Employee engagement and employee experience: What’s the difference?
Updated 7th February 2022
It's a no-brainer that as a manager, you want your team to be as engaged as possible. There's a huge range of benefits up for grabs for those who engage their people well.
Companies have tried lots of different ways of improving engagement. From flexible or hybrid working to rewards like vouchers or extra days off. While some of these approaches directly benefit an employee's ability to engage with their role, others address broader elements of the employee experience. The two are very difference and need to be approached and remedied as such. So what's the difference between employee engagement and employee experience? Well, we're glad you asked...
The difference between employee engagement and employee experience
Engagement tells you whether an employee holds an intrinsic commitment and emotional attachment to their job, the organisation they work for, and its goals. The 5 pillars of employee engagement are:
- feeling valued as an individual contributor
- feeling satisfied with your role
- giving discretionary effort willingly
- being proud of your work
- championing your organisation through advocacy
Employee experience is more generally about everything that happens from the employee's perspective. Their first impression during the hiring process, their morning commute, the technology they work with, their manager and team mates, their lunch break habits... According to Gallup, employee experience "constitutes the entire journey an employee takes with your organisation.'
So while an employee's workplace experience includes their engagement along with everything else, the two are not interchangeable.
Engagement is one potential outcome of an effective employee experience. But not everything done in the name of employee experience actually impacts engagement. And certainly not as much as many HR suppliers might have you believe.
Perks attract talent but don't help retention
One way employers try to improve the employee engagement is with cushy perks. Free snacks, dry cleaning, a gym membership. Or it might be as simple as a performance-based cash bonus.
While perks are great when it comes to attracting talent to an organisation, they don't encourage long-term engagement. Who really focuses on the unused gym membership when you've had an angry customer on the phone for 30 minutes?
83% of HR leaders said employee experience was important or very important for organisational success. 56% were investing in more training, while 51% were making improvements to workspaces, and 47% gave more rewards.
Obviously training and workspaces connect quite directly to engagement. If an employee feels like management cares about their personal development, it gives them a reason to care about the organisation.
Financial rewards can negatively impact engagement
While financial and other performance incentives can provide a short-term boost to engagement, they can actually have a negative effect in the long-term when they drive staff to compete with each other. In one study of an attendance reward scheme, employees with good attendance records were rewarded by having their names entered into a raffle for a $75 dollar gift card.
While this did create a short-term improvement, employees who previously had poor attendance soon returned to their old patterns when they no longer became eligible for the raffle each month. But on top of that, the awards decreased attendance, motivation and productivity in what the study described as "internally motivated workers" who previously had great track records. The overall efficiency of those formerly motivated employees fell by 8%.
In an interview about the study, Timothy Gubler, one of its authors, said, "Conscientious, internally motivated employees who were performing well before the award program was introduced felt the program was unfair, as it upset the balance of what was perceived as equitable or fair in the organization. So, their performance suffered and not just in terms of their attendance but also through a motivational spill-over that affected other areas of their work and including productivity.'
Personal development, not shallow perks
A 2018 global survey of 7,300 employees, found that more than 55% of staff prioritise personal development opportunities over fun activities, free treats, or financial incentives.
Other studies found that the most important benefits to employees were time off, health insurance, and retirement plans, and that the most popular at-work perks were natural light and outdoor views.
Look, we're not saying that nobody's ever been won over by a foosball table in the break room. After all, fun perks can be the icing on the cake that makes your workplace a more enjoyable place to be and certainly help the employee experience. But the parts of experience that generally matter for long-term engagement and retention are the ones that enable employees to do their jobs more effectively while prioritising their wellbeing and work/life balance.
The results of these studies highlight the various aspects of wellbeing we covered in our four-part series. People need insurance to ensure good physical health. They need time off to maintain mental health and social wellbeing. The desire for effective retirement planning shows that long-term financial wellbeing is very important to a lot of employees; more-so than any individual reward, monetary or otherwise, could ever be.
That said, some perks do sit at the centre of the experience/engagement Venn diagram. Optional group activities like paintballing can boost social wellbeing, as well as engagement by developing team bonds. And feeling like you belong is a core pillar of employee engagement.
How employee experience can give a broader view of employee engagement
Managers need to take a thought-out, multifaceted approach to employee engagement with different options to suit different needs. Thinking in terms of both employee engagement and experience might just be the key to engaging employees long-term.
The 2020 Global Talent Trend report found that despite 58% of organisations becoming more people-centric, more than half of executives still aren't convinced that employee engagement is a top workforce concern. Their 2018 report had previously found that employees valued flexibility, commitment to health, and the ability to work with purpose.
We've all heard the expression that people quit managers, not jobs. The key to overcoming a stick-and-move attitude to employment is with work cultures that encourage loyalty. These aspects of employee engagement are good first steps in getting there.