Employee satisfaction leads to customer service - Employee Relations

by Neville C. Tompkins

Xerox's quest for customer satisfaction led to greater employee satisfaction.

In the late 1980s, Xerox took a close look at offshore competition, their competitive position, business performance and customer satisfaction. They discovered a direct link between customer satisfaction and business performance. Without customer satisfaction, they decided business performance would not thrive.

"Xerox had to have a highly motivated and satisfied workforce if we were to achieve our goal of 100 percent customer satisfaction," says Anne M. Mulcahy, director of human resource operations for Xerox's corporate office. "Our workforce then became a key source of competitive advantage," she says.

Pursuing the Baldrige Award

These focused efforts to improve customer and employee satisfaction facilitated the company's pursuit of the Malcolm Baldrige Quality Award several years ago, as every business card now proudly proclaims--Xerox won in 1989.

Where are the parallels in customer satisfaction with employee satisfaction? Xerox knew that U.S. workforce demographics of the 1990s were changing, as the Department of Labor's Workforce 2000 study predicted. Within Xerox, management saw these changes more specifically with more minorities, women and single parents in their company. The changes in Xerox's workforce were also being duplicated in Xerox's customer base.

Xerox's long-standing affirmative action policy is to have a workforce that mirrored the demographics of the communities in which it operates. Chairman Paul Allaire felt that Xerox's competitive edge over Japan was the diversity and creativity of its workforce. For those reasons, Xerox developed its Total Customer Satisfaction Guarantee that, very simply, states that customers dictate whether they are satisfied with a product and, if not, the company will replace it.

Worldwide quality team

Finding out how employees feel about their jobs and the company is not new to Xerox. Since the mid-1950s, the company has conducted employee attitude surveys. But the company's recent efforts were the most ambitious to date with the forming of a worldwide Quality Improvement Team (QIT) within the human resource function. The team had three goals:

* Identify common root causes of employee dissatisfaction on a worldwide basis.

* Conduct a benchmark study of best practices in selected other companies.

* Develop an employee satisfaction measurement system that could be used corporate wide, worldwide.

An early step was the appointment of a corporate-level manager in the HR department to coordinate the process. William E. Madison of Xerox's Rochester, New York, human resource office, was picked as corporate manager of employee resources to work with HR representatives from eight Xerox business units, representing the 53 countries in which the company operates.

To identify causes of dissatisfaction, surveyors took on the sizable task of a root-cause analysis and attitude survey among nearly 80,000 employees of the company worldwide. Survey questions were selected and then validated through a pilot program and by roundtable discussions with Xerox employees.

Responses were eye-opening. Employees were concerned with the performance feedback process and didn't understand how performance was evaluated. Another area of concern was the merit increase cycle, which at that time, included a variable portion.

"It was obvious that our former merit increase system delivery was a barrier to increasing employee satisfaction and motivation, so we changed it," explains Madison, who says the company now uses a more conventional arrangement.

Employee satisfaction worldwide

Measuring employee satisfaction on a worldwide basis is no small undertaking. "In doing a worldwide employee analysis, we were surprised to find more similarities than differences in how employees feel about their jobs, the concerns about personal growth, good supervision and pay," says Madison. "What is different is how the information is 'delivered' to employees--explanation of benefits to U.S. employees, for example, is very different from other countries where state-mandated benefits are the norm and employers provide few extras," he says.

Nine common causes of employee dissatisfaction were rooted out at Xerox: training, career, benefits, inconsistent management practices, personal recognition, work environment, communications, workload/resources and compensation.

"In time we were able to use that data to make changes in how we deal with employees," Madison says. "Poorly accepted practices or policies were re-examined and where possible they were amended or dropped."

By far the greatest impact on motivation and satisfaction expressed by employees was the work relationship with their immediate manager. "It is critical that we ensure that both new and seasoned managers have the training and tools to understand the role they are to play and the expectation levels of employees who report to them," Madison explains.

Feedback from the survey was then given to the "process owners"--line and staff managers in the company--to develop potential solutions and implement the selected changes.

Consulting help

As a next step, Xerox hired the consulting firms Towers Perrin and International Survey Research Corporation (ISR) of Chicago. The firms selected participants for an external survey, visited the facilities of these companies and identified best practices that might be transferable to Xerox. A number of common themes evolved from these findings and were integrated into Xerox's strategy processes and programs.

The third part of the QIT challenge involved developing a single corporate-wide, employee-satisfaction measurement system. Typical survey questions ask if the employee understands and is committed to the objectives of the corporation, if the employee's work objectives are tied to corporate objectives, if employees understand the performance-management process, whether benefit coverages are understood, and the like.

These core questions allow management to compare internal levels of motivation and satisfaction with external norms, country by country. Using ISR's extensive international database, Xerox is able to compare employee reactions in countries like Chile and Switzerland with the scores of employees of major international companies in those countries.

Management policy

Xerox employees around the world are asked to participate in the attitude survey process within their own work groups at least once every two years. At a minimum, each operating unit or subsidiary company surveys a statistically valid sample of its employees annually. Reports are generated for each manager with four or more employees. The response rate for this survey is more than 85 percent, well above normal returns for these types of surveys.

In 1991, Xerox expanded the employee satisfaction objective to include employee motivation. Ten elements were identified as influencing both satisfaction and motivation:

* Benefits.

* Career and professional growth.

* Company leadership.

* Immediate manager practices.

* Employment security.

* Pay.

* Personal accomplishment.

* Recognition.

* Relationships with co-workers.

* Effects of the work environment.

Now 49 core questions make up the Employee Satisfaction Measurement Survey (ESMS), with 18 questions in the core survey designated as the overall satisfaction index.

Each operating unit within Xerox reviews survey results, compares those results to external in-country norms and develops unit improvement strategies and targets.

The result

"We've come to realize the critical importance of the individual manager to employee motivation and satisfaction," Mulcahy says. "Through our training and development activities we are now working to more clearly articulate the role of the manager as it relates to leadership and accountability for their human resources--their employees," she says.

The management curriculum at the corporate training center, the Xerox International Center of Training and Management Development in Leesburgh, Va., has been revised to reinforce core values, human resource management responsibilities and the company's empowerment philosophy.