The Importance of Understanding Employee Needs: How it Impacts Your Business

Employees are very important to a business. To make the business successful, it’s important for bosses to know what employees need. When bosses know and care about their employees, it makes the work environment better. Everyone feels like they are part of a team and will likely feel a stronger sense of loyalty.

So what’s the value in understanding your employee’s needs? How does it impact your business? Knowing what each employee wants and needs makes them feel happy and motivated, and they work better. There are different ways bosses can help employees, like having flexible work options. Both employees and bosses benefit from understanding and meeting employee needs. This article will talk about how they help each other.

Understanding employee needs benefits employees but also helps the company. This article will explore the many ways the two work together.

What Are Today’s Employees Looking For?

Modern-day employees have diverse needs. Every employee brings something new to the table and will need different things to maximize their potential. Still, there are some things that most employees will look for in a company.

Competitive Compensation

Employees prefer when they are paid fairly and competitively for their skills and hard work. People want to feel financially secure. They also may want recognition for their work. Sometimes, companies try to make employees happy by giving them treats like pizza parties or office lunches, but this isn’t a good long-term strategy. What employees really want is fair pay for what they do.

It’s critical that employers know how much work their people do and their value to the company. This way, they can make sure employees are treated well and appreciated for their efforts.

Gab Fabian, a Head of Employee Engagement, describes why:

“To retain good talent and foster a positive work environment, it’s essential that management recognizes and supports the contributions of all employees, regardless of their role. By valuing the hard work and expertise of support staff, providing opportunities for growth and development, and offering fair compensation and benefits, we can create a culture where all employees feel respected and valued. Ultimately, this will lead to a more motivated and productive workforce, and contribute to the long-term success of our company.”

Worker productivity has generally been on the rise decade after decade since the early 1950s. However, since 1972, there’s been a growing gap between how much people do for their companies versus how much they make. To help you learn more about this and how compensation interacts with worker productivity, we’ve written an article titled “The Great Divide: Exploring the Disparity Between Worker Productivity and Compensation.”

Work-Life Balance and Flexibility

There is a growing emphasis on achieving a healthy work-life balance. Employees appreciate flexibility in their work hours, the ability to work remotely, and policies that support personal well-being. They will also prefer to work for companies that emphasize the value of work-life balance over companies that don’t. As such, companies that care for their workers tend to keep and retain the top talents.

The core of workplace flexibility is remembering that it has to be flexible. Allowing for nonstandard setups enables employees and employers to create one that benefits everyone involved. Steven Bartlett of Flight Story explains it:

“There is no one-size-fits-all answer to the question of whether employees should work from home or in the office. Each company must consider its unique mission and reverse-engineer the optimal working conditions to achieve it. CEOs should avoid imposing their personal preferences without providing clear explanations for their expectations. The goal is not to achieve compliance through coercion – that’s a shitty way to lead – you want people to understand, agree and come with you out of choice.

The only wrong answer is a lack of clarity.”

To add to this, allowing employees to work from anywhere also increases your reach and potential recruitment pool. Work-from-anywhere setups offer several benefits to employers and employees. We recommend reading our an article titled “The Benefits of Workplace Flexibility: A Win-Win For Employers and Employees” to learn more.

Career Growth and Development

Employees seek opportunities for continuous learning and professional growth. They value organizations that provide training programs, mentorship, and clear paths for advancement.

People who think they are stuck or in dead-end jobs may look for employment elsewhere or stop doing their best at work.

Meaningful Work

Most people look for a sense of purpose or fulfillment in their lives. This feeling extends to their work. Workers are more engaged when they understand how their contributions align with the company’s goals and values.

Creating an impact report is an excellent way to make employees excited about your company’s mission. If your company wants to make the world a better place, an impact report shows what it’s doing and its plans for the future. It also helps to follow special goals for sustainability called sustainable development goals (SDGs). These goals help us measure and show the good things your company is doing.

People like it when a company helps its community. Sustainable goals and corporate responsibility aren’t just fancy words to impress people. They are effective strategies to create connections to your people and customers. For a how-to guide on building engagement with your people through a mission, read our article, “How to Increase Employee Engagement with Corporate Social Responsibility.”

