Not that we need to say it again, but more recent research confirms that increasing employee engagement increases performance. Most boardrooms see employee engagement as a key priority for the future and investment in engagement is set to grow — even in the current economic environment.
This is a key finding of the comprehensive study of engagement practice undertaken in the UK, commissioned by employee engagement consultancy, Engage Group.

The survey of nearly 23,600 directors, managers and employees, conducted during October 2008 , reveals that effective engagement can demonstrably improve an organisation’s performance.

A high level of employee engagement is one of the top three drivers of an organisation’s performance, and nearly a third of the UK’s senior leaders see a fully-engaged workforce as one of the most critical factors in their organisation’s success.

Key findings from the report are as follows;

• Effective engagement can demonstrably improve an organisation’s performance
• Most boardrooms see engagement as a key priority for the future and net investment in engagement is set to grow, even in the current economic environment
• Despite growing board support for engagement, most employees still feel disengaged from their organisation – board buy-in has not yet, according to employees, been translated into action
• ‘New world’ aspects of engagement, particularly the appetite and ability of leaders at every level to share power and engage people in decision-making, emerge as powerful new elements of engagement
• Delivering on the ‘new engagement agenda’ will result in more engaged employees, more committed customers and faster growth
• Forceful ‘command & control’ styles of leadership have little, no or even a negative impact on engagement and performance levels – less than 40% of employees view their leader(s) as effective
• Employee satisfaction, the oldest assumed element of employee engagement, sinks near the bottom of the list of influential factors
• Internal measurement lags behind external measures of performance – only 28% of board members claim to use robust internal measures of employee engagement

This study confirms an earlier thesis, the outcome of an extensive research programme carried out in partnership with McKinsey & Company, that the drivers of employee engagement are steadily shifting towards a new inclusiveness

However, despite growing board support for engagement, most employees feel disengaged from their organisation. Only just over a third of employees believe their organisation engages them to perform well.

For those of us who live in the world of employee engagement this comes as no surprise, but for those clients who are still struggling to find the time, money or motivation, maybe this will help.

You can download a complete copy of the full report at Engage Group.

Recently MarketingProfs sent out a note about going the extra mile. In it they referenced an article (Giving Firms an ‘E’ for Effort: Consumer Responses to High-Effort Firms) by Andrea C. Morales, assistant professor of marketing at the Marshall School of Business, University of Southern California.

Their research indicated that customers reward companies that are seen to go the extra mile — even if they don’t personally benefit from that effort. In fact, customers are willing to pay more for a product, frequent one store rather than another, and, in general, have a more positive impression of a company or brand that is perceived to put in more effort.

Andrea’s explanation is that customers recognize that effort is a controllable behaviour, and as a result, feels gratitude toward firms that work hard.

It reminds me of a review an advertising agency got from a client (our customer) where I worked many years ago. In that review the client was very critical of the creative product and lukewarm on the media and production. However, they were very positive about the account service team because, in their words, “we worked so damn hard”.

They acknowledged that they were not always getting the level of service they expected, but were willing to be somewhat forgiving because of the obvious effort their daily account team was expending on their account. They gave us time to address the issues while putting senior management on notice that something had to be done.

According to the researchers, customers can view a company’s outstanding efforts as either general or personal.

• A company’s actions are considered to be general when they benefit the universe of customers, such as creating new products
• However, a company’s actions are considered personal when the action is deemed to benefit a specific customer (such as outstanding customer service), even if they are not the customer receiving the benefit.

We all know that personal wins because of the emotional connection. However, the interesting notion is the halo effect created by doing a good deed for someone else. My sense is that it is driven by the belief that the company (or person) would do the same for us in a similar circumstance.

I think this concept applies to personal behaviour as well as company behaviour. So demonstrate you are making the effort even if you can’t satisfy your customers need. They will recognize your efforts and appreciate and reward you for your attempt.

Cheers!

