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Business Journal
The Five Ways Top-Performing Companies Engage Customers
Business Journal

The Five Ways Top-Performing Companies Engage Customers

by Susan Sorenson

Most companies hire employees without giving much thought to whether they have the talent to engage customers.

Measuring and managing customer engagement leads to better customer relationships, resulting in increased share of wallet, profitability, revenue, and growth. But the world's top-performing companies don't stop there.

When it comes to winning over customers, successful businesses know that everything depends on their customers' experience with their organizations. During these interactions -- whether online, over the phone, or in a store or showroom -- customers do more than assess a company's goods and services. They are subconsciously forming an emotional perception of how they feel about the encounter and about how the company's employees treat them. These perceptions dictate not only how much customers will spend but also whether they will recommend the company to others or provide repeat business.

Yet most companies hire employees without giving much thought to whether they have the talent to engage customers. And businesses train workers simply to complete the functional requirements of their roles, such as executing a money transfer at the teller window or properly checking in a guest for a hotel stay. By performing such functions correctly and efficiently, employees may leave their customers feeling satisfied with the transaction, but they won't necessarily leave them feeling emotionally connected to the company. In this sense, companies are equipping workers to do only part of their jobs, setting them adrift when it comes to increasing engagement and using their strengths to connect with customers.

But top-performing companies don't leave the critical moments between employees and customers to chance. These businesses purposefully invest in developing their workforce by hiring for talent, building on their employees' strengths, creating an engaging workplace, maximizing their teams with great managers, and harnessing the potential of the employee-customer encounter. These five steps pay dividends by helping these businesses differentiate their brands and win more business in an increasingly competitive global marketplace.

Hiring for talent

Highly successful companies strategically seek candidates who are the right fit for each role and for the company's culture. Though companies must consider several factors in the hiring process, the most fundamental is whether a person has the talent required to excel in fulfilling a role's responsibilities. Skills, education, and work experience are important to a lesser degree. But if candidates don't bring the right blend of innate qualities to the job, all the credentials and specialized training in the world won't help them excel.

By selecting employees who have the talent to excel in a role, companies can reduce the time they spend recruiting and hiring employees, which lowers the cost per hire. Selecting for talent also increases the likelihood that new hires will exceed performance expectations and potentially improve customer engagement, brand image, and reputation.

Building on strengths

Though hiring for talent is a critical investment, companies must help employees develop their innate talents to perform with strength. It's not enough to put the right people in the right roles. Employees need support to discover their greatest talents and learn how to use them to achieve their full potential. All employees can develop strengths -- the unique combination of talents, skills, knowledge, and practice that helps them excel. These strengths are employees' -- and their companies' -- greatest opportunities for success.

Gallup developed the Clifton StrengthsFinder, an online assessment of personal talents that reveals individuals' areas of greatest potential for developing strengths, to help people identify what they do best. Since its launch in 1998, more than 10 million people worldwide have taken the assessment, in 50 countries and in 24 languages. Gallup works with clients to help their employees and teams use their StrengthsFinder results to increase performance, engage customers, and achieve important business outcomes, including higher profitability and productivity. And Gallup's research shows that people who use their strengths every day are six times more likely to be engaged in their jobs.

The moment that an employee connects emotionally with a customer is a source of untapped power.

Creating an engaging workplace

Engaged employees are the lifeblood of their companies. They are involved in, enthusiastic about, and committed to their work; have higher productivity, profitability, and customer ratings; have lower turnover and absenteeism; and have fewer safety incidents than employees who are not engaged. However, in a recent U.S. workplace study, Gallup found that only 30% of American employees are engaged in their jobs, while 52% are not engaged and 18% are actively disengaged. Active disengagement is no small threat to American businesses. Gallup estimates that it costs the U.S. between $450 billion and $550 billion per year.

Gallup also found that employee engagement for service workers is among the lowest of any job category and has declined as engagement in other categories has increased. This is a red flag for companies that entrust their customers to the care of service workers every day. When front-line employees are not engaged in their own roles, they stand little chance of engaging their customers.

Maximizing teams with great managers

Gallup has found that managers account for at least 70% of the variance in employee engagement scores across business units. Companies often end up putting people who lack the natural talent to manage in this critical role, and as a result, the organization and its employees suffer. Gallup research has revealed that companies fail to choose the candidate with the right talent for the job 82% of the time. And, unfortunately, these miscast managers can do real damage to a company's performance and bottom line.

Naturally talented managers, however, inspire employees to stay longer, produce more, and perform better. They help employees understand how every role in the company connects to the customer through the company's mission and purpose. Every direct or indirect point of contact between a company and a customer -- even through a bill, a letter or email, an ATM transaction, an online interface, or a product or service -- has the potential to make a customer feel more engaged or less engaged with the company. Such experiences are rarely neutral. Great managers recognize this, and they help motivate all employees, accelerate their development, and unleash their innovation and productivity to engage the emotions of the customers they serve at every possible touchpoint.

Great managers have the ability to maximize the potential of each employee, ultimately creating an unstoppable team. But finding these managers can be a challenge. Gallup research shows that one in 10 people possess the talents necessary to be a great manager. Another two in 10 exhibit some characteristics of basic managerial talent and can perform at a high level if their company invests in coaching and growth plans for them.

Harnessing the power of the employee-customer encounter

When Gallup researchers studied the effects of aligning and combining customer and employee engagement, they found that in workgroups with engaged employees serving engaged customers, the result was more than the sum of its parts. When companies successfully engage their customers and their employees, they experience a 240% boost in performance-related business outcomes compared with companies that have neither engaged employees nor engaged customers. Organizations that maximize only customer engagement or only employee engagement can experience growth in the short term, but they won't be able to sustain it long term unless they align their efforts to improve both.

Optimizing the emotional connection between employees and customers must be central to what leaders and managers think about every day. If they don't focus on this connection, missed opportunities to maximize employees' efforts quickly result in missed opportunities with their customers or prospects, inhibiting organizational growth. Despite what companies stand to gain, Gallup often finds that businesses struggle to connect engaged employees' actions with engaging experiences for customers.

All employees need to understand how their individual contributions relate to the company's mission and purpose, whether that mission is to make a profit and increase earnings per share, to raise funds to keep a nonprofit operation running, or to provide healthcare to those in need. But front-line employees represent a particularly important opportunity to fulfill this mission in direct interactions with existing and potential customers.

The moment that an employee connects emotionally with a customer is a source of untapped power that has profound implications on a company's productivity and profitability. When companies know how to prepare front-line employees to make the most of these moments, they successfully engage their customers -- who in turn spend more, visit more often, resist competitive overtures, promote the brand to others, and forgive the occasional service blunder. To maximize employee and customer interactions and win in the marketplace, companies need to select the right employees, build on their strengths, engage them in their roles, support them with great managers, and then deploy every facet of their operation to engage their customers.




Susan Sorenson is a writer and editor at Gallup.

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