Should You Put Employees or Customers First?

Put Employees or Customers First two doors to choose the best option: employee engagement or customers first

Employees or Customers First?
There is much debate in the business world about which orientation is the best choice when you are looking to succeed…should you strategically and culturally put employees or customers first?  While employees and customers are both critical ingredients to any business, you cannot realistically focus on and invest equally in both from a strategic and cultural perspective.  So which is more critical to the success of your business?

Putting Employees First
This side of the debate argues that if you engage your employees they will exert more discretionary effort, be better brand and company advocates and remain loyal workers for a longer period of time.  This equates directly to greater financial returns and more fruitful interactions with customers.

  • Service-Profit-Chain: Dating back to the 1970’s concept of a Service-Profit-Chain, the overarching premise is that high levels of employee engagement (back then they called it employee satisfaction) are created from high-quality cultures and policies that empower employees to deliver outstanding results to customers.  These outstanding results create high levels of customer satisfaction and loyalty – and thereby profits.
  • Best Places to work: Additionally, according to four recent studies and our own Best Places to Work Research, disengaged employees and unwelcome attrition create 10% lower profits, almost 20% lower operating income, and up to 30% lower earnings per share. Conversely, higher employee engagement correlates to nearly 20% greater productivity, more than 10% higher customer satisfaction and up to 50% less voluntary turnover.

Companies that Put Employees First
Editors of Fortune magazine recently put together a list of 30 companies that truly put their employees first. To generate the list, they looked at companies whose work environments supported and encouraged:

  • employee development
  • career growth
  • employee engagement

Not surprisingly, in return, these organizations have been outperforming their peers in terms of employee turnover and employee performance.  It’s also not surprising that Google, famous for treating its employees well, ranked #1 the list.

W.L. Gore & Associates
Another example is W.L. Gore & Associates, the manufacturer of Gore-Tex and Glide dental floss.

  • They have an unbelievable 3% voluntary turnover rate for their full-time employees.
  • As one of the 200 largest privately held U.S. companies with approximately $3 billion in annual sales, Gore vows to “reinforce a key element of the culture to take a long-term view.”
  • Beginning with their first annual picnic at the CEO’s home, they regularly and happily continue to include the entire workforce as they celebrate business milestones.
  • The company focuses on fun, philanthropy and making money with superior products.
  • They believe and live their philosophy… engaged employees are simply good for business.

Southwest
One of our favorite examples of putting employees first is Southwest Airlines.  From their smiles to their low fares, Southwest’s employees are treated better and deliver higher value compared with most other domestic airlines. Southwest has been profitable for 21 consecutive years and was the only major airline to realize a profit in 1992.

Putting Customers First
On the other side of the debate is Amazon.

Amazon
Amazon has famously put their customers at the front and center of their business. Amazon goes beyond simple world-class customer service.

  • CEO Jeff Bezos talks about “customer obsession.”
  • The company is regularly at the top of every customer service poll.
  • Clearly, their customers-first approach, which now includes the ever more popular Amazon Prime, has won them record-breaking success.
  • From an employee engagement perspective, however, the news has been mixed for Amazon.  The word on the street is that working in their retail environment is less than engaging.

REI
Another company that focuses on their customers first is REI. But they are not looking to dominate all retail markets. They understand who their ideal target customers are and what their customers truly value. They recognize their niche and deliver superior service to their members who want dependable outdoor equipment with a no-questions-asked guarantee.

A customer-centric strategy and culture also pay handsome dividends.  Back in 1990, Harvard Business Review calculated that a 5% increase in customer loyalty can produce profit increases from 25% to 85%.

The Bottom Line
When it comes to putting employees or customers first, clearly both approaches can breed success. There is no one-size-fits-all choice. As with most things related to culture, it all depends on your strategic direction.

While both employees and customers are vitally important, your true focus depends on your core business strategy and how well you align your culture with that strategy.  Regardless of putting employees or customers first, when your culture and your strategy are aligned, your organization will outperform the competition.

To learn more about creating an aligned culture, download our How to Create a Purposeful and Aligned Workplace Culture

Comments are closed.

LSA provided top notch solutions right when and how we needed them. They exceeded my expectations from a speed, quality, and cost standpoint. I recommend them to anyone looking for a true business partner in the Learning and Development arena. The breadth and depth of their expertise has helped us hit tight deadlines across multiple projects.

Fortune 500 Financial Services Company
Director of Infrastructure & Technology

Understanding and conforming to legal compliance was very important to our company. We turned to LSA Global to provide a quality and cost effective way to ensure that we were AB 1825 compliant. Their interactive eLearning program was top-notch. It allowed our managers to learn at their own pace, and on their own time. The program was tailored to include our logo and our internal harassment policies. It was interactive and met all federal and state legal requirements. I would highly recommend LSA Global to any company looking for an efficient and effective and top quality way to train their managers to be in compliance.

