Avoid Dissatisfied Customers by Empowering Your Employees
Entrepreneur's New Year’s Guide
If you're a small-business owner, you're probably familiar with the frustration that comes with requests for managerial assistance from your sales team. Whether it's an irate customer who wants to vent or a vendor looking for a discount, conversations like that are always tough. What's more, they seem to happen at the worst possible time, diverting your focus and time away from other executive-level priorities.
There's a solution to this, one that many companies are hesitant to implement. It's called employee empowerment, and it's something that can fundamentally alter how your workers interact with customers, each other and the business as a whole. While there are dozens of ways to empower your employees, at the end of the day it all comes down to trust.
Here are a few reasons you should consider employee empowerment as a permanent shift in your business strategy:
1. Lower-level employees can properly address customer concerns.
It doesn't matter if you're a millionaire or the founder of a new startup, all of us are customers when we leave our place of business, and we've all experienced the woes of terrible customer service. Maybe you've even objected, asked for a discount or some kind of accommodation, only to be told that there's nothing that can be done.
This kind of dissatisfactory experience is a direct result of employee disempowerment, and it's one of the main reasons customers ask for a supervisor. The customer is unsatisfied and the employee is restricted by company policy from offering any kind of recompense or compensation to make it right.
Virgin America CEO David Cush notes that empowerment is the key to a great customer experience. "As we always say in our company, it's better to ask forgiveness rather than permission. If you think you need to do something, do it, and we'll sort it out later," he says.
In my own business, I give my employees the authority to incur a company loss of up to $500 in order to resolve a service issue. If a customer is upset, an employee can offer a refund of $500 without even asking. As a result, I deal with far fewer headaches, and both the customer and the employee have a better experience when resolving issues. Everybody wins.
If $500 sounds steep for your business model, consider lowering the ceiling to something you're more comfortable with. The point is to give employees the ability to create a positive experience (and a happy customer) with every interaction.
2. Employees can enhance the customer experience in real time.
Great customer service isn't just about damage control. Empowered employees have the ability to greatly improve the customer experience during a live interaction by pulling out any of the tools you've given, and it gives works the ability to nudge policy aside for the sake of controlling that experience. The one sentence that I never want uttered from anyone at our company is, "If I did it for you, I'd have to do it for everyone."
These can be simple things, like giving away an extra bag at the register or enacting a fast-and-loose policy of rounding $2.04 down to $2.00 so that customers don't have to dig for change. You can also go big by empowering employees to apply discounts to close sales or add small items to a larger purchase. I've found that the best way to ensure that employees use good judgment during this process is by creating a broad, ethical goal -- making happy customers -- and setting relaxed guidelines regarding how they utilize their authority.
Employee empowerment lacks the rigidity of stricter policy mechanisms, which is why some business owners shy away from it. It's also not a perfect system, especially if you're just starting out. You should anticipate that an employee will sometimes give away too much (or too little) and may need additional guidance to enact your vision.
3. Staff morale and communication drastically improve.
Giving your employees the ability to affect the outcome of an interaction using their own judgment and authority is a tremendous morale booster for your team. This is doubly true if you celebrate empowerment wins across the team and use it to inspire employee best practices. Because no two customer interactions are alike, exemplifying ideal behaviors encourages your workers to communicate and collaborate with one another to improve customer relationships.
By itself, morale is a powerful tool. If your employees feel powerless to solve their own problems, they'll likely be just as frustrated by your customers when problems arise. Instead, give your employees the ability to change the outcome of their own interactions and, by consequence, the direction of the business.
One study published in the Global Journal of Management and Business Research indicates that using employee empowerment as a motivational tool "gives employees a sense of satisfaction toward their job and organization." When employees feel like they have a stake in the business through their choices and actions, they're more likely to provide feedback on how you can improve that process. Employee empowerment may provide a window for you to solicit feedback and use the results to further optimize your sales process.
4. Lower turnover means less time training replacements.
Every year, companies spend thousands of dollars training new staff because team members leave. What if that wasn't the case?
Organizations with empowered employees see lower rates of employee turnover. This helps your bottom line indirectly by decreasing the amount of time, money and energy your company needs to expend in order to build your team.
On top of that, veteran employees are much better at enacting your vision, especially if they've built long-term relationships with customers. You can even take this a step further by training your most seasoned workers across other teams. Apple, long touted for its powerful and innovative work culture, does this by allowing employees to cross-pollinate their skill sets by moving between teams and trying different roles for six months at a time, as one New York Times article explains.
The result: Systems engineers who better understand the customer purchasing process. Copywriters who can better interpret what engineers are building and what features customers want to buy.
None of that happens if you're stuck training workers on entry-level tasks.
It's true that empowerment policies only go so far in this regard. A large part of keeping employees happy comes down to a living wage and better benefits. While empowerment practices will likely boost your bottom line, it's up to you to reinvest that money in a way that keeps your staff smiling when customers walk through your front door.
5. You'll learn how your employees handle authority.
Perhaps the most important aspect of employee empowerment is that ambiguous policies create a space for leadership to thrive.
Pay careful attention to how each employee utilizes their authority during customer interactions. Do they use it sparingly or not at all? Are they reckless with discounts? Do they push the boundaries and experiment within the scope of the policy?
For a small business owner, empowerment policies come down to trust. For an employee, they come down to responsible use. How does the employee deal with situations when they aren't straightforward? Do they willingly share those practices with others when they uncover a method to success?
The right empowerment methods can give you key insight into your next employee promotion.
At the end of the day, there's no right method for employee empowerment. Sharing your vision with employees and giving them the tools to implement that vision is a strong start.
On a broad scale, empowered employees are happier, more creative and more willing to help your business grow. Give your employees what they need and congratulate them when they exceed your expectations.