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  • Writer's pictureAndy Goram

We're Not Measuring Employee Engagement Correctly

Two spectacle-wearing men, one grey-haired and one bald, discuss why we may have been measuring employee engagement incorrectly
Nick Court (left) and Andy Goram (right) look at why we migh be measuring employee engagement incorrectly

For years, companies have poured resources into employee engagement surveys, chasing those elusive high scores and using them as a badge of success. But what if we’ve been measuring the wrong things all along? What if those numbers are nothing more than surface-level distractions that hide the real issues beneath?


In the latest episode of Sticky From The Inside, I sit down with Nick Court, CEO of The People Experience Hub, to uncover the truth about employee engagement measurement. Together, we dive into the flaws of traditional engagement metrics, explore why they haven’t moved the needle in decades, and challenge the obsession with numbers like the Net Promoter Score (NPS).


Nick introduces the PX3 model, a revolutionary framework that goes beyond the usual engagement score to focus on the "Think-Feel-Do" approach. This new way of understanding employee engagement could be the key to unlocking the full potential of your workforce—and it’s a game changer.


In this episode, we discuss:


  • Why chasing engagement scores is leading your company down the wrong path.

  • How traditional metrics like NPS are misleading and fail to capture the real drivers of engagement.

  • What the PX3 model is and how it can help you move beyond engagement scores to understand the deeper factors driving employee satisfaction and retention.

  • Why internal benchmarks offer more value than external comparisons in improving company culture.


If you’re serious about creating a thriving workplace culture, this episode is a must-listen. Hit play on the player below, or read the full transcript underneath to dive deeper into how you can transform your approach to delivering the benefits employee engagement, and forget about chasing the wrong score!


Podcast Transcript

Below is a full transcript of this episode. Some of the text has been auto-generated, so may contain some errors, but you should still be able to follow-along nicely.


The Truth About Employee Engagement Measurement. We’re Doing It Wrong.

00:00:10 - Andy Goram

Hello and welcome to Sticky from the Inside, the employee engagement podcast that looks at how to build stickier, competition-smashing, consistently successful organisations from the inside out. I'm your host, Andy Goram, and I'm on a mission to help more businesses turn the lights on behind the eyes of their employees, light the fires within them, and create tons more success for everyone. This podcast is for all those who believe that's something worth going after and would like a little help and guidance in achieving that.

Each episode, we dive into the topics that can help create what I call stickier businesses. The sort of businesses where people thrive and love to work, and where more customers stay with you and recommend you to others because they love what you do and why you do it. So if you want to take the tricky out of being sticky, listen on.


Is Chasing Employee Engagement Scores Leading Us Astray?

Okay then. Today I am shaking things up a bit with a conversation that might just challenge everything you think you know about employee engagement. If you've ever been involved in an employee engagement survey, you know the drill. Numbers go up, celebrations ensue, numbers dip, and it's time to scramble for a fix.

“They're now bored of bean bags. We clearly need more fruit and a new coffee machine!”

But here's the thing. What if chasing that elusive engagement score is actually taking us in entirely the wrong direction?


My guest today is Nick Court, the founder and CEO of the People Experience Hub, and he's here to tell us why 2024 needs to be the year we go beyond the score. Nick believes that we've been so focused on those numbers that we've lost sight of what really matters, understanding their behaviours, experiences, and feelings that truly shape workplace culture. So let's get real. Are we simply ticking boxes and patting ourselves on the back for a high score? Or are we digging deeper to understand what's really driving, saving or stalling our people's engagement? And is even that the thing that we should be measuring? What, have we been doing it wrong all along?


In today's episode, I hope we'll explore these questions and more. We'll unpack why the traditional approach to employee engagement might not be moving the dial like we think it is. After all, globally, engagement numbers haven't budged significantly in decades. Despite all the surveys, despite all the money that's spent on it's been, all the efforts. There's something somewhere isn't right. So what does it take to design to grow and maintain a workforce that's not just engaged but really thriving? How do we know what the key elements are to achieving that outcome and how we should we measure our progress in working our way towards that.


So buckle up as I think Nick's about to flip the script on everything we thought we knew about engagement.


Welcome to the show, Nick.


00:03:15 - Nick Court

Andy, welcome for having me on here. It's exciting. I'm excited and it is exciting. So, yeah, looking forward to jumping into this.


00:03:23 - Andy Goram

Me too, mate. Me too. Now, before we start, just so everybody gets on the same page, just do us a favour, my friend. Just give us a little bit of insight into you and your background and perhaps the origins of The People Experience Hub.


