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THE IMPACT OF DIGITAL TECHNOLOGIES ON EMPLOYEE ENGAGEMENT:
CASE STUDY OF COMPANY “A” IN SERBIA
Jelena Lukić Nikolić*
Modern Business School,
Belgrade, Serbia
Abstract:
The rapid and progressive advancement of modern digital technologies
and
tools, as well as their widespread application, have changed the working
environment and working conditions. As a result, many concepts,
methods, practices, and activities related to employee engagement
must be reconsidered and adapted to the needs of the new workplace.
This paper highlights the key changes in employee engagement caused
by digital technologies. Obtained results from conducted case study
in one IT company from Serbia showed that modern technologies
enable remote work, flexible working hours, more challenging and
interesting tasks, but also lead to a variety of challenges among which
are technologically caused stress, over-reliance on technology, work-
life conflict, and burnout syndrome. The findings presented in this
paper can be useful for managers and leaders who want to build,
improve, and nurture employee engagement in the digital age. Human
resource managers also have valuable information on how to develop
practices and methods for using digital technologies and tools in
the best possible way, without negative effects and consequences on
employee engagement.
Keywords:
digital age,
digital business,
for-profit organizations,
remote work,
human resources.
JEL Classification:
O15, O33, J28.
*E-mail:
jelena.lukic@mbs.edu.rs
ISSN 2406-2588
Original paper/Originalni naučni rad
Arcle info:
Received: March 06, 2023
Correction: March 09, 2023
Accepted: April 21, 2023
INTRODUCTION
Employee engagement has become a popular research topic in the elds of human resources, work
psychology, organizational psychology, organizational behaviour, organizational dynamics, strategic
management, leadership, and business practice (Lukić Nikolić, 2021). Previous engagement research
concentrated on traditional work environments and organizations in which employees worked in
oces ve days a week for eight hours. e advancement and widespread application of modern
digital technologies and tools such as Big Data, Real-Time Analytics, Internet of ings, 5G, Mobile
Technology, ChatGPT, Blockchain, Cloud Technology, Virtual Reality, Augmented Reality, Additive
Manufacturing, Robotic Process Automation, Articial Intelligence, Machine Learning, Quantum
30
Computing, Digital Twin, and API Based Integration have signicantly altered the working environment
and working conditions (Balakrishnan & Das, 2020; Ciarli et al., 2021). For that reason, traditional
approaches and methods are being repositioned and changed in order to become more intelligent and
agile (Ćormarković, Dražeta, & Njeguš, 2022).
e aim of this paper is to investigate and analyze whether digital technologies impact employee
engagement in for-prot organizations. e paper is organized as follows. e rst title addresses the
role and importance of employee engagement in for-prot organizations. e second title provides an
overview of the major negative eects of employee over-engagement caused by constant availability via
digital technologies. e third title represents the methodological approach applied in this paper. e
fourth title is focused on discussion of research results regarding the impact of digital technologies on
employee engagement in Company A from Serbia. Finally, the main ndings, implications, limitations,
and recommendations for future research are presented in conclusion.
LITERATURE REVIEW: EMPLOYEE ENGAGEMENT IN FOR-PROFIT ORGANIZATIONS
Employee engagement is dicult to dene because it encompasses many dierent concepts
from various scientic disciplines, among which are human resource management and organizational
behavior. ese concepts from these two disciplines are widely used to explain what employee engage-
ment truly means and how it aects employee behavior and the overall functioning of the organization
(Macey & Schneider, 2008a). Employee engagement, according to Kahn (1992), is much more than
simply appearing and being present at work. It includes employees' physical, cognitive, and emotional
energy at work. Some of the key characteristics of engaged employees include an ongoing and permanent
state of mind that reects continuous eort, a high level of energy and dedication, and ambition for
growth and innovation (Cooper-omas, Xu, & Saks, 2018; Kwon & Kim, 2020; Smith & Bititci, 2017).
For Robinson, Perryman and Hayday (2004), employee engagement is “a positive attitude held by the
employee towards the organization and its values. An engaged employee is aware of the business context,
works with colleagues to improve performance within the job for the benet of the organization” (p. 2).
