There are a lot of things that impact customer experience—employee engagement, the online customer journey, the in-store atmosphere, and more. One area that is often overlooked but that has a tremendous impact on customer experience is leadership development.
CEOs are often thought of as the main drivers of customer experience and culture, and while they do play an important role in defining the experience, CEOs can be easily replaced. They come and go, but leadership lives on. Instead of relying on a strong CEO, the deeper focus of a company should be on leadership strategy and incorporating it into the overall business strategy. Think of it this way: leadership strategy is a sub-category of a company’s business strategy, and leadership development strategy in an even smaller sub-category under the general leadership role. They are building blocks to an overarching business plan.
What is leadership development? It’s a culture that builds and encourages leaders at all levels. It includes the infrastructure and training to educate and empower employees to solve problems. The CEO may be the figurehead of a company, but the rubber really hits the road with mid-level managers and supervisors. These are the people who are often interacting with employees and customers. When these mid-level managers are properly trained on leadership development and management, a business can thrive, and customer experience can grow.
In fact, research from Josh Bersin of Bersin by Deloitte shows that how dedicated a company is to leadership development has a bigger long-term impact on its business performance than anything else. Think about that—you can pour resources into getting the latest technology, scoping out the competition, or creating a stellar marketing campaign, but if your leaders aren’t properly trained and supported, the company won’t reach its full growth potential.
The best companies integrate leadership into their culture with a well-defined process for training and supporting leaders. One example of this is UPS, which is consistently rated as the parcel delivery service with the best customer experience. UPS has built a culture of customer service, entrepreneurship, and safety. It encourages all employees to step up as leaders and has a strong track record of promoting from within. If the CEO of UPS were to be replaced, the company would continue on the same track because leadership is so deeply rooted in its culture.
Leadership doesn’t just come from the C-Suite, and companies with high performance and strong customer experiences know that. Executives may be the people with the overall big picture ideas, but it is the middle managers and supervisors that really make the work happen. Research has shown that the best companies build leaders from the bottom up. This method follows the idea of an inverse pyramid, where senior executives serve the needs of middle managers and lower employees. Companies that follow this structure instill leadership in all their employees, not just those who formally oversee others. Each employee has the responsibility to understand the business and make decisions to support the brand’s mission. Everyone knows what they bring to the company and does his or her part to improve the company and reach out to customers. Customer experience may come from the top down, but it is the employees on the ground who are really making decisions that impact customer experience. When these employees have a leadership mentality, they take ownership of the experience and do their part to create satisfied, loyal customers.
However, many companies use the opposite of this model. These are the companies that micromanage lower-level managers and don’t treat employees like they are smart enough to make their own decisions. Customers can see right through this—there is a definite difference in how an employee who is treated as a leader interacts with customers versus someone who is only serving a customer because that is what they were told to do.
Leadership development is definitely an investment and something that companies can’t take lightly. The companies with the strongest leadership development invest 30%-40% more money in leadership programs than their peers. In 2012, top companies spent at least $3,500 per manager, with investments nearly double that for senior leaders. However, the investments pay off with a strong culture, consistent growth, and an agile organization that can adapt with changing trends and technology.
Leadership development looks different at every company because it reflects each organization’s culture, mission, and employees. Just as businesses evolve, so too should the leadership development model and values.
Leadership development is a pivotal part of a company’s success, especially when it comes to the customer experience. When leaders are developed and regularly empowered at all levels, they are invested in the company and can create a consistent, high-quality customer experience. If your organization is looking to improve customer experience, start by taking a look at the internal workings and strengthening your leadership model.