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In an article for the May issue of Chief Learning Officer magazine entitled The Leadership-Profit Chain, authors Drea Zigarmi and Scott Blanchard identify the impact of leadership behaviors on employee passion and customer devotion. Their research shows that organizations can’t treat employees poorly, put pressure on them, and then expect them to perform at high levels.

Sometimes organizations operate as though they’ve forgotten the human element of business, and that people have strong feelings about the way they are treated that translates into subsequent behavior. Zigarmi and Blanchard remind us that leaders need to see employees as more than just assets to be maximized.

5 Recommended Leadership Behaviors

For leaders looking to treat people right and provide employees with the direction and support they need to succeed, here are five ways the authors recommend getting started:

1. Provide strong strategic leadership that includes setting an overall vision for the organization, coordinating the efforts of employees toward that purpose, and keeping them prepared to adapt to changing conditions as necessary.
2. Identify and focus the organization on key strategic imperatives that have purpose for the customer or meaning for the greater community. People want to be a part of something bigger than themselves.
3. Send consistent messages based on a clear vision and the type of culture the organization wants to create. Behaviorally define the values that guide the way employees interact with customers and each other.
4. Identify employee needs and strive to meet them. Day-to-day leadership is the linchpin that drives the ways that employees engage with clients.
5. Don’t make profit your only goal. Profit is a byproduct of serving the customer, which can only be achieved by serving the employee. Don’t fall into a trap of thinking that an organization can’t focus on both people and results. Organizations can focus on both at the same time and should.

If leaders create the right environment and engage in the right behaviors, employees will give their best to the organization. This leads to a greater sense of excitement and passion at work that leads to better customer service and retention.

You can access the full text of The Leadership-Profit Chain article here.  Also be sure to check out the Key Factors Influencing Employee Passion which identifies 12 components of an engaging work environment.

Colleen Barrett, past president of Southwest Airlines, and Garry Ridge, president and CEO of WD-40 Company both spoke at The Ken Blanchard Companies recent 2010 Client Summit.  Each leader talked about the ways that they have created a close-knit, high performing culture in their organizations through a combination of high expectations with a sense of caring that is very unique in business today. 

Most leaders believe that focusing on people versus focusing on performance is an either/or decision.  The belief is that you can’t have both.  Still for some reason, Southwest and WD-40 have been able to pull it off.  They have been able to create a caring culture and industry leading results year after year.  How are they able to strike this perfect balance?  It all begins in an important two foot space within each organization—the distance between managers and their direct reports.  By holding their managers accountable for creating an environment that features equal amounts of trust, respect, and accountability, they are able to drive results and create an environment where people feel proud and cared for. 

Would you like to build some of that same spirit into your organization?  Here are three tips for getting started.

Take the time to connect.  Find out a little bit more about your direct reports.  Share a little bit more about yourself.  Create a people-based connection.

Demonstrate trust.  Trust is an important component in any relationship.  Cultivate trust by being transparent in your thinking.  Demonstrate trust by doing what you say you’ll do.  Show that you are consistent and can be relied upon.

Have high expectations.  Expect a lot from your people and encourage them to expect a lot from you in return.  Once you’ve set up a foundation of trust and respect you have the ability to ask for more from your employees and to hold them accountable for delivering on it.

Too many organizations today act as if the human element is unimportant.  Leaders and managers don’t take the time to build connections or demonstrate trust.  But this short-cut comes back to haunt them when it’s time to set goals and hold people accountable for achieving them.  Without a relationship in place, it’s hard to ask people to give their best—and even more difficult to have a conversation when performance comes up short.  Don’t let this happen in your organization.  Follow the example set by great companies like Southwest Airlines and WD-40.  Practice trust and respect-based relationships that get results and creates a winning, people-based spirit.

In his article, The One Number You Need to Grow, Bain consultant Fred Reichheld identifies one essential question to ask customers:  “How likely is it that you would recommend this company to a friend or colleague?”  In Reichheld’s experience researching thousands of companies over the past ten years, the higher the percentage of people who answer extremely likely, the better your chances to increase sales in the years ahead. 

How much better?  In reviewing other research on customer satisfaction and its impact on the bottom line, improving customer satisfaction scores by just 10% can improve revenue growth by 3%.  That might not sound like much on the surface, but in a company with $100 million dollars in sales, a 3% increase equals an additional $3 million dollars in revenue. 

Interested in creating a higher percentage of people who enthusiastically recommend your company?  Here are a couple of tips from Blanchard consultants Kathy Cuff and Vicki Halsey on how to create a culture of service in your company:

• Good service begins by showing your customers that you care.  Create a culture of service and align everyone in the organization towards a focus on the customer.
• Get to know your customers. What are their likes and dislikes?  How do they prefer to be communicated with? 
• Be responsive.  Demonstrate this by responding quickly to requests and service needs. 
• Empower your people. This starts by turning the organizational pyramid upside-down.  In this model, the people closest to the customer come first.  Frontline supervisors, mid-level managers, and senior leaders all play support roles to the person directly serving the customer. 

By getting started in these four areas you can create a culture that gets a higher percentage of people recommending your company to their friends.  That, in turn, translates into extra revenue growth.  It’s a success formula where everyone wins.

Would like to learn more about the linkages between customer service satisfaction and the bottom line?  Download Blanchard’s new whitepaper on The High Cost of Doing Nothing.

“Love” as the key ingredient to business success?  Ken Blanchard and Colleen Barrett make a convincing case in their new book, Lead with LUV: A Different Way to Create Real Success.  I received an early manuscript of this new book (due out in January) after attending Barrett’s keynote address at The Ken Blanchard Companies annual client summit in San Diego last month.  Their basic formula is simple: Southwest succeeds because it treats employees with respect, practices The Golden Rule, and loves people for who they are.  In return, the company asks employees to treat customers in a similar manner.

It’s an approach that allows Southwest’s leadership to expect more—and receive more—from their people than other airlines.  Because employees know that leadership is on their side, leaders can confidently challenge and hold people accountable for meeting expectations.  It’s a business version of tough love that only works when employees know you care.

Interested in trying a little leadership love at your organization?  Here are three tips for getting started:

1. Communicate your organizational mission and vision. Barrett explains that at Southwest, they are first and foremost in the customer service business—they just happen to express that service by providing airline transportation.
2. Define the values that will guide behavior. At Southwest values start with safety and practicing the golden rule–treating people as you would like to be treated–as a foundation.  Three additional values of Warrior Spirit, Servant’s Heart, and a Fun-LUVing Attitude guide employee behavior on a day-to-day basis.
3. Combine caring with high expectations. Leaders at Southwest treat their people with respect, strive to bring out their best, and love their people for who they are.  In return, employees are expected to buy into the company’s mission, and to practice the company’s values with each other and customers.

What’s the level of leadership love in your organization?  Do employees know that leaders truly care about them?  It’s an essential ingredient at Southwest that has helped to create long-term success and a fun-loving culture in a challenging industry.  What could it do for you?

Win an Advance Copy of Ken and Colleen’s New Book!

Would you like to get a sneak peek at the unbound manuscript version of Bringing LUV to Leadership?  Rarely made public, we have a small number of extra copies from the proofing and review process that we are giving away this Friday.  To be entered into the drawing, just sign on as a fan at Ken Blanchard’s new Facebook Fan Page by 12 noon Pacific Time, Friday, April 9.  Everyone who is signed up as a fan by that time will automatically be entered into the drawing.  Good luck!