The Power of Positive Employee Relationships: Realizing Your ROI

As the workplace evolves, so should your strategy for maintaining positive employee relationships. Today’s employees come to work every day to find purpose and satisfaction —not just to collect a paycheck. Fostering positive employee relationships does more than keep workers happy; it improves your bottom line. When you invest in employees, you’re guaranteed a return on that investment through increased employee engagement and productivity, better talent retention, and improved brand reputation. Organizations that focus on building positive employee relationships from within quickly realize a positive impact on every facet of the business -- from recruiting to results.

The 2015 “Labor of Love” survey from Virgin Pulse found that nearly 60% of employees believe their relationship with their employer—positive or negative—impacts their focus and productivity at work. Beyond productivity levels, many employees (44%) say a good employer relationship positively impacts their stress levels, leading to higher productivity overall. When employees are stressed, productivity diminishes, as Emma Seppala, Ph.D., and Kim Cameron, Ph.D. highlighted in their article for Harvard Business Review.

How do you realize the ROI from employee relationships? Here are five places to start:

#1: Employer Brand

Advertising and PR are important vehicles to promote your brand. However, when it comes to establishing an employer brand, people tend to trust their friends, peers, and online reviews to decide if your organization will be their next place to work. When you become a word-of-mouth-worthy employer of choice, finding and hiring top-tier talent becomes significantly easier.

So what does the employer-employee relationship have to do with building your brand? If you want people to talk about your employer brand, you have to give them something to talk about, and the better the employer-employee relationship, the more positive things they’ll have to say.

Start by making sure your employees feel valued for the role they play at your organization. Here are a few actions you can take:
- Listen to employees and make them feel heard.
- When employees give you feedback, acknowledge it and do something about it.
- Recognize employees for a job well done, and give credit where credit is due.
- Build a positive employee experience from recruitment to outplacement and everything in between.

#2: Retention

The cost of finding and replacing employees is equivalent to between 30 and 50 percent of their annual salary, and the average cost of an unfilled position is approximately $500 per day, according to our parent company, Randstad. Given the high-cost of hiring and recruiting, employers are expressing growing concern over trends in job mobility and attrition of employees caused by dissatisfaction in the workplace. In a recent blog post, It Takes More Than Salary to Attract and Retain Talent, our Practice Development Manager, Emily Elder, noted that one in three employers is concerned voluntary exits will increase, according to Glassdoor’s Statistical Reference Guide for Recruiters.

Retention has become a major concern for employers. Even beyond cost, retaining good, productive employees is vital to business agility. When employees have positive relationships with leaders and managers, retention increases and attrition decreases. According to SHRM’s Job Satisfaction and Engagement research report, “The majority of employees find the relationship with their immediate supervisor and senior management to be very important to their job satisfaction.” When employees feel respected and trusted, they extend similar respect and trust to their managers and peers. Fostering a workplace where open communication and the ability for both peers and managers to show appreciation for a job well done creates a positive environment where employees thrive and want to stay long-term because they feel valued.

#3: Employee Engagement

Did you know that there are many outside factors that impact employee engagement? Employees might feel less engaged if they’re short on sleep, or bored, for example. Sometimes, engagement is out of your control. But did you know that manager relationships account for 70% of variance in employee engagement? Gallup found that great managers “build workplaces that are engines of productivity and profitability.”

Positive relationships between managers and employees can have a profound impact on engagement levels. The stronger the relationship, the more likely managers will be able to spot roadblocks and challenges to an individual employee’s success. When the manager-employee relationship is solid, managers can help employees stay engaged and overcome obstacles that might otherwise serve as distractions.

Disengaged employees who are not working to their full potential are slowing economic growth and costing organizations between $450 and $550 billion annually, according to a Gallup poll. When employers successfully get workers engaged, involved, and enthusiastic about their workplace through stronger employee relationships, they realize ROI through improved productivity, increased job satisfaction, financial savings, and the achievement of corporate goals.

#4: Employee Network

When employees leave your company, voluntarily or involuntarily, they become brand ambassadors. Positive or negative, good or bad, employees have an extraordinary opportunity to impact your business even once they’ve left. Positive employee relationships extend far beyond your employer brand—former employees can solidify positive sentiment and create an alumni network that might offer a number of benefits to your company down the road.

Former employees can always come back in some capacity. Their relationship with you is no longer finite. They might become boomerang employees after gaining additional valuable experience elsewhere. They could come back to work as freelancers or gig workers. Valuing employees and treating them well may lead to a favorable business outcome, months or years down the road.

#5: Business Results (AKA Your Bottom Line)

When you endeavor to fully support the employee journey, you’re making a commitment to improve the employer-employee relationship. That relationship begins with the first point of contact with a potential employee and continues long after that employee has left the organization. Companies that offer best-in-class engagement, retention, outplacement, and other HR services designed to support employees along their career paths will find this approach is a recipe for business success. Measurable business metrics—from revenue to employee retention and even diversity numbers—all hinge on an organization’s ability to build and foster positive employee relationships.

In today’s Employee Relationship Economy, where former employees become vendors, customers, brand evangelists, recruiting references, and even boomerang employees, the employer-employee relationship is crucial. Look across your organization to spot weak spots, or hurdles standing between managers and employees, or your brand and employees and ask yourself these questions:
• Can employees trust your company?
• Do workers feel supported in their journey at your company and beyond?
• If team members want to undergo a job transition, would they feel supported?

What is your organization doing to improve the employee-employer relationship? Let us know – we’re committed to helping companies build positive workplaces based on trust and transparency. Our solutions help organizations achieve these five goals – and more.