The Value of Committed Employees
In a recent class, a guest speaker, Professor Danielle Van Jaarsveld, talked about human resources and organizational behavior. She used Zappos, an online shoe company, as an example of a business that shows high dedication towards it’s employees and customer service. Is it worthwhile to spend money on organizational culture, as Zappos has done? Although it is costly to maintain high employee standards, I tend to see low retention rates as a greater threat than the expenses. Having a low retention rate can lead to a $5 billion annual expenditure on employee replacement; also when a company’s millennial resigns, they can spend up to $20,000 replacing one person. I believe Zappos’ focus on bettering their workforce will reflect in their profits in the long-term.
Another example which exemplifies this placement of high value on human resources is Costco. Costco uses higher wages to boost employee morale. However, high wages is only part of their overall “engagement (HR) strategy”. The high wages are also meant to attract highly-skilled candidates and people whom, in the words of Professor Jaarsveld, “fit” in the organization (enthusiastic and punctual people). Hence, implementing Costco’s business model could potentially improve organizational behavior. Overall, this method leads to a committed and engaged workforce. An article in the Financial Post states, “higher employee engagement is linked to better consumer engagement”. I fully agree with this statement; if I were a Costco employee, I would be willing to make an effort at work and to help my manager pull connections if he or she needed.
After attending the lecture and reading this article, I am convinced businesses dramatically increase their chances of being successful with an engaged workforce.