00:03:34 - Nick Court

I came into the world of HR for a slightly different route to others, which is I came in from an operational background and I, more than that, I came in from actually from a trade union background. So I started my life working in a warehouse and I was a trade union rep for years and then I was a trade union official was a branch chair. So I got into the concept of how we should be treating people at work through, number one, experiencing it, and number two, supporting trade union members and Tesco employees. So I very much came into it that way. And I had the opportunity to go into payroll team. The HR director at the time said to me, you know more about our policies and procedures than so many other people do in the organisation. And payroll is simply taking those policies and procedures and turning them into transactional elements like pay. So I did that, found out I had an affinity for payroll, affinity for HR systems, and from there I progressed.


I then left and went for Associated British Foods. So I got from retail into food manufacturing, where I looked after HR, shared services, reward benefits, global mobility, went from there to Carlsberg. Then I realized I've gone from a 400,000 person company to a large company to a 1800 person company. And I decided to set out on my own, went out and did a consultancy role, and then that's where the people experience hub concept came along. I sat with my business partner, Ben at the time. We were looking at, you know, what we felt was wrong in the world and or wasn't quite working, probably more than anything. And we said, one of the things around colleague surveys as people surveys is it feels a little bit like tail wagging the dog. Like the supplier of the survey is telling you how to do it, telling you what the measure is telling you the question to ask and not really understand the experience. And my, and that's where we went out to solve and that's where the people experience hub was born.


00:05:45 - Andy Goram

Fantastic. And it's clearly doing great stuff. You've just received a finalist kind of nomination for the People Pioneers for 2024. Congratulations on that. That's great.


00:05:54 - Nick Court

Culture Pioneers. The Culture Pioneers award is for brand. So it's about, does our external brand and our internal brand match up when we walk the walk and talk the talk, do the two things come together? So delighted to have been a finalist for that.


What Does True Employee Engagement Look Like in Your Organisation?

00:06:11 - Andy Goram

Oh, I think that, say, do gap is so important when it comes down to people and culture and really, really delivering this kind of thriving environment. We're hopefully going to talk about today. Now, back early in the day, I had your friend and colleague Rob Robson come on and totally blow my mind while asking him this very simple question, which I'll ask to you, which was a. From your perspective, Nick, when we talk about employee engagement, what are we referring to?


00:06:43 - Nick Court

So it's Rob. And, you know, I'm going to be careful here because I don't want to be. I don't be competing against, you know, what Rob does. Rob, you know, Rob's far more intelligent than I am. Okay? I feel my intelligence comes through my feet. You know, it comes, like, where I am, where I'm walking and all that stuff and my life experience. So when I think about employee engagement, I really understand if I'm engaged in something, right? I understand that when I go into a shop, am I more engaged in Coke or Pepsi? Right? I know what I'm engaged in. I know how I feel that day. And I think that we can risk over complicating what is effectively. What is engagement? The answer is, well, what does an engaged employee look like in your organisation? What does an engaged employee look like to you? What does someone who is engaged, what does their behaviour look like? What do you expect somebody who's engaged to do?


You expect them to be responding and responsive. You expect them to advocate and be advocating. You expect them to align with what you're doing. And we got to think that engagement ultimately is a set of things, but ultimately, it's about motivation. When I walk past three restaurants on the high street, which is the one I'm most engaged with, which is the one that gives me a great experience, and experience leads to engagement. So I'm deliberately, by the way, keeping this vague, because the problem of locking engagement down to one thing and then going at it means that we are going at a social norm, and we are ignoring any differences that there may be in the world. And we are. When we go at a social norm, think about what social normative groups are. We end up at a risk of what is employee engagement for white middle aged men? And what we have to look at is an engaged employee is likely to do the following things. It's likely to behave like this, and it's the behaviours we're looking for. So I've deliberately not answered your question.


00:08:58 - Andy Goram

You have answered my question. You've just done it differently to Rob. Rob, you know, just absolutely did my brain in, in a good way.


00:09:06 - Nick Court

Yeah.


The Dangers of Focusing Solely on Engagement Scores

00:09:07 - Andy Goram

And what you've done is you've talked my language, Nick, which is amazing. I'm not comfortable with... and maybe this is the problem. I mean, measurement is going to be at the heart of what we end up talking about today, because we can talk about alignment and we can talk about behaviour and we can talk about differences. Somewhere in there, organisations are trying to measure something, and we, the fewer things we measure, I guess the more comfortable we feel. "Oh, it's that thing." Right. But if that is the case, what are we doing wrong at the moment? Because I mentioned, and depending which survey you look at, numbers go up, numbers go down. I think it's reasonably well understood that globally, that number's been pretty static, pretty stagnant right around engagement. Organisations are different, countries might be different. Globally, it's not really changed much. So what's wrong? What's happening with this measurement thing? What are we doing wrong, Nick?


