The Relationship Between Employee Engagement and Satisfied Customers

a woman on the phone with a smile and thumbs up

Those of us who have spent decades in the field of customer service look at the picture above and see two things:

1. An engaged employee who loves their job, their company and gives it their all.
2. The likelihood of a happy and loyal customer on the other end of the phone.

And that’s what so many miss…the link between engaged employees and customer loyalty. Some people call it the service-profit chain. Whatever you call it, the concept is that there is a direct relationship between [internal service quality, employee engagement, employee retention, employee productivity, customer satisfaction and customer loyalty] and [revenue growth and profitability.]

Just think about your own customer experience at the store, on the phone or in business. If you encounter an employee who has high conviction about what they do and how they did it that provides excellent service and value, what is your reaction as a customer? You most likely leave with positive feelings about the interaction and the organization.

For example, I am a volunteer ski patrol in the winter. My Patagonia ski pants of 15 years started to lose their water protective qualities. I called Patagonia and they sent me a new pair of pants for free with little fuss because their products are guaranteed for life. I am now a Patagonia advocate for life – and so are my friends and the people that see me patrolling on the mountain.

Of course, the opposite is true too. A disengaged, sour-faced employee will leave you with doubts about the organization they work for. For example, my son recently was involved in a minor traffic collision. Our insurance agent of 30 years was useless in helping us understand our options and making a wise decision about how to proceed. Our satisfaction with the process was low, and we would gladly entertain switching providers based upon that one negative experience.

The point is that the attitude and behavior of your employees (especially your customer-facing employees) have a profound effect on the attitude, behavior and profitability of your customers. The more engaged your employees, the more likely your customers will reflect their positive attitudes. When you analyze the numbers, this connection can make a huge difference to your bottom line.

Studies show that a whopping 70% of the workforce is at best complacent and at worst actively disengaged. Imagine what these employees are doing to your customer base. If customers are tuned in to their experiences with your employees, you risk having the same negative impressions that I had of our insurance agent and her company.

Well satisfied customers are loyal and profitable. They talk to friends and associates about their experience. Go Patagonia! They add ratings and reviews that are readily available as testimonials on your web site and through social media. Indifferent customers, by the same token, can cause a lot of damage. They are easily tipped toward negative impressions. Actively disengaged employees can result in actively disengaged customers…the customers who can bad-mouth your organization and go elsewhere.

If you are looking to improve customer reactions and word-of-mouth marketing, begin with your workforce. Improve employee engagement and you will improve the experience of your customers. It’s all about relationships. Strengthen the one between your employees and the organization and you will, at the same time, strengthen the relationship between your customers and the company. All this hard work will end up in your favor… improved business results.

Benchmark your employee engagement practices to see where you stand.

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