In May last year, Ryanair reported its first full-year decline in profits in half a decade. Just six months later, in November, the budget airline’s bottom line looked in rude health once more: first-half profits for the year are up by a third and full-year profit looks set to grow by a similar proportion.

What happened? The airline that makes its money by turning its aircraft around faster than anyone else in the business did the same with its attitude.

Sensing a growing disenchantment among customers, Ryanair’s boss Michael O’Leary decided to stop insulting them.

Instead, the airline introduced some empathy into its product mix. “If I’d known being nicer to customers was going to work so well, I would have started many years ago,” Mr O’Leary said when the results were released.

Empathy remains something chief executives dismiss as a gimmick for the boffins on Twitter.

As the chief executive of one British bank admitted to me, most of his employees think empathy is for wimps: “Empathy reeks of vulnerability. Nobody wants to appear weak.”

That is a grave misconception. By helping companies understand their customers — and their needs — better, empathy is actually a source of strength.

Worries about weakness are not the only thing hampering empathy’s inclusion in the corporate business model.

Even relatively enlightened chief executives assume they simply cannot do much about empathy. They think it is an innate and intangible quality that cannot be taught nor measured. They are wrong.

Empathy is not a god-given gift. It is more like a muscle. Leave it inactive and it will atrophy; exercise it and watch it develop into a corporate skill.

Moreover, this growth can be measured. The Lady Geek Empathy Index, which uses a methodology involving employee and customer perspectives as well as social media interactions, took a year to develop and now ranks companies by their “empathy quotient”.

Belinda Parmar
Belinda Parmar

Empathy requires a company to work on three qualities: emotional connectivity; a sense of reassurance; and an aura of authenticity. These three qualities need to be projected across three channels: internally, within a company’s workforce; externally, with clients and customers; and, finally in the public eye, through a company’s use of social media.

LinkedIn, which topped the Empathy Index, provides a good example of how empathy works. It combines all three elements across the three channels.

Internally, its monthly “Indays” allow employees to invest in the community and inject the company with innovative ideas. Meanwhile, it deals with its clients and customers in the public eye, deftly addressing negative feedback on Twitter.

Ironically, LinkedIn scored far higher in this category than Twitter itself.

At the other end of the spectrum is Ryanair, which limps into the top 100 thanks to its recent change of tactics. There is not much emotional connection in being called “stupid”, as Mr O’Leary has referred to his passengers in the past, nor in being told that if you forget to print a boarding pass, the airline will not help, not to mention the lack of authenticity in hidden booking charges. As Mr O’Leary admitted, there is no need for the company to be “unnecessarily pissing people off”.

Social media have generated an increasingly transparent world. Customers publicly air their grievances — or simply ask for assistance — and expect replies as sensitive as they are quick. Companies can no longer get away simply with providing goods and services; they are expected to live up to their branding with humanity and authenticity. In this new world, no business survives without empathy.

Belinda Parmar is chief executive of Lady Geek, a consultancy

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