Why organisations should understand their employees like their customers
Organisations spend a lot of time and money trying to understand their customers; their attitudes and behaviours with the ultimate view of satisfying existing customers and trying to reach new ones. I argue that organisations should be doing as much to understand their workforce with the very same rationale of trying to satisfy existing employees and trying to reach new ones.
I start with trying to understand why organisations want to understand their customers and then move on to why organisations should be trying to understand their workforce in a similar manner.
Why do organisations try to understand their customers?
Customers are important to any organisation, be these customers other organisations or individuals. Without customers; users of a product of service, organisations would not exist. One of the purposes of an organisation is to fulfil the needs of customers, often this purpose has to be balanced with fulfilling the needs of other stakeholders such as shareholders, the government and employees. The goal of organisations has to be to retain their existing customers and attract new ones.
Customer satisfaction is important for both the retention of existing customers and attracting new customers. The cost to retain customers is lower than attracting new customers so therefore it is in organisations best interest to keep their existing customers satisfied. Organisations employ techniques to understand their customers through: trying to put themselves in their shoes; collecting and analysing data; or by asking them. Often customers will be asked directly about their satisfaction or a product or service as part of the Market Research technique. This enables the organisation to make improvements about a product or service. With the advent of social media, often customers will provide their feedback about an organisation, product or service without being invited to do so.
The other way customers can be better understood is through analysis of data held on them. Loyalty schemes have been an effective way of gathering data on customers enabling organisations to identify who their most valuable customers are and devise programmes which incentivise and delight these customers, reward them for behaving in the way the organisation wants them to and improve their retention levels. These schemes also work well to dissuade the bad customers. From the data gathered by loyalty schemes organisations can better anticipate their needs and behaviour and thus respond in a manner that exceeds their expectations. The increased contact and communication that can be driven through schemes such as this can improve an organisations relationship with their customer and develop a more engaged customer.
When wanting to attract new customers Brand Advocacy is important and where your existing customers can have a huge impact. Further analysis on how consumers care for brands and how their; mind-set, mood, motivations, desires, aspirations etc. can help organisations understand how this affects their attitude and action. Social Media is again a powerful tool in the customer’s ability to represent how they feel about certain brands.
So organisations focus on understanding their customers so that they can ensure that they keep existing customers satisfied and loyal and to reach out to new customers. How can parallels be drawn with employees within organisations?
In many organisations, particularly in this knowledge-based economy an organisations workforce is as critical to their success as their customer base. Organisations derive their competitive advantage through high performance.
The table below drawers some parallels between what organisations do to understand their customers and applies this into an organisation;
Therefore with organisations having many of the same goals internally with their employees as their share externally with their customers, in order to realise these goals, I argue that they need to imploy similar techniques internally within their organisation to understand their employees as extensively as they understand their customers.
Organisations may currently undertake an employee survey, measuring an employee’s satisfaction with the organisation and their job, these however receive some criticism for providing nice statistics but not being sufficiently actionable. Some organisation may also run an employee forum that enables employees to raise issues and concerns and enter into a dialogue with others in the organisation. It is my opinion through that very few organisations would go through the same rigour as organisations do with regards to their customers and undertake exercises to profile and group their employees according to shared motivations, attitudes, underlying mind-set. Then from this data attempt to predict employee behaviour, use to input into the design of employee products and services or maintain quality performance. Neither do they analyse the most value add employees who could be potential brand advocates or the employees that they wish to retain and develop programmes to reward and maintain this loyalty and desired behaviour.
This blog post is part of my preparation for my next week at Cranfield for my Critical Writing lecture. We were asked to start to write to build an argument. I have tried to kill two birds with one stone here. I am in a situation where I know what I want to research for my PhD, I want to try and apply the techniques that organisations use to understand their customers into understanding employees, however, I am struggling to identify the 'Why'? what is the current problem with employee insight, employee analysis that means that this would bring something valuable? Feedback welcome on all fronts.