I was reading Seth Grodin’s blog this morning and he talked about the importance of measuring the quality of traffic that is coming to your site or blog versus the quantity. His point being that it is better to have a smaller number of qualified prospects/customers versus a lot of people who will never purchase. He summarized with the comment “Just because something is easy to measure doesn’t mean it’s important.”

It reminded me of the same principle that should be employed when trying to measure 1) customer satisfaction, and/or 2) employee engagement.

Too often we get caught up in designing dashboards and metrics that may measure lots of things, but if they are not actionable or possibly aren’t measuring the stuff that gives you insight into the health of the organization, then they aren’t very useful measures.

So ask yourself, are your measures giving you advance notice of changes in your business, or are they lagging indicators of issues that may have been around for awhile?

I have been doing some reading on this topic lately, so I will share some of my observations over the next little while.

Cheers!

I recently came across an article about the Kronos Retail Shopping Frustrations Survey that takes a look at shopping frustrations across all retail store types and the effect that a poor shopping experience has on the retailer’s reputation. Some highlights include:

• 84% of shoppers are frustrated with lines at checkouts
• 74% of shoppers would actually leave a store without making a purchase if lines are too long
• 81% of respondents are likely to share a poor shopping experience with friends and family
• 49% of respondents say they have walked out of a store with long lines at the checkout without making a purchase
• 25% have walked out and taken their business elsewhere to find a store with shorter lines
• 51% indicated long lines with unopened checkouts as the biggest frustration

Yet at the same time, customers felt that having to wait was acceptable.

• 17% of respondents happy to have one person in front
• 44% of respondents agreeing that a maximum of two people is acceptable
• 23% of shoppers think its fine to have a maximum of three people in front of them
• 7% of respondents think it’s acceptable to have up to four other customers in front.

Commenting on the findings from the survey, Simon Macpherson, Operations Director EMEA Kronos, says: “Shoppers are happy to shout it from the rooftops when the service provided is not up to scratch, leaving retailers with dented reputations. Unopened pay points, long queues and out-of-stock products are almost without exception the result of staff not being in the right place at the right time to provide the best possible customer service. Retailers need to address this issue if they are serious about improving one of the prime differentiators between their competition – the customer experience.”

You would think that every retailer would aspire to having happy customers 100% of the time. Happy customers mean loyal customers and greater loyalty brings bigger profits, yet many retailers still fall short when it comes to providing a great customer shopping experience.

Cheers!

Recent data released by TD Canada Trust found that 95 per cent of consumers say their experiences with a company can make or break a relationship with the firm or its products — up 10 points from a year ago.

In fact, when asked which form of appreciation they are most interested in, 49 per cent ranked “just good customer service” as No. 1, followed at a distance second by rewards or loyalty programs at just 18 per cent and 17 per cent gifts.

But as we know, even more importantly, good service doesn’t end with one customer but spreads to other potential customers, as happy customers become advocates. The survey also found that 89 per cent say they share their positive experiences with friends and family.

Compare this to the recent study on the airline industry. J.D. Power and Associates 2008 North America Airline Satisfaction Study indicated that overall satisfaction for the airline industry has declined in 2008 to its lowest level in three years.

Now you might expect that this would be driven by increased pricing, but the decrease in satisfaction with people factors is more than twice as large as the decline in satisfaction with price factors.

The study finds that satisfaction with “people” factors—including knowledge, courtesy and helpfulness of reservation and gate agents, check-in staff and flight crew—has declined dramatically since 2007, and is the leading contributing factor to the overall decline in customer satisfaction with airlines in 2008.

Sam Thanawalla, director of the global hospitality and travel practice at J.D. Power and Associates said, “In this unstable industry environment, it is critical that airlines invest in their employees as a means to enhance the customer experience, as there is a strong connection between employee satisfaction and customer satisfaction. Those airlines that focus on keeping their employees informed and motivated will be better able to change negative consumer sentiment and truly differentiate themselves.”

Whether banking, airlines or any other business, I couldn’t have said it better.

Cheers!