The relationship between employee and customer loyalty is easy to sense or feel but hard to prove. This is a tough question to answer well, especially for the analytics, but let’s see if we can create a trail of causation.

Recent research by Dan Pink author of Drive indicates that there are three important factors involved in motivating employees in a sustainable way:

• Autonomy (I get to choose and be in charge of certain things at work)
• Mastery (I get to to become master of a skill, domain, etc.)
• Purpose (we all need to know why if we are going to present our best self and best effort.)

People who are motivated in a sustained way do their best, deliver their best work, and contribute.

Autonomy + mastery + purpose = engaged employees

Who do you want interacting with customers?  If I am an engaged employee, I usually interact with enthusiasm and speak from an informed authority. I am also more inclined to advocate for my company if I feel good about the work I am doing, the opportunities I have, and the understanding and clarity I have for why my work matters. We all prefer to talk with upbeat and informed people- so do our customers.

The only piece missing from the information above is ‘listening to the customer’ which you describe so well in your video.  I don’t assume that an engaged employee who can speak well on the part of the company is necessarily a good listener or open to tough customer feedback. However, that is a skill that we all can develop over time with practice and training.

Patrick Reilly is the President of Resources In Action, Inc. Patrick is a successful entrepreneur and executive consultant with 20+ years experience helping leaders solve current business problems while supporting them to become better leaders tomorrow. His work is strategic, developmental and focused on improving performance. He specializes in working with leaders and organizational systems in transition. His experience is both tactical and strategic.

Patrick brings his extensive experience in both change management and executive development to accelerate and focus the results of his work. Patrick has been a featured speaker at national and regional conferences sponsored by the Association of Executive Search Consultants, ERE Media, the Professional Coaches and Mentors Organization, Northern California Human Resources Organization, and the Organizational Development Network.

At first, it seemed like the show was about ‘spying on employees’ and sort of made me feel sick given my commitment to helping companies understand the link between employee loyalty and customer loyalty…and ultimately business success. After awhile, however, it became evident that even if the boss’s original intent HAD been to spy on his employees to find them doing something wrong, the real experience became something very different…the boss (Larry O’Donnell, President and C.O.O. of Waste Management), via various entry level roles such as cleaning portable toilets and collecting garbage, got a REAL view of what it’s like to work for Waste Management.

This view from the ground made him realize that:

• He has some terrific employees who are devoted to providing good service
• Many of the guidelines and policies that he and the board had implemented over the past year were actually serving as obstacles to his employees’ best efforts.

How many organizations are in this same position? Do YOU know what you are doing to keep your employees from bringing their best intentions to the job? As we’ve discussed before, employee satisfaction is on a steep decline in the U.S., which impacts the bottom-line at companies all over America.

Could this trend be reversed if more managers and executives spent just a little bit of time to experience their organization from their employees’ perspective? It sure couldn’t hurt… Could this new reality show help people in charge consider doing a little ‘snooping around’ of their own? We can only hope…

We got started on this topic a month or so ago when discussing our respective work with clients: her focus is on employee retention and mine is on customer loyalty.  We are both passionate about helping organizations be more successful from our different perspectives…and we realized that our clients that don’t focus on ‘loyalty’ as a priority are least likely to emerge from this recession in a healthy position…or at all.

As we explored this topic, we found a multitude of information that supported our hunch about the link between employee and customer loyalty:

- Southwest Airlines is rated the #1 place to work in Glassdoor.com’s 2nd annual Employees’ Choice Awards.…is it just coincidence that this same organization rates as one of the highest in customer satisfaction/loyalty?

- Deborah Schmidt of Loyalty Leader, Inc. recently wrote an article, “Unhappy Employees Create Dissatisfied Customers“, that explores the many facets of this connection and provides some great advice to employees.

- Walker Information has been tracking the relationship between employee and customer loyalty for the past 8 years and finds that both types of loyalty consistently move in parallel to one another.

Given this strong connection, it’s a very bad omen to those of us who are passionate about customer loyalty that employee satisfaction is at a record low.  According to a study by the Conference Board, only 45% of U.S. workers are satisfied with their jobs compared to 61% in 1987…and the numbers have been declining over the past 20 years.

During a recession where companies believe that they are in the driver’s seat since unemployment is high, it’s especially vital to remember this inextricable relationship…if organizations don’t consider employee loyalty a priority, it will inevitably show up in the quality of their customer relationships.  Just remember the last time you had contact with someone from a company that had obviously ‘checked out’ and was unhappy with their job…how good was THAT experience?  What did that do for your commitment to that company?

Let’s all spread the word out there to not forget about the importance of employee satisfaction/loyalty…it’s common sense, but another area that is not common practice.