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The Reasons Why Employee Satisfaction Is Important

It is no secret that when employee satisfaction drops, it costs companies money. The cost of recruiting new employees or having to replace them can be staggering. Companies who are able to effectively increase the level of customer satisfaction in their organization will see a direct impact on their bottom line. The problem is figuring out how to positively affect the work environment in your place of business without spending more than you already do on salaries and benefits for current employees. Here are the top reasons why increasing your employees’ level of satisfaction is critical to your organization’s success.

satisfied Employee

Improved Morale and Productivity

Happy employees mean productive employees. Employee satisfaction has an immediate impact on morale which results in improved productivity. It is no wonder that satisfied employees are willing to work harder than those who are not! Employees can also use feedback get from their employees and use their findings to make their employees feel more valued. There are many materials available on the internet on how to obtain feedback from your workers. Whether it is by way of group discussions or employee surveys, you can research and learn all about it at your own time. When people feel appreciated and respected, their desire to do a good job increases. While happy workers may not be 100% productive 100% of the time (because break-time should be used for breaks), it can easily be proven that using positive reinforcement to improve morale in the workplace can reduce rates of employee absenteeism and increase productivity.

Improved Image and Reputation in the Community

When people think of your company, do they associate positive words such as trustworthy, friendly, or hard-working with you? People remember how they feel when interacting with companies and individuals much more than what is actually said during conversations. Happy employees who excel at their jobs create a strong image for your organization which increases its value. It is even better if these same employees are able to talk about their experiences with your business in a positive way! These things matter since word-of-mouth recommendations from satisfied customers and employees could be the difference between success and failure in today’s tough economic times.

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Reduced Turnover Rates 

As mentioned above, a 5% increase in customer retention equates to an average 50% increase in profitability. Unfortunately, replacing a single employee can be extremely costly for many companies. Turnover rates are skewed significantly higher in some industries where the work is physically demanding or the demands on employees are high. In these instances, it is essential to provide adequate training and resources to new hires as well as retain good managers who possess strong people skills and provide effective leadership. Employee satisfaction doesn’t just have a direct impact on your organization’s bottom line – it also has a positive influence on your company’s overall success rate! By making certain that employees meet their goals and expectations you will see increased productivity which leads to increased profitability. 

Higher Retention Rate

 Improved customer satisfaction is primarily influenced by your employees’ ability to resolve issues at the point of sale, but retention rates are also impacted when companies work to improve their employees’ level of job satisfaction. When employees enjoy what they do and feel appreciated for their efforts, there is no reason for them to leave your organization! Companies that use positive reinforcement to create a fulfilling work environment may actually find that it costs less over time because of reduced turnover rates. It also improves customer service. Quality service breeds satisfied customers who become long-term customers. Customers communicate more frequently with sales reps they trust and continue to do business with companies whose employees are happy in their roles. Quality customer service can only be achieved through teamwork between management and staff. Acknowledging the efforts of your employees is one of the keys to building strong customer relationships. 

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Improved Job Satisfaction 

One of the major benefits of a company treating its employees well is an increase in job satisfaction which has a positive impact on morale and motivation. Employees who feel they have a voice in their organization and that management supports them, will be more productive and take more pride in what they do. This increased engagement allows them to go above and beyond the call of duty for customers thus creating repeat business. Additionally, if your staff thinks you care about their personal development then it makes them much less likely to look elsewhere for employment or seek training opportunities outside your organization. You might spend many years developing strong working relationships with individuals who come to know your business inside out – only to lose them overnight because another organization offered a higher salary or a chance to work on a different project!

Improved Company Reputation 

When companies treat their employees well by creating positive working environments, it also has a tremendous impact on the company’s reputation. Today’s job seekers are much less interested in working for businesses whose reputations aren’t great and tend to be more selective about where they apply their skills and expertise. In addition, many people hear about organizations from friends and colleagues which reinforces the value of maintaining strong relationships with your staff. Research shows that employees who feel supported by management are significantly less likely to leave an organization within the first 18 months. There is no doubt that building company loyalty is beneficial for both you and your employees! Acknowledging your employees for their efforts is a win-win situation!


Organizations that treat their employees well are much better placed to compete in the current job market because they have access to a greater pool of talent. They have an edge over their competitors when it comes to recruitment and retainment of staff, productivity, customer service levels, and creating positive working environments. The benefits far outweigh any additional costs associated with employee appreciation initiatives!


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