Leadership Drives Loyalty

Here’s a sneak peek into my upcoming book: How To Hire the Best: The Entrepreneurs Ultimate Guide to Attracting Top Performing Team Members (Releasing November 18, 2020)

Your Leadership Drives Loyalty.

(Loyalty Drives Profit.)

How you show up as a leader makes or breaks the culture of your team. Leadership in your company drives loyalty. As you will come to appreciate, loyalty drives profit. 

In their book, Why Loyalty Matters: The Groundbreaking Approach to Rediscovering Happiness, Meaning and Lasting Fulfillment in Your Life and Work​, Timothy Keiningham and Lerzan Aksoy contend, “The long-term success of any company depends heavily upon the quality and loyalty of its people.” Among other points, Keiningham and Aksoyshared insights from two well-known studies into the impact of employee loyalty on company performance. 

First, they share insights from Harvard Business School professors Leonard A. Schlesinger, James L. Heskett, W. Earl Sasser, and Professor Schneider. In the 1990s, they began talking about the impact of employee loyalty on performance. In no uncertain terms, they contended, “Employee loyalty drives productivity.” They identify employee loyalty as one of four critical elements of performance in satisfying customer needs. As Keiningham and Aksoy put it, ​“Loyal employees are more willing to suppress short-term demands for the long-term benefit of the organization.” 

A Part of the Mission

What does this mean? Your team member is more likely to work late on Friday afternoon if she believes in your team’s mission of creating a positive impact for your customer. It means your sales associate will forgo making the sale and a commission if the sale is not in the best interests of your customer. The team member will not jeopardize a long-term relationship. It means your team members look out for the needs of your customers and identify ways to serve them better. 

The cumulative impact of these actions cannot be underestimated. It’s no wonder that a Harvard study of 200 companies identified that a strong culture increases net income more than 750% over eleven years.

Which Comes First

Keiningham and Aksoyalso discuss a study by Professor Benjamin Schneider of the University of Maryland. The study was on the impact of employee loyalty and attitude on performance. It was called ​Which Comes First: Employee Attitudes or Organizational Financial and Market Performance? Professor Schneider and his team studied thirty-five companies over eight years. They found positive loyalty-related attitudes in employees led to better company performance. 

When I interviewed Dov Baron, author of ​Fiercely Loyal, ​ on the ​Profit by Design podcast, we discussed how keeping employees engaged and happy in a positive environment contributes to the release of oxytocin. Oxytocin is the “feel-good” chemical delivering the high mothers get from holding their babies, among other examples. It is the “social bond” chemical. 


Be intentional in creating a safe, supported environment, in which your team and you are willing to be vulnerable. You will be creating a culture of high-performing team members willing to stretch outside their comfort zones to reach for higher and higher goals. If you understand this, says Baron, “you can bond people to you by creating a purpose in your organization.” 

Intentionally driving loyalty results in reduced turnover costs and increased productivity, which translates into increased profitability. I cannot overstate the benefit of investing in finding and retaining the best talent possible for your company through developing yourself as a leader so that you have a strong culture. When you do, your team will become more loyal and your performance will improve. Also, the culture you create by doing so will serve you well when you look for more A-Players to join your team. This is what it means to create a highly profitable, great place to work! 

For more ideas to develop your team and build culture, check out Tap the Potential’s Great Place to Work Spotlights in the accompanying Toolkit. In these spotlights, we feature business owners doing simple things that are enhancing their company culture. I hope they give you some ideas of what you can be doing.

For tips on how to work through these problems and coach your team more effectively, please be sure to check out How To Hire the Best:The Entrepreneurs Ultimate Guide to Attracting Top Performing Team Members, releasing November 18, 2020.


About The Author

Dr. Sabrina Starling, The Business Psychologist and international best-selling author of the How to Hire the Best series and The 4 Week Vacation™, is the founder of Tap the Potential and host of the Profit by Design podcast. At Tap the Potential, we work to free business owners from the constant demands of a growing business.

We believe work supports life, not the other way around. Clients in our Better Business, Better Life coaching program have more time for what matters most and more money in their bank account than they’ve ever had. Next, we send them off on a 4 Week Vacation™ to celebrate their hard-earned journey to take their life back!

Dr. Sabrina and her team at Tap the Potential are on a mission to change the story of entrepreneurship from one of long hours, grinding it out, to one of sustainably profitable businesses that support and enhance life. The Tap the Potential Solution™ and our Tap the Potential Family of Business Owners are disrupting small business as usual. We are on our way to making the Tap the Potential Solution™ the mainstream model for growing business.

By 2023, 150 Tap the Potential clients will have taken 4 Week Vacations. These are the trailblazers, role modeling what’s possible for entrepreneurs. In many entrepreneurial circles, it is becoming more and more common for one entrepreneur to ask another, “Have you taken a 4 Week Vacation™?” (as opposed to asking “How many employees do you have?” or “What is your annual revenue?”). Taking a fully unplugged 4 Week Vacation is rapidly becoming the recognized symbol of entrepreneurial success.

Never one to accept the status quo or back down from a challenge, Dr. Sabrina’s How to Hire the Best series grew from her desire to solve the toughest hiring challenges interfering with her clients’ growth and profitability. What sprang from her experience working with entrepreneurs in rural areas catapulted her into becoming the world’s leading expert in attracting top talent in small businesses—no matter what hiring challenges those businesses are facing—and earned Tap the Potential’s reputation as the go-to resource for entrepreneurs committed to creating Great Places to Work with thriving coaching cultures and highly engaged team members working from strengths.

As The Business Psychologist, and with her years of driving profit in small businesses, Dr. Sabrina knows what it takes to find, keep, and motivate exceptional performance out of your biggest investment—team members.