By Shaun Smith
We have made the case for focusing on and keeping your most profitable customers. The question is where do you begin? The answer is with your own people. Some years ago researchers at Harvard Business School found a statistical relationship between the way in which employees are treated and the way that they treat clients.4 One bank found that this correlation was around 85%. There is no doubt that employee alignment is a major driver of business results.
Some years ago we created a survey that set out to measure the extent to which employees were aligned internally with organisational strategy. Recently, the survey was subjected to a very thorough validation by David Matsumoto, of San Francisco State University.5 Responses were correlated from over 23,000 Organisational Alignment Survey™ respondents from 52 companies representing a variety of industries and across 20 countries. The 60 statements of the survey were correlated against six business results areas namely, customer service, employee retention, sales growth, meeting agency requirements, competitive performance and profitability. Finally the dimensions were correlated against all six business results areas overall. The employee responses which correlated most highly with the improved business results achieved by these companies were:
1. We are a highly successful organisation.
2. We have a well-defined strategy to overcome competitors.
3. We match the claims made through our advertising and promotion.
4. Employees are well trained to meet the performance standards required by their jobs.
5. We measure our quality/service performance against the worlds' best organisations in our field.
6. Managers meet with customers and consumer groups on a regular basis.
7. We carefully monitor the product/service quality of our suppliers, distributors and agents.
8. Employees are regularly briefed on departmental and organisational performance.
9. There is good cooperation among all departments in my organisation.
10. Performance targets that my department sets are realistic and consistent with our organisational vision/mission.
David Matsumoto concluded: "All of the correlations are statistically significant and seem to predict the desired business results".
In conclusion, we believe that the companies that will thrive in the future are those that create loyal customers and loyal employees. These two go hand in hand and it is the leaders of the organisation that must create this alignment. However, executives are often focused on short-term results and more concerned about the views of the analysts rather than their customers or people.
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