00:10:02 - Nick Court

I think there's no harm in having a concept of engagement and having a concept of a number to help us understand if we are heading in the right direction. And I think ultimately that's what's been lost. And if we were to go to an organisation, let's go. We'll go to Hello Fresh. That has a huge technology arm, a huge commercial business arm, and then a huge production arm. And you were to talk to them about what does employee engagement look like? It must look different in different parts of their business. To then have an overarching measure that tries to span all of that is almost impossible just in one organisation. So what we see going wrong is that there's a couple of things, I think.


So number one is chasing the benchmark. So the benchmark becomes the score, the score becomes the goal, and the obsession on the goal becomes the driver of behaviours. And if all you have to do is increase your engagement score from 72% to 73%, then what will you do? And will you do it in a sustainable way? And will you do it in a way that is understood by everybody? And will you declare that when you get to 74%, because the benchmark provided by the wisdom in the world, which is the data that people have decided to share, will you then stop? And ultimately, you can't sit there and say, we're going to design an experience that people are going to interact with for 8 hours a day, 10 hours a day, 12 hours a day, and do it in the same way that a retailer may design an experience for somebody who's going to come in once a week, it's different. So that whole customer experience and employee experience, we can learn so much, we can learn a bit. But designing something that's going to take a third of people's lives and be so influential is something you can't stop when you hit the goal. And I think that's one of the big problems.


Employee engagement creates an employee engagement benchmark, which locks people into a concept of engagement, which locks people into six questions that are the engagement questions. And then we chase the benchmark. And what we do is we limit ourselves on things that are not engagement. So what does an organisation want? Employee engagement. Of course it wants employee engagement. That's a nice measure of are people motivated? Are they engaged? They want their people to be well, right? So well being must be a measure of an outcome. They want people to be innovative, they want people to be ready for change. They want people to be motivated and motivational. They want people to be productive. So there's so many things that they want for their people and of their people, that engagement can only ever be a small subset of that. So there's a real risk that says, when engagement is the only score you're chasing or the only goal in town, you're racing to the benchmark and you're comparing yourself, Hello Fresh is comparing themselves to Sainsbury's and comparing themselves to Barclays and comparing themselves to different industries, across different groups with different experiences. When, if you just ask the question, what do we want of our people? What do we need to give them? What does an engaged person look like here? And what are our expectations of outcomes like innovation, change, readiness, and well being, you start asking far broader questions.


And, you know, if my original answer to what is engagement is vague, that's because engagement is vague. It's nebulous as a concept. And therefore, trying to chase it sometimes can feel like you're batting away at clouds and mist, especially if you're chasing the wrong things..


Why a Singular Engagement Metric May Be Misleading

00:14:04 - Andy Goram

Especially if we're going down the wrong paths, if the information or the data we're getting, I guess, isn't nuanced enough, isn't asking the right sort of questions, to get the outcomes that we're looking for and that people need. And I think also this point and the dangers, perhaps discuss a bit more about the dangers of being obsessed with a score is that this isn't like a PlayStation game. I don't, I don't think that I've got to 75. Therefore I've completed engagement. Right? What's the next game? Because this is an ongoing quest, right? Involving in culture. It's a never ending thing. You've constantly got to work on it, to keep it, to maintain it, to grow it. People come in and people go, things change, dynamics change. Right? It's, it's a, it's a living beast. So even the context of engagement must change over time with business focus changing and industry changing.


00:15:02 - Nick Court

Yeah, it has to. When you look at the most innovative organisations or innovative brands, what do they do? They buck the trends. They go different, they do more, and they obviously need to understand what they want to be. But if your focus is only on engagement, then your focus can't also be on being a better business, on helping our people create a better business for us and our customers and our stakeholders. And I think there's a broader set that needs to be looked at here. And ultimately we can also get into the concept that is to HR. Have a seat at the table. So where does employee engagement sit within an organisation? Typically, the transactional running of surveys and starting to pull strategy sits within the HR of the people teams. My experience when we have stood up in front of boards and we talk about engagement because it is such a nebulous concept, because no one can say, when you do this, you get that it's about, well, we must increase our engagement score. And it's like, well, what's important to you? And when you say to a CEO or a CFO, we can improve retention, we can increase productivity, we can improve motivation, we can increase advocacy. Your promoters and your internal organisation, it's more solid. But our obsession with wrapping all of that up into one concept of engagement has become quite high. And I think if organisations were focused on designing the experience for our people to deliver for our customers and consumers, you end up with the 1950s thinking of the service profit chain.


