Hybrid and remote work are increasing employee satisfaction, leading to improved client interactions.

Small- and medium-size businesses (SMBs) are reaping benefits through their efforts to cater to employees and customers. Intermedia Cloud Communications conducted a survey and found that greater workstyle flexibility for employees has correlated to more engaged workers and more satisfied customers. Since the COVID-19 pandemic necessitated both remote and hybrid work environments, 69 percent of the 300 SMB owners and leaders believe employees' job satisfaction has increased.

"Many studies have shown a direct link between employee satisfaction and customer retention," says Elka Popova, vice president and senior fellow at Frost & Sullivan, a US market research company. "A happy employee produces more positive customer interactions—they respond to inquiries quicker, they care more, and they are more protective of the company's reputation. Investing in your employees makes a lot of business sense."

The results reflect the positive effects on business. Two-thirds of survey respondents reported that their customer retention has increased since moving to a hybrid or remote work environment. That number grows to 79 percent for companies that offer both remote and hybrid options.

"The workplace evolution has created its own set of unique challenges for SMBs looking to grow operations and maintain a competitive advantage in today's market, balanced against expectations from employees for greater flexibility in the way they work," says Scott Anderson, Intermedia's chief marketing officer. "As this research would appear to indicate, many business owners and decision-makers who were once skeptical about productive work happening from wherever are now realizing the real benefits that offering workplace flexibility affords, including a marked increase in customer retention."

That skepticism hasn't completely disappeared, however. While the benefits of allowing employees the flexibility to work outside the office are clear, 72 percent of SMB leaders surveyed still thought it was important for their employees to live within commuting distance of their office.

That said, remote and hybrid work options aren't going anywhere any time soon. According to the study, SMB leaders said nearly half of their employees who had left their positions in the previous year cited a lack of flexible working options. The numbers say it's wise for business leaders to offer that or risk losing both employees and customers.