In my last installment of The Art of Retail Management, I reviewed the benefits of having satisfied and loyal employees.

In my last installment ofThe Art of Retail Management, I reviewed the benefits of having satisfied and loyal employees. I discussed the benefits that flow to them personally, to their co-workers (including you and their supervisors) and to your customers. I listed eight benefits that extend throughout the entire organization and even push up your profits. In addition, I mentioned the first three or seven elements within your store that, if improved, would enhance your employees' satisfaction and loyalty. In this article, I'll discuss elements 4 through 7.

The fourth critical element is respect. To what depth do your employees feel that you respect and sincerely care about them as individuals? Often, managers complain that their employees don't respect them. That, I've found, is because the manager hasn't first demonstrated that he respects the employees - and respects them sincerely.

In a recent survey by the Opinion Research Corp., only 37% of hourly employees and 44% of professionals responded positively to the question, "Is the company treating you with dignity and respect?" Respecting an employee means that his/her opinions count, and that the employee feels listened to.

The customer comes first? Not really. The EMPLOYEE comes first. How employees treat customers reflects how their supervisors treat them. True leaders must do far more than merely meet the numbers. They must put their people first and continually connect with, and motivate, their human capital.

Gallup research has found that peak performers in a variety of organizations feel that someone at work cares about them and their personal progress. They report that someone regularly and frequently asks about their progress. In contrast, 80% of employees say their boss does not follow-up on their performance reviews, and 70% of employees claim to have never had a meaningful performance discussion with their manager.

Employee retention correlates closely to each employee's sense that he or she is growing and learning. Employees feel managers care when they spend time and money to train and enhance the employees' skills. Most salespeople who resign cite lack of training in the first 60 days as the No. 1 reason for their failure. Research indicates that most turnover is avoidable.

Related to these findings, nearly all peak performers had a "best friend" at work. Consequently, effective managers seek ways to become trustworthy friends with their employees. No doubt, at one time or another, you've heard a manager say, "I don't want to get too close. They won't respect me." That conventional wisdom is wrong. People work best when they have meaningful relationships with their bosses. Not necessarily a social relationship (though it could be), but at least an open, trusting relationship where bad news can be shared as safely as good news.

The fifth critical element of employment retention is the meaning and value of the work tasks - by this, I mean meaning and value in the employee's eyes. Employees invest more when they feel their work is meaningful because it gives value (not just money) to others. Employees produce more when they feel that everyone in the company works toward excellence, and that everyone has committed to that quality.

"Excellence is not an act, it is a habit," said Aristotle. The "excellence habit" keeps peak performers working at excellent companies.

The sixth element is whether an employee feels appreciated in the job he or she does. If you personally recognize your heroes, you should publicly recognize them as well! According to Robert Half International Inc., as many as 34% of good employees who had quit a job cited little or no appreciation for their contributions. This became a primary reason for their leaving.

Praise will help you hang onto talented people when money can't. Praise costs nothing and yields big dividends. And yet the world is filled with otherwise bright people who are absolute dolts at delivering praise.

The seventh and final element of a successful employee retention/loyalty program is frequent feedback. A piece in the October, 1997 edition of Fortune magazine said that great companies regularly ask all employees what satisfies and what disturbs them. Great companies know what their employees are thinking and feeling. They are rarely surprised if a peak performer leaves.

Certain dealers have told me that their best people eventually became their competitors. Great leaders would not let this happen, because they'd already know the dreams and aspirations of their people. They'd do all in their power to help them achieve their dreams in a way that promotes, rather than undermines, their business.

I wouldn't allow any employee of mine to harbor a dream to own a store without my guiding him to achieve his dream and help me in the process. I don't want my best employee to open a competing store across the street. If one of my employees wanted to become a manager or entrepreneur, I'd help him build a plan. I'd guide her or him to learn how to manage a store well. Then, I'd invite her or him to become a partner with me, or open a second store within my company.

What are your people thinking? Are they aspiring for roles that could help you¿r injure you? Are you sure? Are you consistently losing good people?

Remember that your people are four times more likely than is your advertising or marketing to create customer loyalty. Customer loyalty is the foundation of ongoing business growth. And customer loyalty is directly caused by employee loyalty.

How loyal are your employees? You owe it to yourself and your business to do everything in your power to help them become as successful as possible. You succeed only when they succeed.

So, when you set profit goals, you should simultaneously set employee-satisfaction goals. Productivity, customer satisfaction and profitability flow from employee satisfaction. The Gallup research I cited two months ago found that great companies focus on these four outcomes: profitability, productivity, customer satisfaction and employee retention. I recommend that you do the same.