Leadership development leads to improved customer experience

At Rex Albright A/S, we have found that the key to improved business performance in any company first and foremost lies in the causal relationship between:

1) accomplished leaders, seeking to create 

2) high levels of employee engagement, eventually leading to

3) high levels of customer satisfaction. 

 

Research conducted by Josh Bersin from Deloitte expands on this perspective by claiming a direct link between the level of dedication to leadership development within a company and a positive long-term impact on its business performance.

CEOs may often be viewed as the main drivers of customer experience and culture, and while they do play an important role in defining the experience, the CEO is a person and a periodic caretaker of the institution/company - they are not THE institution. 

"CEO's come and go, 

but leadership lives on."

 

As the leadership of a company is impacted by the leadership culture and strategy on which it rests - leadership development can become the true difference-maker in driving sustainable growth. So, what is leadership development? It’s a culture that builds and encourages leaders at all levels. It includes the infrastructure and training to educate and empower employees to solve problems. The CEO may be a key figurehead of a company, but the middle managers and the front line managers play a key role in the success of a company. If these mid-level managers do not execute a leadership strategy that is rooted in the business strategy and focused on driving employee engagement, then reaching high levels of customer experience will be short lived. Remember, it is the middle managers and the front line managers and their employees who are interacting directly with customers, and when they are properly trained on leadership development and management, employee engagement is positively impacted and businesses can thrive, and customer experience can grow.

Gerald E. Ledford Jr. (Ledford Jr., 2011) claims that engagement overlap three heavily correlated and researched concepts:

 

  • Job involvement

  • Job satisfaction, and

  • Organizational commitment

 

The latter implies an employee’s attachment to an organization as a whole – hereunder feelings of loyalty, pride and shared values. The first two concepts - job involvement and job satisfaction - encompass intensity of feelings and connection towards a job. Moreover, high employee engagement (and involvement) seems to lead to better performance – or organizational outcome. The key link between the two (employee engagement and organizational outcome/performance) being customer experience - or satisfaction (see below figure).

Employee engagement can be optimized when 1) Leadership, 2) Structure, roles and capabilities, and 3) People systems and processes are aligned with the overall strategy and embedded in strong values and a positive work culture. These elements also become the drivers of engagement.

So, leaders play a critical role in driving employee engagement. When leaders seem to value their employees, communicate to them, provide the necessary support to them to do well and lead by example, they create a strong foundation for employee engagement. Additionally, learning and development, a subcategory of people systems and processes, is also a key driver of employee engagement. The creation of a positive work culture is another key driver of engagement. People feel it is important to be treated with respect and that they are empowered to make decisions and encouraged to bring new ideas to the table. Finally, research shows that employees feeling that their organization provide career opportunities, are six times more likely to also feel engaged. The same goes for well-being in the workplace. In fact, the psychological and physical wellness of employees is a key driver of engagement. Research indicate, that employees are likely to be more engaged and thus more productive if their workloads are appropriate, the work pressure is reasonable and some acceptable level of work-life balance is stroked. Furthermore, employees are 8 times more likely to be engaged when health and well-being are actively promoted in a company (Schroeder-Saulnier, 2011; Caldwell & Fairhurst, 2011).

So, pouring resources into getting the latest technology or creating a brilliant marketing campaign will get you far, but if your leaders aren’t properly trained and supported, the company won’t reach its full growth potential. Research has shown that the best companies build leaders from the bottom up. Following the idea of an inverse pyramid, where senior executives serve the needs of middle managers and lower employees, these companies seek to instigate leadership in all their employees, not just those who formally oversee others. By leaders empowering each employee to take responsibility and understand the business, they are more prone to feel engaged and to act in support of the business strategy and company mission.

 

"Essentially, it is the employees on the ground that make everyday decisions

that impact customer experience."

 

When these employees have a leadership mentality, they take ownership of the experience and do their part to create satisfied, loyal customers.

In conclusion, leadership development is key to the success of any company as it provides a platform for a strong leadership culture. In fact, the companies with the strongest leadership development invest 30%-40% more in leadership programs than their peers. However, the investments almost always pay off with a strong culture, consistent growth, and an engaged and agile organization that create engaging dialogues with their customers eventually leading to postive customer experiences.

Article by Henrik Brabrand, CEO - Rex I Albright

Rex I Albright A/S

Bredgade 63A

DK-1260 Copenhagen