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People Management

Service employee engagement drives higher customer satisfaction


How do you design a service delivery system that adds value to your customer organization? Our new 2015 study shows that focus on employee engagement needs to be an important part of the solution.

Since the early service management theories, engaged service employees have been regarded as the bedrock and cornerstone of any successful outsourcing relationship.

For many, engagement is often viewed as something soft and difficult to comprehend. Feelings and emotions. While this is true, the other perspective is sometimes missing: engagement has tangible effects through its direct impact on behavior. Unsurprisingly, studies have concluded that employee engagement is a strong predictor of outcomes such as productivity, efficiency, customer focus, service quality and profitability. In other words, engagement affects service behavior and service behavior is a prerequisite for excellent customer experiences.

What is the evidence?

To understand the link between service employee engagement and customer experiences as well as identify the specific drivers behind customer experience, we have used input from more than 500,000 responses from the ISS annual Employee Engagement Survey – conducted over a three-year period – and more than 20,000 responses from customers comprising more than 2,500 contracts globally. We then matched the employee and customer data and performed regression and factor analysis.


The study revealed two important conclusions:

  1.     Frontline service employee engagement correlates highly with customer experience
  2.     There are three main employee engagement factors behind high customer experience


Service employee engagement is a win-win

Our research reveals that happy service employees significantly lead to happy customers. This is not really a surprise considering the vast amount of literature supporting this subject.

What is more interesting is that looking into the loyalty metrics of both employees and customers (NPS), the research found that if the employees and customers report a high level of satisfaction, then the organizational unit will have significantly higher margins than if either of the two scores are low. Simply explained: the higher employee engagement, the higher will the profitability of both the service provider and the service customer be.

To take the most advantage of these win-win synergies, it is crucial that the service provider invests resources in service improvements, employee training, on-boarding processes, and service innovation as well as establishing co-creating processes with the customer. This will lay the foundation for continuously engaged employees, better service delivery, better service products, and thus a better customer experience.

What drives the customer experience?

Our research has revealed important new knowledge regarding the factors that drive employee engagement and customer experience.


If all three areas are managed well, a service provider is more likely to improve the satisfaction of the customer, as these factors have an overwhelmingly positive impact on the customer experience.

Want to learn more about how employee engagement and customer experiences interlink? Read the complete study in our our new White paper – Service Management 3.0: Linking Employee and Customer Engagement or explore  Disney’s secret to delighting customers: putting employees first.

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