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Employee loyalty, retaining customers go hand in hand By Nathan Hurst, Globe Correspondent, 11/20/05 As company towns and single job careers become antiquated notions in today's turbulent And while employee loyalty toward companies is higher this year than ever, according to a survey released last week, current economic improvements are giving workers more flexibility in what they do and for whom they do it. "The Walker Loyalty Report: Loyalty in the Workplace," released last week — it quizzed thousands of workers across the United States in a variety of fields on their attitudes about their employers — showed that employee loyalty has increased since 2003, the last time the survey was conducted.
Thirty-four percent of those surveyed were dubbed "truly loyal." "Being loyal to a company is something deeper than simply enjoying where you work," said Chris Woolard, a consultant with Walker Information. Dianne Durkin, an employee and customer loyalty consultant and president of Portsmouth, N.H.-based The Loyalty Factor, agrees. She said employee loyalty is also important for increasing customer loyalty. "Employee loyalty drives brand loyalty, which drives customer recognition for a company," Durkin said in a telephone interview last week. "For a customer, the one employee they interact with is the company." Durkin described a common situation for consumers: A customer purchases a product and shortly after, something goes wrong. An employee who is responsible for fixing or taking a return on the item mentions in passing that the product is known to be a bad buy, because of recurring problems. While the product’s quality is also an important issue for the company to handle, so is the employee’s attitude. Even longtime employees might show that loyalty isn’t necessarily built around how long they are willing to stick with a company, Durkin said. With the majority of workers no longer laboring for one firm, Woolard said, companies are having to focus on creating an environment where employees are interested in the work they do or at least feel as if they have a vested interest in the future of the corporation. The survey showed that sectors with the highest loyalty responses from employees included nonprofit; healthcare, including hospitals; information technology; and financial services. Durkin wasn’t surprised. "People that go into a nonprofit are totally and completely committed to what "If you ask anybody in a nonprofit what their purpose is, they can repeat that. It's the same for people in healthcare. They’re totally committed to the health and well-being of the people they service. It's just part of their nature.’’ But what about workers who aren't working at jobs in their dream career? Or those who don’t know what their ideal career could be? Durkin said employers should focus more intensely on promoting a culture where employees are valued for what they do well, in addition to allowing for and even improving their chances to stand out in the crowd. She cited Starbucks and Southwest Airlines as companies that recognize employee achievements well. "Management at Southwest gives [employees] the ability to be themselves. A stewardess I talked to said she liked her job because she didn’t have to be pretentious, just herself," Durkin said. "Their employees don't think the airlines are the end-all, but the company shows that they are very grateful for the people that are there." Promoting an environment where employees "love the company and feel like the company loves them back" is a key to retaining top loyalty from workers, she said. Starbucks shows it values employees by offering a bevy of benefits, such as healthcare coverage and stock options, even for those who work part time. Durkin said this is just another way of making employees feel they are part of a company, instead of just working for a paycheck. "Employees want to feel like they’re in on things," Durkin said. "They want to know how they can contribute to success." The survey also showed that just because an employee shows long-term commitment to a company, true loyalty does not necessarily follow. For example, 57 percent of US workers said they felt "like part of the family" at their workplace. Only 34 percent, however, scored as "truly loyal" to their employer. Woolard said the survey also showed an employee can be engaged in the work and enjoy the job without being loyal to the employer. Both Durkin and Woolard said training and development programs can cause loyalty to surge. Training serves multiple purposes, Durkin said. First, it allows employees to provide top-notch service. And it gives them an opportunity to broaden their investment in a company by knowing more about what they are doing. "If people are stuck in a place where they aren't learning or being intellectually stimulated, they’re not going to stick around," Durkin said. About 54 percent of workers this year said they valued development opportunities as an important component of their careers. How a company’s leaders conduct their business practices can also have a severe effect on how much a corporate ship can sink in troubled times before employees start bailing out for other jobs. Woolard said that in this year’s survey, corporate ethics were more important than ever to employees. While 64 percent said their companies had good "overall ethics," the same percentage as in the 2003 survey, figures showing the number of employees reporting sound ethical judgments from senior leaders was up to 58 percent, from 54 percent in 2003. More employees were feeling less pressure to cut corners for the company, and more said ethical guidelines were clearly communicated to them by superiors, in addition to having corporate ethical values interpreted for them by managers. "If an employee feels like something isn't quite right with what managers and executives are doing, they're not going be loyal to the company or what it does," Woolard said. "Nobody wants to be a part of a workplace that isn't doing the right thing." Nathan Hurst can be reached at nhurst@globe.com
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