Developing effective human relation skills is crucial to establishing and maintaining productive business relationships. Good communication and attention from managers typically lead to increased levels of productivity and job satisfaction. Human relations skills make working in groups and teams possible. Increased opportunities for understanding among diverse groups is one of the benefits of a business environment that fosters open and sincere communication. Establishing an attitude of respect toward employees as human beings may result in more positive working conditions and loyalty towards the company.

Employee Productivity

According to the Hawthorne Theory, the most important factor that influences worker productivity is relationships. Productivity is shown to increase when relationships between managers and employees is positive and supportive. Relationships between employees who are dependent upon each other also directly influence productivity. Individuals are more likely to produce quality results when they are treated with respect and are made to feel as though they are being recognized for making a positive contribution to the company's success.

Employee Motivation

Motivation is directly tied to the idea of increased productivity. In Maslow's hierarchy of needs, motivational theory ascertains that positive human relations affect whether an employee's esteem, self-actualization, safety and physiological needs are being met. If an employee feels that his needs will be met by performing his job tasks, he is more likely to be motivated to do them. For example, when a manager recognizes an employee's work performance by congratulating him for an outstanding job, the employee feels appreciated and valued. By having his esteem needs met, he is more likely to repeat his current behavior.

Positive Perception

Good communication and interpersonal skills promote feelings of goodwill between individuals and companies. It creates a perception of the individual as either being a superior, adequate or a poor performer. Even if an individual's technical skills are adept, if he is unable to foster solid relationships with superiors and co-workers, he may be viewed as someone who is not a positive contributor. Achieving success in a position and opening up opportunities for future advancement is directly linked to making a good impression.

Company Loyalty

When employees and customers are treated with respect, they are more likely to feel good about maintaining an existing business relationship. Turnover is often linked to poor relationships between employees and managers. Likewise, when a company seeks to terminate a relationship with a vendor or supplier, one of the reasons is that the vendor was not able to understand and address the company's business needs. Establishing a sense of mutual value and trust creates an environment where employees and customers feel as though they matter.