. And some of the things that employees care about most here are having technologies that are focused more on their needs instead of just on the requirements to the business. That seems to be one of the top things that employees care about. And technology is important because we always assume that technology sits in its own little bucket underneath it. But what we’re starting to see now is that when technology breaks down inside of an organization, so do all of the human aspects around technology. So trust, communication, collaboration, engagement. When employees don’t have the right tools and resources to do their jobs, all of these human aspects around technology also start to break down. And so the main lesson from this is technology isn’t just a technology thing, it’s not just an IT thing, it’s a people thing, it’s a human thing. And when the tools break down, so do all of the human aspects around those tools.
Matt Alder [00:13:05]:
So you said you looked at a number of companies and organizations in your research for the book, who’s Doing this? Well, what’s some of the great stuff you saw happening in practice?
Jacob Morgan [00:13:16]:
So out of the 252 companies that I analyzed, only 6%, that’s 15 companies are doing a really amazing job when it comes to investing in employee experience. And some of these organizations are the likes of Adobe, Cisco, LinkedIn, Microsoft, Accenture and others. And these are companies that have truly rebuilt their core workplace practices around their employees for kind of the year that we live in. In other words, they don’t just focus on perks, they don’t just focus on engagement or tactics. They genuinely break down their people practices and rebuild them. So what is the purpose of hr? What is the purpose of the people related function? They’re constantly challenging conventional wisdom around everything from annual engagement or performance reviews to hierarchy, to all of these kind of traditional components and factors that we have in our companies. They’re just always questioning them and trying to rebuild them and redesign them. These are some of the organizations that are doing a really tremendous job.
Matt Alder [00:14:18]:
And in terms of it being an advantage for them, did you see that they were, you know, there were sort of, you know, the metrics or ROI attached to this that made them stand out from. From their competitors or from the other companies that you looked at?
Jacob Morgan [00:14:32]:
Yes, there was quite a significant ROI in terms of revenue. So I looked at a lot of different business metrics. I looked at stock price, performance, revenue, productivity. I looked at profit. I looked at tenure. I looked at company size. And consistently across the board, the organizations that do an amazing job of investing in employee experience have higher stock price performance, higher average revenue per employee, profit per employee. They’re usually smaller, 24% smaller. Their turnover is 40% less. So there is a very significant tangible ROI as to why organizations should be investing in these three environments of culture, technology, and physical space.
Matt Alder [00:15:14]:
If the ROI is that clear, why do you think so few companies are getting it right? Are there any sort of common barriers to moving forward in this area?
Jacob Morgan [00:15:30]:
Well, it’s the same thing that we see in our personal lives, right? I mean, we all know that we should exercise. We all know that we should eat healthy, yet so many people don’t do it. And so ultimately, the question becomes, well, if you know something is good for you, why don’t you do it? And I think the same analogy is inside of our organizations. And the reasons why companies don’t do it can range. Oftentimes they’ll say they don’t have priorities. They have other things that they’re worrying about. They’re focused more on the near term instead of on the longer term. They don’t know what to do. They aren’t educated about it. They don’t have time. The excuses are very, very common. These aren’t surprising things. Oftentimes, organizations get very stuck in the planning, the researching, the strategizing portion of this instead of on the doing aspect. And that is where a lot of them get held up. I mean, they might spend years analyzing and researching and planning, and by that time, it’s useless, right? Because the average tenure now for most organizations is around five years. For millennials, it’s around two years, three years. And so if you spend a long time kind of just staring at paper and creating PowerPoints and all this crazy stuff, by the time you roll these things out, you don’t Even have the same workforce anymore. You’ve had the significant churn of almost 100% of people that work there. Organizations need to move quickly. And I always say that they need to think more like a laboratory and less like a factory. They got to be nimble, quick, embrace failure and make decisions quickly and go with things quickly.
Matt Alder [00:17:11]:
No, that makes perfect sense. And I think we, you know, we kind of see, we see those issues particularly around speed and you know, in lots of, lots of things that sort of going on in business, business change at the moment. So lots of, lots of HR professionals listen to this show. What advice would you give to someone who’s either leading or within an HR department, within an organization that wants to, you know, wants to kind of build a case for these kind of changes or move, move forward with their employees, employee experience? What should they be doing first? What would your advice be?
