Why your loyal clients are your most important asset, not employees

Written by Martian Logic | Apr 8, 2024 3:34:00 AM

WHY YOUR LOYAL CLIENTS ARE YOUR MOST IMPORTANT ASSET, NOT YOUR EMPLOYEES

By aligning your culture with this goal, you’ll naturally have a great and loyal employee base.

I recently came across an article by Oleg Vishnepolsky where he argues that the most important asset for a business is their loyal employees. He also clearly states, “it’s not your loyal clients”. In fact, the headline of this article is:

“Your most important assets aren’t your clients; it’s your loyal employees. If you take care of your employees, they will take care of your clients.”

As much as I want this to be true, and while I consider employee loyalty to be critical for a business, I still think that the natural order is for the loyal clients to come first, not the other way around.

To start with, loyalty is something that you earn. When dealing with intelligent employees, management has to dig really deep to find a genuine and sustainable win-win reason why those employees should be loyal to them.

Initially, I thought Vishnepolsky had it right. But on reflection I think the correct order of approaching this paradigm is as follows:

“I need to have clients… lots of clients… no, no lots of loyal clients. OK, then how do I do that? Well, among other things… I need a group of employees… and they will need to be loyal too…”

I believe this is the way a business ought to think.

Money talks, BS walks

As vulgar as this might sound, I think this old-fashioned saying hits the nail on the head.

It might come as a shock to you, but for a business running in a Western and one would like to think, free-market society, focusing on building a great company will naturally force you to take the best care of your employees and ultimately earn their loyalty. Otherwise, you won’t be able to grow your business into a great one!

The north star

YOUR NORTH STAR AS A BUSINESS IS TO HAVE LOYAL CLIENTS, AND MANY OF THEM.

I don’t think that many people would disagree with that! We live in a competitive free-market economy, where the only way for a business to thrive is by making money. But you can’t make money unless you have clients, you can’t continue to grow unless you retain existing clients, and bring in new ones! Otherwise, your business will be running like a leaking bucket, where you add a new client and you lose an existing one – so that your business will never grow, and will ultimately slowly die.

My Experience

I know this from my own experience at MyRecruitment+. Up until a few years ago, our client retention rate was low and it was hurting our growth and costing us significant shareholder value. We managed to turn our retention rate completely around and made it the best in the industry by simply saying, when it comes to our clients, we are willing to go kamikaze – we will listen and do whatever they ask of us. From that point on, I needed to figure out how I could create enough commitment and loyalty from my employees for them to be the type of support people willing to go on that journey with me. I can tell you, I had to make lots of changes to make this happen – including bonuses, share options, free coffee, free dinner and free Uber too when we were working late, but the most important thing that we did was to make sure every one of them has a seat at the table! This, in my opinion, is the most powerful incentive for retaining employees and earning their loyalty.

OK, so if we agree that your north star as a business should be “having loyal clients”, then I believe that everything will naturally flow from there.

As a byproduct of focusing on this ultimate goal, one of two things can happen:

You hire and retain good employees, treat them the best you can and earn their loyalty, which will give you the best chance of acquiring and retaining clients, eventually turning them into loyal clients and advocates, or;
You’ll attract inferior employees and managers and they will never have a chance in hell of attaining loyal clients who will become advocates for your business. These inferior employees might succeed at acquiring some clients, and do a reasonably good job of that too, but they will never be able to retain a high enough percentage of those clients in order for your business to grow at a rate that’s enough for sustainable growth.

You’re not in the business of having loyal employees, are you?

That’s not the natural order nor is it sustainable. What business model have you ever heard of, that says let’s have a few hundred loyal employees and we’ll worry about what we do with them later?Hypothetically speaking, somewhere in the world there must be a particular company whose business model doesn’t require loyal employees. For example, this model will ensure that employees are looked after and are happy, but it makes no difference for this particular model, as to whether or not those employees stay in the business for more than three months at a time. (i.e. a three-month contractual period) – just the nature of the business model.

However, there is no way that you can find a business model that doesn’t require having loyal clients.

Please don’t forget to share this article if you enjoyed it, and please comment below and let me know your thoughts on the topic.

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