The clamor for more insightful and actionable employee feedback has never been louder, and as illustrated in Perceptyx’s 2023 State of Employee Listening report, companies are adapting by listening more frequently through a myriad of channels. However, the challenge persists: translating these invaluable insights into concrete actions, and more importantly, into tangible organizational impact.
Recently, Perceptyx hosted a revealing webinar to tackle this critical issue. Featuring industry leaders Laszlo Bock, former Google CHRO and Co-Founder of Humu, and Joe Freed, Perceptyx's Vice President of Product, the webinar delved into the transformative role of Artificial Intelligence (AI) in the realm of employee feedback.
The discussion zeroed in on a groundbreaking concept — an "intelligent" nudge engine that not only analyzes but also activates employee feedback. The engine, rooted in AI technology, aims to bridge the gap between employee insights captured via listening and real-world business outcomes.
The Current State of Employee Experience and the “Manager Squeeze”
Joe Freed set the stage by discussing the complicated landscape of the employee experience market, mentioning how rapid changes — whether triggered by technological advancements or socioeconomic pressures like the pandemic — make it crucial for companies to "listen" to their employees. “The good news is that many companies understand the need to listen to their employees,” Freed stated. “Perceptyx is one of the mature vendors providing state-of-the-art platforms for this purpose.”
Yet, the challenge lies in how organizations can transform these insights into actionable strategies, especially when the responsibility to enact change frequently falls on already overburdened managers. Managers are faced with increasing demands for change, yet often feel unsupported by their organizations. “Managers actually feel like they're getting less support from their organization,” Freed observed. “They feel they have less clarity on how to be successful and fewer data insights into their team’s engagement.”
Laszlo Bock highlighted an unintended consequence of the pandemic. “What happened in the pandemic was this massive growth in not just employee measurement but also employee monitoring,” he said. "The volume of measurement went up dramatically," Bock said, "Managers were given more data, more demands from their bosses, without actually knowing what was important within that data."
Bock cited Nick Bloom, a Stanford professor and leading thinker on the hybrid work model, explaining that managers have been left wondering, “Now I have all this data. What do I do with it? What's meaningful and what's not?” Freed pointed out a major challenge: while organizations believe they’re providing managers with ample information, managers conversely feel they lack actionable insights. This dissonance, Freed argues, leads to managerial stress and a broader inability for organizations to act upon gathered data effectively. “At the end of the day, all of that data, all of the pressure on the managers not really understanding, it leads to this idea of, okay, we can listen and we can analyze, but how do we actually act and change?” he asked.
Challenges in Translating Insights to Action
Joe Freed outlined a twofold challenge in transitioning from data gathering to action. The first issue involves connecting actionable outcomes to the data gathered, something organizations have traditionally failed to do. “That attribution challenge is hard and it's traditionally not been part of how we think about taking action,” he explained.
The second challenge has to do with taking meaningful action at the enterprise level. “What's difficult about taking action at the enterprise level is what I refer to as the personalization/scalability ratio. In order to take action at the enterprise level, you have solutions that are either scalable or personalized, but it's very hard for them to be both,” he said.
Laszlo Bock agreed that these challenges are not new but asserted that their urgency has escalated, particularly due to societal changes and the COVID-19 pandemic. He added that employee activism and the rise of the Black Lives Matter movement have underscored the need for organizations to not only listen but also to act meaningfully — which some have yet to truly begin doing: “If companies have been doing listening for decades and they've been acting for decades, but employee engagement hasn't really moved that much systemically over decades, then the actions probably aren't having any impact.”
Merging Data and Behavior: A New Frontier in People Analytics
Joseph Freed explained that Perceptyx saw a critical problem in employee engagement and decided to take proactive steps to solve it. "Perceptyx has been focused on understanding how we actually solve this core issue our customers are facing," he said. To that end, Perceptyx has invested in targeted solutions, making acquisitions like Cultivate — the organization he co-founded — and Humu to strengthen its approach.
Cultivate had developed a series of AI and natural language processing models that allowed people to gain insights into their own behavior at work. "Cultivate provides leaders and managers the data needed to understand their behaviors in a highly digital work environment," Freed explained. This targeted approach was designed to meet the challenges of a shifting work culture that increasingly includes hybrid and remote work settings.
Cultivate focused on what Freed calls "behavioral self-awareness," leveraging AI to transform unstructured data into personalized analytics. These analytics are aimed at enhancing how people leaders interact with their team members. "It’s about understanding the outcome first, then changing behavior. And Cultivate was developed to help individuals reach that understanding," he said.