Saks (2006) denes employee engagement as “a distinct and unique construct consisting of cognitive,
emotional, and behavioral components associated with individual role performance” (p. 602).
Every for-prot organization wants to have engaged employees. Engaged employees propose new
ideas, demonstrate enthusiasm while doing the job, take the initiative, try to improve their work,
consistently exceed dened goals, are curious, encourage all team members to achieve above-average
results, overcome obstacles, and remain goal-oriented (Albrecht, Breidahl, & Marty, 2018; Rasool et al.,
2021). Engaged employees are important for for-prot organizations because they give their all to
complete all tasks, have positive energy, initiative, motivation, commitment, and a genuine concern
for the organization's future. e positive impact of employee engagement on productivity and prot
is perhaps the most important aspect of employee engagement for organizations. e majority of
studies found that employee engagement has a positive impact on productivity and profitability
(Kim & Ausar, 2018). Engaged employees put all their cognitive, emotional, and behavioral energy,
which leads to higher productivity. Furthermore, the impact of employee engagement is connected to
higher organizational outcomes, such as improved cost control, higher overall quality of products and
services, and nancial results (Maltseva, 2020; Young et al., 2018).
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THE IMPACT OF DIGITAL TECHNOLOGIES ON EMPLOYEE ENGAGEMENT: CASE STUDY OF COMPANY “A” IN SERBIA
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Employees who are engaged are more likely to be open to new experiences and changes. Positive
employee behavior and emotions show that the organization has devoted employees who are ready and
willing to embrace meaningful change (Men, O’Neil, & Ewing, 2020). As a result, employee engage-
ment may be important in organizational change and transformation. e appropriate psychological
state and behavior necessary for successful change management are fostered by employee engagement
(Akingbola, Rogers, & Intindola, 2023). Additionally, employee engagement is also critical in increasing
organizational capacity for innovation and corporate social responsibility (Chaudhary, 2017). is
characteristic is particularly important in the digital age. Employees who are engaged are more ready to
use their maximum eorts to enhance and increase organizational innovation. As a result, every organi-
zation's goal is to have engaged employees as the foundation for their future growth and development.
RESEARCH BACKGROUND: THE IMPACT OF DIGITAL TECHNOLOGIES ON EMPLOYEE
ENGAGEMENT
Existing research on the concept of engagement focused on full-time employees in traditional
organizations where they physically came to work ve days a week for eight hours. e advancement
of modern technology and its increasingly widespread application have enabled and stimulated numerous
changes in the way people work and conduct business, and consequently in employee engagement
(Duque et al., 2020).
One of the most noticeable changes is the increase in remote working. Employees can work from
any location where they have a personal computer and the Internet. Remote work became especially
popular during the Covid-19 pandemic at the beginning of 2020, when it was necessary to ensure
adequate physical distance and preserve employees’ health and safety (Savić & Dobrijević, 2022). When
the nature of the work permitted, many organizations incorporated remote work (Krstić, Tomanović,
& Stanojević, 2022). Employees were confronted with new circumstances that required them to adapt
quickly - a desk, chair, computer, a good Internet connection, becoming accustomed to working with
other family members, and adjusting to new modes of communication and soware tools. Employees
who were engaged devoted themselves to work tasks and activities to a greater extent, feeling an added
responsibility to work more intensively and be of service to the organization in these sudden and
unexpected circumstances. According to research, engaged employees worked longer and harder while
working remotely (Lonska et al., 2021; Tzoraki et al., 2021), increasing the risk of burnout syndrome
or work-life conict. Employees who work remotely face an additional challenge in that they do not
have direct contact with the organization or their colleagues, which leads to feelings of isolation, lone-
liness, less importance, and belonging (De-la-Calle-Durán & Rodrguez-Sánchez, 2021). e situation
is more complicated by the lack of direct "face-to-face" communication, as well as the lack of approved
activities for building and improving employee engagement during remote work. Given the social
nature of organizations, employee needs can only be met through interaction with co-workers during
remote working (Anakpo, Nqwayibana, & Mishi, 2023). ere is a growing need for frequent and
open communication, as well as meetings where all participants will turn on their cameras, giving the
impression that they are all gathered in the same place.
