Engage Employees to Increase Member Satisfaction

Research consistently shows that employee satisfaction and engagement – the level of commitment that leads employees to volunteer greater levels of discretionary effort – has a direct impact on customer satisfaction, especially in service industries.  And, of course, customer satisfaction has a direct impact on any organization’s bottom line. This holds true for banks and credit unions as well. A 2014 report on the banking industry released by Gallup Research indicates:

• Companies that engage both their employees and their customers gain a 240 percent boost in performance-related business outcomes.
• Retail banking customers who are fully engaged bring 37 percent more revenue per year to their primary bank compared with those who are actively disengaged.

Although every employee is unique, several factors associated with talent management powerfully impact employee engagement. Whether they are done well or poorly will impact customer service, so maybe it is time for your organization to take a look to see if its talent management levers are working in the right direction.

University of Wisconsin Credit Union did just that, implementing changes that helped improve employee engagement scores consistently for five years. At the same time, $1.9 billion/199,000-member UW Credit Union, Madison, Wis., scored in the 91st percentile in customer satisfaction among U.S. credit unions.

Understanding the link between employee engagement and member satisfaction, UW CU set out to build a committed, service-minded and performance-oriented workforce. The CU overhauled its performance management process to implement and maintain a work environment in which employees are enabled to perform to the best of their abilities.

Let’s see how they did it.

Goal Setting

UW CU’s performance management process begins with making sure each employee has goals that are clear and aligned with organizational goals. This helps employees understand what they need to do and how their efforts support the larger organizational strategy. Once these goals and performance measures are established between manager and employee, they become the standard upon which performance is measured.

For UW CU, the goal setting process is not one and done. Goals are regularly reviewed and revised to ensure they correctly reflect the credit union’s priorities and act as a guide for employee performance. Employees receive specific feedback so they know if they are on the right track. Managers and employees meet together to make sure barriers to success are removed and employees are enabled to develop the talents, skills and experience to be successful – for their own careers and for the organization as a whole.

Performance Appraisal

To ensure the appraisal process is fair and consistent, managers at UW CU seek multiple sources of input, including a self-evaluation submitted by each employee. Appraisals are based on the goals and standards that were set by the manager and employee, and revisited throughout the year. Needless to say, member service is an important part of the performance that is evaluated and encouraged.

Compensation

Pay for performance is a goal of many organizations. In theory, it is a catalyst for building high performing organizations when employees are motivated to give their best and are rewarded for their efforts. But, in many organizations, compensation decisions tend to be a lot of work and can be sources of conflict and controversy.

To cut through this, UW CU now uses a compensation system linked to other talent management processes that not only makes the process quicker, more secure and more accurate, but is a useful and objective driver for building a high-performing workforce. UW CU uses compensation as a tool to reward and retain top performers. Because it is linked to a transparent and fair performance management process, employees know what they have to do to excel and how they will be rewarded when they do.

Organizations like UW CU have learned how to use talent management processes as powerful levers to align priorities, drive high performance, engage employees and, ultimately, please members, who in turn reward the organization with their business.

Karen Knox is a certified human capital strategist and regional sales manager at Halogen Software. In her role with Halogen, she helps HR teams improve their talent management processes to achieve measurable business results. Connect with Karen on LinkedIn.