“The customer is always right,” this was the mantra I learned time and time again while working at K-Mart during my grad school years. K-Mart’s philosophy was simple: happy customers are repeat customers; unhappy customers stop shopping at K-Mart and tell their friends and family not to. For that reason, we were encouraged to and provided with a margin of flexibility in helping customers – whether they were right or wrong about a situation. Usually that meant giving contested items to them at a lower price in order to work with them and keep them happy – within reason.
It was a lesson I never forgot. When you are flexible with customers and make clear strides to retain them by providing the best possible price and service, your customers will reward you with loyalty, even spending more just to shop your store than buy from the competition.
At the two K-Marts I worked for, another attribute to their success was clearly evident: they generally treated us well. In return for our hard work and loyalty, they maintained a measure of flexibility, particularly with regards to the unforeseen and uncontrollable. Car won’t start right away? Buses not running on time? Don’t worry about your job; as long as you don’t make a habit of lateness and can accept not being paid for the time you were late, K-Mart will work with you.
K Mart was also very good about employee incentive programs and rewards. Employees who worked holidays were not only given time and a half pay, but typically given small thank you gifts and food (including a full catered turkey feast on Thanksgiving) in appreciation for coming in when most employees did not want to work. K-Mart cash was awarded every time an employee provided particularly good service or went above and beyond in some area. Accumulate enough K-Mart cash and you received a gift card for anything you wanted. It was an attractive incentive and reward for hard work and one reason that very few of the non-student employees left the company.
For all the hard work and low pay of the retail environment, it was a formula that worked better than I could have possibly realized at the time. How we treated our customers and how we were treated were, in essence, one and the same.
After leaving K-Mart I worked in a broad range of industries, from pharmaceutical advertising to small law firms to education to market research, and even industrial. I interviewed in even more sectors of our economy, gaining glimpses of corporate strengths and weaknesses along the way.
What I saw shouldn’t surprise anyone: the companies that had the highest turnover rates with their staff were also the ones experiencing the most dissatisfaction and highest turnover rates with their customers, both at considerable cost to the companies. Recruiting and training staff and pursuing new business are, after all, two of the highest expenses companies face.
This makes sense: corporate culture tends to be consistent both internally with staff and externally with associates and customers.
So of course the companies with the highest customer satisfaction rates were the ones who treated their staff the best. Conversely, the companies with the highest turnover rates with staff also tend to have the lowest rates of repeat business and the fewest loyal customers.
The message: when your staff is happy, your customers will be happy. When you are flexible with your employees and treat them as equals, you will also treat your customers the best and be the most responsive to their needs.
This is all common sense, of course, but sadly one that most companies today lack.
It is time to grow our businesses by caring about our employees. Listen, learn, respect your staff and they will reward you with lasting productivity and lots of repeat business from your customers. And the best part: treat your staff well and you dramatically cut your costs while increasing profits through more business. It’s a win-win combination.