The Soft Side of Hard Numbers

“I don’t have time for all this touchy-feely stuff. I need results.” I’m sure you’ve heard or maybe even said something like this before. In tough economic times with competitors breathing down our necks it’s understandable that business leaders need to focus on the bottom line. We need to measure and control all those factors that contribute to a healthy profit. Things like customer loyalty, employee retention, productivity and safety all contribute to a healthy bottom line. They can be measured in hard numbers. How do you measure “Listening?” What does Listening have to do with anything? Who has time for all this “soft” stuff?

Why the Soft Stuff Matters

In their book, First Break All the Rules: What the World’s Greatest Managers Do Differently, Marcus Buckingham and Curt Coffman outline the results of a 25-year Gallup study on World Class Management. The study cut across industries, countries, sizes of business, for-profit and non-profit and public and private sector organizations. In their book the authors focused on 12 survey questions that, sometimes counter intuitively, tied directly to desired organizational outcomes (in other words, “Hard Numbers”).

The Gallup study showed that those companies that reflected positive responses to the 12 questions

  1. Profited more
  2. Were more productive as business units
  3. Retained more employees per year
  4. Satisfied more customers
  5. Worked more Safely

Here are Gallup’s 12 questions:

  1. Do I know what is expected of me at work?
  2. Do I have the materials and equipment I need to do my work right?
  3. Do I have the opportunity to do what I do best every day?
  4. In the last 7 days, have I received recognition or praise for doing good work?
  5. Does my supervisor or someone at work seem to care about me as a person?
  6. Is there someone at work who encourages my development?
  7. At work, do my opinions seem to count?
  8. Does the mission / purpose of my company make me feel my job is important?
  9. Are my co-workers committed to doing quality work?
  10. Do I have a best friend at work?
  11. In the last 6 months, has someone talked to me about my progress?
  12. This last year, have I had the opportunity at work to learn and grow?

What the Cows Know

The California Dairy Producers aired a series of popular TV Ads. In the ads there were dairy cows in a variety of situations. These cows talked to each other about different funny things always showing that the California Cows are the happiest cows in the business. Each of the ads ended with the tag line, “The best Milk (or cheese) comes from Happy Cows and Happy Cows come from California.” Without satisfying an employee’s basic needs first, a manager can never expect the employee to give stellar performance.

In essence that’s what the Gallup study (and several others2) showed. Happy (or “Engaged”) employees are 5 times more likely to deliver on an organization’s desired outcomes than those that are not “Engaged” and far more so than the employees who are actively disengaged. Employee Engagement (“Soft Stuff”), then, drives Customer Loyalty, Employee Retention, Productivity, Safety and Profitability (“The Hard Numbers”). Furthermore, these five organizational metrics are trailing indicators of organizational health. You don’t know what the numbers are until the close of the reporting period. On the other hand, if your Employee Engagement scores are trending up it’s a good indicator that your other metrics will also improve. Employee Engagement is more of a leading indicator of organizational health.3

Here’s how Gary C. Kelly, President, Chairman and CEO of Southwest Airlines put it:

We’ve always “hung our hat” on providing the best Customer Service in the business, at a low cost. Now, I realize that almost any company would (and should) say that, so, you may be wondering, “What’s the difference at Southwest?” The difference is this: Everything begins and ends with our People. If we keep our employees happy and engaged, they will keep our Customers happy, who will reward us with their loyalty. That repeat business helps our bottom line and adds value to our Shareholders.4

This “touchy-feely stuff” might just deserve more attention than you thought. Improving a manager’s, a department’s or a business unit’s scores on these questions has been statistically proven to improve that entity’s other metrics. So, what does all this have to do with listening? That’s what the next several posts will explore.

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1 Depending on the type of organization, these metrics may be slightly different. However, the connection between Organizational outcomes of any type and these elements remains intact.

2 Harvard Business School study The Service Profit Chain, as well as studies by the Dale Carnegie organization and others.

3 Gallup, Q-12 Meta-Analysis, c. 1993 – 1998, 2006

4 Gary C. Kelly, “Making Connections”, Spirit Magazine, September 2013

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