Happy Employees = Happy Customers
It’s become a business bumper sticker! It’s a fantastic sentiment! It’s the right strategy!
“If you treat your staff well, they will be happy,” says the Virgin Airlines website (CEO, Sir Richard Branson’s mantra). “Happy staff are proud staff, and proud staff deliver excellent customer service, which drives business success.”
Zappos once ran an advertising campaign with the theme “Happy People Making People Happy.”
“We built the Starbucks brand first with our people, not with the consumers,” said CEO Howard Schultz. “Because we believed that the best way to meet and exceed the expectations of our customers was to hire and train great people, we invested in employees.”
“The formula is simple: Happy employees equal happy customers,” asserted an article in CEO Magazine. “Similarly, an unhappy employee can ruin the brand experience for not just one, but numerous customers.
All the above examples & conventional wisdom which we rarely question suggest that there is bound to be direct co-relation between “Happy Employees” & “Happy Customers”. However, I thought it only fair to dig a little deeper.
Do happier employees really mean happier customers? Without giving too much away, the results of my exploration will almost certainly surprise you. Not because happy employees don’t mean happier customers (in general they do). But, because of the potentially worrisome connections between employee performance and happiness, and customer engagement.
Gallup which we are familiar with, for example, has been promoting the 12 Elements of Great Managing – which are all about inspiring top performance in employees – since the 1990s. Remember the famous question from Q12- Do you have a friend at work? Their latest Q12™ research quantifies the (significant) gap between companies at the top and bottom quartiles of employee engagement. In it, they found that organizations in the top quartile had:
- 22% higher profitability, 21% higher productivity,
- 10% higher customer metrics, 37% less absenteeism, and
- Up to 65% less turnover
No brainer, right? Faced with numbers like these, what company wouldn’t think that employee engagement should be a top priority? What we want to know, though, is if happier employees mean happier customers.
Since the top employee-engagement groups beat the bottom by only 10% in customer metrics, it seems the answer is a resounding “maybe.”
Recent research from Leadership IQ states that in 42% of the companies studied, low-engagement employees outperform high-engagement employees. After reading the research, a crystal-clear picture of these high-engagement, low-performance employees emerges. They are happy and engaged, in part because they actually aren’t held that accountable and/or don’t have to work as hard as high performers. Expectations are lower, and their jobs are easier. As a result, they’re even more motivated to “deliver 100 percent at work” than high- and middle-performers.
These higher-performance, lower-engagement employees care a great deal about their work, have loads of intrinsic motivation, and lots of talent – but often don’t feel empowered, encouraged, or recognized.
While higher-engagement/lower-performance employee want nothing more than to please your customers, they may not be as willing (or as able) to make the difficult choices sometimes required to satisfy customers and meet business objectives.
Which brings us back to the question at hand, and the “dangers” of conventional wisdom. Because, while happy employees do help deliver happier customers, high-performing employees can help to deliver happier customers and business results.
The trifecta is this: happy, high-performing employees, happy customers and stunning business results. If you’re like the most successful firms I’ve worked with, getting there means aligning your reward systems with your customers wants and needs – and ensuring that your desired outcomes are clearly defined, and that everyone is held accountable for their results.
Get that in place, and it gets easier to imagine all your employees contributing to customer happiness – boosting customer metrics, while driving profitability and productivity along the way.
The strongest links between employee happiness and business outcomes occur over the long term and behind the scenes. Innovation, for example, is a fragile thing; it flourishes in supportive, transparent & high-recognition environments. The correlation between employee happiness and innovation is nearly twice as strong as the correlation with customer focus.
Businesses are bound to crash once their customers are repeatedly turned off by their experiences with the employees to the point they seek alternatives. In order for your company to grow, you have to ensure positive customer experiences are the norm with your staff – not the exception. Investing in the happiness of your staff translates into happy customers more willing to shop with you more.
Now, let’s also see why happy employees create happy customers?
- Happy Employees build better relationships with customers –
When an employee has a positive attitude towards their work and is fully engaged, that positive attitude naturally spills over into their customer relationships. Happy employees easily strive to deliver high quality service with a lot of consistency, resulting in increased customer happiness and loyalty.
It takes presence, attentiveness, and attitude to create and build the strong customer relationships that separate successful companies from mediocre ones. When an employee is happy in their workplace, they are not only far less likely to miss work (presence), they are also more likely to handle customer needs faster (attentiveness) and with much more positivity at that (attitude).
Happy Employees are more creative with their customer service –
Employee-customer interaction is not a scripted role play. In a world of rapidly changing customer preferences and increasing corporate competition, the creativity with which your employees approach their jobs can become the deciding factor between your company’s growth and stagnation.
Innovative thinking is an important skill for your employees because your customer service staff is the first representative of your business that customers interact with. Happiness contributes to the creative ability of your staff because a happy employee has more mental room to come up with fresh ideas and their mind is more likely to take on new challenges with gusto and enthusiasm and such happy employees make happy customers.
Happy Employees provide more knowledgeable service –
Happy employees tend to stay with a company much longer. Not only is employee retention good for the business (think about the additional costs you will have to face when hiring a new worker such as the cost of advertising or interviewing, the cost of onboarding and training, the cost of errors as well as time for adjusting and etc.) but it’s good for the customer as well.
Employees who have spent longer working at your company have more experience and knowledge to use in providing better customer service. And when customers receive more knowledgeable service, they have a better experience and are more likely to do business with you again.
- Happy Employees put the company’s best face forward –
Similar to having a positive attitude that promotes a positive customer experience , employees that are happy and committed to their workplace genuinely want to see the company do well.
They are more motivated and innovative, and will often go the extra mile to give customers an exceptional experience. They are a vital asset to maintaining a strong reputation, brand image, and competitive advantage.
Even though prioritising your customers’ needs will most certainly increase customer satisfaction and loyalty, under no circumstances should managers forget about equally important assets of their company – happy employees ☺!
Happy employees make happy customers and are the strong foundation on which a successful company can build lasting customer relationships.
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