Digital failures are costing businesses the equivalent of hundreds of full-time staff every year, according to new global research that raises fresh concerns about the impact of poor workplace technology on employee performance, wellbeing and retention.
The findings come from Nexthink, a digital employee experience (DEX) company, which analysed over 20 million digital endpoints from nearly 500 companies across multiple sectors. It found that slow systems, crashing applications and other routine IT problems were not only frequent but deeply disruptive, with every employee facing an average of 14 negative digital events per week.
While each incident may last only a few minutes, the report estimates the cumulative loss to be 470,000 working hours annually per large business – equivalent to 226 full-time roles.
Technology troubles affect more than output
The report draws on telemetry data from 474 organisations and includes sectors such as healthcare, retail, finance and education. While all experienced similar numbers of weekly disruptions, the severity varied, with retailers, healthcare providers and financial services firms losing 1.7 times more productivity than technology companies. It suggests that the same type of disruption can have a bigger impact depending on the user environment and system reliance.
Beyond lost time, the research also raises concerns about quality and accuracy of work. It cites American Psychological Association findings that delays of just five seconds can triple human error rates, while separate research from the University of California shows that when workers are knocked out of a “flow state” by an interruption, it can take around 23 minutes to fully recover focus.
In workplaces where interruptions are frequent, this cycle of disruption, recovery and stress can become the norm, with implications not only for productivity but also for staff morale and mental health.
Pedro Bados, Nexthink’s chief executive, said the scale of disruption caused by malfunctioning technology had become impossible to ignore. He said digital friction was quietly draining company performance while also contributing to employee stress. “All told, enterprises are losing millions of hours every year because of malfunctioning technology,” he said. “This is unacceptable, yet it’s regarded by many as just another cost of doing business.”
Link between DEX and productivity loss
Central to the findings is the concept of a digital employee experience score, or DEX score, which Nexthink uses to measure how well workplace technology supports staff. The analysis found a strong inverse relationship between DEX scores and productivity loss. A 10-point improvement in DEX was associated with a gain of 22 minutes of productive work per employee each week.
The company said this shows how improving the quality of workplace digital tools can directly support business performance. It warned that failing to address recurring IT issues risks not only inefficiency but also staff disengagement.
“Even small digital disruptions can cascade into hours of lost productivity,” said Bados. “But often these incidents are much bigger with employees losing whole days as a result. This isn’t just about overall enterprise productivity; it’s also about digital friction pushing people to boiling point because they feel stuck and abandoned – a feeling that is being turbo-charged in the AI era.”
He added that “[i]f IT departments don’t address these fundamental issues, the business will lose talented people to competitors, become less collaborative and fall behind in the innovation race, all of which will inevitably have serious implications for their bottom line.”
Proactive stance urged
While IT teams have traditionally focused on fixing broken systems, the report suggests a more proactive, employee-centric approach is now needed. HR professionals, particularly those overseeing hybrid or remote teams, may also need to consider digital experience as a key factor in performance management and wellbeing strategies.
The report notes that many organisations included in the data were still in the early stages of DEX management, suggesting that current figures may understate the full potential gains available.
The cumulative effect of poor digital experience is often hidden, the report suggests, because losses are dispersed across teams and days. Yet over time, the costs mount, not only in terms of output, but in higher staff turnover, reduced collaboration and missed innovation opportunities.
As employers face growing pressure to improve productivity amid economic uncertainty, Nexthink said DEX must be part of the solution. With digital tools now central to most roles, fixing the basics – such as reducing login issues, improving system speed and proactively identifying common problems – could be a low-cost way to improve performance and retention.
The company warned that organisations ignoring these issues may find themselves falling behind, particularly as digital transformation accelerates and employee expectations evolve.
