The Idea in Brief
Companies routinely assess the quality of manufacturing processes. But what about the quality of employees’ dealings with customers? Each employee-customer encounter—every sale, every call-center conversation—creates or erodes value for a company.
Yet most businesses don’t measure or manage the quality of employee-customer encounters. If they did, they’d discover extreme differences in employee and customer satisfaction across units. For example, some stores operated by the same retail chain are exceptional places to work and shop; others, awful.
Unpleasant employee-customer encounters damage revenues and profits. How to elevate the quality of these shared experiences in every part of your company? Start by measuring employees’ and customers’ emotional engagement with your organization. Why? Energized and committed employees engage customers and work more productively. Customers who feel strongly connected to your company spend more and stay loyal. When employees and customers are happy, your profits can soar.
By measuring employee-customer encounters in each part of your company, you manage them better—spotting and addressing problems before they poison your bottom line. In one study, companies that applied these practices outperformed peers by 26% in gross margins—and 85% in sales growth.
The Idea in Practice
To enhance employee-customer engagement:
Assess Emotions
Studies suggest that emotions play a larger role than analysis in people’s decisions. Thus it’s vital to measure your employees’ and customers’ emotions. For employees, monitor energy level and strength of commitment. For customers, assess their:
- Confidence: Do they feel your company always delivers on its promises?
- Pride: Do they identify positively with your company?
- Passion: Do they view your company as irreplaceable in their lives?
Measure Encounters Locally
High-level assessments of company performance (“We’re the leader in customer satisfaction”; “We’re one of the best places to work”) provide good marketing copy. But they obscure performance variation across company locations, and thus don’t give local managers the information they need to improve their units’ performance. To address this, measure employee-customer encounters at the work-group level. Example:
A telecom company formerly measured customer and employee satisfaction at the company level through random customer surveys and annual companywide employee surveys. But the results generated little useful information about local conditions. When the company began measuring customer and employee satisfaction at the work-group level, it gained valuable information. For example, call-center data revealed that each customer’s experience hinged on the service representative who took the call. The top 10% of reps produced six positive interactions for every negative one, while the bottom 10% yielded only three positive for every four negative encounters. Armed with these insights, call-center managers could reinforce exceptional performance and address poor performance.
Centralize Responsibility for Measurement
In most companies, customer data reside in the marketing or quality department; employee data, in HR; and financial data, in finance. To gain a true picture of the health of employee-customer encounters, bring these data together on one platform. Assign responsibility for measuring and monitoring the health of the employee-customer relationship to a single organizational structure, with an executive champion who has the authority to initiate and manage change.
Develop Local Managers
Local managers strongly influence their employees’ engagement and thus performance, retention—and customers’ experiences. Encourage managers to use training, performance reviews, and coaching to foster employees’ learning and correct performance shortfalls. Support managers with similar tools. If interventions don’t improve local performance, replace managers.
“Quality” is easy to measure and manage in some contexts, and extremely difficult in others. Businesspeople have a pretty good idea how to judge the manufacturing process that yields a snazzy new handheld device, for example. But what about the retail employee’s attempts to sell the gadget? Or the call center employee’s efforts to help the customer navigate its eccentricities? Businesses aren’t especially good at measuring and managing the quality of those processes—or indeed of most work done by nonmanufacturing businesses and units.
