Engaged Employees Key to Customer Service

The Gallup Organization

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FOR IMMEDIATE RELEASE

Engaged Employees Key to Excellent Customer Service

Sydney, Australia, 31 March 2005 - Recent research conducted by The Gallup Organization in New Zealand found that high levels of employee engagement are related to excellent customer service over time as well as the likelihood of an employee recommending their company’s product and services.

Gallup’s research has shown that 9 in 10 “Engaged’ workers in New Zealand always strive to provide excellent service to their customers. By contrast, only 50% of workers in New Zealand who are “Actively Disengaged’ try to provide “excellent customer service”. Gallup research has also shown that while 74% of “Engaged’ workers in New Zealand recommend their company’s products and services, only 18% of “Actively Disengaged’ employees will do so. These findings are particularly important for organisations with customer facing employees. Gallup’s customer research conducted worldwide has shown service quality to be as important as the product quality, brand name, its promotion and location.

Gallup classifies employees into three categories - Engaged, Not Engaged and Actively Disengaged. “Engaged’ employees are loyal and psychologically committed to the organisation. They are more productive, more likely to stay with their company for at least a year, less likely to have accidents on the job, and less likely to steal from their company. “Disengaged’ employees on the other hand are not psychologically connected to their company. They are more likely to miss workdays and more likely to leave their company. More serious however are “Actively Disengaged’ employees, who are physically present but psychologically absent. They are unhappy with their work situation and insist

on sharing that unhappiness with their colleagues. Gallup’s recent research has shown that just 17% of workers in New Zealand are “Engaged’, 68% are “Not Engaged’, and disturbingly 15% are “Actively Disengaged’.

According to Anita Pugliese, PhD., Managing Consultant at Gallup, it is certainly no surprise that employee engagement impacts customer relations and the bottom line so significantly.

“Organisations with low levels of engagement are effectively suppressing the potential of their employees to create a legion of loyal customers. There can be no doubt that an employee’s level of engagement affects the quality of tasks performed. For example, most people should be able to recall a dining experience where the level of service was so bad that they vowed never to return despite having great food. Chances are high that the poor service employee is not “Engaged’.

Gallup finds that the best way to increase engagement is through intervention and action planning at the local level of an organisation, as the specific drivers of engagement differ from workgroup to workgroup.

Statistics

The New Zealand Engagement Study was conducted 27 October to 26 November 2004 among a sample of 500 working people, aged 18 years and older. The maximum sampling error for this study is +/-4.4 %.

The graph below represents the percentage of respondents in each engagement group who strongly agree with the statement.

About Gallup

The Gallup Organization is one of the world's most respected management consulting firms, with offices in 33 countries and over 2,500 consultants worldwide. The Gallup Path is the conceptual framework that relates an organisation's financial performance (or accomplishment of mission) to effective strategy execution by harnessing the Human Difference.

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