Collaborative and Inclusive Environment

Employees love working in places where they can work together as a team and everyone feels included. It’s important for a team to have different perspectives and a strong sense of cooperation. On the individual level, people like it when they know their voices are heard.

Diversity strengthens teams. When everyone is the same or comes from the same place, they tend to think in one way only. But when people are different, they can come up with lots of different ways to get things done. It’s like having lots of options and finding the best solution together.

Technology and Tools

Technological advancement creates new tools that help people work and be more efficient. Employees expect access to modern tools and resources that enable efficient and effective work. They appreciate organizations that invest in relevant technology and provide adequate training.

Recognition and Feedback

Regular feedback and recognition for their efforts motivate employees. They appreciate constructive feedback, performance evaluations, and acknowledgment of their achievements.

Failing to recognize an employee’s accomplishments will make them feel unappreciated. There are several ways to show appreciation, but opening a dialogue with your workers can benefit you. As we stated, different people appreciate different things.

As Michael Seelman, a leadership coach, puts it:

“Performance reviews are a critical component of managing a workforce, providing valuable feedback to employees, and assessing their progress toward achieving company goals. However, traditional performance reviews are often ineffective, failing to provide actionable feedback and failing to motivate employees. “

Workforce Diversity and Inclusion

Forward-thinking people believe it’s vital for companies to treat everyone fairly, no matter where they come from. Having a diverse group of people at work brings in new ideas and ways of doing things.

Diversity is not just something people talk about — around 50% of talented people consider a company’s diversity and inclusion policies before applying for a job. If a company doesn’t have good policies, they might miss out on hiring really talented people. That would be a big loss for the company.

We’ve written an article that takes an in-depth look at diversity and inclusion while offering tools to make it happen in your company. We recommend reading our article, “Diversity and Inclusion in the Workplace: Why it Matters and How to Achieve It.”

Work Security

Employees seek stability and job security. You can expect that they look for the following:

Clear expectations
Job stability
A supportive working environment
Security in times of change

When employees feel secure, they are more likely to stay in their jobs. It’s important for companies to give positive rewards and show employees that they care about them. When companies give negative consequences or make employees worry about losing their jobs, it can make employees feel stressed and unhappy. This might even make them want to leave the company.

Well-being Support

Employees appreciate it when their companies take care of their well-being. This means having programs and policies that help with mental health, wellness, and balancing work and personal life. People today are more aware of how these things can affect their mental health and overall happiness.

Companies should see these initiatives and programs as a way of taking care of their most important asset: their employees. When employees feel good and have a good balance between work and life, they can do their best work.

Your employee’s mental health will have a direct influence on their performance. Dave Ulrich, a professor at the University of Michigan, describes why:

“Employee mental health underlies employee experience, which in turn affects business results. So employee mental health becomes an important focus for both business and HR professionals in contributing to the success of the business. Business and HR leaders become caregivers when they seek to help employees improve their mental health as part of their employee experience.”

It’s important to note that individual needs may vary. Organizations should strive to understand and address the unique requirements of their employees to foster a productive and satisfied workforce.

Why Should You Address These Needs?

Meeting employee needs is crucial for several reasons. Whether or not your organization can meet these needs will significantly impact a company’s overall success. Here are some key reasons why a company should prioritize meeting employee needs:

Employee Engagement and Productivity

Employees feel valued and engaged in their work when they feel the company can meet their needs. Engaged employees are more motivated, committed, and enthusiastic about their roles, leading to increased productivity and higher-quality work.

Addressing employee needs is a powerful catalyst for enhancing employee engagement and productivity. When employees feel their needs are recognized and met, they develop a stronger connection to their work and the organization. They experience a sense of value and appreciation, which fosters a higher level of commitment and motivation.

