The Cycle of Satisfaction Starts With Employees

-A satisfied employee leads to a satisfied customer, which in turn leads to a satisfied shareholder.
At a recent conference in New York, the Chief Financial Officer of American Express shared a concept familiar to the audience, but explained it perhaps more clearly than others had expressed it: a satisfied employee leads to a satisfied customer, which in turn leads to a satisfied shareholder. Clever, yes, but is that accurate? Does the "Cycle of Satisfaction" (as I call it) really start with employees? The answer is yes, and with good reason.

Suppose the equation were to start with satisfying customers. With this as their number one priority, organizations would (and do) pour resources into market research, advertising, and other external vendors. But, ultimately, in order to implement any change in customer service, the employees would be the ones actually making it happen. This is true whether the employees are doing marketing, sales, service, product development, or what ever else. When the rubber of an organization meets the road that is its customers, the employees are the tires that either provide reliable traction or not.

And if the employees are dissatisfied, it is fair to conclude that the customer will not be as satisfied as she otherwise would be. We have all dealt with bitter, resentful, underpaid (from their point of view) employees, and we´ve also dealt with those who are very satisfied with and fulfilled by what they do. With whom would you rather deal if you have a customer service issue or are negotiating a deal?

Could the Cycle start with shareholders? In other words, if organizations wanted to satisfy their employees and their customers, would it be effective to begin by taking steps to satisfy their shareholders? Consider how that might be attempted. Perhaps re-structuring, downsizing, acquisitions, investments in new technology, and other measures would be taken so as to increase shareholder value. All of these steps would presumably be taken in an effort to minimize expenses and increase productivity. Important goals, to be sure, but mustn´t an organization consider the impact of cost-saving measures on its employees?

One may respond, "Keeping employees satisfied is not the responsibility of the organization. Making money is." OK, but how can you make money without your employees? In fact, isn´t there a relationship between employee productivity (which is heavily influenced by employee satisfaction) and the attractiveness of a particular company as an investment opportunity? It is doubtful that many of us would walk out of a business office, after dealing with a representative who appeared burned-out and overwhelmed, and say, "Now that´s a company I´ve got to invest in!"

Of course, this is not to say that the interests the shareholder and the interests of the employee must be in conflict. On the contrary, if shareholders have any degree of a long-term view, they appreciate the benefits of many things that employees also benefit from, including improvements in technology, streamlined processes, and effective employee training. Yes, there may certainly be tension between a shareholder´s interest in efficiency and an employee´s interest in holding on to a particular job. However, in reality this is a healthy tension, in that it forces companies to consider the reasonableness of their decisions to downsize in the eyes of their shareholders (leaner is not always better). It also forces employees at all levels within an organization to keep their eyes open to layoffs/restructuring that may appear on the horizon, so as to best position themselves for their next career move.

So the relationship between employees, customers, and shareholders is best driven by focusing on employees first (but certainly not exclusively). The bottom line is that you can´t satisfy your customers without a satisfied workforce, and you can´t satisfy a shareholder if the relationship between employee and customer is faltering. To return to the "rubber meets the road" metaphor suggested earlier, it is safe to say that the safe operation of the business vehicle depends upon the customer traction that employees provide, so that the shareholders can reach their destination. (Whether the shareholders are driving the car, in the back seat being chauffeured, or are locked in the trunk is perhaps the subject of another article.)

As the discussion of the Cycle of Satisfaction deepens, the next layer of the issue becomes what can employers do to contribute to the creation of a more satisfied workforce. Consider this: the American Express CFO delivered his remarks at the Spirit in Business World Conference, subtitled "Beyond the Bottom Line". It seems that the deeper discussion has already begun.

The HR industry´s premier online community and resource for Human Resource professionals: HR, human resources, HR community, human resources community, HR best practices, best practices in human resources, online communities for HR, HR articles, HR news, human resources articles, human resources news, HR events, leadership, performance management, staffing and recruitment, benefits, compensation, staffing, recruitment, workforce acquisition, human capital management, HR management, human resources management, HR metrics and measurement, organizational development, executive coaching, HR law, employment law, labor relations, hiring employees, HR outsourcing, human resources outsourcing, training and development
hr.com. human resources management resources for hr professionals. | HR menus | HR events | HR Sitemap