In today’s business setting, having an edge against rival companies can make or break you. Loyalty is that edge that will have your company profiting and the customers returning. Frederick Reichheld’s theory, The Loyalty Effect, is one of the most useful and needed business strategies. Without loyal employees within a company, your company is destined to fail. I consider myself a very loyal person, not only at my job, but in all aspects of life. I am a manager at Maui Nix Surf Shop and every part of the job is based on loyalty such as opening the store on time, cash deposits, or staying on task with overseeing the store. I plan on becoming a computer engineer and hopefully working for a company like Google or Apple. I love their business strategy and how they allow “free time” in the workplace. Loyalty is not just given from the employees to the company, the company must also treat the employees fairly and well enough that they want to perform above and beyond of what is expected from them. Frederick Reichheld is a business theorist and a director at Bain & Company. In the mid-1980’s, a group of colleagues including Frederick Reichheld were struggling with growth-and–profit riddles. The usual factors were failing to explain the results shown in the graphs. They noticed that firms that had superior levels of customer loyalty also had consistently higher profits. This is where Frederick Reichheld developed The Loyalty Effect. On average, U.S. corporations lose half of their customers in five years, half of their employees in four years, and half of their investors in less than one year (Reichheld). By having loyal employees and loyal investors, you can make more efficient decisions with people you know, in turn, making your company... ... middle of paper ... ...use of the face-to-face contact I will have with the customers. According to Entrepreneur.com, keeping it personal with the customers and remembering special occasions are key to building customer loyalty. Frederick Reichheld’s theory of The Loyalty Effect has taught me essential strategies to become a profitable and successful business. Loyal investors, owners, customers, and employees all come together to make a loyal, successful business. As a computer engineer, I would be a loyal employee to help my company move forward and progress. Working in the café, I would be on the owner level and have to treat my employees and customers with fairness and respect. Without the loyal returning customers, my business would most certainly fail. Whether I am working as a computer engineer or owning a café, Reichheld’s theory of loyalty will help an all aspects of either job.
Mujtaba, B., & Johnson, W. (2012). Case 5: Publix Super Markets--Achieving Customer Intimacy. Weinstein, A. Superior customer value: strategies for winning and retaining customers (3rd ed., pp. 269-286). Boca Raton, FL: CRC Press.
First, customer centricity is important to channel customer centricity into their company strategy. It will get the whole workforce on track. Next, the collection should keep their customer data up-to-date. They would benefit from building a stable foundation by bringing all of their current customer contacts. The brand should also save all documents including minutes-of-meetings, emails, offers, contracts, and every payment transaction. Then, the company should establish healthy customer relationships based on their customer profile. It is always important to follow-up on customers and to make sure they stay satisfied with the merchandise. Finally, it is all about the customer. Their response is very important. It is viable to surprise and impress their customers, as well as plan and implement multi-phase marketing campaigns(CAS
Within the Brookfield’s Restaurant organization there is a problem of having a high turnover rate, which is dependent on employee’s motivation as well as how much they feel they are involved in the company culture. Since the restaurant is a fast paced food service industry that requires employees to be capable of handling the pressure of dealing with many customers’ demands while also providing a high level of service to each guest which can be hard for many, making them less motivated to work. Also, the company culture is important by making the employees feel welcomed in the company and to help support them while on the job, so as to the employees want to stay on the job and not wanting to leave. We will provide an analysis showing employee’s work motivations and involvement in the company culture to determine if these factors are the cause of the high turnover rate.
...rs since the reward is tangible. Since 80 percent of profit comes from a small percentage of customers, programs should be developed to retain them. Companies will use resources that aren’t available to the entire customer base to ensure they are retaining their most valuable customers and offering incentives to encourage others to move up.