e second change is the disappearance of boundaries between private and working time, resulting
in a work-life conict. Employers and managers enthusiastically embraced modern technologies because
they saw them as a valuable tool for coordination, control, decision making, and reporting. However,
numerous negative consequences began to emerge over time. To begin with, when employees nish
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THE IMPACT OF DIGITAL TECHNOLOGIES ON EMPLOYEE ENGAGEMENT: CASE STUDY OF COMPANY “A” IN SERBIA
32
their ocial working hours, they have less free time, they frequently feel like they are under surveillance
and control, they are constantly available to their employers, and thus they cannot truly get away ("switch o")
from their work and devote themselves to their private life.
e third change is reected in job insecurity because of advances in machine learning, articial
intelligence, and robotics, which have resulted in the automation of routine, repetitive, and highly
standardized tasks. e rise in job insecurity is inuenced by a variety of factors, the most important
of which are modern technologies that stimulated the automation of most routine jobs and activities
(Ghani et al., 2022; Nam, 2019). Automation and the replacement of people with machines is desirable
and useful in all jobs that are hazardous to people's health and safety, as well as in physically demanding jobs
(Breque, De Nul, & Petridis, 2021). According to a study in which 352 articial intelligence experts
participated, there is a 50% chance that machines will replace humans in all jobs within the next 45 years
(Grace et al., 2018). Some employees who are afraid of losing their jobs become more engaged, forcing
themselves to increase the volume and quality of work in order to keep their current position in the
organization or, if that is not possible, to move to some another position. On the other hand, there are
employees who are overwhelmed by despair and hopelessness, and their engagement declines as a result.
The fourth change follows from the third, and it is reflected in the complex work tasks that
employees perform. e goal of automation is to free employees from routine, monotonous, repetitive
tasks (Siderska, 2020). On that way, employees gain time and freedom to devote to tasks that require
knowledge and skills that automation systems and technologies cannot (yet) master - creative and
analytical thinking, complex problem solving, caring for people, new ideas and proposals, and innovations
(Beer & Mulder, 2020; Pedota & Piscitello, 2021). Employees frequently discover that their work was
exhausting and boring aer the process of automation, and that they can now devote themselves to more
creative and challenging jobs that carry a higher degree of responsibility, as well as the opportunity to
use their talents (Fantina, Storozhuk, & Goyal, 2022; Smids, Nyholm, & Berkers, 2020). Employees are
encouraged to become more engaged by performing meaningful, stimulating, and challenging tasks.
Furthermore, automation can improve working conditions, work-life balance, and employee commitment
to activities that add value to the organization (Chugh, Macht, & Hossain, 2022).
e h change refers to the possibility of more comprehensive and precise employee engagement
measurement and analysis. Although, at rst glance, it appears that managers cannot measure and control
employee engagement with certainty due to remote working, exible working hours and the fact that
remote employees are "far from the eyes", the situation is actually quite dierent. Technological advancements
and modern tools have resulted in new methods and types of measuring and analyzing employee engagement
(Curtin, 2022). Modern applications and tools are considered as readers of employee’s minds (Burnett
& Lisk, 2019). Traditional methods of polling and interviewing employees are clearly insucient in the
digital age, especially given that employees want to express their experiences, opinions, and comments
on various social and professional networks and portals. Modern technological solutions allow for the
real-time collection of all available data from various sources, as well as their faster processing, analysis,
and visual presentation (Burnett & Lisk, 2019). Managers have data-driven insight into all the segments
that need to be improved in order to build, improve, and nurture employee engagement.
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METHODOLOGY
In this paper the following research question (RQ) was imposed: What eect do digital technologies
have on employee engagement?
In order to answer the imposed research question, a case study was conducted in one company from
IT industry, which will further be referred to as Company A. e purpose of a case study is to examine
and evaluate a single phenomenon considering its unique social, cultural, and economic environment
(Yin, 2014). e ability to examine some unusual, uncommon, and abnormal occurrences and processes
makes the case study crucial in the elds of management and social sciences (Tight, 2017). e case study
technique suggests using numerous data sources, both secondary and primary, in order to provide a
comprehensive analysis and examine the phenomenon from a variety of perspectives (Gerring, 2017).
