Research from McKinsey has found that for the last two decades, US productivity has grown at a “lackluster” 1.4% on average. And, recent data from the Bureau of Labor Statistics found that 2023 demonstrated even slower productivity growth, at just 0.7%. Many US business leaders have been quick to point the finger at remote and hybrid working as one of the main culprits.
This has resulted in some large companies, including Amazon and Zoom, rolling out strict return to office (RTO) mandates. Our recent research of US and UK firms backs this up, with 90% of IT decision makers saying hybrid working is creating ‘productivity paranoia’ in their organization.
Yet while hybrid working is an easy target, there is something far more impactful but less visible at play – the digital employee experience (DEX). Modern workplaces are increasingly digital, and poor DEX wipes out nearly four hours a week for the average employee as they battle against the digital friction caused by non-performant technology, unnecessarily complicated digital processes, and ‘notification overload’ from a host of applications.
The struggle to gauge productivity compounds the problem
Part of the reason the productivity crisis has been so pervasive is because measuring the problem is extremely challenging. Most IT departments use a number of established metrics – such as evaluating the volume of outputs, deploying time tracking software, or getting employees to self-report. But these metrics are too subjective and too narrow in focus to deliver true insight into employees’ digital experience and its impact on how effectively they work.
Firstly, it is hard to quantify output for many knowledge-based jobs. Secondly, even when there is a tangible output to assess, that lone figure offers only partial insight. Accurately measuring productivity needs nuance. For instance, a financial services enterprise might consider five mortgage originations processed per hour by a customer service agent as a benchmark for a high level of output, and so regard employees completing five originations as productive.
Yet simply looking at a standalone number gives no understanding into how a task was carried out, or how digital friction impacted the process, or if the origination workflow could be optimized for improved productivity. It could be that by eliminating digital friction, the organization could uplift the number of originations completed by 20% for the same level of effort. But without the capability to accurately measure DEX and see where friction occurs, organizations are in the dark over how to empower employees to be more productive.
Why does DEX matter?
The shift to hybrid has increased the need for this kind of digital experience and productivity analysis. It’s easy to assume that seamless and frictionless DEX is merely a “nice-to-have”, not a “must-have.” But a good DEX is critical to job satisfaction for knowledge workers. Almost a third (29%) say poor DEX has made them want to quit a role – a worrying statistic given the cost of replacing an employee averages at nearly double their yearly salary.
The good news is that the situation is changing, with both IT decision makers and knowledge workers agreeing on the top three causes of digital friction that contribute to poor DEX:
- Having to repeatedly toggle between applications to complete a task or find information
- Applications that repeatedly freeze, crash or load slowly
- “Notification overload” caused by have too many communication channels to manage
This developing alignment between IT and the business means there is a growing urgency around the need for IT to transform away from its traditional workstation’s ‘break/fix’ role. What is needed is an emphasis on delivering the best digital workplace for the modern hybrid enterprise. The issue is that most IT teams lack access to the DEX observability data that would allow them to optimize the digital workplace.
Evolving the ‘break/fix’ approach
To make the shift away from the ‘break/fix’ model, IT departments need sophisticated solutions that deliver visibility across the enterprise to surface hidden friction. For example, by identifying if employees have to access multiple applications to progress a workflow because of missing information or functionality, or spotting parts of a workflow that could be automated to reduce app switching. Given the average employee is found to switch between apps more than 10 times an hour, there is significant room for improvement in most businesses. Crucially, these measures not only improve productivity but eliminate information and knowledge siloes to make it easier for workers to collaborate.
Such insights enable IT leaders to make data-led investment decisions. Understanding who the top performers are in a team means IT can replicate their workflows for other teams, while automating time-consuming and repetitive tasks. Moreover, when IT teams have observability over how work is done, they can assess the risks of any planned change and see if any users or tasks would be disrupted if migrated to a new application. This allows improvements to be made that deliver the most impact while minimizing upheaval for everyone.
A new way to tackle productivity
American companies need a new way to tackle the productivity crisis. Rather than persisting with limited metrics and focusing on concerns about hybrid working, businesses must ask more sophisticated questions. To goals should be to give IT leaders the means to tackle one of the most notable productivity barriers that exists by fixing the digital employee experience. For those organizations that make the leap, the benefits will be huge – delivering a satisfied and engaged workforce, while creating a much healthier bottom line.
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