Have you ever been to Trader Joe’s natural foods supermarket? The employees are so happy they almost sing, they tell you how much they love something you’ve bought when they’re ringing it up at checkout, and they never just point you to where something is -- they walk you over. Someone at that company knows that happy employees who enjoy what they’re selling increase the odds of good customer experience -- a subject addressed in a new report from Forrester.
The report, Sharpen Customer Experience Focus with Employee Engagement, verifies this factor. “Companies with higher employee engagement ratings have higher profit ratings,” the report says, adding that such ratings also result in higher customer satisfaction, stronger brand loyalty, better likelihood-to-recommend scores, and they help sustain customer experience success over time.
Employee Engagement Affects the Bottom Line
The report points to a variety of measurements that validate the importance of employee engagement for the bottom line. For instance, human resources consultancy Towers Watson analyzed 50 global companies and found that those with scores indicating low employee engagement had average one-year operating margins of under 10 percent, but those with the highest engagement scores exceeded 27 percent.
Similarly, a Journal of Applied Psychology-published study of nearly 8000 business units in three dozen countries found that higher employee engagement correlated with higher customer satisfaction and loyalty.
Forrester points out that about two-thirds of customer experience professionals already have budgets to boost employee engagement, so this isn’t a question of companies knowing the importance of happy employees. CX professionals know they will need employees to deliver positive customer experience across the countless touchpoints with customers, with or without supervision.
Nevertheless, the report points out that most companies do not have engaged employees. According to a recent Gallup study, 70 percent of employees in the US report they were actively disengaged or not engaged. Forrester says companies aren't doing what they need to do.
Best Practices for Engagement
Employees aren't, for instance, being trained to deliver the customer experience the company wants. They aren't being motivated to know when to do the right thing for the customer, and they aren’t consistently provided with informal or formal rewards for the best customer-centered behavior.
Forrester interviewed 11 companies and four consulting firms to figure out the best practices for employee engagement. The report uncovered three major needs:
- Create an employment engagement roadmap
- Inspire employees by socializing customer centricity
- Build customer centricity into employee tools and ongoing practices
An employee engagement roadmap requires an assessment of current employee engagement, a gap analysis, a clear customer experience vision at every stage of the customer's journey, and a definition of explicit goals.
The Ritz-Carlton’s Daily Stories
Socializing customer centricity means that a customer focus is required at every level of employee training, communication, and rituals and routines. The report cites the Ritz-Carlton Hotel chain, where, twice a day at every one of the company’s hotels around the world, employees get together in 15-minute meetings that include sharing stories about "great guest experiences they delivered the previous day," as well as discussions about what areas need to be focused on to deliver great guest experiences that day. As the report points out, "these conversations facilitate employee ownership for delivering the hotel's intended experience."
Similarly, customer centricity needs to be built into the tools that employees use, the mindset of the front-line managers, and the system of formal and informal rewards.
There’s one other factor that undoubtedly plays a substantial role in employee engagement, but Forrester doesn’t explicitly mention it. It’s hard to imagine employees being so strongly engaged with a company’s brand and products that they can project a positive experience, if they feel badly treated by the company. Case in point: Walmart employees.
Employee engagement, such an obviously large portion of the formula needed to deliver great customer experience, has often been ignored in reports and vendor pitches. But this huge factor is obvious to those of us who shop in Trader Joe's or other such businesses where interaction with people is key to feeling good about the brand.
One hopes that Forrester will periodically revisit this subject, to see what other advances promote great human-based customer experience where the humans on the business side of the interaction really like and understand what they’re offering.
Image courtesy of OPOLJA (Shutterstock)