00:16:49 - Andy Goram

There's a bit of me still rose tinted glasses that just loves the concept of the service profit chain. Right? I think it lives and breathes and we can overcomplicate things or try and change them. That's still at the heart of it all. Happy employees, happy customers, happy shareholders. Off we go. All good. I wonder whether some of this, some of this measurement issue is a quest for simplicity driven by communication above all else rather than actual outcome. So we need to be able to tell people what, how engaged people are in this business. Therefore we need something really simplistic and the easier we can make it to understand as in a number well then more people will comprehend what is the reality is something that doesn't do anything that probably has just more questions. Maybe even something like net promoter score is like the devil, right? We've got this one number. It tells us everything. What on earth does it tell us?


Rethinking Net Promoter Scores for Employee Engagement

00:17:51 - Nick Court

I mean it's a great example because the guy who invented NPS, the net promoter score, regrets doing it. He's publicly came out and said he regrets creating the one score you need to manage your business, which is net promoter. Would I recommend this company to my friends and family? And that means from a consumer perspective it wasn't long before people co opted that into the eNPS, the employee net promoter score. And so it's like, okay so you are Nike with millions of consumers and millions of data points and you want to get one question but you employ 1000 people but you now want to try and take that same concept to a thousand people. Would I recommend this as a great place to work? And are you a detractor or a promoter?


When you look at McKinsey you look at someone else talking about NPS. The one danger of NPS is it asks what would you do? Not what did you do? What do you do? What would you do? It's a measurement of your perceived intent to do something, not your opportunity to do it. So it doesn't ask you do you have the opportunity to recommend someone to this brand or this organisation? It says would you if you had the opportunity, not did you and have you in the last however long and then takes you away from the rest of your business. So when you see businesses that have struggled who have these measurements they don't understand but we have a good NPS or a good eNPS and it's like. But that's not the only thing. Yeah, you can't measure every part of your people, you know, and your people KPI's based on whether they would recommend you as a great place to work.


00:19:38 - Andy Goram

There's a number of pitfalls there I think with the measures. Look, I've, I've used eNPS. You know, I'm not, I'm not here trying to sort of like say I haven't. I have, but I guess I've seen the light on those sort of things. But also like as a, if I'm doing facilitation work, right, let's say I'm doing, I'm running a leadership development course. There's a survey at the end of that program for all the delegates to take and, you know, was it engaging and fun and all those sort of good questions are coming through. I know if I've had a really challenging group and I've had to challenge them to get them to think, to move forward, I know more often than not in the moment my scores may be lower than I would like because it's been an uncomfortable session. However, I also know that six months down the line I get emails from people saying, you know, that time I didn't like you very much for pushing me. Actually, I'm now kind of seeing why you did.


00:20:31 - Nick Court

And I've recommended you to ten people who revived that. It would be great. And I think this is the important thing when we talk about something like NP's is the difference between the question you're asking and the measurement you apply. And this is which wells back into this, which is I don't have any problem at all with asking somebody, would you recommend us to your friends and family as a great place to work? If we had a vacancy, would you refer your friend to come and work here? Its a great indicator of engagement. Its a great measure of that. But I have a real issue is probably this eleven point scale that says, are you a detractor or a promoter? Is it plus 50 -100 because it gives no one anything to go on. You know, the third thing is it cannot be your only score. My experience of the training that I had with you, the environment was one that was conducive to learning to change. The materials I had that I had to work with enabled me to take part. The preemptive work enabled me to understand what's happening. Was it uncomfortable? Maybe. Would I recommend you ask me again in six months? Yeah, you know, all of that stuff is good, but you got to look at it in the round to understand the full experience.


00:21:48 - Andy Goram

Absolutely. And so that's, that's what I want to kind of drill into. So we've talked about outcomes and trying to understand the various outcomes or even the specific outcomes that we're looking for to sort of see, well, is the business in the people inside the business thriving? Have they got an opportunity to do their best thing, bring them, bring their best self, share their efforts, you know, contribute in some sort of way? So in the quest for simplicity, maybe we've gone down the wrong path, right? Maybe we're starting to look at okay measures, not the most useful measures, because we haven't really thought about the outcomes that we're looking for. And so maybe... maybe we're doing employee engagement wrong.


