How you answer one simple question could determine your success as a leader:
“Who are the human beings most critical to your business?”
Are they the employees who support your products and services? Or are they the customers who buy what you sell?
It’s a question continually debated by top business leaders, from employee-centric Richard Branson, founder of Virgin Group:
“Clients do not come first. Employees come first. If you take care of your employees, they will take care of the clients.”
To customer-centric John Mackey, co-founder of Whole Foods:
“For us, our most important stakeholder is not our stockholders, it is our customers. We’re in business to serve the needs and desires of our core customer base.”
With all due respect to both Branson and Mackey, I’ll go ahead and settle the debate for you. The answer is: Both.
A Matter of Perspective
How you or I personally respond to that question is almost certainly a reflection of the role we play in the business world. If you’re an HR professional, you’re more likely to see a company’s team members – and by association, its leaders – as the driving force for business success. Without engaged and committed employees, you’ll argue, a company cannot serve the market. You are the advocate from employee-centricity.
Conversely, if you’re a marketing professional, you’ll most likely say that customers are the vital spark that drives profitability and sustainable business growth. After all, a company without loyal customers won’t keep their doors open for very long, even if their employees are engaged. You are the advocate for customer-centricity.
As a long-time marketing professional, I’ve seen this debate literally lived out inside of companies on a daily basis. HR cares about employees. Marketing cares about customers. And sometimes it seems like a zero-sum game in the struggle for company resources and leadership’s attention. As a result, HR and Marketing folks may say hello to one another in the hallway on a Tuesday morning, but you’ll rarely see them at the same happy hour on a Thursday evening.
This is unfortunate. As business leaders, these locked-in opinions most of us have leave us arguing a false choice and missing a major opportunity as a result. Yes, customer-centricity or employee-centricity are two options. But there is also a third. People-Centricity.
Why You Need a People Strategy
Employees and Customers are in your span of care as a leader. These two groups have become increasingly impossible to separate because the impact each have on another. Just consider these data points:
- 73% of consumers say they will go out of their way to do business with a company that delivers better customer service (2021 ACA Study)
- 70% of brand loyalists say they would also stop purchasing from a brand if they did not like how that company’s employees were treated (2022 Chapman & Co. Study)
Choosing to focus on just customers or just employees is like trying to divide an ocean in half. No matter how hard you try, the two parts will just continue to rush back into one another. Understanding this reality offers companies who get it a major advantage – the value of joining the talents of HR leaders and Marketing leaders to address, together, a more holistic “People Strategy.” This approach has several key aspects:
- Recognize both employees and customers are both within the span of care of all leaders inside a company.
- View company culture as a shared experience for both employee and customer – driven by shared vision and values.
- Measure the impact of the strategy based on both outcomes of engagement and retention.
This is going to be new thinking for most companies, but you don’t have to look hard in the market for examples of business already leaning into a unified “people strategy.” Consider the integrated language of Southwest Airlines’ company promise:
“Employees will be provided the same concern, respect, and caring attitude within the organization that they are expected to share externally with every Southwest Customer.”
Or the Ritz-Carlton’s corporate motto:
“We are Ladies and Gentlemen serving Ladies and Gentlemen.”
These are companies recognizing that employees and customers are really part of a shared experience, with each influencing outcomes for the other, and each participating in an aspect of the values that drive the overall company. This is the essence of a people strategy.
What’s In it For You
Leaning into this holistic approach is not just about benefiting the company as a whole. It also offers advantages for the leaders that embrace this understanding. Specifically:
- For HR Professionals: You know that an investment in culture initiatives is critical to your company’s success. But how many times have you had to fight for that investment because senior leadership had a hard time quantifying the value in real dollar terms? How often have you had to dance around the soft-ish metrics of higher employee engagement scores when justifying your budget? By joining forces with Marketing in a more encompassing people strategy, you can now begin to leverage customer outcomes as a metric for your success. Working with your marketing partner, you can establish experiments to show that in their areas where culture initiatives are supported (and therefore, employees are more engaged), customers are more satisfied, more loyal and spend more. Customers, by their behavior, will provide the hard dollar rational for your culture work.
- For Marketing Professionals: You know that investment is customer engagement and a loyalty strategy is critical to your company’s success. But you should also know that a majority of B2B and B2C customers now view your customer experience as equal in importance to the products you offer. More significantly, 58% of brand loyalists now cite “the experience” as their top loyalty driver over price, discount or convenience. That means your success in driving profitable customer outcomes is dependent upon more than great branding and effective campaigns. Your fellow employees, and how well they deliver upon your customer experience, are also having a huge effect on the metrics most important to you. Recognizing you are not a bystander in company culture and leadership work, but actually a stakeholder significantly impacted by its outcomes, gives you the motivation to join force with HR in a holistic people strategy. You should help shape the vision, values, and training that are the foundation of your company’s employee experience. In turn, that foundation will ensure the high-quality external experience your customers expect. Happy employees make happy customers might sound like a cliché. But it’s also a business reality.
Finally, I’ll note that no one says this is going to be easy. HR and Marketing professionals are often wired differently, often with contrasting defaults and biases. But in collaborating on your new people strategy, you’ll likely find those differences to be a strength, not a weakness.
You’ll bring together complementary skills and perspectives from your respective parts of the organization to better serve all the human beings in your new shared span of care. Additionally, you’ll establish a partnership to drive improved business outcomes for your company. And lastly, you’ll lead by modeling for your peers how HR and Marketing can show up as a united front working together toward common goals.
And, just maybe, you’ll expand your invite list for that Thursday evening happy hour.
