The dictionary defines "trust" as "assured reliance on another’s integrity, veracity and justice." "Sincere," a related word, means "pure, real, honest and free of hypocrisy."
Both sincerity and trust are at the heart of partnerships, contracts, relationships and dealings between people and institutions; and these two words and concepts are central to optimizing customer behavior. Apart from creating trust and commitment among customers, leading to loyalty and advocacy, there is no other topic that concerns organizations more than staff loyalty, commitment and productivity. These staff behaviors cannot exist without trust—by the employer and employee.
The landscape
Staff turnover is near 20-year highs for many companies. Two research firms, Walker Information and Hudson Institute, recently joined forces to conduct a nationwide employee loyalty study. Their results confirmed that staff loyalty is in short supply:
- Only 24 percent of employees consider themselves truly loyal, committed to their organization and its goals, and planning to stay at least two years.
- Thirty-three percent of employees were high risk, not committed and not planning to stay.
- Thirty-nine percent were classified as trapped. They plan to stay, but are not committed to their employer.
- Among those who felt they worked for an ethical organization, 55 percent were truly loyal. For those who didn’t feel they worked for an ethical organization, the loyalty figure was 9 percent.
The 72 percent of employees at risk or trapped represent another key, yet less explored, concern for companies. The lack of employee commitment frequently translates to being out of alignment, with each other and with customers, in executing the company’s mission, goals and strategic objectives. In other words, what they are doing on the job can be counterproductive and damaging. Because the issues affecting customer loyalty and commitment to a supplier are often highly correlated with staff productivity and proaction, optimizing employee loyalty and alignment becomes doubly effective.
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| The trust equation
A good source for identifying where employee trust and advocacy creates customer loyalty behavior is the Fortune “100 Best Companies to Work for in America” list. Companies like Rosenbluth International, Southwest Airlines, Wegmans, Baptist Health Care and other leading lights are perennial listees. They exhibit common traits, among them: high levels of diversity, leading-edge investment in staff training and low employee turnover. The most important common denominators are having a customer-centric culture and creating a climate of trust and contribution for employees. It’s no accident that all of these companies are also known for creating high levels of customer loyalty. Nordstrom, long identified as a company that provides excellent service, believes in hiring the kind of people who will be self-motivated and customer-oriented. At Nordstrom, the relationship is the sale, and it can’t be consummated and sustained without trust working on both sides of the equation. Employees are encouraged to be innovative and creative with customers, and rules and bureaucracy are minimized. Accomplishment is celebrated. Above all, there is a total commitment to customer value and support, at every staff level. Starbucks, too, understands that customers are looking for more than just tangibles in their relationships with suppliers. Today, they want products and services that create a strong emotional connection and bond. Starbucks employees are trained in how to communicate the company’s core set of cultural values to customers, in an informal, subtle and conversational manner, while at the same time learning more about customer interests, work and families, so they can create more of a personal, one-on-one relationship. Customers are now engaging in what Starbucks calls a “cultural audit.” The company is training its baristas and unit management on how to engage the customers to convey Starbucks values while learning more about the customers and their interests. Howard Schultz, Starbucks’ CEO, has observed that the corporate world has created significant public cynicism, but people want to be part of something they can believe in, to be associated with a product or service that they can rely on. And companies that serve the emotional and human needs of customers and employees will separate |
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Alarming employee loyalty and productivity facts like these are driven, in large measure, by low employee confidence in the employer. In major organizational culture studies, it has been found that more than half of employees, 56 percent to be exact, say their employers fail to show concern for them and 45 percent say employers don’t treat them fairly. On the key issue of trust, 41 percent of employees feel that it doesn’t exist on the part of the employer. And trust is becoming weaker. In these same studies, 75 percent of employees believe that the level of trust between themselves and their employers is declining. The highest level of trust is between supervisors and their direct reports. Dangerously, the lowest level of trust exists between front-line staff and senior management.
Customer loyalty alignment
Customer service representatives (CSRs) across the United States handle an average of 2,000 customer interactions each week. If CSRs are not aligned with the customer management strategy—indeed, are not directly involved with creating and executing the strategy—it can represent 2,000 opportunities to put customers at risk or lose them today.
These centers of customer contact now represent the principal touch-point with customers; and beyond technology, they have the capability to generate and manage a continuous flow of customer information, and to increase customer loyalty. Getting the most out of customer contact centers will require change; in many companies, this means significant change.
For customer management to be optimized, one of the changes that companies will have to institute will be to start focusing on people. Hal Rosenbluth, former CEO of the highly successful, multibillion-dollar travel management company, Rosenbluth International (which was recently merged with American Express Travel Related Services), said in his book, The Customer Comes Second:
Companies are only fooling themselves when they believe that "The Customer Comes First." People do not inherently put the customer first, and they certainly don’t do it because their employer expects it. We’re not saying choose your people over your customers. We’re saying focus on your people because of your customers. That way, everybody wins.
Tremendous investments have been made on technological innovations—IVR systems, call routing, multi-media integration and the like—yet investment in people, and processes to support them, has been stagnant, lagging behind other efforts. To deliver on the promise technology offers in customer relationships, you have to prioritize staff performance. People have to be shown what to do, given feedback about how they’re doing and rewarded if they are doing well.
Meeting the objectives of a management strategy means, for one thing, that targets and metrics set for CSRs must be balanced to incorporate productivity, quality of service delivered and effectiveness of performance on behalf of customers. One of the most effective ways for accomplishing this, is through "customer first" teams, throughout the company.
Tom Peters has said that, in the future: "Most work will be done by project teams. The ˜average’ team will consist of various people from various ˜organizations’ with various skills. Networks of bits and pieces of companies will come together to exploit a market opportunity." Such can certainly be the case with customer loyalty; service and relationships; and customer recovery programs. There are several advantages to networked, team-based structures as opposed to traditional hierarchies as you strive to create value for customers. They include better, more quickly shared information; greater staff decision agility, initiative and empowerment; faster response time; and greater customer contact, as well as:
- Flattened, matrix-based organizational structures for greater efficiency
- A minimization of non-value-added functional activities and better use of staff time and talent
- Ownership of performance
- A greater opportunity for self-management and a wider scope of work in each job
- A linkage between performance objectives—and individual and team performance—to customer loyalty
- More targeted employee training and skill development
Creating a culture within the organization that nurtures loyalty, commitment, advocacy and productivity from the moment the new hire walks through the door and throughout the lifecycle of the employee will go a long way to sustaining customer loyalty behavior. The good news is that employees, particularly those in customer service, seek trust and trustworthiness; and they desire to be active contributors to that effort.
