Why Empathy is Essential to Transforming Your Business

These days it’s typical to get cynical about everything. We are confronted by news containing images and extreme headlines of some of the most damaging tragedies we’ve ever heard of. This rhetoric seems to be that all the violence, ageism, xenophobia, and prejudice are winning.

However, another way to look at this is that access to information from all over the world allows us to consider the needs of others and to choose to respond with compassion. And if being empathetic is important to every aspect of our lives, why shouldn’t it apply in business? We’ll take a walk through the business benefits of empathy and compassion in this article.

1. Increased sales, loyalty and referrals

One of the key skills every salesperson should have is the ability to anticipate the needs of customers and demonstrate how your product or service can meet their needs. Truly understanding the needs of customers means connecting with their fears, desires, and pain points. 

If your sales team is not able to connect to customers on a personal level, how can they explain how your products or services benefit them? This is what empathy does in a business. Another way it boosts sales is that it encourages loyal customers to refer their friends and families to a business that will care about them.

2. Increased Productivity and Innovation

More empathetic companies typically have employees who are more productive and innovative. This means if you are looking to boost efficiency and expand on how many problems you can solve for your customers, you want to hire employees who have empathy.  

According to a study which released in 2017, companies that implement the most important new ideas have B-teams of employees that exhibit a wide range of skills which include, emotional intelligence, generosity, curiosity to learn about other people’s idea, and above all, empathy. 

These teams may not have the most skilled professionals, but members feel confident speaking up because they know they will be heard, and this is how great ideas are born.

Related article: 5 Tips to Help Improve Employee Performance Reviews

3. Greater Competitive Advantage and Market Value

The most performing companies are also the most empathetic ones. While this might be initially surprising since the general belief is that companies have to be cutthroat to survive in this competitive, capitalist economy, stats support the fact that empathy is more crucial to business success now more than ever. 

4. Boosts Engagement and Collaboration

So from what we have learned if the best managers and team members are willing to be more sympathetic and empathetic towards others, it makes sense that companies with cultures that encourage empathy would attract individuals with highly engaged competencies. Empathetic companies retain talents more and have employees with higher morale. 

Since high-performing individuals have employment choices beyond the traditional corporate benefits and see companies that have human-centric values as more in line with what they value, it is therefore important that companies that are looking toward future growth should make small, subtle shifts in including empathy to their company culture. 


One critical asset that is often overlooked by businesses is empathy. It has the potential of significantly boosting sales, as well as providing a competitive advantage. Above all, it helps your co-workers, employees, and clients connect more effectively. It is not easy to overcome the barriers to developing empathy in the workplace, but it is possible with conscious effort. Good observation, consideration of others, and active learning are all great steps to take.