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Responsible Marketing

CSR and the Frontline Context: How Social Programs Improve Customer Service

Daniel Korschun, CB Bhattacharya and Scott D. Swain

CSR activities can motivate frontline employees, when they address relevant social causes.

Feeling good plus doing better?
A lot of research on CSR deals with the external effects of a company’s engagement in social issues. These studies have tackled questions such as the following: What are the effects on society? Are customers more committed to brands that serve a cause beyond its own profits? Can brand image be improved by doing good?

But there are also internal effects to CSR activities beyond those on the market. Employees can better identify with companies that build social value and form strong psychological bonds with their employer. As a result, they are more motivated to perform. “Work that has a positive impact on society,” was also found to be the most important measure of career success for high potentials in a recent “leaders of tomorrow” survey conducted by the GfK Verein together with the St. Gallen Symposium. 

While hardly anybody questions that CSR makes employees feel good about their company, some critics question if this feeling will actually translate into observable changes in behavior beyond those produced by monetary incentives. Especially in the frontline context, employees do not only identify more or less with the company. They are also confronted with customers on an everyday basis and might identify with them, for example, if they feel to belong to a common social group. This dualism – consumers on one side and the organizational bond on the other – creates a special social landscape. To see if and how CSR works in improving the job performance of frontline employees we developed a model, which we then tested in a study with hundreds of employees at a Global 500 financial services company.

CSR can improve customer service
Overall, the research showed that CSR activities such as charitable giving, environmental programs and ethical practices can motivate frontline employees. Indeed, we found that CSR represents a new way to motivate the frontline work force. By revealing the psychological mechanism behind the relationship between improved service and CSR activity we were able to demonstrate that CSR can be effective for frontline employees, but it isn’t necessarily so in every case. The following model (Figure 1) shows the conditions for a positive effect on job performance.

One of the key variables is organizational identification. CSR communicates values, and, if these values are consistent with a person’s own value system, it results in higher identification with the company. If management supports the CSR noticeably, they can strengthen identification. The effect of this positive influence, however, depends on the personal relevance of CSR to the individual employee. If the supported cause is relevant to the value system of the person, he or she will be more positively affected by CSR support from management, and higher organizational commitment will result (Figure 2).

A similar process takes place on the consumer side. Employees who notice that consumers are fond of the company’s CSR activities will identify even more with the company. If CSR ranks high in their own personal value system and the value system of the consumer as well, they find common ground for conversations beyond immediate business talk. Employees told us that CSR can be an icebreaker in conversations with customers, and once they find out that a customer shares a passion for social or environmental causes, it creates a bond that is highly motivating (Figure 3). If employees believe that customers share their excitement about the company’s CSR activities, they become more confident that they know what customers want. As a result they are more motivated to serve those customers because they see that both of them care about the same sorts of things.

How to use CSR potential successfully on the frontline
Several companies now try to leverage their CSR activities to motivate their frontline workforce − salespeople, customer service representatives, waitstaff, account managers and others. The mechanisms that we found help when taking tailored action to deploy the full potential of CSR as a way to improve customer service. Based on our findings, executives can better create CSR initiatives that maximize benefits in job performance.

  • Select the right people
    We found much better results for those people who already consider CSR important to their self-image. To cultivate the links between CSR and job performance, managers first and foremost must understand which frontline employees place importance on CSR. For companies committed to using CSR to encourage superior job performance, this should be used as one of the criteria for hiring new frontline employees.
     
  • Demonstrate management support
    Employees attend to the views of upper management concerning job-related behavior but also beyond this. They notice when organizational leaders make statements or take actions that demonstrate strong support for the company’s social responsibility activities and practices. Especially if CSR is important to employees, positive effects can be leveraged when managers act as role models. It carries weight when they refer to CSR in communications, participate themselves or encourage employees to participate in volunteering or fundraising.

CSR can be an icebreaker in conversations with customers, it creates a bond that is highly motivating.

  • Monitor identification with the company and its activities
    One of the key variables leading to better job performance is employees’ identification with the company. As CSR is able to increase identification, management should not only hire employees with a high personal interest in CSR but also monitor this interest on an ongoing basis. They could evaluate which activities resonate most with frontline employees and if the programs foster identification with the organization. However, managers should not restrict this research to frontline employees but include all employees who contribute to customer outcomes, such as those in product design or quality control.
  • Monitor employee-customer identification
    Frontline employees have dual targets for identification: not only the company but customers as well. Therefore managers also need to foster and monitor identification with those customers by implementing CSR initiatives in ways that resonate with key customer segments. Management might conduct research to determine which CSR activities are most likely to inspire CSR-related dialogues between frontline employees and those customers. Both organizational identification and employee-customer identification are relevant, but they vary in relevance depending on the nature of particular frontline jobs. If job performance requires superior customer service, a manager should monitor employee-customer identification very closely; if, however, job performance goals are more general and require more company-centric tasks, such as work efficiency or cooperating with coworkers, monitoring organizational identification should be a higher priority.
     
  • Encourage CSR communication within and across traditional stakeholder lines
    Both frontline employees and customers need to be well aware of the ongoing CSR activities in order to play out their positive effects. This puts the onus on companies to encourage communication within and across traditional stakeholder lines. It suggests, for example, that companies must first increase awareness of their CSR activities among both employees and customers. As these stakeholders become more aware of the company’s CSR activities, companies are more likely to achieve additional gains like improved customer orientation or job performance by encouraging communication about CSR between those groups. This means that companies must actively monitor and subsequently match, if possible, frontline employees with customers who are most supportive of the company’s CSR activities. A perfect way to encourage both groups is to not only inform them about what the company is doing but to invite them to participate together actively.

Environmental initiatives, charitable giving and ethical business practices can all help employees by highlighting common values with both customers and the company. And it is important to ensure that company leaders take a visible role in enacting CSR. Leading companies such as Hewlett-Packard, Starbucks, Cisco and SAP have experimented with volunteering programs that bring customers and employees to the same site to create shared CSR experiences. DHL, a German-based package delivery company, operates a Global Volunteer day with hundreds of community-building projects in the 220 countries or regions in which it operates. Customers and business partners are invited to join in these activities. Such initiatives unite the most enthusiastic employees with the most enthusiastic customers in a natural setting, likely activating the identification processes and job performance. For creative companies, there are many ways to benefit from corporate social responsibility activities, ways that can encourage employees to feel more connected with companies and their customers.

Authors

Daniel Korschun, Professor of Marketing, LeBow College of Business, Drexel University, Philadelphia, USA
dek46@drexel.edu
CB Bhattacharya, Professor of Marketing, Pietro Ferrero Chair in Sustainability der ESMT European School of Management and Technology, Berlin, Deutschland
cb@esmt.org
Scott D. Swain, Professor of Marketing, College of Business and Behavioral Science, Clemson University, Clemson SC, USA
sdswain@clemson.edu

Further Reading

Korschun, D.; Bhattacharya, CB; Swain, S. D. (2014): "Corporate Social Responsibility, Customer Orientation, and the Job Performance of Frontline Employees," Journal of Marketing, Vol. 78, No. 3, pp. 20–37.

Buder, F.   Neus, A. (2015): “Global Perspectives Barometer 2015 – Voices of the Leaders of Tomorrow”. GfK Verein & St. Gallen Symposium.