Eighty percent of employees who were victims of insults or bullying in the workplace lost valuable work time worrying about the incident.

Another Business ‘Golden Rule’

It’s one of the golden rules of customer service: Never be rude to a customer. But what about being rude to colleagues or employees? It turns out that badmouthing your peers can bring down your business’s bottom line, too.

In fact, clients would rather deal with an incompetent businessperson than one who mistreats his or her co-workers. At least, that’s according to researchers at the University of Southern California’s Marshall School of Business, who found that employees’ rude behavior could have a negative effect on how customers view that business.

USC Marshall’s Christine Porath and Christine Pearson, a professor of management at Thunderbird School of Global Management, discovered while researching The Cost of Bad Behavior: How Incivility is Damaging Your Business and What to Do About It, that not only is bad behavior costly for a company, it is more common than people realize. The study looked at a range of service industries – including restaurants, banks, government offices, retail stores and universities – and found that customers frequently witness employees behaving poorly toward one another. That includes making derogatory comments and inappropriate gestures, such as the case of a store manager calling an employee an “idiot.”

The researchers found that job stress in the United States accounts for $300 billion in losses due to reduced productivity as a result of an uncivil workplace. In addition, according to Porath and Pearson 80 percent of employees who were victims of insults or bullying in the workplace lost valuable work time worrying about the incident and 78 percent said their commitment to the organization declined.

What’s more: Clients who witnessed workplace incivility were faster to jump to negative conclusions about a company than those who witnessed employees behaving incompetently. Porath and Pearson found that if a customer witnesses incivility, that customer will not re-patronize the business 50 percent of the time.

In one of the studies, customers who had to wait several minutes as an employee gossiped on the phone left with an even more negative impression of the company when the employee was reprimanded rudely by another employee in front of them.

“One might anticipate that incivility directed at consumers has extremely negative effect(s),” wrote the authors, but “consumers are also negatively affected when they are mere observers of incivility between employees.”

Some of the authors’ recommendations for establishing a civilized tone in the workplace include: Emphasize civility in hiring and training; set zero tolerance expectations; and establish norms for all employees, including managers and executives, to live by.

“It all starts at the top,” according to Porath, who says executives should emphasize good behavior in every aspect of the company. “There should be a thread of civility,” Porath says, through everything a company does.