The integration of Cultivate into the Perceptyx platform aimed to link this behavioral self-awareness with other larger, organizational metrics. Freed gives an example of how this integration could amplify the impact of a 360-degree feedback process. "Most managers get feedback about their behavior but often lack the actual data to understand where they're falling short. Cultivate fills that data gap," he said.
Humu: An Approach Rooted in Nudge Science
While Cultivate was effective at providing self-awareness, it wasn’t as proficient at strategizing behavioral change. "It could tell you what you’re doing wrong, but not how to do it right," he says. That’s where Perceptyx’s acquisition of Humu comes into play.
"The idea was to solve exactly this issue of organizational change," said Laszlo Bock. At Google, Bock was deeply involved in behavioral experiments focused on "nudging," a concept developed by Richard Thaler and Cass Sunstein. This psychological strategy aims to influence individual decisions subtly but significantly, for the better.
Bock recalled an experiment at Google where sugary snacks were placed in opaque containers while healthier options were made more visible: "Over an eight-week period, people consumed 3.3 million fewer calories just by making it a little easier to make a good choice.” Humu, according to Bock, took this principle and applied it to various aspects of workplace behavior, by creating a framework, rooted in behavioral science, that focused on what actually drives human behavior. They mapped employee engagement data to various psychological themes like dependability and decision-making. "This allows us to identify specific team needs and figure out what to nudge on,” he explained. This happens automatically in the background, transforming survey data into actionable insights.
Bock described how Humu’s “nudge” system highlighted an issue with his own work-life balance during a particularly busy phase. An email he received advised him not only to make a list of what was causing him stress but also to "let one thing go." "For someone who's founded a company, even I was taken aback by the simplicity and effectiveness of this nudge," he recalls. "It just stopped me in my tracks. Some may look at these nudges and think they're already doing them. Others will find them revelatory. The idea is to offer what is needed when it's needed."
Humu built a library of thousands of personalized nudges that are delivered in the flow of work. According to Bock, these nudges are designed to be complementary, versatile, and scalable: "It's like a personalized learning curriculum that addresses the unique challenges every team and individual faces.” By combining the data-driven capabilities of Cultivate with the behavioral nudging of Humu, Perceptyx aims to create a comprehensive solution for people leaders who want to change not just metrics, but actual behavior. "We're leveraging both to offer a well-rounded approach to solving the complex issues that every person and team faces," said Bock. “The average person gets a nudge every week to two weeks. It's not a flood. We make sure to explain why a person is receiving a particular nudge, maintaining transparency.”
Joe Freed emphasized how the Humu platform redistributes the responsibility of change from solely being on the manager to the entire team. "What struck me is that Humu addresses the cultural environment. Everyone on the team has a role in culture, not just the people leader," he stated.
Bock also elaborated on how the evolving system will reach field workers, who are often excluded from standard office analytics. He cited examples from Humu’s past work in various industries, including delivery and hospitality: "We've actually deployed field workers in the past. Delivery drivers, fulfillment personnel, frontline restaurant workers — you name it." For those without access to company emails or other digital platforms, Bock pointed to alternative data collection methods. These range from integrating with native systems provided to the field workers to using iPads in break rooms for survey data collection. Even when you can't reach every frontline employee, the technology's reach can still be expansive and effective: "We've been able to reduce employee attrition by four to 20 percentage points just by nudging down to the manager level in high employee churn environments."
A Framework for the Future
Discussing future directions, Freed elaborated on how combining targeted solutions like Cultivate with Humu’s behavior-changing nudges and Perceptyx's listening platform can offer a robust solution for organizations. "The problem is, 'How do we help organizations take action at scale across the company and then measure change?' What we're developing is an actual learning loop, linking insights to actions to outcomes," he said. The deployment of AI was critical to making this system work efficiently: “It's not just about sending a nudge; it's about knowing what the right thing to send to you at the right time is. We're not just building a solution; we're creating an ecosystem for behavioral change and organizational excellence — and it’s very exciting to layer the AI piece on top of that and see where this is all going.”
The integration of Humu promises to not just offer sophisticated analytics but also actionable nudges, allowing organizations to measure and drive change more efficiently than ever before. To view the full webinar on-demand, click here. To stay informed about new resources, product releases, and upcoming events related to AI and closing the gap between employee listening and action, opt-in here.