Posts

If You Want to Increase Your Profit, Don’t Put Your Customers First

Some professors at Harvard developed a concept over ten years ago called  The Service Profit Chain. This concept is designed to increase your profits year after year.


The Service – Profit Chain

Employee satisfaction leads to customer satisfaction. Satisfied customers lead to revenue growth. Revenue growth leads to profit growth.

Reinvest a portion of those profits into things that will make your employees even more satisfied, and the chain never breaks.

So your profit keeps going up year after year!

Employee satisfaction
It starts with satisfying your employees. Many business owners focus on satisfying their customers first, but that’s putting the cart before the horse!

If you don’t have satisfied employees, you won’t be able to satisfy your customers. Work from the inside out, because your product or service is built around those who create or deliver it.

So if you want to increase your profits, find out what will make your employees happy!

Happy employees stick around
It’s expensive to find and train new people. New people cost you money until they get through the learning curve. They cost you money because your established employees have to help train them, so they aren’t as productive as they would be if they weren’t faced with that burden.

They know what they’re doing. They know your customers personally – their likes and dislikes. They have relationships with your customers, and most people do business with people they like.

Your employees are golden! So seek first to satisfy your employees.

3 things satisfied customers do
Satisfied customers buy more, they buy more often, and they tell others.

Look at those three again – isn’t that a great way to increase sales?

You don’t have to spend a boat-load of money chasing new customers. You focus on making your employees happy so they make your customers happy.

If you do that, your sales will grow. If you just keep your costs under control, your profits will grow. Reinvest a portion of those profits to find even more ways to satisfy your employees, and your profits will grow year-after-year.

Our bigg quote today is a paraphrase of a Walt Disney quote:

“If I treat my employees the way I want my employees to treat my customers,
I’ll never have to worry about how my employees treat my customers.”

Take care of your employees and watch your business turn into a magic kingdom!

Next time, we’ll discuss what to do if you made a commitment you no longer feel you can honor. Until then, here’s to your bigg success!

Subscribe to The Bigg Success Show in iTunes.

Related posts

3 Things Every Employee Wants

How To Be A Terrible Boss

Growth: The Good, the Bad, and the Ugly

(Image by duchessa)

*We are Amazon affiliates. If you purchase the book we linked to in this article, we’ll receive a small portion of the sale.

Pages

Keep Your Employees Happy And Watch Your Profits Grow!

By Bigg Success Staff
03-07-08

Bigg On Small Business 

Here’s a concept that’s been around for over a decade now, but is still relatively unknown to many business owners. It was developed at Harvard Business School. There’s a great book on it by Harvard professors James L. Heskett, W. Earl Sasser, and Leonard A. Schlesinger.

It’s called The Service Profit Chain. Here’s what it says in a nutshell:

Employee satisfaction leads to customer satisfaction. Satisfied customers create revenue growth. Revenue growth leads to profit growth. Reinvest a portion of those profits into things that will make your employees even more satisfied, and the chain never breaks.

Seek first to satisfy your employees
So if you want to increase your profits, find out what will make your employees happy!

Happy employees stick around longer. They know what they’re doing. They know your customers.

Bottom line – they’re golden!

They’re golden because it’s expensive to find and train new people. New people cost you money until they get through the learning curve.

They cost you money because your established employees have to help train them, so they aren’t as productive as they would be if they weren’t faced with that burden.

They’re golden because they know your customers’ likes and dislikes. They also know your customers personally. They have relationships with them, too. And we all do business with people we like.

So seek first to satisfy your employees.

3 things satisfied customers do

Satisfied employees lead to satisfied customers. They do three things:

  • They buy more
  • They buy more often
  • They tell others

Now look at that list again – isn’t that a great way to increase sales?

You don’t have to spend a boat-load of money chasing new customers. You just have to focus on making your employees happy so they make your customers happy. If you do that, your sales will grow. If you just keep your costs under control, your profits will grow.

It can’t get much simpler than that!

Subscribe to the Bigg Success feed.

Hear today's lesson and laugh on The Bigg Success Show. 

Related posts 

Finding Balance At Work

Happy People Make Happy Employees

3 Things Every Employee Wants

7 Steps To Lead Your Troops To Victory

How To Be A Terrible Boss

Are Twenty Somethings Getting A Bad Rap?

(Image by Ella's Dad, CC 2.0)