Align the Voice of the Employee with the Voice of the Customer to Improve Business Outcomes

Whether it’s your car or your company, proper alignment of all the parts is necessary to get the best performance. And for a company, two of the most critical parts are its customers and its employees. The better aligned the perceptions of the two groups, the better your investment choices and the better your company will perform.

There is compelling research examining the benefits of identifying and correcting disconnects between customer and employee perceptions of importance and performance. Companies with a clear understanding of the views of each group and what it takes to resolve those disconnects outperform their competitors by substantial margins.

A study published by The Forum for People Performance Management & Measurement at Northwestern University (Oakley 2005) found that:

"There is a direct link between employee satisfaction and customer satisfaction, and between customer satisfaction and improved financial performance."

The study looked at the impact of organizational culture, organizational climate, human resource systems, and market characteristics on employee satisfaction and employee engagement (which they define as the degree of employee motivation and sense of inspiration, personal involvement, and supportiveness). They then gauged the downstream effects of these employee attitudes on companies’ market performance.

Other key conclusions:

Organizational culture was another significant driver of employee engagement, where employees must be expected to cooperate and work together, but also to take charge and provide a voice for the customer within the organization (italics added).
Organizations with engaged employees have customers who use their products more, and increased customer usage leads to higher levels of customer satisfaction
It is an organization’s employees who influence the behavior and attitudes of customers, and it is customers who drive an organization’s profitability through the purchase and use of its products
In the end, customers who are more satisfied with an organization’s products are less expensive to serve, use the product more, and, therefore, are more profitable customers.

Similarly, Wiley and Brooks (2000) reviewed the relationship between financial success and customer and employee variables (e.g., customer satisfaction, employee satisfaction, etc.) and found that, depending on market segment and industry, between 40 and 80 percent of customer satisfaction and customer loyalty was accounted for by the relationship between employee attitudes and customer-related variables. With a body of convincing information demonstrating the benefits of aligning what the customer is saying with what the employee is saying and doing, why does there continue to exist a significant disconnect between these two important drivers of a company’s marketplace performance and financial success?

It is accepted wisdom and common practice among a great many companies to survey both customers and employees regularly to define what matters most to them in their relationships with a company. This helps build better equity in the company for each group. Unfortunately, these two activities usually reside in different functions such as marketing and human resources. Consequently, there is often little or no connection or coordination between design of the respective surveys, access to the findings or integrated deployment of results.

However, there is a relatively simple and straightforward way to get better use of the results of such surveys and eliminate disconnects between the two groups. A well-designed and executed customer satisfaction survey will identify and measure the relative importance of various aspects of the customer experience as well as performance of a company on key drivers of customer satisfaction and loyalty. Typically, a small number of these drivers account for the most significant attributes of importance and performance.

These critical few questions on importance and performance can be incorporated into the employee survey as a useful mirror. Simply ask the employees to rate how important they think these attributes are and how well they think the company performs on them. Comparison of the ratings between the two groups can provide some eye-opening insights on major disconnects and where to focus improvements. The chart below compares the hypothetical results of such a mirror survey.

In this example, the employees attach much more importance to product features than do customers and they also feel the company is performing well in this area. Customer ratings are much lower. Understanding these differences provides the basis for reassessing the emphasis on features and investing in areas more important to the customer. The same is true to some extent for technical support. Also, the company is doing well on customer training, but possibly over-investing in an area of relatively low importance to the customer.

A major disconnect exists customer and employee ratings on sales support. It is much more important to the customer than perceived by the employee, but customers rate performance much lower than employees perceive it to be. This is a major problem in a critical area of customer loyalty and retention. Prompt delivery is another important disconnect.

These examples simply demonstrate the improved customer focus and alignment of priorities for training and process improvements made possible by a quantitative understanding of the perceptual differences between customers and employees. Common understanding between customers and employees can help a company improve critical performance areas that that drive the customer experience, customer loyalty, employee engagement, and a company’s business success.

References

Oakley, James L. (2005). Linking Organizational Characteristics to Employee Attitudes and Behavior – A Look at the Downstream Effects on Market Response and Financial Performance. Northwestern University Forum for People Management & Measurement.

Wiley, J. W., & Brooks, S. (2000). "The high performance organizational climate." In N. Ashkanasy, C. Wilderom & M. Peterson (Eds.), Handbook of Organizational Culture and Climate. Thousand Oaks, CA: Sage.

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