Employee Retention Leads to Client Loyalty

Employers are starting to see the casual link between turning the focus inward, ensuring employees are happy and engaged in order to keep clients happy.

Businesses are constantly searching for ways to keep clients happy, as they are one of the top drivers for profit and business growth. However, many organizations are wary of straying from traditional customer relations practices for fear of shaking up the status quo. Business leaders tend to overlook the secret weapon right under their noses—their current employees. Keeping current employees happy not only benefits company culture, it is also a powerful way to keep clients happy, too.

Customer retention does not just occur in executive offices; it actually happens as employees communicate with the company’s clients on a daily basis. When employees are engaged in their day-to-day work life, they are more likely to have an emotional commitment to the organization and can be its biggest advocate.

While this isn’t a particularly new idea, the causality between both employee engagement and client retention is. It brings up a debate about whether engagement is responsible for client retention and better outcomes, or if successful companies simply have more engaged employees. Thankfully, employers are starting to see the casual link between turning the focus inward, ensuring employees are happy and engaged in order to keep clients happy.

Employee Engagement Leads to Brand Loyalty

Employees who are constantly motivated by business leaders tend to be more passionate about the brand and the products they are working with. These workers likely will have a personal investment in their work, which will lead to an improved customer service experience and positive representation of the brand they are spending time on. Because these employees speak to their clients daily, they are likely to share their personal experience, which will be positive if they are consistently engaged. These clients then are more inclined to stay on contract or come back for additional services in the future.

Customer Retention Is Driven by Empowered Employees

In today’s competitive workforce, it is critical for business leaders to realize the importance of empowering their employees. When employees are given important responsibilities and trusted with the ability to make decisions surrounding their job, they will feel appreciated and valued. When business leaders micromanage their staff, it discourages employees from taking the reins on future projects and cramps creative thought. Leaders also take should the time to praise their employees for doing something right, and encourage them to turn their mistakes into learning opportunities.

Money Isn’t Everything for Employees

While employees should always be fairly compensated for their work, many employees seek satisfaction and fulfillment beyond the paycheck. These motivated employees will identify with their work on a personal level, and constantly look for ways to improve their work life, growth, and the organization overall. When employees are solely working to get a paycheck, they are less inclined to go the extra mile, which often will make or break a business.

Just a Job vs. a Career

While the main focus of this article is customer retention, the importance of employee retention must not be underplayed. In a recent study, Hay Group revealed that employees who are engaged are up to 43 percent more productive than those who are not. This is possibly one of the greatest benefits of keeping employees motivated and engaged. Employees who are disengaged will see their work as “just a job,” while an engaged employee will see it as a career from which they garner personal satisfaction. Creating a loyal employee base improves the overall perception of your brand.

When a company has happy employees, it will retain happy customers. This ultimately begins at the front lines of any organization. Because employees are the main point of contact between clients and the organization, it is imperative that they create a positive experience for clients. By shifting the focus inward and motivating employees, businesses will be able to increase customer retention rates and help drive business for the future.

David Dourgarian is the CEO of TempWorks Software, based in Eagan, MN. His accomplishments within the company include launching the payroll funding and payroll processing divisions, as well as engineering a substantial software partnership with Sterling National Bank.


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