Human Resources Issues for Senior Management
Issue link: https://digital.hrreporter.com/i/343811
4 Executive Series Digest hrreporter.com ADVERTISING INDEX ABC Life Literacy Canada www.EssentialSkillsDay.ca ....... 30 Aimia www.aimia.com ............................5 Brock University www.brocku.ca/education/ futurestudents/adulted .............. 15 Conference Board of Canada, e www.e-library.ca ........................ 19 DLGL Ltd. www.dlgl.com ............................ 32 Human Resources Professionals Association www.HRPA.ca/bigdata ............. 11 Industrial Relations Centre-Queen's University www.irc.queensu.ca ......................2 Strategic Capability Network www.scnetwork.ca ..................... 21 EDITOR'S NOTES TODD HUMBER RUDER STAFF, HIGHER PROFITS? THINK AGAIN I n a recent issue of Canadian HR Reporter, we looked a study that found rude and snobby store sta can actually make cus- tomers want to pony up their cash and make a purchase. But before you go and burn your cus- tomer service manuals and overhaul how you've been doing business, there are two ma- jor caveats to this research out of the University of British Columbia (UBC). First, it really only works for high-end retailers with so-called "aspirational" brands. And, second, even for those rms it's not a viable long-term strategy. Once customers do make a purchase, they expect to be treated like gold. While the idea of crappy customer experience trans- lating into a sale seems counterintuitive, it ac- tually makes sense. Rejection can sometimes be irresistible. Take the anecdotal story that Darren Dahl, the marketing professor at UBC in Vancouver, told us: He walked into a store to buy Hermes cologne wearing tattered jeans and a T-shirt and was treated with disdain by the salesperson. Instead of storming out, he actually became even more determined to buy it — and he did. e logical thing to do would have been to walk out the door and spend his money with another retailer who treated him better. And yet he didn't. "Most research in this space would say, 'Oh, you always want to give good service, never ever is it a good idea to give bad service' and this research says, 'Well, that's true. But there's some situations where bad service may actu- ally cause people to buy," said Dahl. "If you're this luxury retailer, you have an image of exclu- sivity… and when you challenge me, I aspire to that, I want to show you that I can actually buy it so, in that case, rude service actually makes you want it more. You want to prove in that context that that's something you can a ord." But the same study found mainstream re- tailers — such as e Gap — could never get away with rude service. And despite the fasci- nating results of this academic study, we all know that — in the real world — excellent customer service is critical to bottom-line success. We also know, through our in-depth coverage of human resource issues, that employee engagement is a critical driver of success. A higher engage- ment score is linked to higher pro t margins. In a study of 32,000 employees around the world in 2012, consulting rm Towers Watson found that rms that scored high in employee engagement generally had pro t margins three times higher than rms with disengaged workforces. at's why, for the cover story, we set our sights on employee engagement and the impact it can have on the customer experi- ence. We put together a panel of thought leaders and had an in-depth discussion on the link between the two, and you can read the results in depth starting on page 6, and watch videos online at www.hrreporter.com/ engagementroundtable. What I can comfortably say, a er moder- ating this discussion, is that the jury is most de nitely in on engagement and its impact on the customer experience. With this much evidence on the books, any rm that lets toxic cultures go unchecked and — doesn't move to boost engagement — is playing a dangerous game with the bottom line. FIRMS THAT SCORED HIGH IN EMPLOYEE ENGAGEMENT HAD PROFIT MARGINS THREE TIMES HIGHER THAN FIRMS WITH DISENGAGED WORKFORCES.