When Companies Put Employees and Customers First

Topics: Southwest Airlines, Consumer behaviour, Customer service Pages: 3 (860 words) Published: August 20, 2010
“When companies put employees and customers first, their employees are satisfied, their customers are loyal, their profits increase, and their continued success is sustained.” Harvard Business Review, March-April 1994.

There is growing number of companies that includes Banc One, Intuit Corporation, Southwest Airlines, ServiceMaster, USAA, Taco Bell, and MCI know that when they make employees and customers paramount, a radical shift occurs in the way they manage and measure success. The new economics of service requires innovative measurement techniques. These techniques calibrate the impact of employee satisfaction, loyalty, and productivity on the value of products and services delivered so that managers can build customer satisfaction and loyalty and assess the corresponding impact on profitability and growth. In fact, the lifetime value of a loyal customer can be astronomical, especially when referrals are added to the economics of customer retention and repeat purchases of related products. For example, the lifetime revenue stream from a loyal pizza eater can be $8,000, a Cadillac owner $332,000, and a corporate purchaser of commercial aircraft literally billions of dollars.

Top-level executives of outstanding service organizations spend little time setting profit goals or focusing on market share, the management mantra of the 1970s and 1980s. Instead, they understand that in the new economics of service, frontline workers and customers need to be the center of management concern. Successful service managers pay attention to the factors that drive profitability in this new service paradigm: investment in people, technology that supports frontline workers, revamped recruiting and training practices, and compensation linked to performance for employees at every level. And they express a vision of leadership in terms rarely heard in corporate America: an organization’s “patina of spirituality,” the “importance of...
Continue Reading

Please join StudyMode to read the full document

You May Also Find These Documents Helpful

  • Employees first, customers second Research Paper
  • Employees First Customer Second Book Analysis Essay
  • An Analysis on Customer Care Strategy of General Electric company Essay
  • Essay about Employees as Internal Customers
  • Employees Are More Important Than Customers Essay
  • Essay about First Securities Company of Chicago
  • Effects of Outsourcing on Companies Employees and the Economy Essay
  • Essay about Company and Marketing Strategy: Partnering to Build Customer Relationships

Become a StudyMode Member

Sign Up - It's Free