You know, maybe we've been led down a garden path, and if we follow the wrong scores and the wrong measures, we're going to do the wrong things. And so, in the work that you're doing, which, from what I have seen out there, is different. And even back in the day, when I talked to Rob, this stuff was being thought about and trialled and tested, but now it's out there. I want you to tell us about the. The PX three model, the sort of think, feel, do model. What is it? What is it attempting to do, and how does it work?


Introducing the PX3 Model: A New Approach to Measuring Employee Experience

00:23:14 - Nick Court

PX3 looks effectively at broader concepts than engagement. So it looks at outcomes, people outcomes. So, if you think about the three levels we're looking at, I'm going to go 321. 3 is people outcomes. And, of course, you can have a rolled up engagement measure in that. But ultimately, we're looking at things like outcomes like retention, intention to stay, motivation, well being. Can people be well in your organisation? And innovation, readiness for change. So, all of these things are outcomes. And when we think about outcomes, you got to think about the things that are desirable for your people as an organisation, because, you know, when these outcomes happen, you do well as an organisation, so you're winning. And the outcomes you want for your people because you care about them, you want your people to be well, not just because when they're well, they'll do more productive work, because, you know, that that's ultimately might be someone feels like that organisation, but, you know, a caring organisation wants their people to be well. They want their people to be motivated. They want their people to be ready for any change that's coming. Yeah. So there's a balance there between organisational needs and organisational wants for their people. So there's a balance there. Number three.


Number two is the felt experience that comes under feel. So where number three is outcomes, which is what are people likely to do, number two is the felt experience. And this is how do people feel? And here, where we. What we put in here are things like the feelings of autonomy, belonging, the feelings of connection and enjoyment. So if you think about these as meeting the fundamental human needs that we have. And number one is the perceived environment. So this is the think part of think, Phil, do. And the perceived environment is how people perceive the environment around them. I think. I believe that my manager cares for me. I think that the communications are adequate. I think that I receive recognition. I think as an organisation, we're doing everything we can to be sustainable. And what this allows us to do is it allows us to take a concept then, which is we can draw a line between those. Because the only thing you can do as an organisation is tackle the area of think. So when you look at that and you go, how do people think is the only area that I can influence? You can't tell people how to feel, and you can't demand an outcome for long. Maybe you can demand an outcome in a real controlled environment.


00:26:06 - Andy Goram

Not sustainably, no.


00:26:08 - Nick Court

So the two things you can't control, we measure and we understand, and then we measure the thing you can control, because that's the lever you can pull. So when we say, think, feel, do, we're now able to do that. And why did we go down this route? Rather than a classic way of measuring engagement or looking at standard approaches, which are all fine as well in their own space, it was because it gave us richer. So we see this as the next evolution. We see this as the model, the framework of engagement plus one, you know, and if you look at what other people are doing, what we saw was you'd end up with this huge list that said, people who feel they belong are twelve times more likely to be engaged. Okay? I don't, I can't tell them how to, I can't demand they feel that they belong. I can't demand that. So how does that work? And then they'd say things like, people who enjoy their job are more likely to be engaged. People who feel connected are more likely to be engaged. And when you looked at the list, and it was a stacked list, so it was a nice stacked list of the questions and concepts we asked, then what we saw was all of those felt experience. The feelings just came straight up to the top. Of course they do. Feelings are important. Feelings drive us. Feelings drive us every single day, but they're things that an organisation can't do anything about. So the concept of PX3 Think, Feel, Do is actually to say to organisations,

"It's important to understand the feelings. But let's show you what you can actually do. What can you actually influence? What can you change? Put more resources in it, change training, physically, change the environment? What can you change that will best predict an outcome?"

And we end up then with a model that says, if you want your people to do something, they should feel this and they should think that, which.


00:28:08 - Andy Goram

I think is this is the big difference between what you might call a traditional survey, which is why I want you to come on and explain this stuff today. Because to me there's a couple of things I want to just make sure I understand. Firstly, the clear, obvious thing for me is there's the emergence of why outcomes happen, which is really what, if we think about it, it's really what we want. Out the back of any, any survey, whether it's engaged or not, I want. Do you know what, I want to know why something's happening. Please not. I just want to know something is happening. I want to know why something's happening. And the three levels just talked about get to a point of understanding why something is happening. Right. Which should then inform where you go and put your focus and your energy.


