An acquisition and an IPO- the last fortnight has indeed witnessed a flurry of activity in the space of employee experience. First, Workday Inc., a leader in enterprise cloud applications for finance and human resources announced that it is buying Peakon ApS, an employee success platform that converts feedback into actionable insights, for $700 million in cash.
Simultaneously, SAP spinoff Qualtrics International, Inc., a technology platform that organizations use to collect, manage, and act on experience data made a stellar debut on the IPO markets, raising $1.55 Bn, which exceeded elevated expectations and boasting a market valuation of $21.66 Bn.
With Peakon, Workday is going to provide organizations with a continuous listening platform, including real-time visibility into employee experience, sentiment, and productivity, to help drive employee engagement and improve organizational performance. And when you come to Qualtrics, over 9,000 enterprises worldwide, including more than 75% of the Fortune 100 and 99 of the top 100 U.S. business schools, use it.
And just last week, Microsoft Corp. announced Microsoft Viva, the first employee experience platform to bring tools for employee engagement, learning, wellbeing, and knowledge discovery, directly into the flow of people’s work. With this launch, the company is hoping to reimagine the fragmented $300 Bn market to bring tools for employee communications, wellbeing, learning and knowledge discovery into the flow of work
All this makes one thing evident-listening to employees is on-trend and there is big money betting on it and the employee experience space.
Employee experience-A pandemic led pump
One look at the past year’s extraordinary events and one can understand how the massive change in the world of work left business leaders grappling with uncertainty while needing to support employees like never before. The unique circumstances forced organizations to rethink HR strategies and continuously listen to their employees. Gone was the luxury of those half-yearly and annual surveys. Business in the new normal required engaging, supporting, and most importantly listening to talent and responding to them on a continuous basis.
In a Zoom call with Bob Evans of Cloud Wars, Founder and Chairman of Qualtrics, Ryan Smith aptly put it, “And suddenly, experience was out in front of everything—companies had to figure out how to deliver beautiful experiences in a very different world, and CEOs began to realize that they need to be able to design that whole experience. Well, Qualtrics is the perfect platform to help them do that.”
It is this consistent cultivation of a two-way dialogue to hear, understand, and respond to employees that Workday is banking on by buying Peakon, which was founded six years ago, in the words of Co-founder and CEO Phil Chambers, “to help every employee drive the change they want to see.”
Peakon had one clear problem they were trying to solve-as stated by Phil, “When we entered this industry, we identified a cause where we believed we could make a real difference; you’ve probably all seen the graphs showing how employee engagement has flatlined globally for years, or felt the frustration of action plans left unaccomplished. Experts and organizational psychologists lacked the technology to reach those who could affect change: people leaders. Conversely, we saw general-purpose survey providers delivering poor quality, unactionable data.”
And in order to meet this challenge, Workday and Peakon will come together with a continuous listening platform that will help customers capture real-time employee sentiment, facilitate ongoing feedback, and access personalized, prescriptive recommendations for actions.
As it is, over years, organizations had been struggling with the lack of unactionable data and falling levels of employee engagement and productivity and thereby the bigger challenge of talent retention. Added to that, the pandemic exacerbated the problem of employee engagement, thrusting to the forefront the need for every organization to help leaders continually discover and respond to evolving employee feelings, needs, and behaviors.
Aneel Bhusri, Co-founder and Co-CEO, Workday aptly reiterated this point when he said, “Bringing Peakon into the Workday family will be very compelling to our customers – especially following an extraordinary past year that has magnified the importance of having a constant pulse on employee sentiment in order to keep people engaged and productive.”
Remote work demands greater connectivity, more listening, more tech
However, the demand is not restricted just to the one extraordinary year we passed but rather to what follows after it. The pandemic has led to remote work/hybrid work becoming the order of the day and has forced organizations the world over to look seriously at the ways they work and the kind of employee experience they are offering to them in these changed circumstances.
"Listening to employees has become one of the most urgent strategies to build agility, responsiveness, and growth. Workday’s acquisition of Peakon will enable Workday customers to deploy a highly targeted and integrated employee listening strategy, addressing a top priority in employee experience today, "stated Josh Bersin, global industry analyst, on the acquisition.
Remote work will be a continuing reality beyond 2021 and employers realize that means so will the need to be connected to employees continually, to build healthy, productive, engaging, inclusive, and collaborative work environments. Thus employers will want to utilize specialized tools in order to be in the thick of workplace issues and provide actionable solutions.
Both Peakon’s and Qulatrics’s platforms enable employers to understand employee experience, gather employee feedback, convert them into actionable insights, and drive business results. Or tools that we call that lie at the intersection of continuous analytics and targeted analytics.
Ultimately, what’s clear is that listening to employees is on-trend, fueled by the pandemic led push to the remote/hybrid work and thinning of offices which have made it much harder to tune in to employee conversations. What it has also led to is a renewed focus on employee wellbeing, continuous communication and more importantly transforming employee feedback into actionable insights that can actually drive organizational performance.
David Hassell, CEO of 15Five, a leading people and performance platform reiterates the same point. In a LinkedIn conversation with us, David says, “Over the past decade, companies have continued to realize more and more the importance of listening to their people if they're going to build responsive organizations that can attract, retain and engage the best talent. COVID however made this even more critical. Every single CHRO I've spoken to in the past year has shared some version of the idea that companies have had to care for the emotional and psychological wellbeing of their people more than they've ever had to before, and this trend is not going back."
"Between fear, the potential for overwork and burnout, isolation and uncertainty there's been enormous pressure on employees, and when you add in working in a distributed fashion, it makes it even more important to listen and challenging to get a pulse on your people. I expect these trends to only continue into the future," David further adds.
Technologies like Peakon, Qualtrics, and 15Five, which provide a continuous listening platform to elevate employee engagement, thereby making employee conversation quantifiable while serving business imperatives of improving organizational performance, are going to be in demand. If Qualtrics’ post-IPO valuation and Peakon’s deal price are anything to go by, this is good news for the employee experience space. And ultimately, both for the employer who is listening and the employee-who is being finally listened to.
For more insights on the employee experience space, stay tuned for the People Matters Employee Experience Conference in June 2021.