Landmark study: Interactions with HR positively impact a company’s reputation as a place to work

11 November, 2020

Melbourne, AUSTRALIA, 28 October 2021 – A new first-of-its-kind study by ADP Research Institute (ADPRI) shows that having even a single point of contact with HR positively influences an employee's overall experience. A survey of 32,000 respondents found that when employees have a designated HR contact, they were twice as likely to value their company, and five times as likely to recommend their company as a place to work, compared to those who have no direct HR contact.

The 25-country study, which included Australia, debuts the HR XPerience Score (HRXPS) - a metric to measure the impact of the HR function on a company’s reputation as an employer - as seen through the lens of the employee experience. Generating a strong score is influenced by an employee’s relationship with HR. 

The study reveals the key interactions and services provided by HR which positively impact employee experience, highlighting the importance of HR in turning employees into company ambassadors. 

Other key findings:

  • Frequency of interactions matter: Employees are 7.4 times more likely to say HR is valuable when they experience seven interactions (compared to no interactions)
  • The more HR services used, the more positive the experience: Employees who use five services are 11 times more likely to say HR is a valuable function
  • Effective HR creates ambassadors: Employees are 8 times more likely to promote their company to others if they have a positive HR experience
  • HR retains talent: If an employee finds HR valuable, they are 3.7 times more likely to stay in that employment
  • Formal onboarding is important: Employees that experience a formal onboarding process are 8.5 times more likely to say HR is Value-Promoting compared to those who had no formal onboarding
  • Health services are key: Employees who receive health benefits and use them are 3.5 times more likely to say that HR has a positive impact on their workplace experience than those not offered health benefits.

“While companies have always tried to better understand what contributes to the talent brand, we now have a studied metric to effectively measure the HR function,” said Marcus Buckingham, head of people and performance research at the ADP Research Institute. 

“Our research found that the HR function is critical to the talent brand – so much that every employee interaction that takes place, the specific services used and a personalised feel with a single point of contact are what influences a higher HRXPS. In fact, this high-ranking, single point of contact upends the current industry trend of doing away with HR.” 

“The workforce remains hyper-focused on the need for talent, as job vacancies soar and competition for top talent remains high,” said Sreeni Kutam, chief human resources officer, ADP. “At the center of driving talent, both in acquisition and retention, as well as the talent brand, sits HR. Its importance can now be measured with an industry benchmark to gauge the strength of an organisation’s HR function. 

“As companies continue to ramp up hiring, HR has an opportunity to refocus efforts on the onboarding process as this is a critical touchpoint, as uncovered in the study. A company’s talent is vital and this study shows where and how HR can make a direct impact on the talent brand of an organization.”  

ENDS

Note to editors
Marcus Buckingham, Head of ADP Research Institute | People + Performance

Marcus Buckingham is a global researcher and New York Times bestselling author focused on unlocking strengths, increasing performance, and pioneering the future of how people work. He is the author of two of the best-selling business books of all time, has two of Harvard Business Review’s most circulated, industry-changing cover articles, and his strengths assessments have been taken by over 10 million people worldwide. He now leads People + Performance research at ADP Research Institute, spearheading groundbreaking global studies on subjects like Resilience and Engagement.

About the research

Real-world actions and behaviors that support HRXPS:

What influences HRXPS: 

As part of the study, ADPRI created a metric to measure and categorize the HR function of a company as Value-Promoting, Value-Performing and Value-Detracting, which can be used as an industry benchmark of comparison to the national and global level of a company’s HR function. 

A positive perspective of HR: 

  • When an employee thinks HR is Value-Promoting, they are 8 times more likely to be a talent brand promoter.

Likelihood of intent to leave: 

  • Employees who are Value-Promoting are 3.7 times more likely to have no intent to leave compared to Value-Detracting.
  • However, for employees who are Value-Detracting according to HRXPS, they are 3.4 times more likely to be actively searching for a new job compared to Value-Promoting. 

Timeline to actual voluntary terminations:

  • Employees who voluntarily leave are 1.6 times more likely to see HR as Value-Detracting three months prior to leaving the company. 

Key factors that influence HRXPS: The global study found that overall, HR interactions and the human experience have a dramatic effect on a company’s talent brand and can influence retention. 

A single point of contact:

  • Employees who have a single point of contact with HR are twice as likely to say HR is Value-Promoting than employees with multiple HR contacts, and 5 times more likely than employees who have no HR at all.

Frequency of HR Interaction:

  • Employees who had seven interactions with HR are 7.4 times more likely to say HR is Value-Promoting than those who have had no interactions.
  • The more services used by an employee, the higher the HRXPS; an employee who uses five HR services is 11 times more likely to say HR is Value-Promoting than an employee who doesn’t use any services.

Top HR services that influence HRXPS:

  • Onboarding: 
    o Employees that experience a formal onboarding process are 8.5 times more likely to say HR is Value-Promoting compared to those who had no formal onboarding.
  • Performance Attention:
    o Employees who receive the most frequent attention on their performance are 4.4 times more likely to say HR is Value-Promoting than those who receive no performance attention. 
  • Health Benefits
    o Employees who receive health benefits and use them are 3.5 times more likely to say HR is Value-Promoting than those not offered health benefits.

Employee characteristics that do not relate to HRXPS: 

The study further analysed additional factors and characteristics that do not relate to HR’s service quality. Employment status, whether full time or part time, does not increase the likelihood of any one of the HRXPS categories. The average HRXPS is relatively equal between full time and part time workers. Being a certain gender or age does not increase one’s likelihood to view HR as Value-Promoting or Value-Detracting, nor does an employee’s level of education. High school graduates are just as likely to rate HR as Value-Promoting as a college graduate. While an employee’s tenure with an organization has been found to be a driver for many outcomes, such as Engagement, length of employment does not increase the likelihood of being in any one of the HRXPS categories. Company size has also been found to not impact the HRXPS. 

For a more detailed look and to download ADP Research Institute’s HRXPS, visit ADPRI.org.

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About the ADP Research Institute 

The mission of the ADP Research Institute is to generate data-driven discoveries about the world of work, and to derive reliable economic indicators from these insights. We offer these findings to the world at large as our unique contribution to making the world of work better and more productive, and to bring greater awareness to the economy at large.

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