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Over the past year or so I have heard many clients talk about their increased focus on the service profit chain. While I have heard it described a variety of ways most companies are paying close attention to 3 key links:

  • Engaged Employees
  • Produce Satisfied Customers
  • Resulting in Increased Profits

Based on my experience these components must be preceded by one more link to be successful, Great Managers! Without managers who know how to inspire, lead and connect with their direct reports you can’t have engaged employees that create loyal customers who spend money.

I can’t help but wonder what the multiplier effect of a single manger is. Here is my hypothesis:

  • A single manager leads a team of 10 employees.
  • This manager has failed to engage these 10 employees.
  • If each employee interacts with 30 customers per shift.
  • We can have up to 300 unsatisfied customers.
  • Unsatisfied customers will tell an average of 5 people about their poor experience.
  • 300 customers telling 5 people each about their experience can lead to 1,500 people who have a low opinion of a business.
  • And that’s for just one shift!

How many employees does 1 of your manager’s impact? What is the multiplier effect in your business? What do you think the role of a manager is in the service profit chain?

October 14, 2010

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