This article was first published in the August edition of People Matters Perspectives.

While we’re witnessing the industrial shifts unfolding today, there’s a layer we can’t afford to overlook: People, and their role in transformation and progress. 

For HR and talent professionals, this has always been the real concern: while transformations may be fuelled by new technologies and innovations, it’s ultimately people who stand behind them. 

We can decode technologies and innovations through algorithms and data, but understanding people is far more deep-rooted than we can ever fully grasp. 

And in today’s work landscape, this brings us to the real question: is delivering the best employee experience defined by culture, AI-driven skills, employee care, or the lure of big bonuses or is it something deeper that ties them all together?

Is Culture the ‘only’ secret behind great EX?

Culture, without a doubt, remains the bedrock of great employee engagement, even during transformative shifts. A workplace culture that empowers, includes, and inspires is what sustains long-term engagement. Because employees don’t just look for a paycheck; they look for value, belongingness, and shared purpose.

In 2025, culture is less about posters on a wall and more about lived experiences: how leaders communicate, how teams collaborate, and how values show up in day-to-day decisions.

And HR is not the only custodian of a workplace culture. As Dr. Raju Mistry pointed out, “HR is one of the custodians, they can provide directions. But HR alone cannot create or control every employee experience. It is a shared responsibility of: leaders, managers, teams, business dynamics.”

The ‘evolved ways of working’ has also shifted the workplace culture conversation, making it clear that culture is not defined by office spaces but by how people feel connected, whether they’re at home, in the office, or somewhere in between.

AI Skills: The new currency of growth

Industries are welcoming AI and AI agent bosses. And if culture sets the tone, AI skills set the pace. The demand for employees to build and refine these skills has become a defining part of the employee experience.

Today, employees aren’t asking if they should upskill in AI, but how fast they can and where to do it. For organizations, this means investing in learning ecosystems that make AI skills accessible, personalized, and practical.

It’s not enough to offer a generic online course or a static dashboard of resources; employees want hands-on opportunities to apply new capabilities in their roles. Take, for instance, a software engineer in your organization who wants to build a new AI-automated product. To do this, he’ll need to train tools and sharpen AI/ML skills. Will you provide him with the right learning opportunities tailored to his needs, or leave him to experiment with external ‘high-risk’ free tools that might hinder more than help? Offering customized learning and skilling programs ensures that he can innovate effectively and deliver the product with confidence.

The best EX strategies in 2025 are those that integrate AI not just into workflows, but into growth paths, making employees feel future-ready and valued in a shifting landscape.

Care = Human

The pandemic years put employee wellbeing firmly on the map, and it hasn’t gone away. If anything, it’s become non-negotiable today. Care is no longer defined by perks like free lunches or wellness apps; it’s about how organizations respond to employees’ real human needs, which are: flexibility, psychological safety, financial security, and respect for personal boundaries.

The conversation around care has also matured from supporting employees during crises to building workplaces where people feel safe to innovate, fail, learn, and grow.

Care in workplaces today is a lived value, which reflects through empathetic leadership, transparent communication, and policies that reflect human realities.

Million$ bonuses matter? 

The AI Talent War in the tech industry showed us a grim picture. And truly, compensation has always been a piece of the EX puzzle, and big bonuses still have their appeal. Especially, in times of inflation or economic uncertainty, financial incentives can make employees feel recognized and secure.

But here’s the catch: bonuses alone don’t create loyalty. They’re transactional.

Employees in 2025 are increasingly clear: they’ll take the money, but they’ll leave if the culture is toxic, growth is stagnant, or care is missing.

In other words, bonuses may win attention, but they rarely win hearts.

A lesson in overlooking people EX

Back in the 1960s, Dr. Laurence J. Peter described something he observed again and again in schools, offices, and factories: competent people being promoted into roles where they became incompetent. A brilliant mechanic made into a foreman who could no longer fix cars. An engineer skilled with machines but unable to manage people. Teachers promoted to administration, only to lose touch with education itself.

This was the Peter Principle, where in any hierarchy, an employee tends to rise to their level of incompetence, and there they stay. What he also noticed was the toll this took on individuals. People followed the rules, kept climbing the ladder, and then suddenly found themselves lost in jobs that didn’t fit them. As he put it, they faced an “identity crisis”, wondering not just what am I doing here? but who am I?

This theory, though satirical at the time, resonates powerfully with EX today. Because, if EX is reduced to promotions, titles, or bonuses, we risk repeating the same mistake: pushing people into roles or paths that don’t align with who they are. The result is disengagement, burnout, or worse, the loss of identity at work.

Modern EX must go beyond the carrot-and-stick approach of promotions. It should create multiple pathways of growth: deepening skills instead of forcing leadership, lateral moves instead of rigid hierarchies, and rewards that reflect both contribution and individuality. By doing so, organizations can avoid the Peter Principle trap and keep people fulfilled, not just employed.

The truth is, it’s not either-or. Culture, AI skills, care, and compensation all play a role in shaping the EX today. But if there’s one thread that ties them all together, it’s the recognition that people are at the center of transformation.

An employee who feels part of a strong culture, is supported in building future-ready skills, experiences genuine care, and is rewarded fairly is far more likely to stay engaged, loyal, and innovative. That’s what EX in 2025 truly means.

You may also like:

• Machines to lead people, and people to lead machines
• When the intern mentors the CEO: What reverse mentoring can teach us about inclusion
• Bringing the Human back into Tech transformations
• From ChatGPT, with love

Did you find this article insightful? People Matters Perspectives is the official LinkedIn newsletter of People Matters, bringing you exclusive insights from the People and Work space across four regions and more. Read the previous editions here, and keep an eye out for the upcoming August edition rolling-out soon.