Why Companies Need to Listen to Employee Feedback


Sometimes the truth hurts. In this case, ignoring employee feedback carries risks to employee engagement and the bottom line. In fact, if you want to attract, land and retain quality staff, a mutual exchange of constructive feedback is imperative. Here’s why companies need to listen to their employees, even if they don’t like what they’re hearing.

The Study
From January to June 2017 Leadership IQ surveyed over 27,000 executives, managers and employees. They asked several questions:

  • Did employees feel that the company openly shared the challenges it was facing?
  • Were managers open to suggestions for improvements?
  • Did leadership and the organization take constructive action based on employee feedback? 
  • Did the employee feel comfortable recommending the organization as a great place to work?

Some interesting correlations were observed that made it evident that organizations ignore employee feedback at their own peril.

Sharing Challenges
The study made it abundantly clear that transparency was critical in securing employee engagement. Fifteen percent of the employees surveyed felt that their organization openly shared challenges. Those same employees were 10 times more likely to recommend their employer than those who felt that their companies were not as open.

Leadership Matters
A leader who encourages suggestions for improvement can make a difference to employee engagement. One quarter of those surveyed felt that their leader was open to constructive feedback.  According to Leadership IQ, “they’re [also] about 12 times more likely to recommend [their company] as a great employer.”

Interesting note: Middle managers and executives were much more likely than others to feel that their leaders were responsive to feedback. The younger workforce were not as likely to feel this way. This poses a potential challenge to retaining a millennial workforce who value mentoring and the ability to voice their ideas.

Read: To learn more about what millennials need in a finance or accounting job, read, “Why Millennials Quit Their Accounting or Finance Job.”

Acting on Feedback
Three quarters of the employees surveyed said that, “good suggestions or valid complaints from employees never led to important changes,” and they were highly unlikely (only 4%) to recommend their employer to others. 

In comparison, 75% of the 25% of people who felt that their organization took action would encourage others to work there.

Interesting note: Those who worked for smaller organizations felt that suggestions from staff were more frequently incorporated into organizational change than those who worked for larger companies.

Tips for Retaining Staff
It’s a very competitive marketplace for attracting and retaining top talent. Progressive companies are listening to employee feedback and offering a company culture that acknowledges the need for work/life balance. If you want to retain staff:

  • Build flexibility into company culture
  • Adopt an individualized approach to benefits
  • Maintain a diverse workforce – According to McKinsey, “More diverse companies, we believe, are better able to win top talent and improve their customer orientation, employee satisfaction, and decision making, and all that leads to a virtuous cycle of increasing returns.”  
  • Create resource groups where like-minded individuals can meet and brainstorm ideas
  • Develop mentoring programs that help people grow their strengths and mitigate their weaknesses
  • Clearly lay out an individual’s path to career progression
  • Establish in-house training programs and offer funding for individuals to pursue professional development

Key Takeaways
There are risks for an organization that ignores employee feedback. It’s clear, for example, that employees who feel heard are much more likely to recommend their employer to others. As it’s incredibly competitive to attract and retain top talent in the current marketplace, it’s imperative that companies listen and take action on suggestions and complaints made by its workforce.

Your Next Step
No one should walk the job search or hiring road alone. At Clarity Recruitment we help others realize their success through a process that marries proprietary technology with unwavering commitment. Contact us today to take control of your career, or to partner with us to hire well.

Clarity Recruitment, connecting exceptional people with remarkable companies.

More from Clarity