Happy Workers Equal Happy Customers

A new twist on the Golden Rule should be the new mantra of small-business owners. Rather than doing onto others as you would have them do unto you, business owners should consider treating their employees better so their customers will be more loyal to them.

According to new research from the University of Missouri (MU), CEOs who pay attention to employees' job satisfaction are able to boost both customer satisfaction and increase the number of customers who intend to do repeat business with the company.

"You might think that as an owner, you only need to pay attention to the customers, providing them with what they want. Yet, we found that keeping your employees satisfied with their work experience, providing them with challenges, and allowing them to have a sense of ownership in the business can have a tremendous effect on customer satisfaction and loyalty," said Christopher Groening, assistant professor of marketing in the Robert J. Trulaske Sr. College of Business at MU.

"This is not a one-way street where companies implement policies and can expect to experience gains solely through customer service," Groening said. "The relationships among the CEO, the employees and the customers are all linked. It's important for CEOs to know that they can have a large impact on customer service without ever talking with a customer or implementing a new customer service policy."

Following his study, Groening recommends the following actions, based on answers from the employee survey questions, to increase employee satisfaction:

  • Train and empower employees so they have the tools to make decisions. This allows them to make decisions that are beneficial for the company and each individual customer, instead of following a simple flow chart and possibly upsetting a customer with the final outcome.
  • Hire managers who serve as examples and also can be mentors with employees. If a company policy is established, it should be honored by managers as well as employees. Additionally, managers should help employees know what is expected in order to advance in the company.
  • Create good working atmospheres. Offer incentives or intangible benefits, such as flexible working hours , if possible.


"While many of these actions might seem like common sense, they can be very difficult to maintain," Groening said. "It's also very important to hire the right people in management positions who will take part in these activities — for example, serving as mentors — or employers might have difficulty meeting their goals."

Groening co-authored the research with Heiner Evanschitzky from Aston Business School in the United Kingdom, Vikas Mittal from Rice University and Maren Wunderlich from T-Mobile International. The study was published this month in the Journal of Service Research.