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“Fanatical” customer support is the mantra at Rackspace, an IT hosting company. Hype and fluff? Not so. Energized, motivated Rackers really do put in the discretionary effort that creates a better experience for customers. In turn, customers reward Rackspace with intense loyalty, contributing to the company’s 25% compound annual revenue growth and 48% profit growth since 2008.
To pull this off, Rackspace invests heavily in a culture of employee engagement, because making customers happy requires making employees happy. Importantly: Supervisors lead the charge. Rackspace insists that supervisors talk often with their groups to solicit employee feedback, identify the root causes of any concerns, and then follow through with meaningful changes to how work gets done.
Encouraging frequent dialogues between bosses and employees—pretty obvious, right? Yet it’s all too rare. Many senior leadership groups preach a gospel of engagement, but they often abdicate responsibility to HR. While HR has to provide heavy support, it shouldn’t be the nerve center for generating the actions required to influence employees’ attitudes.
Small wonder that companies struggle to get people jazzed about their jobs. When Bain & Company and Netsurvey recently analyzed responses from 200,000 employees across 40 companies in 60 countries, we found several troubling trends:
- Engagement scores decline with tenure, meaning that employees with the deepest knowledge of the company typically are the least engaged.
- Scores decline at the lowest levels of the organization, suggesting that senior executives likely underestimate the discontent on the front lines.
- Engagement levels run lowest among sales and service functions, where most interactions with customers occur.
But companies such as Rackspace, AT&T and Cintas manage to counter these trends. These firms put line supervisors, not HR, in the lead. They know that it’s difficult for employees to be truly engaged if they are not fans of their boss. Netsurvey’s data show that 87% of employee “promoters” of their company also give high marks to their direct supervisor.
That’s why it’s critical for supervisors to make engagement a high priority day-in and day-out. At one communications provider, the leader of a cable-television installation team learned that technicians felt they had unrealistic targets for installing a certain number of households per day. New performance metrics included making sure the customer was happy about the installation before the technician left. As a result, technicians now had to reconfirm that all cable boxes worked, the customer knew how to operate the remote control and the computer network functioned smoothly—all adding 30 to 60 minutes to each job. Technicians felt they could satisfy customers or hit their productivity targets, but not both. From these discussions, the team leader quickly escalated the issue, and the productivity targets were adjusted, benefiting both employees and customers.
Working with employees to raise engagement doesn’t come naturally to all supervisors. Supplemental training makes a big difference, particularly training on how to encourage constructive team discussions and handle tricky topics like requests for better pay or worries about outsourcing. Effective training also covers the importance of promptly taking the right actions and communicating back the outcomes to their teams—a true closed-loop feedback approach.
Short online surveys, conducted frequently and anonymously, will also give supervisors a pulse check of their team members’ frame of mind and attitudes. More importantly, it can offer a sense of how the team believes the customer’s experience might be improved. Discussing the issues raised in these pulse checks can foster a deeper sense of ownership, connect teams to the company’s core mission and increase the direct influence they have on important issues. These discussions can stimulate the extra effort that results in higher productivity and better business results.
Here lies the rub for many companies. Engagement should not be treated as a goal in itself. The link to better products, more loyal customers and improved financial outcomes is what counts. Call-center representatives, sales specialists, field technicians and others on the front line come to know intimately which aspects of the business annoy customers and which delight them. To tap that knowledge, companies that excel in engagement regularly ask employees what the company could do to build the ranks of customer promoters, and listen hard to the answers.
AT&T, for example, has built a digital infrastructure allowing all employee suggestions to be logged online. A small, dedicated team regularly reads and triages the suggestions, sending each promising one to a designated leader or expert who is obligated to consider it and respond properly. All employees can see the progress of each suggestion and log comments.
These dialogues on customer and team issues should take precedence over any concern about the engagement scores. Managers who thrive on data sometimes obsess over benchmarking, ranking and carrot-or-stick responses. But in fact, morale probably will erode if supervisors feel that nothing matters except raising scores. Supervisors might also take subtle steps to manipulate the scores.
Emphasizing the dialogues rather than the metrics demonstrates to supervisors that senior leaders truly believe in the benefits of engagement. AT&T does not distribute scores from its pulse-check surveys to line supervisors or their bosses, choosing instead to show only the trends and verbatim feedback. The point is to signal that discussing and addressing the root causes, and seeing steady progress, matter more than any absolute score itself.
Most companies have a major opportunity to get a higher return on the resources devoted to engagement. But managers often need to turn their current approach upside down. That’s what it takes to earn customer loyalty and reap the higher sales, lower turnover costs and other financial rewards that come from highly engaged employees.
Learn more: Who’s Responsible For Employee Engagement?
Jon Kaufman and Rob Markey are partners at Bain & Company.
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