In this blog I explore key ideas for maintaining customer loyalty and protecting your brand in tough economic times, from an employee engagement and trust perspective.
Tough times call for tough measures. In a recession or economic downturn government and businesses are continually looking for ways to strengthen customer confidence. While ever customers are confident that there is light at the end of the tunnel, or merely have confidence in government and business that they can get through the tough times, there is an economy with a pulse. It may be faint, but there is a pulse.
Typical business measures implemented to bolster customer confidence revolve around cost and waste minimisation. Stripping away the fat that was put on during the good years is a common and smart first step. Most measures that are implemented are geared around cost, for example, streamlining, or optimizing process and laying off employees.
What is often forgotten is that customer confidence is not only the result of cost management. Customer confidence is also the result of what they observe and how they “feel” when they interact with your business. This means that despite the circumstances, employee engagement and confidence needs to be at an all time high. This is because your employees have the power to exponentially increase the effectiveness, and perception, of cost management strategies by the way they engage with the customer and talk to their friends and families about the business.
Employees are smart. They know when things are going well and when things are not so good. So when an organisation is having to make tough, cost related decisions, but keeping this information to the senior inner circle of managers, it's also a given that the employee group by this time suspects something is wrong. But they don't know what; and at the same time no one is telling them anything. So what's the natural thing to do? Speculate. Pretty soon gossip and rumour overcome facts and employee confidence in management and the company starts to diminish. This is a major problem for a three reasons.
Firstly, one of the major contributors to employee engagement is having an enjoyable and stimulating place to work. When paranoia sets in, this negatively impacts on this factor.
Secondly, most businesses today talk about integrity and open communication as being integral to their business. It says so on the policies that sit on the foyer walls and hallways of your offices. When the facts, as much as they can be shared without compromising core organizational strategy, are not communicated in a timely manner the perception is that the workforce is not trusted to be adult enough to deal with the real situation. The result is that employees experience varying degrees of condescension and cynicism instead of integrity and communication.
Thirdly, all the cost cutting and cost optimization measures in the world don't mean anything if you don't have customers being confident in your brand. In tough times repeat business is often the injection that keeps the business pulse ticking along given that customers loyalty can take a hit due to their own need to cut costs and shop around as well. In times of recession loyalty can often be a victim, not that it needs to be. Customer confidence is inspired equally by a good product and human contact; the behaviours that the customer facing employees provide. Simply put; if employees are disenchanted experience tells us that service levels will take a hit.
So how do you avoid this situation that so many companies experience? Companies that weather economic storms are those brave enough to combine trust and communication with their cost management strategies. There will be information that is too sensitive to share, so what is communicated at each level of the business may vary slightly. Going on the front foot and communicating the real situation to all employees from the outset can minimise paranoia and avoid going down the path of employee disenchantment.
There is no doubt that some employees will be upset or angry at the news. You will also have pockets of paranoia and cynicism. However this is outweighed by the fact that the organisation trusted their people enough to be open and honest. The benefits of communicating the 'what's', 'why's' and 'how's' of a situation can have some important benefits, in particular, brand protection, employee and customer confidence.
Brand protection comes about when your remaining employees, and the ones that are made redundant, continue to talk highly of the company. They can do this because they understand 'why' the company took its course action. They may not like it, but they understand. This is even more important within organisations that are laying off staff even though they are still very profitable. This is probably one of the single most misunderstood issues that companies fail to explain.
Communication breeds confidence. When employees know what is happening to their business, and why, they feel involved. They offer ideas as to how things can be done better because they know management will listen. Additionally, when those remaining have to do more with less they know why. It doesn't make the job easier, but it helps provide a healthier mindset with which to do the job. Interestingly, it also helps the employees, especially those dealing with customers, have empathy with what their customers may be going through which is a vital strength during any economic period.
When the brand is being protected, and employees are confident in what is happening and why, it is easier to inspire customer confidence - naturally. It doesn't remove the fact that it is a difficult period, however it can ease the way somewhat for all involved.
For some organisations implementing these ideas are 'tough measures' in and of themselves because it's not something that comes naturally. However of all the 'tough measures' being implemented it's one of the easiest and most effective and can only have positive outcomes in both the short and long terms. In short...your cost optimisation strategy needs to be equally matched by a strong, and genuine, communication strategy.
The first six months of this year have been quite inspiring for me. I have worked with leaders from many countries around the world, including; Poland, Germany, Romania, France and South Africa. In this mix there were countless ethinicities, sub-cultures, religions, countries of origin, languages and expectations.
In this time I have learnt, all over again, the power of connection, of tolerance and of unity. Especially with the leadership group in South Africa where this group of blacks, whites, and their various subsets of ethinicities are responsible for role modeling for their workforce what it means to work together, and to win together.
Dialogue is powerful. Dialogue that is nurturing and adult by nature leads to rational and self-sustaning outcomes. How can it not? In these states dialogue has its best chance of being thought through and empathic. It has its best chance of being authentic...real.
I have witnessed people, through dialogue, realise that they didn't have to give up their culture...who they are. Rather, they could bring the best of who they are to the creation of a shared identity. An identity founded on understanding what is important to each of us. An identity created out of a desire to want the best for each other, and for ourselves...and realising that you can't have one without wanting the other. After all; how we see ourselves, is how we see the world.
