©Copyright Kenexa ® 2008 Kenexa EMPLOYEE SURVEYS: More than a temperature check? How can surveys affect the bottom line? 1

©Copyright Kenexa ® 2008 Agenda About Kenexa EMPLOYEE SURVEYS Why? Methodology Outcome 2

©Copyright Kenexa ® 2008 Kenexa Overview Founded: 1987 Employee Population: 1,600+ Revenue: € 145M-€148M (FY 2008) NASDAQ Symbol: KNXA Expertise: Hire the very best employees Maximize their experience with the organization

©Copyright Kenexa ® 2008 Global Locations

©Copyright Kenexa ® 2008 Select Survey Clients

©Copyright Kenexa ® 2008 Kenexa HR-Solutions Hiring the very best people Maximizing their performance Surveys are part of Kenexa‘s HR-Portfolio Recruiting Applicant Tracking Assessment Tools Interviews

©Copyright Kenexa ® 2008 SURVEYS… More than a temperature check?

©Copyright Kenexa ® 2008 Employee Engagement Communication Future/vision Growth & development Involvement & belonging Leadership/trust Meaningful/challenging work Recognition & rewards Variable dimensions TBD Retain key talent Revenue growth Market share Customer loyalty Innovation Advocacy Commitment Pride Loyalty Discretionary effort Commitment Engagement Outcomes Organizational Performance Drivers of Engagement

©Copyright Kenexa ® 2008 How we measure Engagement? When individual employees are truly engaged, they can tolerate limited periods of lower work satisfaction and stay highly committed. Engagement is a combination of attitudes and priorities that has a consistent and predictable impact on behavior. KENEXA-ENGAGEMENT-ITEMS:  Overall, I am satisfied with > as a place to work. (Satisfaction)  I would gladly refer a good friend or family member to > for employment. (Advocacy)  I rarely think about looking for a new job with another company. (Commitment)  I am proud to work for >. (Pride) Engagement Index = Satisfaction + Advocacy + Commitment + Pride

©Copyright Kenexa ® 2008 Linkage Analysis: Research Overview satisfaction attitudes commitment pride loyalty advocacy responsibility opinions Engagement Company/ Function Employee Engagement Accounts for: F500 transportation company  39% on-time delivery variance Telecommunications company  30% more favorable customer service ratings  15% more likely to reach Net Income Plan Retailer (field sales)  17% sales increase variance  22% net profit increase variance International beverage company  8% increase productivity/hour  20% decrease in absenteeism  22% reduction in waste costs  Total savings of $11M/year Higher Engagement  Quantifiable Business Results 10

©Copyright Kenexa ® 2008 Linkage Analysis: Total Shareholder Return (TSR) Engagement Index Group 1-Year TSR5-Year TSR Top 10%12.09%11.13% Bottom 10%-2.36%-22.17% The average high-performing organization on employee engagement shows a 6 times greater shareholder return than does an average bottom-performing organization on employee engagement over a 1-year period The average high-performing organization on employee engagement shows a 3 times greater shareholder return than the average bottom-performing organization on employee engagement over a 5-year period Total Shareholder Return by Top and Bottom 10 % on Engagement Index Scores 11

©Copyright Kenexa ® 2008 Copyright Kenexa ®, Linkage Analysis: Customer Satisfaction Engagement and Customer Satisfaction is significantly correlated. Only Stores for which 2007 Engagement data was available are included in this analysis (n=653). Store Engagement Level (by quartile) LowestLowerHigherHighest Overall Customer Satisfaction 12

©Copyright Kenexa ® 2008 METHODOLOGY IN PRACTICE

©Copyright Kenexa ® 2008 Design AdministrationReporting Behaviour Change Measure what matters – clear understanding of a company’s objectives driving the survey process Factors that drive high performance Engagement and your culture Alignment with strategy and processes Involve appropriate key stakeholders

©Copyright Kenexa ® 2008 Administration Reporting Behaviour Change Design

©Copyright Kenexa ® 2008 Survey Management System

©Copyright Kenexa ® 2008 Reporting Administration Reporting Behaviour Change Design

©Copyright Kenexa ® 2008 Response Scale - Reporting 18 SURVEY REPORT

©Copyright Kenexa ® 2008 ES: Employee Engagement Priorities Fictitious Sample Data Only Results for Engagement Main drivers to improve Engagement

©Copyright Kenexa ® 2008  Engagement priorities tell us which areas we can act on that will have the most impact on improving engagement.  What themes are most influential across the company.  What items provide the most leverage.  Statistical analyses performed to identify priority items with the strongest influence on engagement.  The natural tendency is to focus energy on the lowest rated items. Resist. How we indentify Drivers? Priority Items for Engagement Associate Engagement Index

©Copyright Kenexa ® 2008 Behaviour Change Administration Reporting Behavior Change Design

©Copyright Kenexa ® 2008 CHANGE… Something that happens as a matter of course?

©Copyright Kenexa ® 2008 Getting the Best Out of the Survey? 70% of enterprise companies conduct employee surveys on a regular basis ~ 20 – 30 % of employees are satisfied with the way in which the results are used for improvements ~ 50 – 60 % of employees think they receive sufficient information on the results of the survey high expectations disappointment frustration How to use the results effectively to gain a lasting effect? 23

©Copyright Kenexa ® 2008 Copyright Kenexa ®, Stores scoring low on the Enterprise-focused item saw Engagement decrease. Those scoring in the top half saw Engagement improve by over 12% in one year! Action Planning Effectiveness One Senior Leadership/Enterprise Focused item Low Action Planning Ratings High Action Planning Ratings 0% 2% 4% 6% 10% 12% 14% -2% -4% 8% 24

©Copyright Kenexa ® BASIC-Elements* Of Successful Follow-Up Processes Project Management Commitment of the Top Management Qualification of Line Managers Inclusion of the Employees HR Acting as Internal Advisor Controlling/ Monitoring of the Procedures Communication/ Marketing of the Follow-Up Processes Action Plan/ Realization of the Procedures EIGHT Basic success factors *based on an interview study with companies conducting regular employee surveys 25

©Copyright Kenexa ® 2008 Contacts Kenexa Germany GmbH Georg-Brauchle-Ring 60 D Munich Astrid Wammers (Program Director) Tel: +49 (0)

©Copyright Kenexa ® 2008 THANK YOU! 27