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04 February 2019

Do annual employee performance reviews impact on customer experience?

It’s no secret that most employees don’t look forward to their annual employee performance reviews. In the HR community, the topic of employee performance reviews and how effective they are is up for much discussion. Some claim that it’s an efficient and necessary process, but its methods need to be revamped, while others argue that its an out-of-date and counter-productive exercise that is essentially a waste of time.


So how effective is the review process and what impact does it have on customer experience? In an interesting twist, research suggests that there is a strong correlation between positive employee experience and exceptional customer experience. Ultimately, we are looking at whether the employee performance review has enough of an impact on the customer experience.


Employee experience indeed has a direct impact on customer experience


The best leaders in business put much time and energy into how customers experience their brand, and it’s for a good reason. It’s a well-known fact in the business world that it is significantly more expensive (not to talk about time-consuming too) to win over a new customer than it is to keep an existing customer. In today's media-hyped society, one negative review or social media post could create substantial damage to any business. However, on the other side of the coin, a few positive reviews could help companies to excel and to stand out.


Positive and negative brand experiences come from the interactions that customers have with employees. If employees are unhappy, they aren’t motivated to do a good job, and the customer experience will most likely be affected. While in the ideal world, creating a culture in which employees are committed to providing the best possible customer service is the ultimate goal, this will only work if the employees have a positive employee experience.


Ultimately, employee experience could make or break your business. In practice, the best way to increase brand loyalty and attract customers is by using the brand ambassadors that already work at your company.


What do regular employee performance reviews have to do with the employee experience?


The employees of today want frequent and meaningful feedback. Businesses are operating at a pace that requires employees to be aware of changes before, during and after they’ve taken place. It’s only through pertinent feedback that employees can modify their priority tasks, work processes, and skills to ensure that they are aligned with the business objectives and strategies.


This is where regular performance reviews come into play. The employees of today want to find meaning in their work, expect frequent feedback, and they want recognition for their excellent work. More and more business leaders start to realise this, and many of them report, that regular performance feedback performance sessions drive higher performance. Research has shown that employees who have managers that seem to care about them as a person are more engaged and committed to the business. By providing frequent feedback employees know where they stand, can discuss issues or concerns with their managers promptly, and they are always being inspired to do better work.


Frequent employee feedback sessions and customer experience


Ultimately what businesses want is employees who are motivated and inspired. This passion is what leads to exceptional customer experience. But, as we mentioned earlier, only those employees who have a positive experience within an organisation, are likely to care about the customers.


In line with the changing attitudes in the workplace, many agree that employees, especially millennials prefer frequent feedback rather than one, in-depth annual review. This change is linked to their growing preference of “people managers” who orchestrate catch-ups regularly and with empathy. They want managers who care about them and know how to show it. This demonstrates to them that they are of value to an organisation and that their work there is useful and appreciated.


Frequent conversations with employees can empower them to do their best work, and this leads to excellent customer experience. Think of it this way, rather than only addressing concerns and opportunities for growth once a year, conversations can be had monthly or quarterly. This ensures employees hit their goal more frequently, and more efficiently. Ultimately this results in better customer service.

Posted by: Edit Ford

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