Catch 22: When Rapid Growth Leads to Employee Disengagement

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Jul 25, 2013

Is your company growing too fast?

Asking your CEO that question might lead to your swift termination. Executives and company shareholders rarely think their companies are growing too fast — but front-line employees do.

This past weekend I decided to take a trip to Manhattan. Luckily, I was able to snag a low-cost fare on a direct flight, and I didn’t care that it was a redeye. In the row seated next to me, an off-duty flight attendant tried to catch some shut-eye, but not before engaging in a lively conversation with the flight attendant seated in front of her.

Rapid growth, but dampened human capital

I didn’t eavesdrop too much on their conversation, but I did hear one thing: both flight attendants agreed that the airline was growing too quickly. The rest of the conversation carried a tone of exasperation and complaint (I don’t remember the details).

So, what does this conversation tell us? The airline is known for being an industry leader, and so it continues to grow and succeed at the expense of their customer-facing, front-line employees.

Because of the airline’s heavy focus on growth, employees are being overworked, overstressed, and eventually disengaged. Since disengaged employees cost organizations $3,400 for every $10,000 of salary, chances are the airline’s growth will be quickly dampened by increased costs of human capital.

Overworking and disengaging front-line employees seems to be a common trend in the industries that heavily rely on customer service. At my job, we work with a wide variety of clients — from the public sector to restaurant chains, and everywhere in between.

The link between engagement and customer satisfaction

One of our employee engagement case studies revealed an interesting point that most companies seem to fail to notice: employee engagement and customer satisfaction are strongly correlated (as are customer satisfaction and financial performance, but that’s a different study).

When comparing individual locations across the client company, the locations with the highest proportions of fully engaged employees had nearly 3 times higher growth in customer satisfaction ratings than the locations with the highest proportion of disengaged employees.

So, as your company experiences exponential growth, don’t let it be at the expense of your most influential employees. How your customers are treated directly affects how they spend their money — and how they spend their money determines whether or not your company will be open tomorrow.

You can find more from Reese Haydon at the DecisionWise Leadership Intelligence blog