Strategic HR

How Employee Happiness Increases Client Retention

by David Dourgarian, CEO of TempWorks Software

Organizations are always looking for ways to retain their client base; after all, they are one of the main drivers of profit and business growth. While many businesses hold tight to traditional customer relations practices, many overlook the secret weapon right under their own roof – their current employees. This idea is simple but powerful: By keeping employees happy, business leaders can keep their client base happy.Happy workers

Business owners and top executives need to realize that customer retention doesn’t occur in executive offices, but with the employees that communicate with the company’s clients on a daily basis. Employees who are engaged and have an emotional commitment to the organization are its biggest brand advocates.

The correlation between employee engagement and client retention is not a particularly new idea; however, the causality of it is. This leads to the age old question: Does engagement lead to retention and better outcomes, or do successful companies simply have more engaged employees?

Employers are now beginning to see the causal link and turning the focus inward, adopting company culture and employee engagement initiatives that will empower employees to provide even better customer service.

Engaged Employees Lead to Brand Loyalty

Employees who are consistently motivated by executive staff tend to be more passionate about the brand and products they are representing. They have a personal investment in their work, which leads to an improved customer service experience and a positive representation of the brand they are working for. When these employees, who speak to their clients daily, provide a personal and positive experience, clients are more inclined to stay on contract or come back for more.

Employees Who Feel Empowered Will Drive Customer Retention

It is equally important for business leaders to realize that they need to make their employees feel empowered. By giving employees important responsibilities and the ability to make decisions surrounding their job, they will feel appreciated and valued. Micromanaging will oftentimes discourage employees from taking the reins on future projects and hampers creative thought. Business leaders need to take the time to praise employees for doing a great job, and encourage them to turn their mistakes into learning opportunities.

Financial Compensation Is Not the Main Driver of Performance

Of course, employees expect to be fairly compensated for their work, but engaged employees seek satisfaction and fulfillment beyond the paycheck. Motivated employees tend to identify with their work on a personal level, and are passionate about improving themselves and the entire organization. Employees who work solely for pay are less inclined to put in the additional effort and go that extra mile, which is often what makes businesses thrive.

Additional Perks to Keeping Employees Engaged

Hay Group revealed that employees who are engaged are up to 43% more productive than those who are not. This is one of the most important benefits of employee engagement. Disengaged employees will see their job as “just a job,” as opposed to engaged employees who will see it as a career from which they derive personal satisfaction.

While the main focus of this article is customer retention, the importance of employee retention must not be underplayed. Employees who feel actively engaged in their work are more likely to remain in the same organization for years and build their career there. This creates a loyal employee base and improves the overall perception of a brand.

In order to retain happy customers, organizations must also retain happy employees, and this begins on the front lines. Employees are the main point of contact between clients and the organization. If customers have a positive experience dealing with employees, they are more likely to remain loyal. By shifting the focus inward and encouraging employees to feel engaged and empowered, businesses will increase their customer retention rate and drive business for years to come.

David Dourgarian David Dourgarian is the CEO of TempWorks Software, based in Eagan, Minnesota. His accomplishments within the company include launching the payroll funding and payroll processing divisions, as well as engineering a substantial software partnership with Sterling National Bank. Connect with David at