Employee Surveys: A Good Way to Improve the Bottom Line

It is encouraging -- consensus is building among business executives that Human Resources (HR) has a strategic role to play in the success of their companies. In a national survey recently conducted by Accenture, senior level executives reported that they ranked HR third behind sales and customer service as making significant contributions to their companies' bottom lines.

One could easily argue that HR should have ranked even higher, since effective staffing, employee development, competitive compensation and appropriate supervision clearly contribute to the quality of the sales and customer service these companies delivered.

The survey responses create a perfect platform from which to talk about how to improve the bottom line with the help of HR. We are talking about how to be more successful and profitable by enlisting your company's greatest intelligence resource -- the people who work for you, from the mailroom to the executive suite.

It is easy to understand why executives single out sales and service as making significant contributions because that is where making money starts. "Nothing happens until the sale occurs," is an old adage. But the importance of retaining customers and growing their business becomes abundantly clear when you begin to understand that it is five times more expensive to acquire a new customer than it is to retain and grow an existing one. It is also well documented that motivated, competent, and satisfied employees (dare we say empowered?) in sales and service know better than anyone their company's products, services and customers. They are on the front line with them every day.

Tapping into your employees' thoughts, opinions, reservoirs of experience and insight about your company and your customers is an excellent way to improve your company's results by discovering the right things to do more of, what to improve on, and what to avoid altogether.

But, how do you do this most effectively? The answer, we suggest, is with well-constructed and administered employee surveys. You do have to be willing to ask probing questions and be prepared to seriously consider and address the input you get. And it is imperative that you make the entire process a safe and comfortable experience for participants, one that will ensure rich, open, two-way communication. If done well, you will find that the results can be powerful.

Employee surveys provide the fuel for continuous improvement in virtually all areas of your business. One of the greatest challenges in utilizing surveys, however, is determining the focus and scope of the inquiry you want to make. It is also very important that you construct a tool that will elicit specific information that can be analyzed and acted upon. This is where HR or an expert experienced in survey design and administration can prove an invaluable resource. The results of a well-executed survey can provide an "x-ray" of your business, systems and programs. Problems can be detected before they become serious, needs can be met that have gone undetected, best practices can be identified, and new ideas for improvement can surface, which otherwise might have been hidden in the routine.

How does this translate to the bottom line? Consider these perspectives:

Reduced costs in the business

As the economy continues to improve and the job market heats up, most companies will begin struggling with turnover as key employees discover better opportunities and greater rewards elsewhere. According to Walker Information, an Indianapolis-based research firm, only 25 percent of workers currently feel a strong attachment to their employers, and four in ten feel trapped in their jobs. Other research suggests that between 30 and 40 percent of workers are ready to leave their companies, and many already are actively searching for that next opportunity. With replacement costs running from one-and-a-half to four times salary, depending on the job, preventing losses before they occur could have a dramatic effect on reducing turnover costs. Not only do you lose talent and knowledge with turnover but customer relationships may suffer, and internal networks and efficiencies can be weakened. An effective survey can help you anticipate and head off these types of problems, or minimize their effects.

Improved internal practices and better management

Employees who find their jobs challenging, and who feel that they and their contributions are valued, become much more invested in and supportive of company goals and are willing (and likely) to contribute their best. Motivation and productivity levels increase, and there is a greater flow of ideas and suggestions about how to better attain common objectives. It takes appropriate practices and inspired, effective management and supervision to gain these results however, and you want to make sure you have them. Surveys can help you determine how you are doing and where you are lacking. But it is important to ask employees the right questions to get the information you need to make improvements. If you don't ask the questions, you will be making up the answers or assuming you know them, which can be disastrous in more ways than one.

Customer retention and increased sales

Customer contact people are the window into customers' needs and wants, and can directly influence how customers feel about your company's products and services. It is well known that employees' treatment of customers often reflects the way they are treated by the company. It is critical, therefore, to know how employees perceive their work relationship with you. Inspired, satisfied employees promote customer retention. High service levels from confident, competent workers inspire increased sales and greater customer loyalty. Ideas for new services and product improvements can result, and it all begins with finding out what employees have on their minds. Don't assume you know.

Foundation for creating an "exceptional workplace" and better financial results

How companies treat employees relates directly to organizational performance. There are numerous books that have been written about it, and there is plenty of evidence to demonstrate the positive effect inclusive, supportive work environments can have on the bottom line. Companies that are considered to offer "exceptional workplaces" have a clearly stated purpose (business goals and objectives), frequent, open two-way communication, and employee-focused programs that allow workers to be fully engaged in their work and directly contribute to business success. Employee surveys can help your company bring about these kinds of results.

Whether HR is directly involved in conducting employee surveys or not, determining the questions that need to be asked and the results that need to be acted upon are the responsibility of HR and the Chief Executive acting in partnership. Promoting effective two-way communication is a core imperative for both HR (who are the stewards of the company's workforce practices), and the company's senior management, because it enables the company to gain the most value from its most valuable resource-its people.

Conducting employee surveys is strategic work that provides you with information and insight that can influence the types of people you hire and develop, the way you manage, and ultimately the quality of products and services you deliver to customers. It helps you build the kind of organization that attracts and retains the best talent, develops the best product and services, and creates satisfied and loyal customers. And all of this leads to better business results.

If you would like more information on the value and use of surveys for determining employee and/or customer satisfaction levels and the relationships between the two, contact us at 925-867-4400. You will find additional information about Employee Surveys here.

Merit Resource Group helps businesses in all stages of development manage their critical human resource issues to increase business success. Merit's HR Assessment helps its clients align policies, procedures, compensation plans, training, employee survey and staffing needs for greater business results and Return On Investment in their people.

www.MeritHR.com -- 925-867-4400 / 408-501-8863 -- surveys@merithr.com