In this study, both primary and secondary data were used for analysis and conclusions. To highlight
the general state of human resource management, company reports about employee engagement and
satisfaction surveys were examined. Aer that, interview techniques were used to acquire primary data.
e interview was semi-structured with the following set of questions (Q):
Q1: Interviewee’s level of education
Q2: Interviewee’s age
Q3: Interviewee’s job position
Q4: Do digital technologies and tools have any benecial eect on engagement? Describe those eects.
Q5: Is there any negative impact of digital technologies and tools on engagement? Describe those
impacts.
e key questions were posed to the interviewees regarding their attitudes and experiences with the
digital technologies they use at work and how those technologies aect their engagement. roughout
the interview process, there were additional questions that requested the interviewee to elaborate on
certain details or provide examples of their responses.
Interviews were conducted with one-third of the employees (ten employees) who were available to
participate in this study. e interviewees were diverse in terms of position (technical support, programmers,
project managers, consultants), experience, and gender. ey were marked as I1, I2, I3, ...., I10.
Interviews were conducted during February 2023. Responses from each interviewee were written
down and aer interviews organized and grouped into positive and negative categories.
RESEARCH RESULTS AND DISCUSSION
Company A's primary business is the development of customized soware solutions, and its operations
are primarily focused on modern communication and collaboration tools. e company has 30 full-time
employees and has been operating in Serbia, Belgrade for a decade. Employees are on average 24 years
old, indicating a younger employee structure. All employees have completed faculties, bachelor or
master studies, indicating a high educational level. e majority of employees are men. By analyzing
the documentation from the human resources department, it is logical to conclude that the company
cares about its employees. It organizes teambuilding events at least once a year in which all employees
participate. e results of a yearly survey conducted by the human resources department show a high
level of employee satisfaction and engagement for 2020, 2021 and 2022.
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Results from conducted interviews in Company A are presented in tables 1 and 2. Table 1 presents
results showing positive impacts of digital technologies on employee engagement.
Table 1. Positive impacts of digital technologies on employee engagement.
Positive impacts Interviewees
Remote working I1, I3, I2, I5, I6, I7, I9, I10
e ability to view critical information in real time I1, I2, I3, I4, I7, I8, I9, I10
e ability to keep up with everything that is going on in company I3, I5, I7, I8, I9
e ability to react quickly in the event of a problem I2, I5, I7
e ability to easily communicate with colleagues I1, I5, I10
I - Interviewee
Most interviewees (80%) stated that the main positive impacts of digital technologies are remote
working and ability to view critical information in real time. Aer that, majority of interviewees (50%)
stated that positive impact of digital technologies is the ability to keep up with everything what
happens in company. Digital technologies provide numerous opportunities for employees, such as
remote working, simple information exchange, the ability to respond quickly, and easy contact with
colleagues. is allows employees to reach a balance between their professional and private life. In
that sense, it is interesting to mention some of the personal feelings of employees regarding benets of
digital technologies which positively impacted their engagement.
"I wanted to oer my help and support to a member of my family who had surgery last month. My
boss gave me permission to work from home for two weeks. As a result, I was able to complete my work
tasks while also being available if anything was required during recovery of my family member, which
made me very happy and satised." Interviewee 1, 35 years old.
Beside positive, there are also some negative impacts of digital technologies on employee engagement. In
table 2 negative impacts of digital technologies which interviewees stated during interviews are presented.
Table 2. Negative impacts of digital technologies on employee engagement.