Why Outcomes Matter More Than Engagement Scores

00:28:56 - Nick Court

Yeah, definitely. And I think, like, if you think about the concept you just talked about, which is understanding the why. So if you think about something like when, when somebody releases a statement of fact, which is their fact, which is according to our data, belonging is super important in an organisation and people who feel they belong are more likely to be engaged, then where do we put our efforts and resources? We put our efforts and resources into things that we think might impact the feeling of belonging. So we might... do we start, you know, we do more diversity training, we might do something around changing our recruitment approach, changing our policies, we might do some stuff around training, development, whatever that might be, but we might do some things around gender pay gap, we might do this stuff and ultimately we're tackling diversity to drive up belonging. And that's laudable, by the way. So that is something every organisation should do. You shouldn't have any practices in your business that exclude people. Why would you want to do that? But when we look at the data and we say actually using a multi step model, when people feel they belong, it's because they're recognized, it's because they have great recognition, they have appreciation, they are appreciated at their work, it is because their manager cares about them. So line manager capability and attitude is very important to someone feeling they belong, it's because they receive the communication they need to do their job at the time they need to do their job. So they are kept up to date. You respect me enough to keep me up to date on what we're doing. And when you look at that and you go, that makes sense. We're complex individuals. I want to know that I work for an organisation that values diversity. I want to know, I work for an organisation that is actively challenging its things like gender, pay and owing on a program. I want that, but when I feel I belong, it's because I'm treated with respect, I'm recognized when I do good work, and I feel like the environmental factors celebrate. So it's a different path that somebody would go on to influence something we want for our people.


00:31:23 - Andy Goram

And when you mentioned before in the 321-123 layers, we talked about belonging here as one factor. Now, are those factors standard in every survey, or are you looking at what an organisation is struggling with, trying to achieve, wanting to achieve? Are those things flexing? Are there some core things that are always there that occasionally bring some other things in? How's that work?


00:31:53 - Nick Court

So flexibility within a framework is probably the best mantra for PX3. So it's the framework that allows you to have confidence, that you can benchmark, that you can understand how you are against other people and how you are in your own organisation. The felt experience is very, is probably the area that we are locking more than anything, because concepts of belonging, autonomy, connection, and growth don't really change much. And there's not that many questions you need to ask in that space. So what we do is we take, what are the outcomes you're looking for for your people? What does an engaged employee look like here? What are the outcomes you want? Where, you know, we're an innovative organisation, I want to drive innovation. So how do we do that and what we then look at with our organisation? So we create those outcomes they're looking for. We then go and look at their environmental. Do they have any concerns? Do they have anything that they think already is worrying them? That we can start exploring with our surveys and with our data, we start bringing that through, and we will then work with our organisation to create the right survey to do that. Now, surveys have limitations. So surveys cannot be your only employee listening tool.


00:33:08 - Andy Goram

No, not at all.


Predictive Analytics: The Future of Employee Engagement

00:33:08 - Nick Court

You have to give your people a voice in many different channels. But surveys allow you to capture data and then analyse that data. And PX3, ultimately is a predictive analytics solution. So we are looking to best predict what environmental factor will predict a positive outcome. So I can give you an example of that if that's helpful. Yeah. If we look at something like intention to stay, what we can pull through from that for an organisation is, and this is the top level of our data, we can say something like, if you want your people to do, if you want your people to stay, they should feel that they can reach their full potential, they can develop their career, and they belong, and they should think that senior leaders care about people. Good work is recognized, success is celebrated, and they're kept up to date. And what we can effectively turn this then into as a formula, we've got one client, hospitality client, who calls it their formula, and they go out to people and say, this is our retention formula.


00:34:17 - Andy Goram

Yeah.


00:34:17 - Nick Court

So these are the things that environmentally drive retention. These are the, you know, there's eight things. These are the four things that are low scoring. These are the four things that are high scoring. The high scoring ones, we are going to celebrate, we're going to protect, we're going to get out there and say, well done to everyone who's doing it well. The four things that are not so great for us as an organisation, those are the things that we're going to take action on.


So if you think about predictive analytics, then leads to action in the right place for the right outcome. And what we can then do is really target that down and say to people, if you want this, go do this. So none of that 40 questions, let's tackle the lowest scoring. It's 40 questions. And these are the four that you really need to work on in Central London restaurants. Different in Manchester. So three of the four are the same, but there's another one that's creeped in. So in Manchester, go and do this and start really flipping that round a little bit.


00:35:18 - Andy Goram

I think that's the thing that I like about this whole concept, because to me it feels different. Because it feels like future action focused as opposed to a retrospective view of what's happening or happened.


