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How Happy Employees Lead To Happy Customers

It’s a well-known fact of business that customers must be the focus of a successful business model; hence the now-cliched idiom “the customer is always right”. But in this customer-focused model, some businesses make the mistake of neglecting to focus on their employees.

However, many companies find that it’s in their best interests to ensure greater employee happiness by providing flexibility, a welcoming environment, and providing them with easier ways to carry out their tasks, such as with the latest POS software or IT systems.

Harvard Business Review states that “becoming more customer-oriented while allowing workplace morale to suffer is a poor and short-sighted strategy.” Their study, alongside others, found that happier employees are at least a predictor of customer happiness, if not one of the main causes. The correlation is even more prominent in industries with greater customer-employee engagement.

But what’s the reason for this?

Happier employees = greater customer loyalty.

When it comes to gaining and retaining customers, increasingly it’s clear that they base their loyalty not on price or product, but on their experience with the company. 95% of customers polled by Microsoft reported that the service they received from a company determined their choice and loyalty. As the provider of that service, employees are essential to the success or failure of keeping customers happy. A Gallup meta-analysis showed that employee happiness had a “well-established connection” with customer ratings.

A satisfied employee is no doubt the best kind to represent a company to its customers. A satisfied employee is more committed to forming better relationships with customers and providing them with creative, dedicated service. It’s impossible to focus on customer satisfaction without first ensuring that the employees who engage with them are happy.

Happy employees are more productive.

Productivity is not only based on motivation or time management – a Social Market Foundation compared ‘happy’ workers with a control group (the ‘happy’ group watched comedy clips or got snacks and drinks) and found that the ‘happy’ group was 12% more productive than the control.

Yale found that employees who are more engaged bring in more sales, and leave customers more satisfied.

Happier employees are more productive employees, who are able to do more for the customer to ensure their happiness. This also generates more revenue, which in turn means that the company is more able to invest in customer experience.

Happy employees are less likely to leave.

High staff turnover can be a costly trend for a business, and consistently losing employees who know your customers and understand their needs can seriously impact customer satisfaction. Face-to-face interactions are a key component of any form of sales, and the face is constantly changing that can be off-putting for a customer.

47% of employees seeking a new job cite their main reason as unhappiness in their current position, and 71% of employees prioritise happiness and job satisfaction over salary. So to prevent high turnover and retain familiar, productive employees for your customers, employee happiness must be a priority.

Moods are contagious.

Studies have shown, time and time again, that feelings spread from one person to another like a contagion. Engaging with someone in a bad mood is more likely to leave us with a bad mood ourselves. Conversely, happiness can be spread – and an individual’s happiness is dependent upon the people around them.

Without considering loyalty or productivity or turnover, one thing is clear: if you want your customers to be happy, you must ensure that the employees they engage with are happy first.

To keep your employees happy, explore insights from employee success experts and, above all, focus on meeting their needs. Happy employees mean greater customer loyalty, higher productivity and revenue, less turnover, and overall customer satisfaction.

Perhaps “‘the customer is always right” is out of fashion, but “the customer must be happy” is easily accepted. Now, add “the employee must be happy” to that business model to achieve success. The face of your business for your customers is your employees, so it’s in your best interests to keep that face a happy one.

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Young Upstarts is a business and technology blog that champions new ideas, innovation and entrepreneurship. It focuses on highlighting young people and small businesses, celebrating their vision and role in changing the world with their ideas, products and services.

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