The ROI of Employees Is Just As Important

We are working for a company that wants us to better understand if their customer experience is “working” for them, and if they are sufficiently closing the loop on customer service by actually enacting changes in their business based on customer feedback. This is all in an effort to achieve the maximum return on investment (ROI) they can from their customers and their customer support.

However, something we observed in this company really stands out, and is a much larger problem for them. To put it bluntly, they treat their employees like crap. It is astounding to me that a company that has so much care for its customers (and understanding how customers feel about their brand) is not taking its own medicine and applying this logic in-house.

Let’s start with some old adages we keep hearing them bounce around in boardrooms:

• The customer is always right.
• Treat customers well in a time of pain/problem, and they will become more loyal.
• Invest in your customers and they will invest in you.
• It’s cheaper to retain customers than acquire new ones.

That’s all well and good, and nothing we don’t already know. But this company takes the exact opposite approach when it comes to their staff. From our observations, it seems to be the owners’ attitudes that:

• Employees are always wrong (or at least that’s the gut reaction when a new idea floats up from them).
• Chastise employees so the other employees learn and don’t try to take advantage of you.
• Tell employees they are free to do ad-hoc projects, but not if it cuts into their assignments.
• If one employee doesn’t work out, fire her and get someone else, sending a clear message to the others that they are all expendable.

What a way to run a business, right? I am astounded by this behavior. To be fair, this is not a Fortune 500 e-commerce company (the mainstay of my company’s client base). This is a smallish mom and pop store that we offered to help out due to some personal connections to the company. Do these behaviors happen with the big guys? Yes, of course, but usually in a less transparent or egregious way. Most companies that grew up in the dot-com era were built on the principals of treating your staff as your best asset, and encouraging them to enjoy their life at the company.

That’s the world I grew up in, and the companies I’ve worked for have certainly understood that. The company in question, however, doesn’t have the same pedigree, and it is eye opening for me. It does make me wonder how many of the smaller companies (that I simply don’t come into contact with as often) have these kinds of problems.

In our report for this company (helping them understand where they are losing on their bottom line) we are going to put in a large section about this issue. Like any company, their bottom line is obviously affected by how much money they are bringing in. But it is also affected by their expenses, and their efficiency.

Because they have created a hostile/toxic work environment, they have employees who aren’t interested in making the company successful any longer, and aren’t willing to put their necks out with new ideas that could help the company. Having witnessed this firsthand, I can tell you this is not the fault of the employees, who universally seem to have had the joy sucked out of them at this company. There have been three staff replacements in the five weeks since we’ve been on site. Clearly this costs the company a lot of money. Some of the issues were in the vetting process, and some were in the training process. Either way, these new staff members were destined to fail from the beginning, and the company tends to take a “one strike and you’re out” policy, which shoots them in the foot as much as anything else.

In the report we file, we will talk about “employee churn,” “employee lifetime value,” and other terms we’d normally associate with customers. It is our hope that they will realize that their best chance of growing the business is to actually let their employees grow and prosper instead of treating them like cattle.

ROI comes in many shapes and sizes. And while we’re constantly looking at customers to figure out how to make more money, sometimes it’s required for us to look inside the walls of our cubicles and understand how we’re stopping our own growth by preventing our staff from living up to their potential within our companies.

Thoughts, comments? Please leave them below!

Until next time…
Jack

Team image on home page via Shutterstock.

This column was originally published on July 20, 2012.