Nine Ways To Reward Employees To Reinforce Customer-Centric Behaviors

The only way your company will differentiate based on customer experience is if the culture of your organization aligns closely with the brand promise to customers. Zappos CEO Tony Hsieh puts it in his blog post entitled “Your Culture Is Your Brand”: “Advertising can only get your brand so far . . . So what’s a company to do if you can’t just buy your way into building the brand you want? In a word: culture. At Zappos, our belief is that if you get the culture right, most of the other stuff — like great customer service, or building a great long-term brand, or passionate employees and customers — will happen naturally on its own.”

When Forrester looks at building a customer-focused culture, we believe firms need some precursors in place, such as a clear strategy and vision, metrics that reflect customer perceptions, and governance mechanisms that set standards and hold people accountable for changes.

Once those are in place, rewards systems are one powerful lever to keep employees focused on what’s important. My colleague Belle Bocal and I identified nine ways that companies use reward systems to build a customer-centric culture.

Celebrate Target Behavior

Many companies make the mistake of trying to tie variable compensation (e.g., bonuses) to customer experience metrics too early. What many firms have learned is that the more informal recognition programs can be even more powerful at moving culture than the compensation metrics.

1. Reward those named in customer surveys. At Pitney Bowes, employees recognized by name in favorable surveys or feedback receive a gift certificate, and at GoDaddy.com, one lucky employee’s bonus is a paid year’s worth of rent or mortgage payments. Circles, a provider of virtual concierge services, gives agents the ability to accumulate points based on customer satisfaction surveys and redeem them for prizes, including additional time off.

2. Recognize people behind the scenes. Since 1992, every Valentine’s Day, Southwest Airlines has awarded a Hero of the Heart as a tribute to a behind-the-scenes star work group that does not have direct customer contact.

3. Empower peers to celebrate each other’s work. One financial services firm allows employees to nominate peers monthly who have the biggest impact on customer satisfaction and bring value to the firm for its “Random Acts Of Customer Engagement” award. KeyBank set up a program that allows employees to give each other “Key Kudos” for work that exemplifies a focus on customers.

4. Align rewards to goals. Instead of rewards like golf trips or dinners that have no correlation to customer experience, Fidelity sent those selected to participate in its customer experience Ambassador’s program to the Disney Institute for three days, which included touring Disney to see behind the scenes how it delivers its experiences.

Provide Perks That Improve The Employee Experience

Many companies on their customer experience journey have recognized that employee experience correlates to customer experience. Just as customers have larger contexts in which they use your products and services, employees have larger contexts in which they work for you. Help them navigate those larger contexts, and you have employees who can focus more on your customers.

5. Provide services that improve a work/life balance. Based on employee feedback, American Express built and piloted its first backup child care center adjacent to the Fort Lauderdale call center. It added nurse practitioners to the on-site healthcare service, allowing employees to get more of their medical needs (e.g., prescriptions) met without having to take time off. And American Express even got the Florida Department of Highway Safety and Motor Vehicles to come on-site twice a year so employees could renew their driver's licenses and car registrations without having to wait in long lines. Similarly, Cisco provides on-site car tune-ups. CDW also uses customer feedback scores to determine eligibility for extra perks, such as the ability to work from home.

6. Offer benefits that lower stress levels. CareerBuilder.com notes, “The inclusion of on-site services such as manicures, laundry, and daycare are enabling employees to cut their errands in half. Massage chairs, yoga classes, and even napping have been encouraged to cut back the daily errands and reduce workers' stress levels." To that end, Kaye/Bassman and Le Gourmet Gift Basket allow their employees to have sleep breaks at work, and Zappos offers employees access to a life coach.

7. Treat the frontlines reps with respect. American Express changed the title of its agents to “customer care professionals” and provides them with personalized business cards. Volusion uses “support concierge” for its call center reps. Zappos lets call center agents get their own desk to decorate any way they like.

Compensate And Promote Based On Customer-Centric Metrics

While I’ve emphasized the non-monetary side of incentives, the tying of variable compensation and promotions to customer metrics is a powerful incentive in companies that have established an understanding of how to affect those metrics.

8. Promotion tied to customer experience performance. At Enterprise Rent-A-Car, no one can further a career into corporate management who has not first started on the frontline and sustains above-average Enterprise Service Quality index scores over time.  The account managers at CDW also have customer satisfaction objectives and cannot become eligible for job promotions until having achieved high satisfaction scores from their clients.

9. Bonuses to customer metrics. American Express created customer experience objectives for everyone in its service organization from senior managers to frontline employees. For its customer care professionals (CCPs), 85% of each performance assessment stems from customer feedback scores, and CCPs have an opportunity to earn an incremental 25% to 35% above their base salaries. The professional services firm, IHS, ties its CEO annual bonus compensation to key customer metrics that measure the company’s “customer delight” performance (see page 45).

For more tools to build culture, read my report “How To Build A Customer-Centric Culture.” I’ll also be speaking on the topic at Forrester’s Customer Experience Forum on June 26.

Comments

Reward

Thats cool way of appreciation, good to follow up these rules.

Celebrate target behavior

These are great ideas Paul, nice post. To add an example I've come across recently, Deloitte University has a full complement of hotel, restaurant, and bar staff, but it's a tip-free environment. Guest are given "thank you" tokens when they arrive and encouraged to pass them along to staff members who have been especially helpful... the tokens make them eligible for prizes. I thought it was a really interesting way to promote terrific service.

We have been researching similar aspects of culture on the Security and Risk team as well. In fact, our most popular blog post in the past 2 months came from one of our researchers, Nick Hayes, who discusses the idea of encouraging compliance with incentives instead of discouraging non-compliance with punishment. (http://blogs.forrester.com/chris_mcclean/12-03-27-dont_forbid_employees_...)

Keep an eye out in the next week or so for our report on building a culture of risk and compliance.

Great ideas here. Rewarding

Great ideas here. Rewarding employees keeps them happy, lets them know that they are appreciated and recognized.

Improve employee experience by user experience design

When you wrote "employee experience correlates to customer experience" I was expecting a dot on well-designed user interfaces for internal (IT) systems. For example, when an employee has to write his daily hours in a crappy Timesheet system, you can't expect him to deliver great experiences to customers. In my opinion, when companies invest more in getting the internal IT systems to ensure an optimal employee experience, the customer experience will follow.

Great Ideas - That's really using your noggin

I am a young marketer studying with CIM and i have to say your ideas have really blown the lid on what i thought you could do to motivate staff to do better. I have always thought you need to connect the money to the good service and one way to get this done was to survey customers. But your ideas have shown me that you can be more aggressive with a customer satisfaction survey by making it look and feel like it isn't a tedious survey and you can really shape the interactions and relationship of the service personnel and the client - and if you balance the ingredients just right you could end up with a great customer service culture.

Thanks guy.