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The DEX butterfly effect: What is the true cost of a bad employee experience?

Butterfly effect

2021 has been the year that organizations globally began to truly realize the importance of employee experience and sentiment, particularly when it comes to their digital experiences. Following the mass move to remote and hybrid working, devices have replaced the physical office, digitizing the employee experience as well as working environment.

What does this mean? We’ve said it before and we’ll say it again, it means leaders need to prioritize a great digital employee experience (DEX) and build an effective DEX program if they want to remain competitive and successful. Easier said than done. As Gartner’s recent prediction findings show, whilst many organizations have indeed implemented technology components of a digital workplace framework, few have improved employee experience or advanced digital dexterity.

Failure to ensure a good digital employee experience will lead to something of a butterfly effect on your organization. Picture it; leadership do not prioritize and optimize the digital employee experience, this leads to digital friction and a bad employee experience, that then leads to a decline in employee engagement and productivity, which consequentially affects retention, replacement, training, opportunities lost, and customer experience. Yikes, right?
So, let’s dig a little deeper into the true costs that may come with a bad employee experience.


This one should be a no-brainer: employees that are dissatisfied with their experiences at work will become disengaged and less productive. The less productive employees are, the more this will impact revenue. In fact, a HubSpot report found that lost productivity costs U.S. businesses a shocking $1.8 trillion dollars every year. Similarly, Gallup estimates that low engagement costs the global economy $8.1 trillion.
However, we can’t blame lost productivity on distractions like getting a coffee or surfing the web alone. Research shows that over a third of employees experienced more IT issues in 2020, 73% said it took days/hours/weeks to get those issues resolved, and 69% of those employees were unable to work (or only partially work) when IT admins did resolve their IT issues. Poor digital experiences are leaving employees frustrated, less productive and unable to work. As Forrester research highlights, many common IT practices aren’t designed with the capabilities needed to support the future of work, e.g., one in three orgs have 50% or worse first-time resolution (FTR) rates. Usurp this by optimizing internal processes, streamlining the employee’s digital experience, and providing much needed self-service or self-healing options.


If the Great Resignation has taught us anything, it’s that regardless of external factors (like a literal pandemic) people are prioritizing a good workplace experience and will leave a job they are unhappy in. New data from the Department of Labor reports that Americans are also quitting their jobs at the highest rate on record, with 4 million workers leaving their jobs every month since spring 2021.
Those leaders that fail to provide a good employee experience leave themselves open to increased turnover, as dissatisfied staff move on. In turn, high levels of employee turnover raise recruitment and training costs, demanding managerial and HR time. It is estimated that disengaged employees are costing the UK economy £340 billion every year in lost training and recruitment costs, sick days, productivity, creativity and innovation.
Built In reports the average costs to replace an employee are:

  • $1,500 for hourly employees
  • 100 to 150% of an employee’s salary for technical positions
  • Up to 213% of an employee’s salary for C-suite positions

Not only are you then forced to dedicate time and resources to recruiting, onboarding and training a new hire after an employee leaves, but your business simultaneously takes a hit internally while the role remains unfilled, leading to loss of opportunities.
It’s vital to provide your employees with an excellent digital employee experience to ensure they feel empowered and motivated in their work, and create a culture of inclusiveness and trust. Gartner highlight the clear dissonance between executives and individual contributors; 75% of execs believe they take employee perspective into consideration when making decisions, whereas only 47% of individual contributors do. If employees do not feel listened to, they will likely become disengaged, demotivated, and look to leave.
Listening to your employees, understanding their sentiment, and using this to inform your DEX program will lead to happier employees and less turnover. In fact, Forrester recommend organizations should proactively combine telemetry data with user sentiment data to enable cross-department analysis and aid in continuous DEX improvement.

Customer Experience

One final cost of a bad employee experience to be mindful of is that of your customer experience (CX). Put simply, engaged employees lead to happy customers. Don’t believe me? Well, as Forbes explains:

  • Companies that excel at CX have 5x more engaged employees
  • 79% of employees at companies with above-average CX are highly engaged in their jobs
  • Companies that invest in employee experience are 4x more profitable than those that don’t

A bad employee experience will leave your staff unmotivated, and less likely to be proactive advocates for your organization. Focus on creating the best employee experience possible, and you’ll reap the benefits of this when it comes to your customers.
Needless to say, a bad employee experience – and a bad digital employee experience – can have drastic effects on your company’s bottom line. Forrester got it right when they said that an exception digital employee experience (DEX) is no longer a luxury, it’s now a necessity.

Keen to learn more about digital employee experience (DEX)? You can read all about it here


The FORRESTER WAVE™: End-User Experience Management, Q3 2022

The FORRESTER WAVE™: End-User Experience Management, Q3 2022