NEW YORK, NY — When Amazon executives have company meetings, CEO Jeff Bezos keeps one empty chair at the table for the customer, a clear commitment to the stakeholder group. At the same time, Amazon has accumulated a checkered history for its treatment of employees, with media stories that depict both a negative corporate culture and a difficult experience for factory and shipping workers. Amazon’s approach to these two key stakeholders – customers and employees – represents a microcosm of the trade-off companies face each day. Company executives, in their pursuit to meet consumer demand, regularly prioritize customer needs while discounting the requests of their employees. As companies combat workplace phenomena including the Great Resignation – where 40 million U.S. employees left their jobs, recent research shows how much focus companies are putting on customer needs compared to employees. The new Columbia Business School study documents a widening gap: a review of text analysis of earnings calls transcripts of S&P 500 companies shows that company executives talk about customers 10 times more often than employees – a number that has grown over the last 15 years. Additionally, when companies discuss employees, executives are more likely to correlate them to risk factors and consumers to growth opportunities.

For their study, Are Customers 10x More Important to Firms than Employees?, Columbia Business School Professor Stephan Meier and doctoral candidate Nandil Bhatia '26 conducted a wide-ranging review of sources that impact company management: earnings calls, prior experience of corporate executives and board directors, strategy textbooks, academic journal articles, and publications including the Harvard Business Review and Sloan Management Review. Using text and sentiment analysis of each source, the researchers find a clear and overwhelming bias for customers compared to employees. For example, in Bezos’ annual letters to Amazon shareholders between 1997 and 2020, customers are mentioned five times more often than employees.

“Record numbers of employees are leaving their jobs, and low employee engagement levels are leading to the new phenomenon of ‘quiet quitting.’ These disruptions and productivity losses not only slow down operations, they can significantly hurt a company’s bottom line.” said Columbia Business School Professor Stephan Meier, the James P. Gorman Professor of Business and Chair of the Management Division. “One reason for the growing dissatisfaction might be that company priorities are disproportionately focused on the customer, while shortchanging the employees. Every company leader at every level, whether they manage two people or a team of 5,000, should consider how they think about customers and start applying that approach to how they treat employees.”

To conduct their study, the authors used a variety of methods involving natural language processing techniques. First, they analyzed transcripts of 31,586 investor calls for 636 companies on the S&P 500 between 2007 and 2019, looking for words pertaining to employees and customers, and the tone in which they were discussed. To complement the earnings call analysis, the authors also examined the expertise of corporate leadership teams and directors on boards of organizations, developing 1.4 million profiles based on data from BoardEx and PRIME Database between 1991 and 2021. Finally, the authors reviewed academic work in strategic management and in textbooks, academic articles, and practitioner-oriented articles.

Key Findings Include:

• Speaking Volumes on Customers, but not Employees: Approximately 92% of the earnings call transcripts have at least one mention of customers in them. However, employees are not mentioned or talked about as frequently, as only 55% of the transcripts have any discussion on employees. At a company level, the researchers find that 6.3% of the average company’s earnings call transcript is devoted to customers, whereas only 0.5% of the transcript is about employees.
• Negativity toward Employees: When speaking on earnings calls, executives are almost 50% more likely to use prevention-focus words (which include “anxious,” “defend,” “pain,” and “threat”) when they discuss employees compared to when they discuss customers.
• A Background in Customer Experience: The prior experiences of senior executives and board members demonstrate an overwhelming bias towards customers compared to employees.
• Customer Literature, but Not Employee Literature: Textbooks, academic journals, and practitioner-oriented articles – which educate future business leaders and inform current ones about strategy – are more focused on customers than employees.

“The consumer-centric business model is continuing to evolve, becoming more personalized than ever. These trends are affecting the labor market, and how employees are treated,” Meier said. “Our findings emphasize that companies should recognize that employees are also consumers; and as consumers, they are accustomed to personalized experiences and are seeking this within their jobs. In order for companies to remain agile and innovative, they need human labor, and for employees to remain creative and innovative, companies need to also adopt a more employee-centric approach.”

To learn more about the cutting-edge research being conducted at Columbia Business School, please visit www.gsb.columbia.edu.

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