The Duel of Dollars: Measuring RoEI Against the Classic ROI
When the post-pandemic era hit us, the conventional RoI playbook became redundant. There is a new playbook in town, and Richard Branson , the founder of Virgin Group , summarizes its crux beautifully:
“Clients do not come first. Employees come first. If you take care of your employees, they will take care of the clients.” ??
Hybrid working has become a basic demand. Leaders need to strike a fine balance between mandates and freedom of choice. Workplaces of today need to be integrated into everything that provides a seamless experience, one that makes the employee want to be in the office. Please focus on the word “want” here.?
Companies worldwide are investing in creating an elevated workplace experience. We need to ask the right questions. Is it even worth it? With the changing drivers, are we even investing right?
So yes, everything does tie back to employee investment. But this is all talk and no show, which is why we shall dive right into it.?
I will further delve into the problems you can solve by investing in your employees. You'll be surprised how closely employee investment directly links to business outcomes!
Not only that, I talk about the increasing role of tech and AI, along with how traditional performance management systems are no longer serving us, and how AI has dynamically helped revamp the entire process.
This edition also answers the million-dollar question: Whose job is it to invest in employees, after all? Lastly, we'll talk about the math behind this investment and leave you with some predictions for 2024 for the same!
Problems that are a sign of misaligned employee investment!
Let’s take a step back to understand the ramifications of this number. It is equivalent to 9% of the global GDP!?This alone should be an incentive enough for organizations to invest in employee investment or attempt to reengage employees. Efforts to engage employees by investing in them can help your business save a lot of these costs.?
Engaged employees are a lot more productive. This impacts organizational profitability. If this sounds unbelievable, then look at this Gallup stat!
Companies with a high level of employee engagement are more profitable by a factor of 21%!
2. Cost of sick leave
According to Circadian, unscheduled absenteeism costs roughly $3,600 annually for each hourly worker and $2,660 yearly for salaried employees. Investing in holistic wellness programs and creating mandates around leave regulations can help you maintain attendance levels.?
3. Cost of replacement?
Employee turnover costs are an age-old liability for any business. Direct costs comprise recruiting, onboarding, and training costs of new employees. And indirect costs? Those include low morale of other employees due to increased workload and lost productivity, which happens due to the gap between the exit of a high-asset employee and the time the new employee takes to get themselves to the optimal level of productivity.
Joining hands with Tech and AI
Workplace solutions such as Visitor Management System help employee journeys to become smoother every time they visit the office. Similarly, Meeting Room Management aids in booking a meeting room through real-time data on occupancy and vacancy. Easy, isn't it?!
Poor managerial interactions
Post my interactions with workplace enablers, managers, and CHROs, I've noticed patterns of change in what the future workforce wants. Today's employees want more than just paycheques- they look for purpose and growth. The future workforce loves challenges and problem-solving environments where they can push themselves to do their life’s best work. ?
And who better than managers to encourage growth? Managers significantly impact how employees engage with the workplace. Even with such a huge responsibility, most conversations employees have with managers are ineffective.
Before getting our hands on how to manage employees better, let's get one thing out of the way: The traditional one-on-one reviews are a thing of the past. We need newer ways to engage and shape employees, even if that means tweaking traditional practices. We need to have continuous and two-way feedback mechanisms- feedback that is specific and intended for long-term progression.
Here's how AI comes into play with respect to performance management and reviews!
This implies that managerial investment is a prerequisite to a successful employee investment. Of course, this is not all.
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Want to know what the experts are saying?
The experts, thought leaders, and global key speakers couldn't emphasize enough what it means to have a supportive organizational structure. The treatment of employees is an intangible investment that pays back heavily.
Take a quick peak into our blog to save you all the work on how to build a winning culture for your organization .
You can also listen to our podcast with Harini Sreenivasan for deeper insights on the leaders of future workplaces .
Whose job is it, after all?
One of the greatest missteps in employee engagement programs is treating it as an "HR thing." This misconception permeates organizational structures, leading to a fragmented approach. To unlock the full potential of employee investment, it must transcend silos and become embedded in the DNA of every department. This is not a one-person job, but managers play an important role here.
Is it the CHROs? Workplace enablers? Workplace managers?
The heart of employee investment beats in the hands of managers, no doubt. They are the torchbearers of daily interactions and setting the tone for the work environment. Recognizing this, employee experience and engagement become cornerstones of managerial responsibilities.
?? My tip? Waiting for the annual review is outdated. You need to facilitate a free-flowing dialogue towards engagement strategies, accounting the dynamics of your organization.
Let's understand the not-so-boring math behind this investment!
To better explain the concept to our fellow math geeks, below is a cyclical relationship between employee engagement, employee experience, and employee investment that connects together via this conceptual equation:
Where:
Predictions for 2024
Forrester's anticipation of a positive shift in Customer Experience (CX) heralds a momentous turn after a three-year period marked by stagnation. How was this made possible? With the integration of behind-the-scenes GenAI!
GenAI empowers customer service agents. Solutions are more personalized, efficient, and tailored. By automating routine tasks, handling complex queries, and learning from each interaction, GenAI ensures that the customer journey is not just seamless but anticipatory.
It can easily work in tandem with human agents, creating a symbiotic relationship. This collaborative approach is the best of both worlds: the efficiency of automation can be utilized while retaining the empathy and creativity inherent in human interactions.
Organizations need to understand that investing in employees is essential. Simply "check the box" efforts won't do. CX and EX are closely related. Employees go above and beyond to serve clients if they know they are and will be well taken care of.
So, what's your strategy for 2024 going to be?
What's brewing at Veris?
There couldn't be a better way to end the year than to have a sneak peek into what 2024 can look like for your organization. From learnings of 2023 to strategies for a game-changing new year, our latest report on workplace experience has everything wrapped up as your early Christmas present!