Shep Hyken\'s Customer Service Blog

The Employee Loyalty Formula

Recently Glen Schmidt, one of our Shepard Letter readers, emailed a question about employee loyalty.  I asked our readers to fill in the blank for a formula.

Appreciation + __________ = Employee Loyalty

Well, we received hundreds of responses.  I will give you my take, and then share with you the other responses.

While some of the answers were obvious, there were many comments that were quite impressive and insightful.  The most popular responses were respect, empowerment, trust and recognition.  Compensation came up as a fairly popular word, but not nearly as much as recognition and trust.

Over the years I’ve seen surveys conducted by numerous sources that indicated that compensation was not nearly as important as appreciation and recognition, and the SL Readers’ responses confirm that.  Tangible compensation comes in the form of benefits and “take home pay.”  Still, based on some of the comments received, fair financial compensation is a must.  Fair doesn’t mean high.  It means enough.  Appreciation, recognition and trust seem to be more important.

My observation is that outside of the fair compensation, you can bundle all of the other words into one.  And that word is: Fulfillment.

If an employee feels appreciated, trusted, empowered, rewarded (non-monetary), has a positive environment to work in and has good management to work with, then he/she will probably feel fulfilled.  Compensation comes in behind fulfillment.  Although the employee should feel fairly (not necessarily highly) compensated.  So it can be said:

Fulfillment = Employee Loyalty

Now it is up to you to decide what fulfillment means.

(Click here to see the responses from our Shepard Letter readers.)

Shep Hyken is a customer service expert, professional  speaker and New York Times   bestselling business author. For information contact (314) 692-2200 or For information on The  Customer  Focus™ customer service training programs go to Follow on Twitter: @Hyken
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