By Rajat Paharia, Founder and Chief Product Officer at Bunchball, and author of Loyalty 3.0 – How to Revolutionize Customer and Employee Engagement with Big Data and Gamification.
When marketers talk about the customer experience, the focus is almost exclusively on the buyer. “What does the customer want/need/prefer?” “How can we improve customer engagement?”
But today, I’d like to offer this (gentle) reminder that the customer experience is part of a larger service-profit chain. Yes, satisfied, loyal customers are essential to profitability. However, you can’t forget where the entire service-profit chain begins – with engaged employees. In 2000, HBR OnPoint published an article titled Putting the Service-Profit Chain to Work that very clearly articulated the value of employee engagement and loyalty, and to illustrate my point, I’ll adapt it slightly here:
In other words, engaged employees are your company’s most important asset. They’re absolutely critical to your customer experience . . . and your business performance overall.
A variety of different studies prove my point. For example, according to research from the Corporate Leadership Council, highly-committed employees:
- try harder (57%)
- perform better (20%)
- are less like to leave (87%)
In addition, Forrester recently concluded that companies with higher employee engagement ratings have higher profit margins and deliver better customer outcomes, as measured by customer satisfaction, loyalty and likelihood-to-recommend scores.
But here’s the problem: Despite all of the studies that underscore its importance, the vast majority of companies have trouble with employee engagement. In fact, Gallup found that worldwide, only 13% of employees are engaged at work! Of the remaining 87%, more than half (63%) are not engaged, and 24% are actively disengaged.
What can companies do to turn those statistics around? How can you begin inspiring the kind of employee engagement that is the foundation of a great customer experience?
Last month, Samuel Stern, a Senior Analyst in Forrester Research’s customer experience research practice, and I discussed the answers to those questions during the Bunchball webinar How Employee Engagement Creates and Sustains A Customer-Centric Culture. Here are our recommendations:
- Make the business case for improving employee engagement and customer focus. You need to demonstrate the correlation between customer experience, business and engagement metrics. That means you need to clearly define the customer experience, and you need to be able to communicate the importance of it to employees and other stakeholders.
- Turn to experts to help. Marketers know how to motivate customers. But you’ll need to bring in others to help you motivate employees. At Bunchball, we know how to leverage fundamental design principles, big data analytics and universal human motivators to create gamified work environments that drive better business performance and ROI.
- Ensure your initiatives align with corporate strategy. As Sam explains in the webinar, strategy defines intentions (vision, mission, values; leadership and governance; customer experience metrics), and culture drives actions (hiring, socialization, rewards). The two must align to achieve desired business outcomes.
Today, the spotlight is on customer experience like never before. It’s important for marketers to remember that customer experience improves when both customers and employees are engaged.
Do you know about Teradata’s Data Driven Marketing Solutions? See how our Integrated Marketing Cloud can drive better Marketing Operations, Campaign Management, Customer Data Management and other digital marketing applications.