00:35:33 - Nick Court

Yeah, definitely. And. And because it's broader than engagement, what we're finding is when we are sitting in front of boards, so we're often representing our data and our insights in front of the boards for our clients, we're finding that the naturally cynical people, apologies to every CEO and CFO out there right now, but the naturally cynical people for engagement are suddenly engaged in what we're telling them. Because when you say to a CFO that the number one cost challenge you have from a people perspective is retention, it's costing you somewhere between three and 10,000 pounds for every lever. More if you look at some broader data. But let's fix around that. It's costing you over a million pounds a year for the headcounts that you're losing. And we can actually show you what best predicts intention to stay and where you're scoring low on that best prediction. The last time we did this presentation, CFO sat there and said, this is a game changer. I know how to help my HR team. I know how to help my colleague, my chief people officer when they're asking for budget and they're asking for training and development budget, line management, development budget. This company has just showed us that line management capability and training is a retention driver.


00:36:58 - Andy Goram

There we go. And that's in most organisations. That is a huge number, relatively speaking. Right. That the cost of ineffective retention or turnover or poor leadership, meaning you're losing people. Whatever. This is what I mean about getting under the why and really focusing on. Actually we've got this big number that's costing us in lost productivity or turnover of people, having to retrain the basics, all that kind of good stuff. This will absolutely pay back dividends, right?


00:37:30 - Nick Court

Yeah. And we don't want to throw out the baby at the bathwater. Let's be dead honest with everyone. Engagement is an amazing concept. It's a known concept. We are never going to move away from the terminology of employee engagement, but moving to what does an engaged employee look like here, really matters. And being your organisation. I saw a statement about the problem with external benchmarking, of any benchmarking, is it's race to mediocrity, because you are an exceptional organisation that wants to do exceptional things, and yet you're comparing yourself to the broadest average out there. So what you're doing is you're racing to the middle. Yeah. And if everyone's doing that, then all we're doing is you might as well not have 100 amazing, innovative brands and organisations. You might just have one Uber organisation. And it's not what organisations need or want. So I think, yeah, I think we got to go different.


00:38:30 - Andy Goram

And clearly you are. You've mentioned the benchmark thing a couple of times because you provide a benchmark, right within PX3. My question is always in these things, people are fixated with having a benchmark, and I flip flop myself between, well, it's interesting to see what other people are doing, but really we want to focus on what's going on here. What is your attitude towards benchmarks? Are they in PX3 because you feel clients want them and need them, or do you really believe in them?


00:38:59 - Nick Court

I'm going to be dead honest. Wear my heart on my sleeve, Andy, on this, which is the best benchmark you can possibly have, is your internal benchmark. As a company, this is how we have performed. As an organisation, this is how we have performed. And within our organisation, some people are beating that, some people are on it and some people are under it. So let's understand those that are beating the benchmarking internally, what are they doing differently? What can we learn? How can we take what they do into other areas? The people that are lower in it, what are they doing differently? What could be the influence? Internal benchmarking is a learning, it's a growing benchmark. It is that whole race to be exceptional. Everything about your organisation drives you forward. External benchmarking, we didn't have it in our platform for probably 80% of our existence. And we put it in because it was a sales enabler, because when we were going out and talking to people, we were going into tenders, we were going into RFPs (requests for procurement), we were going to stuff, and they said, can you do external benchmarking? And trying to explain to somebody that we don't, because you've lost them. And what we found was some of the advice I had is you've got to always be educating, you've always got to be taking people forward. And we've done some work recently with a client who had probably the best case for external benchmarking. And their view was, if I am dropping against an external benchmark, that maybe I was on the external benchmark, it helps me understand, is it because we have a systemic issue within the UK that is affecting everybody? Or is it something in my organisation that is only my organisation or our industry? Maybe. And the answer to that individual was, that's actually a really good way of looking at external benchmarking. But you are not the norm. That's a very mature way of looking at it, which is to understand, but it's not my key driver and I think that's the problem. It's how are we doing against everyone else? We're doing okay. Well then we just don't need to put any more budget into that. Well then tomorrow you can have a problem then.


The Case for Internal Benchmarking Over External Comparisons

00:41:24 - Andy Goram

That is it, isn't it? That is the thing.


00:41:26 - Nick Court

So my view has changed on benchmark over the years. But to be clear, external benchmarking came into our organisation to help our sales and marketing team open doors, not to help our clients be better. And it's a hard thing to talk about because if I was here as a marketing individual, I would be sitting here going, hey, Andy, having the right blend of external benchmarking, internal benchmarking enables you to use our platform to understand where you are both within your industry and our client base, and internally where you can improve. That's the sales pitch, right?