I am grateful that I have been able to create an opportunity for these people to do things differently. The ability to create healthy choices can never be underestimated...and in business, this is the job of an effective leader.
The Business Review Weekly and the Great Place to Work Institute Australia have released the top 50 companies in Australia who are considered the Best Places to Work. It’s really interesting, but not surprising, to see that the common theme that seems to run through the top fifty companies is how they connect with their people to add value to their lives on a daily basis. Some, like Google, have kayaks that staff can use during lunch to paddle on Sydney Harbour, whilst others provide benefits like short massages, flu shots or flexible working conditions.
Whilst this is nice, and it is easy to get envious reading lists like this, the reality is that not everyone is able to work in this type of environment. But that’s not to say as a leader you can’t add value to the lives of your employees in far simpler, and maybe more meaningful ways.
You can be a “Value Add Leader”.
Here are some tips, that are pretty straight forward, but often forgotten; consider them the basics of effective leadership, that are as essential as your ability to perform the technical side of your job. Most importantly they help you add value to the lives of your employees.
Value-Add #1 Talk “with” Your People
Don’t stick to the rituals of “water cooler talk” where you gossip about what is happening in the company and maybe share what you did on the weekend. Take the time to meet each of your team, one on one. Find out what the interests are of your team members, and be prepared to share your own...look for common ground. You will be surprised at the richness that comes from this; there is the opportunity to learn more about the things that motivate each person, what jobs or hobbies they have done in the past and their wider range of skills and capacity that isn’t easily seen whilst performing their current job.
It is this connection where the value add commences. The value you add as a leader in the life of your people…and in return the value your people offer the team and you as their leader through their higher levels of engagement.
If you have greater knowledge of those in your team, and their history, it is easier to share the burden of problem solving, or delegating, in ways that you hadn’t thought of. I remember a few years ago, I was leading a team responsible for designing and implementing a company wide change initiative in a short space of time. By really “knowing” who I had in the team I was able to involve the team in creating a solution that engaged and motivated the individual members, and then had them take on tasks that were suited not only to their skill set, but their personal style and interests. A great example in this team was the guy who was our IT expert. I discovered he had a special interest in leadership and leadership development models, even though this was not something that he normally shared. Given the project we were working on was developing a leadership development model for our organisation, that would have an intranet interface, it meant that I was able to involve him in the design of the model itself and not just the online portal...naturally this meant that the interface was far more intuitive than in may have been; and he was fully engaged. A real value add for him, the project and me.
Value-Add #2 Timely and Customised Recognition
Beyond talking with your team, take the time to be interested in the work they are doing, and recognise them by offering real time feedback on performance. Offer positive strokes (eg, pat on the back, "well done", "great work" etc) at the time that you spot great performance, or offer constructive feedback if you think that the performance could be enhanced, changed or needs to be improved. Don’t wait until appraisal time to offer feedback for something that occurred months before; it will carry no relevance or impact months (or even weeks) after the event. This is as much about respect for the individual as it is good management practice.
A common sticking point with giving feedback or positive strokes is that not everyone is used to doing this. Usually because it hasn’t been done so well for them in the past; there hasn't been the opportunity to learn, and shape healthy beliefs and attitudes around the value of giving positive strokes or feedback. So in simple terms, it isn't a natural leadership trait for all people.
But is easier than you think, and you can make it natural. Just like anytime you wanted to change a way of thinking or behaving, you had to start somewhere... and the best place to start is with the first point mentioned above. Get to know your people. It is easier to have conversations, and give recognition in ways that are more meaningful if you know your people. It is also easier to start one on one before moving to bigger and more robust “go for it” team speeches… not everyone is cut out for that sort of thing!
Just by getting to know your people you are giving very powerful strokes. Once you know a little more about the people in your team, customise the way you recognise them. If you know that one of your team members has a young family and they value their work life balance, then offer give them the ability to work from home for a day, or let them get away a little earlier on a Friday afternoon so they can spend extra time with their family. If someone in your team is interested in a career path away from their current job, organise for them to meet with someone from the department they want to work towards to learn more about it, or organise some mentoring.
Easiest of all is to use those two little, often forgotten, words...“thank you”. A simple "thank you" can carry great weight; just think of the times your manager has thanked you for the work you’ve done…it works.
Above all, keep it simple and customised to the person.
The best thing of all is that you don’t need to work for Google, or other high flying companies to bring this value to the lives of your employees. And; there is an added perk that comes back your way. Loyalty. You will be surprised how much more people will be prepared to do for “you” and not just the role you represent. This can never be underestimated, especially in times when many organisations are asking their leaders to do more with less.
My final word on this is simple. In many companies the question on the lips of the sales, marketing, operations and production teams are around how we can optimise the value chain. This is absolutely critical, and I offer one more dimension to these conversations. Before we can expect true value to be experienced along the supply chain and with the customer, it probably needs to start inside...by investing your efforts as a "Value-Add Leader" in your teams knowing that the value will be returned two-fold, and in ways that you often don't expect.