Few of us need reminding these days that we’re living in a hyper-competitive business environment. Technology is severely disrupting businesses of all sizes and all sectors, from financial services to entertainment to retail to automotive. Any edge that a company can get over its competitors is worth investigating. As the quest for new ways to drive innovation and creativity intensifies, companies may be overlooking an important source of those competitive advantages: the quality of the experience they provide to their workforce.
Research from MIT’s Sloan Center for Information Systems Research, published last year, shows just how powerful that edge can be1. Research scientist Kristine Dery and research associate Ina M. Sebastian ranked companies’ employee experiences by percentile based on two variables: work complexity and behavioral norms. Work complexity is a measure of how hard it is to get work done and companies’ ability – or lack of ability – to connect employees and reduce friction around non-value-creating tasks. Behavioral norms described expectations around employees’ ability to contribute and share new ideas and curate their own ways of working to meet their own needs and those of the business.
Propelling innovation, customer satisfaction, profitability
The researchers found that “companies with great employee experience (i.e. low work complexity, and strong behavioral norms for collaboration, creativity, and empowerment) were more innovative and profitable and had higher levels of customer satisfaction.” And the differences were dramatic: companies that ranked in the top quartile for employee experience achieved twice the innovation, double the customer satisfaction, and 25 percent greater profitability than those in the bottom quartile.
Another result that will interest IT leaders: One of the most important ways that top-performing companies achieved these results was by providing outstanding employee-facing digital capabilities. Companies in the top quartile delivered an average of 66 percent more digital capacity than those in the lowest percentile.
These findings should make forward-looking business leaders everywhere sit up and take notice. They confirm what we’ve long thought at HPE – designing the workplace to maximize employees’ effectiveness can have a deeply transformational effect on businesses.
Why is that so? There are a couple of principles that I think are at work here.
Today’s decision-making styles demand a new kind of workplace.
Command-and-control approaches made sense in their day, but companies today are increasingly aware that they need to push down decision-making to the level at which it’s most appropriate. The most critical decisions can move up the chain as needed, but at a product level you’re trying to shorten time to market, and you need to make quick decisions in a more agile way. It’s not that decisions are made by consensus; but they are made in a much more collaboratively than they were in the past. In addition, decisions are increasingly being made by cross-functional teams. You might have a customer experience designer, a marketing expert and a tech engineer who need to collaborate on a project one week, and then move smoothly to a different cross-functional teams the next. Providing the digital and physical tools to enable this kind of fluid collaboration, innovation and product iteration is an absolute must.
It’s important to note that the work location itself is one of the most important levers in that tool set. In a world where people have, to some extent, been liberated from office space by online capabilities, some companies are starting to wonder whether they need offices at all. It’s an important question. Facilities are expensive (although with the right workplace design you can drive down those costs – a topic I’ll cover in upcoming blogs). I’d argue that the reason you need to maintain some physical footprint is the same reason you need smart workplace technologies – to enable rich dialog, collaborate and solve customer pain-points in creative ways. We humans are still somewhat cramped by virtual collaboration. Sometimes the best sparks of creativity and productivity only happen when you’re meeting and working together in person. The role of the enterprise office will shift toward becoming a “third-place” that can provide a fuller, more natural work experience that helps to grease the wheels of decision-making and innovation.
Generational changes are driving demand for digital enablement.
Millennials are now the biggest generational group in U.S. businesses. Older members of the cadre, now in their mid-30s, already have their eyes on the C-suite. Their well-publicized and often-maligned love for interactive technologies hasn’t changed, but it’s finally being recognized for what it always was: a way to get more stuff done, more effectively. As Forbes contributor Jeff York pointed out recently (The Millennial Expectation of Technology in the Workplace), millenials “no longer ask for sufficient technology at their jobs; they expect it. Often, this expectancy has been painted as entitlement, but what millennial workers really want are the tools they need to do their job efficiently.” The same is true of their equally tech-enabled, hyper-connected successor cohort, the up-and-coming Generation Z.
Businesses rightly place a high value on their workforce’s contribution, and it’s not uncommon to hear statements like “what makes the difference is our people.” Perhaps they should add “and how we enable our people” to that paradigm. At HPE Pointnext, that’s the core of our unique approach to workplace transformation. We apply four major principles to transform the workplace experience. I’ll unpack each one in upcoming blogs, but here’s a sneak preview:
- Free talent by providing secure, pervasive access.
- Create an environment that enables activity-based work anywhere, any time, from any device
- Make engaging and productive spaces by blending physical workspaces with digital tools
- Continuously innovate employee experience by using data driven analytics.
Learn more about HPE Pointnext Mobility and Workplace Services here.