Every sales organization shares the same challenges: keeping high-performing and high-potential sales people on the team, finding ways to boost sales productivity, retaining customers and keeping them satisfied in a competitive marketplace, and driving top line revenue for bottom line growth.
Sales enablement and a host of quick fix solutions promise to do it all. But they often disappoint, not coming through as the “cure all” that was anticipated. That’s because those fixes are too small and can’t be sustained. There’s only one magic bullet that, according to reams of research, actually delivers in all those important areas.
Sadly, this true solution is often overlooked. It may seem too lofty, too theoretical, too much of a luxury. It’s none of these. The true solution is concrete, within reach, and a business imperative. It’s employee engagement.
In the average company, up to 80% of employees are moderately engaged or actively disengaged. That means only 2 out 10 employees is actively engaged in their work. That’s why business results suffer and there seems to be a revolving door of employees coming and going. It’s why customers are dissatisfied and why sellers struggle mightily to attain their quotas.
Let’s break employee engagement down and walk through its impact. Then we’ll describe how to make it happen in your organization.
- Employee engagement is “a heightenedemotional connection that the employee feels for his/her organization, that, in turn, influences him/her to apply additional discretionary effort to his/her work.” (CEB)
- “Emotionalcommitment drives effort. Emotional commitment is four times as valuable as rational commitment in producing discretionary effort. Indeed, the search for a high-performing workforce is synonymous with the search for emotional commitment.” (CEB)
The emotional commitment that start a domino effect of business benefits. Here’s how it works:
- Emotionally connected employees stick around. They are less likely to leave. “Engagement is the key to performance and retention. Highly committed employees are 87% less likely to leave than employee with low levels of commitment.” (CEB)
- The emotional connection results in additional discretionary effort, too. The outcome? Significantly higher rates of productivity. More output. Less downtime, absenteeism and tardiness. Higher quality, less rework. More work getting done in less time. Research form Jim Kouzes and Barry Posner in Great Leadership Creates Great Workplaces demonstrates that “The best leaders elicit three times the amount of talent, energy, commitment and motivation from employees compared to their counterparts.”
- With employees who stick around and improvements in productivity, the next natural result of employee engagement is a boost in customer satisfaction. “Organizations with above-average levels of employee engagement reap 50% higher customer loyalty levels.” (Gallup)
- No surprise here. More customer loyalty produces higher top line revenue. “Employee engagement scores were 21% higher in double digit vs. single digit growth companies.” When sales people stay in their jobs, they maintain customer relationships and secure more repeat business. This, too, helps with revenue growth.
- It’s not just top line… The bottom line is also favorably impacted by increases in employee engagement. The revenue growth plus expense reductions (from less money spent on recruiting, hiring, onboarding… and fewer errors, less overtime, less customer churn) result in stronger profit margins. In one study of 23,910 business units, when the top quartile and bottom quartile engagement scores were compared, those in the top quartile averaged 12% higher profitability. (Gallup Q12 Meta-Analysis)
Customer satisfaction and loyalty are directly linked to employee engagement, especially the engagement of sales professionals. This domino effect all begins with employee engagement. In fact, “engagement is the primary enabler of successful execution of any business strategy.” (DDI Employee Engagement: The Key to Realizing Competitive Advantage)
Only one question remains, then. If a business can get all these benefits by simply boosting employee engagement, the question is HOW. How can we boost our employee engagement?
The definitive answer is that you boost employee engagement by developing your leaders and managers. The manager matters. “The manager has tremendous impact on employees’ levels of emotional commitment to the team, organization and job.” (The Corporate Leadership Council)
No other factor matters more. Kouzes and Posner measured ten demographic variables (age, country, job title, etc.) and found that no demographic variables made a significant impact on the level of engagement. They also measured thirty discrete behaviors of leaders and found that each of these behaviors, alone, could have a double-digit impact on improving engagement.
Clearly, the attributes and activities of a manager have a direct correlation to an employee’s emotional commitment. And this translates into business results. Companies that increase their number of talented/trained managers (vs. untrained) and double the rate of employee engagement because of it achieve, on average, 14.7% higher earnings per share than their competition. (Gallup)
This strongly suggests that sales organizations will be more successful when Sales Managers participate in leadership development programs and learn the behaviors of leaders, like those found in the evidence-based framework of leadership known as The Five Practices of Exemplary Leadership® (Kouzes/Posner, 30 separate behaviors).
The Five Practices are directly linked to employee engagement which, in turn, unleashes that domino effect of business benefits. For sales teams that want to retain their top talent, improve sales productivity rates, decrease customer churn, and experience both top-line revenue growth and improved profitability, this is a true magic bullet. It all starts with leadership development for Sales Managers, a small investment that yields huge and long-term dividends for the entire organization.