Negative impacts Interviewees
Having the impression that I am always on the job I1, I2, I3, I4, I7, I9, I10
Being unable to turn o aer working hours (Not being able to get away from
work aer working hours) I3, I5, I7, I9, I10
Constant mobile phone notications I2, I5, I7, I9, I10
Stress and frustration when I see some problems aer working hours I4, I6, I9, I10
e ability to easily communicate with colleagues I1, I5, I10
I - Interviewee
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e most concerning fact is that 70% of interviewees stated that they have the impression that they are
always on their jobs, without ability to switch o aer working hours. Furthermore, 50% of respondents
stated that they receive mobile phone notication all the time and that they are unable to get away from
work due to digital technologies and tools. Numerous studies have found that engaged employees can
become overly reliant on technology, becoming overburdened with information and notications, and
thus becoming vulnerable to a new type of stress known as "technology-induced stress" (Marsh, Perez
Vallejos, & Spence, 2022). Practice has shown that over-engagement can have a number of negative
consequences not only for employees, but also for organizations (DuBrin, 2019). According to some
authors, employee engagement is the polar opposite of burnout (Maslach & Leiter, 1997; Lemon, 2019).
Unlike engagement, which implies attachment, commitment, positive energy, and positive employee
outcomes, burnout syndrome is characterized by physical and/or psychological exhaustion, loss of energy,
depersonalization, cynicism, mental distance from the work, a sense of ineciency, and a lack of
accomplishments (Gonzalez-Roma et al., 2006; Taris, Ybema Fekke, & Van Beek, 2017). However, Macey
and Schneider (2008b) pointed out that people cannot work at full capacity all of the time; they must
rest ("reset," "recharge") in order to maintain their long-term health and well-being. High engagement
can cause an employee to become "obsessed with work" and work compulsively, causing stress in the
long run. e negative eects of workplace stress are reected in decreased productivity, satisfaction,
motivation, absenteeism, and turnover rate. Furthermore, stress can cause anxiety, tension, depression,
frustration, insomnia, headaches, feelings of heat or chills, ickering eyes, noise in the ears, change in
appetite, lethargy, apathy, increased blood pressure, tachycardia, and other health problems (Britt &
Jex, 2015; Hämmig & Vetsch, 2021).
Engaged employees have trouble untangling aer work and forgetting about it. Receiving notications
on their phones throughout the day has a negative impact on their health and causes stress. is is
demonstrated by one interviewee from Company A, who stated the following:
"When I see a problem on the phone aer working hours that will be waiting for me the next morning, I feel
frustrated. at day is already ruined for me because I begin to consider how I will solve the problem."
– Interviewee 4, 27 years old.
Work-life balance is critical for employee well-being, commitment, productivity, and engagement,
and it implies good functioning at work and in their personal lives, as well as a sense of accomplishment
in both areas (Rodrigues da Costa & Correia Loureiro, 2019; Lee, Rocco, & Shuck, 2020). Employees
require a "digital detox" from their phones, tablets, computers, and all the notications they receive
through them (Cole & Higgins, 2021, p. 47). Policies and approaches that restrict employees' access
to business applications and tools aer working hours would help ensure that employees can clearly
distinguish between their personal and professional lives. Similarly, a prohibition on sending emails
and messages, as well as making calls outside of working hours, would greatly improve the situation.
One approach is to establish a practice of "preferred time and means of communication," in which
employees who work remotely would state (announce) the time and means of communication (email,
phone call, video call) that they consider ideal (Larson, Vroman, & Makarius, 2020). It is essentially the
alignment and harmony between several dierent roles that an individual performs (Haar et al., 2014),
as well as the individual's perception that his activities at work and in his private life are compatible
and promote his development. Employees who are overly engaged spend less time with their families
and friends, have fewer social contacts, and have a less active social life. Disruption of the balance
between work and personal life can lead to stress and dissatisfaction among employees, resulting in
their disengagement (Iddagoda & Opatha, 2020).
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Research results presented in tables 1 and 2 showed that digital technologies can have both positive
and negative eects on employee engagement. It is technology that provides numerous opportunities,
and it is up to individuals to decide how to use it. e primary goal is to maximize its advantages and
opportunities while minimizing its disadvantages and threats to the greatest extent possible. Human
resource managers are developing a comprehensive plan to mitigate the negative eects of digital
technologies on employee engagement. Employees, on the other hand, should change themselves and
learn how to switch o aer working hours.