Engaged employees are more likely to go the extra mile, take initiative, and contribute their best efforts. They are enthusiastic about their work, display higher levels of job satisfaction, and are more resilient in the face of challenges. Proactively addressing employee needs, has several benefits for organizations:

A positive work environment
Increased worker engagement
Higher productivity
Better performance

Talent Attraction and Retention

Meeting employee needs helps attract top talent and retain skilled employees. A positive workplace reputation and a supportive and inclusive environment enhance the company’s employer brand. Satisfied employees are less likely to leave the organization. Keeping your people reduces turnover costs and preserves institutional knowledge.

The ability to retain your most experienced employees saves time and resources. Your best employees likely know much about how your company operates, so keeping them is in your best interests.

One of the best ways to keep your best people is through workplace flexibility. Offering work-from-anywhere setups is attractive to many people. To find out why, we recommend you read our article, “Will Work From Anywhere Be An Effective Employee Retention Strategy This 2023?”

Enhanced Innovation and Creativity

Employees who feel supported and valued are more likely to contribute innovative ideas and think creatively. A work environment that encourages and rewards innovation fosters a culture of continuous improvement and drives business growth.

Customer Satisfaction

Happy and engaged employees tend to provide better customer service. They are more likely to go the extra mile to meet customer needs. This has many benefits:

Improved customer satisfaction
Stronger customer loyalty
Positive customer word-of-mouth

Taking care of employees’ needs has a big impact on customer experience. When employees feel happy and valued, they do a great job of making customers feel special. They listen carefully, help in a way that feels personal, and show that they really care. This makes customers happy and want to come back again.

When employees feel good, they have a positive attitude that shines through when they talk to customers. They treat customers nicely, give them special attention, and show that they really care. This makes customers feel satisfied and want to keep coming back.

When a company takes care of its employees, it builds a culture where everyone cares about a better customer experience and builds strong relationships with them.

Company Culture and Team Collaboration

Making sure employees’ needs are met is really important for creating a happy company culture. When employees feel like their needs are taken care of, they feel like they belong and are part of a team. They work together and help each other, like a big group of friends. This makes them share their ideas and work well together.

When employees feel supported and understood, they feel like they belong to the company and want to stay. The company creates a culture where everyone’s well-being is important, where people talk openly, and where everyone feels included. This helps employees do their best work and feel happy.

When employees’ needs are met, they feel more comfortable working with their teammates. They trust and respect each other, which helps them work together better. They share ideas, solve problems together, and reach their goals as a team. By making sure employees’ needs are met, companies create a strong company culture where teamwork, new ideas, and great collaboration happen.

Reduced Absenteeism and Presenteeism

By addressing employee needs, companies can help reduce two things: absenteeism and presenteeism. Absenteeism is when workers don’t show up to work. Presenteeism is when your people come to work but aren’t fully engaged with what they’re doing.

Many employers may be familiar with presenteeism under the name of “quiet quitting.” However, quiet quitting isn’t what it seems. Rather, it’s likely a symptom of a more significant problem in your company: burnout. Taking care of your people is critical to preventing burnout, so we suggest reading our article “The Rise of Quiet Quitting: How to Recognize and Prevent Employee Burnout.”

Employer Reputation and Brand Image

Companies prioritizing employee needs build a positive reputation as an employer of choice. Demonstrating that your company cares for its people enhances its brand image with new talents. Doing so also improves your company’s optics in the eyes of customers, investors, and other stakeholders, which can positively impact business opportunities and partnerships. More people and organizations today are prioritizing employee care and sustainable development.

Help Your Employees, Help Your Company

In today’s competitive business landscape, meeting the needs of employees has become a critical factor in determining a company’s success. Organizations can reap many benefits by caring for their workforce. In line with this, a company should invest in the following:

Fair compensation
Employee work-life balance
Career growth
Inclusive policies
Up-to-date technology and tools

Engaged and fulfilled employees contribute to higher productivity, foster innovation, and provide exceptional customer service. James Chang, a CX expert, puts it succinctly:

“Have always believed in taking care of your employees first before your customers. Employee engagement needs to be at the heart of your business, and as Sir Richard Branson said, take care of your employees first, and they will then take care of your customers.“

Meeting employee needs enhances the company’s reputation, reduces turnover, and cultivates a thriving business ecosystem. Recognizing and addressing these needs paves the way for sustainable growth and a competitive edge in the market.