Relationship marketing, which emphases on approaches to Building, evolving and keeping a successful relational Exchange (Gro¨ nroos, et al., 1994), is changing marketing orientation from attracting short-term, discrete transactions to retaining long-lasting, close customer relationships. (Czepiel 1990) has pointed that customer relationship exchanges are particularly important because customers expect to receive extra benefits as a result of attractive in interpersonal attention. These benefits that are interpersonal in nature have been termed ‘‘relational benefits’’ in the literature, and increase to those customers who are involved in ongoing relationships with the service provider and its personnel (Gwinner et al., (1998)( Hennig- Thurau et al., 2002). Gwinner et al. (1998) conducted in-depth interviews and quantitative studies to examine the benefits customers receive from relational exchanges. Their findings from the qualitative study first shown four relational benefits in terms of the psychological (Bitner, 1995; Morgan and Hunt, 1994), social (Berry, 1995; Price and Arnould, 1999), economic (Peterson, 1995) and customization benefits (Barlow, 1992; Crosby, 1991). Consequently they empirically identified a typology of three relational benefits: confidence benefits (psychological), social benefits, and special treatment benefits (economic and customization). Confidence benefits in link with psychological benefits refer to perceptions of reduced nervousness and ease in knowing what to expect in the service encounter. Social benefits, which relate to the emotional part of the relationships and...
In the past 20 years, the technology has been improving as well as the behavior of human. Another change that has been significant enough in the workforce is the generation. Since the baby boomers is reaching the retirement ages, the workforce changes its face. During the change of the pace there are many issues regarding the younger generation. Though, the unprepared new labor force brings another issues to the most company. As the new age begin, the company is struggling with the high demand of spending and low output level from the employees. This event challenges the human resource management on the search of potential employees. The consideration breed the pros and cons whether to keep, train and improve or recruit and change the force. The essay will provides the thorough exploration to oversee the positives of developing dedication of the employees. The method will be used are research and case discussion. The objective of the written report is to provide an insight of the importance of loyalty from the employees.
We can build customer loyalty by revealing the values to the customer. Customers will often go out of their way to support companies that share their values. We can build employee allegiance by revealing the values to the employees.
Lawfer, M., R. (2004). Why customer come back: how to create lasting customer loyalty. United State of America: Career Press.
Loyalty is defined as a strong feeling of support or allegiance. I agree fully with this definition. Being loyal is one of the most important of th...
In cultures that value loyalty to the employer, a kind of family relationship seems to develop between employer and employee. It is a reciprocal arrangement, which the employer is concerned with assisting the employee to develop to his or her full potential and the employee is concerned about optimizing the welfare of the company. The negative aspect to absolute loyalty to one company is that an employee may stay in one job that he or she has outgrow and may miss out on opportunities to develop in new directions. From the employer’s point of view, the employee may be burdened with employees whose skills no longer match the needs of the company.
Bashford, 2004 argued that lack in employee loyalty can stressed them which can decrease employee productivity, loyalty, morale, efficiency, trust, commitment and engagement. Bashford, S (2004) ‘The Survivor Syndrome’, Human Resources, p 43. In literature, Cartwright and Cooper (1992) surveyed 600 managers and employees of many merged companies. They stated that the managers’ and employees’ loyalty drops after mergers. He defines loyalty as the attachment of employees feels toward their employer, this refers to affective commitment. They also stated that the employees uttered their organization did not honor their hopes. Cartwright, S., & Cooper, G.L. (1992). Mergers and Acquisitions: the human factor. Oxford, Britain:
In the last 12 months, the Human Resources department has recorded an increased number of employee turnover, absenteeism, and reports of decreased employee morale and productivity by management. This has caused job security concerns, low customer service levels and a financial burden on the company. In this report, I have examined the possible causes, how top ranking companies maintain staff loyalty, and what our company can do to self-promote from within.
Loyalty, which seems a natural outgrowth of the give and take process, may be too elusive to rely on chance. From the onset, organizations deciding to upgrade the skills and employability of their employees have been concerned that they could lose the workers they train to their competition. Filipczak (1995) countered this per...
Francis (2002) reports an investigation that customer retention is progressively being seen recently as an important managerial issue and a key objective of relationship marketing, especially in the context of saturated market such as Telecommunication marketplace or lower growth of the number of new customers. It has also been acknowledged that retaining customer is less cost than to acquire new customers.
Reichheld (1996) descripts loyalty to a value-creation theory and he does not agree loyalty as the pure profit-theory, which brings together the company’s resources go to one unique goal: profit-creation. Reichheld’s loyalty is always focus customers. The basic aim of a company is the creation of value for the customer. Therefore, the business profit become is a consequence of value creation.