CONCLUSION
Contemporary digital technologies and tools have brought about numerous changes in the way
people work, which has an impact on their engagement. It is certain that current trends in remote work,
exible working hours, work-life balance, and increasingly challenging and complex work tasks will
continue to be appealing in the future of work. While the digital technologies and tools allow employees
to choose where, when, and how they work, they also present them with challenges such as providing
adequate working conditions, work-life conict, the absence of direct interaction and communication
with colleagues, and a deeper connection with the organization and its values. In depth understanding
of the above-mentioned implications of the digital age on the concept of employee engagement is a
must for organizations' long-term success, development, and growth.
Results obtained in this paper show that digital technologies can have both a positive and negative
impact on employee engagement. Presented results can be useful for organizational managers and
leaders who want to build, improve, and nurture employee engagement in the digital age. Furthermore,
the ndings in this paper can be useful to human resource managers in becoming acquainted with
the potential negative eects of digital technologies on employee engagement and attempting to
overcome their appearance. Human resource managers can develop practices and methods for using
digital technologies in the best possible way with an appropriate and planned approach. e entry of
younger generations into the labour market, who have grown up surrounded by modern technologies,
will increase the prevalence of remote work, exibility in working hours, and the need for a work-life
balance. Given the importance and role that engaged employees play in the operations and functioning
of organizations, it is clear that this is not one of the nice and desirable activities that managers will
undertake, but rather a necessary and unavoidable activity.
e conducted research is accompanied by certain limitations. One of them is that the case study
was only conducted in one company and encompassed only ten employees. e obtained results cannot
be generalized due to the small number of participants and the fact that the observed company is from
a single industry – IT, which is at the forefront of using digital technologies. Another limitation is the
interview technique, which is not always completely objective. More respondents from more companies
and industries should be included in future research on this topic. Furthermore, it will be benecial to
conduct a questionnaire in order to obtain results that are more objective. Future studies on this subject
should focus on new technical developments like workplace robots and robotic process automation
and how they aect employee engagement. New approaches and trends in the process of developing
and nurturing employee engagement may be expected in the future as a result of new technologies,
particularly as new generations enter the labor market.
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UTICAJ DIGITALNIH TEHNOLOGIJA NA ANGAŽOVANOST ZAPOSLENIH:
STUDIJA SLUČAJA KOMPANIJE “A” U SRBIJI
Rezime:
Brz i progresivan razvoj savremenih digitalnih tehnologija i alata, kao
i njihova masovna primena, uslovili su brojne promene u radnom
okruženju i radnim uslovima. Posledično, mnogi koncepti, metode,
prakse i aktivnosti angažovanosti zaposlenih su morali da se promene
i prilagode potrebama novog radnog okruženja. U ovom radu je
ukazano na uticaj digitalnih tehnologija na angažovanost zaposlenih.
Dobijeni rezultati sprovedene studije slučajeva u jednoj IT kompaniji
u Srbiji pokazali su da savremene tehnologije omogućavaju rad na
daljinu, fleksibilno radno vreme, izazovne i interesantne radne za-
datke, ali da su isto tako dovele do brojnih promena među kojima
su tehnološki uzrokovan stres, prevelika zavisnost od tehnologije,
narušenost ravnoteže između posla i privatnog života i efekat sagor-
evanja. Rezultati mogu poslužiti menadžerima i liderima koji nastoje
da izgrade, unaprede i održe angažovanost zaposlenih u digitalnom
dobu. Menadžeri ljudskih resursa takođe imaju na raspolaganju
vredne informacije o tome kako da na najbolji način primene digi-
talne tehnologije i alate, a da izbegnu negativne efekte po zaposlene
i njihovu angažovanost.
Ključne reči:
digitalno doba,
digitalni biznis,
profitne organizacije,
rad na daljinu,
ljudski resursi.
JEL klasifikacija:
O15, O33, J28.
EJAE 2023 20(2) 29 - 40
NIKOLIĆ. L. J.
THE IMPACT OF DIGITAL TECHNOLOGIES ON EMPLOYEE ENGAGEMENT: CASE STUDY OF COMPANY “A” IN SERBIA
