Avnet managers comb through thousands of anonymous survey questionnaires each year looking for ways to improve employee engagement. The annual exercise pays off for the Fortune 500 company in big ways, Avnet Chairman and CEO Roy Vallee said March 19 at Thunderbird School of Global Management.
“If you have engaged employees who are doing a good job, the probability is that they’re going to be delivering better customer experiences more consistently over a long period of time,” Vallee told an audience of about 100 Thunderbird students, faculty and staff at the graduate business school in Glendale, Ariz.
Vallee said better customer experiences drive customer satisfaction, which drives customer loyalty, which drives profitable growth. He said this “service value chain” receives careful attention at Avent, a technology marketing, distribution and services company based in Phoenix.
“If you keep the customers you’ve got, and you slowly but consistently add new ones, you’re going to accelerate the growth of your corporation,” Vallee said. “It’s always more profitable to serve existing customers than it is to go get new ones.”
Vallee said employee engagement combines two things: Commitment and line of sight. Engaged employees want to perform well, and they know what they’re supposed to do. “The combination of those two things is engagement,” Vallee said.
He said engaged employees aren’t necessarily pampered employees. Perks such as on-site day care centers, flexible hours and company socials are nice but don’t always pay off in terms of profitable growth.
More often than not, Vallee said, engaged employees want a performance-based culture that rewards results. This can turn the service value chain into a virtuous cycle as engagement drives performance, and performance drives engagement.
“These things actually feed off each other to drive more engagement, which drives better performance,” Vallee said.
Companies that want to increase employee engagement should start by establishing a baseline measurement, Vallee said. Avnet began this process about six years ago with annual employee and customer surveys administered by Watson Wyatt Worldwide.
Vallee said the use of a third-part researcher helps protect the anonymity of survey participants, who otherwise might worry about retaliation for honest feedback. He said Avent surveys include multiple-choice “bubble” questions and open-ended prompts for comments.
Avent employees responded with more than 4,000 comments in 2008, and Vallee said these often provide the best feedback for managers. “Real gems can be discovered in the comments,” he said. “They can tell you a lot, and you can take corrective actions accordingly.”
He said Avnet employees often participate in the process as managers use the survey data to create mandatory impact plans. “You can form teams that come back with recommendations for change,” Vallee said. “Then all you have to do is implement the plans.”
He said Avnet audits the impact plans to hold managers accountable, and high scores are published to recognize departments that produce the highest levels of engagement.
A voice of warning
Vallee said the survey process has worked well at Avnet, but he warned other organizations not to collect similar data unless they plan to follow through with meaningful change.
“If you don’t react to what they say on the survey,” he said, “you’re worse off than if you didn’t ask in the first place.”