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Good Customer Satisfaction
Starts with Happy Staff
Written by Shirley Lichti for The Record,
July 18, 2001
When companies look for ways to improve customer
service, they generally start by considering more things they can
do for their customers. If they were smart, they would first look
at how they treat their own employees.
Over the years it's been proven that satisfied
employees produce satisfied customers. Studies have documented that
contented employees have a greater sense of commitment to both the
company and its customers. Employees who are satisfied with their
jobs are more likely to want their employer to succeed. As a result,
they work harder to ensure success and provide superior levels of
customer service.
During the 14 years I worked for IBM Canada,
the company conducted annual customer satisfaction and employee
satisfaction surveys. The results from both surveys were closely
monitored since IBM recognized a direct correlation between them.
If employee satisfaction fell, within six
months so did customer satisfaction. Action was always taken very
quickly to improve employee satisfaction since a decrease in customer
satisfaction inevitably would be reflected by a decrease in bottom-line
results.
Coopers and Lybrand, now PricewaterhouseCoopers,
examined many large companies in 1996 and 1997 and proved that customer
satisfaction is directly proportional to employee satisfaction.
Soctiabank, too, analysed data from employee
and customer surveys and found that employees feel positive about
the quality of service they deliver, they will be more confident
in their ability to meet customer needs. And that, in turn, increases
customer satisfaction.
In a study of seven telephone customer service
centres, MCI Worldcom found clear relationships between employees'
perceptions of the quality of MCI service and their own satisfaction.
The study also linked employee satisfaction directly to the number
of customers stating an intention to continue using MCI's services.
Sears analysed 20 years of data from 800
stores. It found that a 5 per cent increase in employee satisfaction
resulted in a 1.4 per cent increase in customer satisfaction, which
yielded a 1 per cent increase in profitability.
Frederick Reichheld, a director at Bain and
Company who studies customer loyalty and satisfaction, found that
U.S. companies lose half their customers every five years. By decreasing
this by only five percentage points, they could double their profits!
Even more interesting, Reichheld found that
on average U.S. firms lose half of their employees every four years.
This makes employee retention just as important, if not more so,
than customer retention.
Let’s face it, employees who are happy stay
longer, which in itself can produce higher customer satisfaction.
But dissatisfied customers fuel decreases in employee satisfaction,
thus encouraging turnover. And high turnover further deteriorates
service, particularly where the continuity of the customer-servicer
relationship is important.
Not too surprisingly, employees who believe
in the product or service they are offering are happier performing
their jobs. The key is to hire the right staff, properly train them,
and then continually ensure they are motivated.
Through some of the customer service training
I've done over the years, I've discovered that front-line employees
often know what should be done to keep customers satisfied. Unfortunately
their hands are often tied by company policies which prevent them
from acting in the best interests of customers.
Empowering employees to take whatever action
is necessary in the best interests of customers may be scary, but
it's not nearly as threatening as the prospect of customer or employee
churn. Good training programs can help to ensure employees know
the guidelines and act appropriately.
What else can companies do to ensure their
employees are satisfied? Best practices studies asking which actions
increase employee satisfaction noted the following findings.
Communication
Strong companies communicate their values. Values affect behaviour
and create a strong culture, so need to be communicated consistently
and often.
Leadership
Leadership is a significant factor affecting employee satisfaction
and customer satisfaction. Employees look for clarity of direction,
simple messages and consistent behaviour.
Employee Involvement
Best in class companies promote and encourage employee engagement
in solving company problems. They also solicit and use employee
ideas for continuous improvement. If employees are allowed input
about how to do their jobs, they are happier and will do a better
job.
Feedback
Employees who receive continuous, constructive feedback on their
performance are more likely to meet their customers' needs.
Treat them Right
Employees treat their peers and customers the same way they are
treated by management. Just as children learn what they live, so
do employees. Excellent customer service must be modelled throughout
the company.
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