I just ran across a Towers Perrin study entitled “Employee Engagement Underpins Business Transformation” (http://bit.ly/9wcZq5). The results affirm the link between customer and employee satisfaction and the impact on the bottom line.
In a study of more than 900 employees from 40 companies, results showed that companies with the highest percentage of engaged employees increased operating revenues 19% versus year ago while earnings per share (EPS) increased 28% versus the previous year. On the other hand, companies with less engaged employees experienced operating income declines of 33% and EPS declines of 11% versus year ago.
Given these findings, in addition to creating raving fans among customers, employers would be wise to create raving fans among employees since the two go hand-in-hand.
Businesses that value customer satisfaction and invest in management and improvement programs enjoy: 1) higher levels of employee and customer loyalty; 2) positive word-of-mouth and referrals thus lower cost per new customer; 3) reduced turnover, recruiting and training costs; 4) greater price premiums for their products and services; and, 5) greater share of wallet, more up-sells and cross-sells. All of this leads to more revenue, greater profit margins and faster growth relative to businesses that do not value customer satisfaction and invest in management and improvement programs.
This is a function of having employees and customers that are raving fans. Raving fans are more loyal. They have a strong emotional link to your company and your products and services. They are proud of their relationship with you and promote your business to families, friends, business associates and social media contacts.
Employees and customers that are raving fans are likely having a dialogue and relationship with one another. A fan club of two or more you might not be aware of.
What are you doing to determine if your employees are raving fans?
What are you doing if they aren’t?