00:42:09 - Andy Goram

Yeah, but I would expect nothing other than honesty and realness from you, which is what we've got, which is 100% what we're looking for. Right. We don't want to hoodwink anybody. I think this is the thing about trying to understand this stuff. I think the point about internal benchmarking is great and it really plays back to the here inverted commerce piece that you talked about within the survey. What's going on within the marketing team, what's going on within the procurement team, what's going on within finance? Here's what matters. How are we performing and how do we get better? And from what I've heard today, this is all about getting under the skin of how do we get better at delivering the outcomes that we need as individuals within an organisation and an organisation as a whole. If we can get closer to that stuff, we're going to be in better places.


How to Create a Culture Where Employees Thrive

00:42:53 - Nick Court

You know that expression I'm going to get this wrong. It's something like the most important person in the room or the highest paid person in the room or something like that. Their view tends to weigh down everyone else's action. If a CEO says it would be really interesting to understand how people with blue eyes felt, then everyone would leave that meeting going to people going do we have the data? Do we need to get the blue eye reports? And the CEO then wasn't expecting anything but they’ve said it and its happened. And I think most HR people are absolutely on board with the whole internal benchmark and is where its at. The people who have made a throwaway comment tend to be the CEO, which is what are we putting on our annual statement as our engagement score? How do I know if that’s good? And then somebody’s turned around and said well, well, I’ll create a benchmark for your CEO and then, then it becomes industry and it becomes an industry and it becomes unhelpful. So we need CEO's to start asking questions like

"How are we doing against the outcomes we want?"

00:43:57 - Andy Goram

What a great question. What a great question. And leads us nicely, I say nicely most sadly into the bit of a show I call Nick notes Nick, where I'm looking to try and get a bit of a summary on the things that we've talked about. And by the way, I've loved it. Absolutely loved it. We talked earlier about distilling things down to a single number and how dangerous that could be in this case. If we're trying to find out, find out what's going on and how we can take steps to delivering some of these outcomes, what three pieces of advice that you could fit on three little Nick notes would you leave for the listeners today, my friend.


3 Sticky Notes For Better Employee Engagement

00:44:34 - Nick Court

So I put a statement on a post-it note that says, "We want to enable outputs." We have to understand inputs with a little bracket that says output alone is not the goal. Nice. Sticking at number two is probably a memoir, which is simply "engagement equals what an engaged employee looks like here, not from a trade magazine, not from a supplier. What does engaged employee look like here?" And my third one is actually a quote from Rob, which is, it sticks with me because it's powerful, or I think it's powerful, which is helping people think about culture and employee experience. People experience. So

"culture is felt by the group and experience is felt by the individual."

And if people can remember, the culture we have here as an organisation is widespread and I'm designing experiences for the individuals. They then start thinking about the individual needs, the individual wants, desires. What are they giving up for their time at an organisation? What are we giving back to them? So design the experience, aim for the culture, design with the individual, aim for the group.


00:46:01 - Andy Goram

And there I am again, something from Rob is blowing my mind. What a marvellous end to the episode. He is a mind blower, my friend. Nick, it's been brilliant to have you on. Thanks so much for. Well, for the honesty and showing that there's a different way to do this stuff. I've absolutely loved it. If people want to find out a bit more about PX3 and the people experience hub, where should they go.


00:46:23 - Nick Court

So they can head over to. We're quite present on LinkedIn, so they can head over to LinkedIn, search for the people experience hub and we're there. I'm Nick and you can find me on there as well. Our website is Pxhub.io. So you can head over to there and you can access all of our things like ebooks. We've got a. We've just released our insights report. So September 24 Insights report has just dropped that SAR 2024 report that's on the website. There's loads of resources there around what we do. And if anyone wants to reach out, the contact details are all there on the website as well. We're quite a community collaborative organisation, so we love to talk to people about what they're up to that you are.


00:47:10 - Andy Goram

And I will put all of that stuff in the show notes. People can find it. Nick, thanks so much for coming on, my friend. I love what you're doing and more power to you, my friend.


00:47:18 - Nick Court

Amazing. Thank you, Andy.


Podcast Close

00:47:20 - Andy Goram

Take care, my friend. Okay, everyone, that was Nick Court, and if you'd like to find out a bit more about him or any of the things we've talked about today, please check out the show notes.

So that concludes today's episode. I hope you've enjoyed it, found it interesting, and heard something maybe that will help you become a stickier, more successful business from the inside going forward. If you have, please like comment and subscribe. It really helps.

I'm Andy Goram and you've been listening to the Sticky From The Inside podcast. Until next time, thanks for listening.


Andy Goram is the owner of Bizjuicer, an employee engagement and workplace culture consultancy that's on a mission to help people have more fulfilling work lives. He's also the host of the Sticky From The Inside Podcast, which talks to experts on these topics from around the world. 

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