Author: JoAnna Brandi

Some organizations exemplify a 'scarcity' model - fear-based, stingy, always looking to slash, cut or squeeze something to wring every possible cent to the bottom line. Meanwhile, the company invests nothing in the health and well-being of the people who take care of the customers.

It happened again the other day. After my speech was done a few people came up to talk, comment, share. Once again I heard from someone who shared my common sense beliefs about customer care but worked in a company that didn't. The company she worked for exemplified what I had, in the speech, termed a 'scarcity' model - fear-based, stingy, always looking to slash, cut or squeeze something to wring every possible cent to the bottom line. Meanwhile, the company invests nothing in the health and well-being of the people who take care of the customers.

As you might guess, she was looking to leave that company and find another or start her own business so she'd have a chance to practice the things she believed in and live her values through her work.

If I've said it once, I've said it ten thousand times: "When employees are happy, customers are happy, and when customers are happy they spend more and refer their friends and colleagues to you. When you create more value, more money drops to the bottom line." Why? Because attrition - of customers and employees - is a COST. It may be a hidden one, but it's a real cost. When your turnover of customers and employees is high, you lose money.

It's common sense. It's basic. It's elementary, Watson! At least it should be, yes? But the unfortunate fact is that at most organizations, it's not. Then there are those companies that think they're walking their talk and that the culture is hunky-dory, when all it would take is a little eavesdropping in the restrooms or at the water cooler to find out how unhappy and resentful their team really feels. When will businesses really 'get it?' There's a direct link between employee happiness and profit!

Since you know I carry that belief, you can imagine how overjoyed I was when I received this news release from Newswise.com that highlights the latest 'happy, empowered employees = increased profits' research. What's striking about it is the finding that even happy employees who don't directly 'touch' customers can positively impact the bottom line! Read on (I've taken the liberty of bold-facing advice that my company's been teaching for years):

James Oakley, a Krannert School of Management assistant professor of marketing [at Purdue University], found, "a direct link between employee satisfaction and customer satisfaction and between customer satisfaction and improved financial performance."

He said, "Employee satisfaction is a key attribute of the engaged employee who embodies a high degree of motivation and sense of inspiration, personal involvement and supportiveness," he said. "Organizational culture is another significant driver of employee engagement and includes management designing jobs well, providing support and setting goals for employees."

The engaged employee is oriented to providing good service and answering customer questions, which, Oakley said, "gives the customer a voice inside the company." And a customer whose voice is heard inside the company drives profit by being a repeat customer and bringing in new customers by word-of-mouth, which has a high degree of credibility. The given in all this is that a company must start with a solid product.

Starbucks is the prototypical example of a company that understands the connection among engaged employees, satisfied customers and increased profits, Oakley said. Starbucks pays well for the industry and offers health-care benefits. He said the company also does excellent training before their employees take the floor and then continues with ongoing training.

"The goal is for Starbucks' employees to be able to answer customers' questions," Oakley said. "What happens then is customers are willing to spend more because of their good experience. And they communicate their experience to others."

It works. Starbucks' heavy users return 20 times per month. Oakley said, "In the end, customers who are more satisfied with an organization's products are less expensive to serve, use the product more, and are, therefore, more profitable customers."

Starbucks broke the mold and went against the trend of denying part time employees benefits and training - and their formula paid off. As did a contrary philosophy at Southwest Airlines and Rosenbluth Travel - both of whom put the employee first and treat them with caring.

The #1 reason people leave their jobs is that they feel unappreciated, and according to Tom Rath, author of the recently released How full is your bucket?, 61% of Americans received no praise in the workplace last year. Too bad, because the Gallup survey of over 10,000 companies that people who regularly receive praise get higher loyalty and satisfaction scores from customers.

Okay, for the 10,001st time - here we go - happy employees = happy customers. Happy customers = more profits. Spread the word!

It's all about the culture - the beliefs, values, attitudes and assumptions you hold. It's all about the "way we do things around here." The culture determines how the customers will be treated. Treat employees like 'precious cargo,' there is a higher likelihood they will treat the customers the same way.

Wake up and smell the coffee! It's a competitive world out there - and the one that wins the race in the customer economy will be the one who 'gets it' - the link between customers and employees!

Go tell someone you appreciate them! 

Copyright 2004 by JoAnna Brandi. Used with permission.