Kelly Warren, SPHR
Director, HR & Compliance

I have worked with LSA Global at previous companies and welcomed the opportunity to bring them in to support my new organization. We worked closely with LSA to design a solution for our Client Partner Teams and Management Training on both coasts. LSA designed a customized solution for our business and organizational culture. LSA is a quality organization, one that I’d recommend to any company looking for a first class training and consulting partner that makes an impact.

Laurie Torres
Chief People Officer

I’ve partnered with LSA Global at two companies now, and I consider them a valuable and trusted training and consulting resource. They recommended just the right solution to address our management development needs and have wonderful facilitators that match YuMe’s culture and style of our management team. I would highly recommend LSA Global to any company wanting to deliver quality learning solutions with a valuable learning and development partner.

Maya Paul
HR Director

What a refreshing change from the half-baked psycho-babble you normally get from training and consulting organizations. LSA gives you the practical and results-oriented assistance you need to define and reach your goal.  They provide a results driven plan – not just a temporary fix. They are great to work with, and even more importantly, they “get it!”

David Fiano
Vice President Human Resources

Here’s a token of my appreciation for ALL your efforts. I’m offering my most sincere appreciation, and it extends to all the folks who made our customized management development programs possible.

Susan Anderson
Workforce Planning Bureau

Our company engaged LSA to do a specialized “train the trainer” program, and the consultant’s performance outdid our exceptionally high standards for such a program. Very crucial to the success of this program was the work done upfront to discuss our needs and to interview key members of our organization so that the program specifically met our goals. Our facilitators continue to comment on the success of the program. Thanks also for the follow-up.

Frank Abbott
Chief Financial Officer

Avon’s success is dependent on strong relationships among our Customers, Representatives, Associates, and outside resources we hire to help us meet our business objectives. We were very pleased with the results from working with LSA Global to design and facilitate a custom program for our events management team. LSA demonstrated responsiveness, flexibility, and an innovative approach to working with us.

Deanna Rudnitsky
Senior Manager, HR Destiny Sales Region

VNUS Medical has been very pleased with the effective management development programs that LSA Global has delivered for us over the last four years. The programs have been universally facilitated by experienced and best in class instructors. The knowledge gained by our management team has been put into practice very quickly. VNUS is very happy to be working in partnership with LSA because they consistently deliver excellent programs that receive exceptional feedback from our management team.

Cindee Van Vleck
Director Human Resources

“We turned to LSA to help us custom design and deliver a leadership and management development curriculum to help drive performance. They have done an excellent job diagnosing the business situation, designing an approach that fits our culture, and delivering a first class solution.”

Sally Buchannan
VP Human Resources

The Next Generation Management Development courses have helped me communicate more effectively with my peers and teammates. By utilizing effective communication techniques such as clarifying and confirming, and asking open ended questions, I have been able to clarify and understand information in situations where I would have otherwise asked limited questions and made false assumptions.

Robert Breckner
Firmware Engineering Manager

We consider LSA Global our outsourced learning and development partner. We worked closely with LSA to customize a management development program to meet our growing business needs. I would highly recommend LSA to any company wanting to deliver quality learning solutions.

Terri Wright-Scheer
Vice President Human Resources

I’ve been associated with LSA for the last 8 years and have found them to be an extremely professional, well managed full service training organization. Since working with LSA, I’ve participated in a number of solutions ranging from Performance Management to Assertiveness Training – I’ve found that the quality of the resources is superior. They are well prepared and have definitely done a considerable amount of pre-work in order to customize our culture and business into the total learning experience – making it most beneficial for our employees.

Duane Schroeder
Human Resource Manager

We recently contacted LSA Global to assist us with a unique training request. We gave LSA a very short deadline and LSA custom designed a training program to meet our exact requirements within the limited time allotted to them. We found their facilitator to be well versed in the subject matter and very credible; the design provided practical and valuable information to our team of managers. I highly recommend LSA Global, particularly in the area of management training.

Julaine K. Souza
Senior Vice President

LSA’s approach and ability to bring the best resources to eBay has been a great asset. They really focus on helping us succeed in any way they can and are very flexible in meeting our management and talent needs.

Mike Normant
Learning & Development

ebay

Evaluate your Performance

Toolkits

Toolkits

Download key published insights and tools from industry experts highlighting best practices in the areas of talent, strategy and culture.

More

Health Checks

Health Checks

Want to know how you stack up against leading organizations?  Receive a complimentary benchmarking analysis courtesy of an LSA Expert.

More

Whitepapers

Whitepapers

Get up to speed on timely solutions critical to your business. Published by LSA Experts based upon client feedback and key industry trends.

More

Methodology

Methodologies

First we identify the key metrics you want to improve. Then we assemble a dedicated team of elite experts who have successfully solved similar problems with similar clients.

More

Blogs

Stay up to do date with the latest information on how we help high growth companies align their culture and talent with strategy.

More

Case Studies

Client Case Studies

Real world consulting and training approaches from LSA projects, providing insights on how your company can outperform the competition.

More