“Our people are our greatest asset” has been uttered by many CEOs for a long time. However, most of them don’t focus enough on employees’ experience because they are too busy setting their sights and business targets on improving the customers’ experience.
Even Google says so … doing a simple Google search on “customer experience” gives nearly 50 million hits whereas one for “employee experience” returns less than 500,000.[i] Ironically this lack of attention on employees almost certainly undermines the business goal of creating happy customer experiences; because how can employees be expected to care about customers’ experience when they don’t feel the business cares about theirs?
I am not suggesting that businesses should move their focus away from customers: it is clear that companies who successfully create great customer experiences will be rewarded with increased sales and a growing customer base. The rewards are endless; greater customer retention, increased customer referrals working towards the ultimate goal of driving down the cost of sale.
All good business sense but it also makes great business sense to think about employees’ experience.
Bring It Into Focus
Companies with great cultures are rewarded with loyal enthusiastic employees who are more productive, more creative and will help you in your talent attraction. It doesn’t take a genius to work out that happy, engaged employees will naturally create great interactions with customers.
Despite this, CEOs and businesses are not focusing on employees’ experience of work to nearly the same degree as customer’s experience.
This is what behavioural economists, such as Nobel prize-winner Daniel Kahneman, call a “focusing error.” These errors occur when people put too much importance on one element of a problem, resulting in an inaccurate prediction of a future outcome. They are a type of cognitive bias which is caused by the fact that when we make estimates we tend to start with the information we have in front of us and then make incremental adjustments and iterations from that starting assumption.
Clearly, the information that CEOs most often have in front of them are financial metrics. This is their normal starting place for understanding problems. Indeed most of them have been doing this for their whole career with a typical CEO background being in finance or sales.[ii] They are used to cashing out problems in terms of hard currency rather than soft measures of experience.
Ignore the employees’ experience and you will undermine the customers’ experience.
It is much easier for them to make the intuitive leap from customer experience to revenue generation than from the employee experience, which is cognitively more distant. This is the heart of the “focusing error” – too much focus on one element of the problem and not enough on another – in this case the employees who are critical in generating positive customer experiences. Ignore the employees’ experience and you will undermine the customers’ experience. In fact there is a danger of a double negative here as one study showed that if retail employees weren’t happy then even if customers said they were satisfied with the product they were still less likely to rebuy.[iii] Because the experience of purchasing the product wasn’t great so why should they buy from that store again.
So, smart CEOs and businesses should overcome this bias and start to focus more systematically how to improve employee experience – their happiness at work – and this will naturally lead to improved sales. Luckily this is in many ways easier than they think because they have already learned a lot about how to improve customer happiness.
We Know How To Do This
Broadly speaking there are three main steps that companies use to improve customer experience:
- Asking for customers’ feedback
- Understanding their experience
- Taking action to improve their experience
Many companies create key metrics, such as customer satisfaction, that they can track over time and make comparisons between different offerings, locations etc. They also look at the relationship between these metrics and their financial metrics, with customer satisfaction being known to predict future sales and customer loyalty.
There is absolutely no reason why companies can’t follow these same steps to improve their employees’ experience. They can create key metrics like employee happiness, which reflect the actual changing experience of employees and teams. These indicators will not only give visibility to what is happening now in the organisation but will also predict future behaviours such as retention rates and productivity. In this way, companies can learn how to become better places to work, just as they learned how to create better customer experiences.
Same Intention, Different Approach
In fact, there is also a piece of magic that we have witnessed with our clients. Individuals and teams start generating positive ideas based on their own data and feedback. If stimulated in the right way this builds a very powerful and inspiring atmosphere that naturally creates positive change.
By focusing on employee experience, forward thinking companies can start to reap a huge happiness dividend that will benefit not only the employees and customers but also the business itself as it becomes more profitable. Now that would be “focusing success.”
I welcome your thoughts and comments.
[i] If you substitute the word “satisfaction” for “experience” the same bias is evident: 83 million to 1.3 million hits.