Jacob Morgan [00:17:46]:
Well, the first thing is to understand that if you’re in a traditional HR role, your job is going to become obsolete. In probably five years, three to five years, you’re not going to have a job. And that is again talking about traditional hr. In other words, most of what traditional HR does is looking at things like who should we hire, who should we bring in, how do we move them through the organization, when do we promote people, when do we give reviews and salary bonuses? The traditional stuff that all HR people are very familiar with. A lot of that is going to go the way of automation and AI. You’re going to have algorithms and pieces of software that are going to be able to make these decisions for you. Who’s a good fit, who’s not a good fit, when should you be promoted? A lot of these things HR professionals make based by looking at, at paper, by looking at data, by looking at anything that a piece of AI can look at. So if you’re in hr, you need to take a long hard look at your role and figure out how you can move out of the non traditional space. And that means becoming more strategic. That means looking at non typical things. It means looking at culture, it means looking at physical workspace, it means looking at technologies. It means trying to move beyond this kind of traditional aspect of HR to truly empowering the people and creating an organization where employees genuinely want to show up. It means understanding the gig economy. It means understanding people, analytics and data and transparency and all these amazing trends that are shaping how work is getting done. It means also helping your organization redefine what work actually means. So these are non traditional, non typical HR related roles that we’re going to start to see more of and I absolutely believe that anyone in traditional HR role is going to have a very, very hard time justifying their existence in their organization in five years time. So my advice for HR professionals is quite simple. It’s get your head out of the traditional HR mentality. Get your head out of the traditional HR role because that stuff is something that can easily be done by a piece of software. So as an HR professional you need to think of how you can go above and beyond the concept of traditional HR to truly focusing on how to build an organization, how to redesign an organization where people want to show up to work. And again, looking at those three areas of culture, technology and physical space.
Matt Alder [00:20:23]:
Interesting. Now I think you’ve, you’ve touched on this a little bit already, but I’m going to kind of sort of ask this as a, as a, as a last question. Where are things going? What’s on your radar for the future? Where do you think the developments in this space are going to, are going to come from? And other than the complete automation of hr, what else can we expect to see?
Jacob Morgan [00:20:47]:
Well, there are several trends that we’re starting to see shaping organizations. I mean if I specifically look at hr, of course you touched on one that I mentioned which is the AI and the technology component which is going to take away kind of traditional HR functions. We’re starting to see a more dynamic workforce. So not just traditional employees, part timer, like it’s going to be very dynamic. Gig workers, freelancers. 1099. There’s a lot of different things that are happening here. You need to be comfortable leading and managing and building a very hybrid workforce that is very dynamic and that’s very fluid. Data and analytics is going to be a huge area. It already is that organizations are investing in. So how do we truly know what’s going on inside of our organizations from a people perspective? Which by the way used to be a very, kind of a soft, I don’t even want to say soft but it used to be a lot of people related roles in hr. Decisions were made based on kind of gut instinct. Right? There wasn’t a lot of like quantitative data and analytics that you could look at for a lot of HR related things. And that’s shifting where HR is going to have a very, very robust data and people analytics team where decisions will be made based on data that has been collected. So we’re definitely seeing a lot of stuff happening there. Physical workspace design. We’re definitely seeing organizations around the world spend billions of dollars building New spaces. And I think at the core, we’re seeing a redefinition of what work actually means. So how do we redefine employee manager work? More soft skills inside of our organizations is another big area that we’re seeing strong investments in. But by and large, the core of our organizations. It’s not like if you look 10 years down the road, you’re going to see an organization and say, oh, my goodness, this is so different than the organization of a decade ago. Not entirely true. There will be changes, but it’s not as if, if you were to fast forward 10 years, the organization will be unrecognizable. So a lot of the things will still be there, right? I mean, there’s still going to be some form of structure. We’re still going to have offices and places where we show up to work. A lot of these traditional things are still going to be there. We’re still going to have managers. But the ways in which we structure these organizations are going to be different. More technology, more hybrid workforce, different spaces that we’re going to be redesigning. I kind of struggle because sometimes we hear people say that companies are just going to be radically different and there will be changes, but it’s not going to be to the extreme of radical transformation where you won’t recognize the organization. You’re still going to have a CEO, you’re still going to have an executive team. Many organizations may still even have cubicles. So it really depends, I think, on the organization. The organizations that are already thinking about this now, I think will pull much farther ahead than they already are.
Matt Alder [00:24:02]:
Interesting stuff. I think it’s going to be a fascinating next few years. So where can people find your book and where can they find your other content?
Jacob Morgan [00:24:11]:
I am quite easy to find. The book is available wherever books are available. Amazon tends to be a place where most people order it. So just Jacob Morgan on Amazon or Employee Experience Advantage on Amazon. I have a podcast which you can find wherever podcasts are available, called the Future of Work podcast. And pretty much all of my contact info, resources, et cetera, can be found on my website, which is the futureorganization.com or if you just type Jacob Morgan into Google, that’ll bring you right to the website as well.
Matt Alder [00:24:43]:
Jacob, thank you very much for talking to me.
Jacob Morgan [00:24:45]:
My pleasure. Thanks for having me.
Matt Alder [00:24:48]:
My thanks to Jacob Morgan. You can subscribe to this podcast on itunes, on Stitcher, or download the show app on your smartphone. Just search for Recruiting Future in your app store. You can listen to all the past episodes@www.rfpodcast.com on that site. You can also subscribe to the mailing list and find out more about Working with me. Thanks very much for listening. I’ll be back next week and I hope you’ll join me.
