Why Listening Is Good for Business

Published On: October 19, 2022By Categories: Business Management, People at Work

Good listeners build good relationships and that can impact the bottom line.

By Alexandra Walsh

Verbal communication involves both speaking and listening. In a company, listening is key to effective working relationships among employees and between management and staff.

Being a good listener has significant benefits. It helps build critical relationships with clients, bond with customers, and engage with employees. That, in turn, builds trust and confidence. That trust encourages loyalty and that confidence motivates productivity.

And all of this equates to increased profitability.

Getting Information

Research suggests that you remember only a quarter to a half of what you hear. Listening enables you to acquire facts so that you can make decisions that benefit your business. It is essential to building trust and can reduce conflict. The reputation of a business depends upon its listening skills.

By listening to a job applicant in an interview, for example, you might discover attitudes toward the business, performance in previous jobs, and information not detailed on their resume. This additional insight can help you decide whether the applicant is a good fit for your company.

And a supervisor who listens intently to an employee’s complaint about a health risk on the job might reduce injuries and enhance job performance.

Developing and Building Trust

Listening is essential to building trust. If one member of a team doesn’t listen to instructions, an entire project might fail.

To develop trust, pay attention to verbal instructions and deadlines. Listen for statements an employee might make regarding their own strengths and weaknesses as it relates to a project, so that you can collaborate in a way that maximizes everybody’s strengths.

Maintaining Your Reputation

The reputation of a business depends upon listening skills. A company develops relationships with other businesses and vendors through verbal communication, too. So remember: talking on the phone and working on a task at the same time can easily result in misunderstandings.

For example, if you fail to listen to what a customer is saying, they may not receive the service or products they were expecting. When this occurs repeatedly, it can tarnish the company’s reputation.

In the world of small business, customers love to feel valued. As a small business owner, you can make your customers feel valued by practicing active listening techniques every time you talk to someone. You can get repeat business, a good review, or word-of-mouth referrals from simply being a good listener.

Active Listening

When we think about communication, we tend to think a lot about the specific words we choose and the tone of voice we use. But listening plays an important role in the communication process as well. If we don’t listen attentively and put effort into the conversation, we impede the transfer of ideas. We also display body language, even on the phone, that says, “I’m not interested in what you have to say,” whether we mean to or not.

Active listening techniques will help you to focus and give whomever you’re speaking to the attention they deserve.

Fight Distraction: Resist the natural urge to be distracted by whatever else may be going on around you, or by forming in your mind counter-arguments that you’ll make when the other person stops speaking.

Don’t let your mind wander so that you lose focus. All this contributes to a lack of listening and understanding.

Put Aside Biases: An essential part of listening is the discipline of setting aside one’s own prejudices in order to step into the shoes of another person.

If we don’t listen attentively and put effort into the conversation, we impede the transfer of ideas.

Learn to silence your personal thoughts and opinions in such a way that you can address the needs of other people immediately and directly.

Make Eye Contact: Generally speaking, in the United States, making eye contact with the person who is speaking to you is a way of showing that they have your full attention.

This doesn’t mean you stare into someone’s eyes. Keep your head up and make eye contact for a few seconds while they speak and while you speak back. It’s normal to let your gaze move around but coming back to make eye contact indicates you are still engaging in the conversation.

Follow Along: Your eyes represent just one aspect of the overall body language you display as a listener. You can use your entire body to show that you’re following along and listening.

Look directly at the speaker, lean in, and be interested. Listen and learn. Watch your body language and watch the body language of the person speaking. Use smiles, nods, and gestures to signal your engagement and connection. Nod your head when needed, furrow your eyebrows and frown a bit to show concern, smile when the speaker breaks into a smile.

Subtly adjusting your facial expressions and overall body language helps the speaker understand that you’re engaged and taking a real interest in what they have to say.

As a small business owner or executive, showing interest in even everyday small talk makes customers feel special.

No Multitasking: If someone is trying to talk to you, stop what you’re doing and give them your full attention.

Multitasking instead of actively listening says you are too busy to engage. Neither employees nor customers deserve to be on the receiving end of that.

If a conversation needs to happen, give it your full attention. If it doesn’t, politely end or reschedule it.

Avoid Interrupting: Resist the urge to interrupt; it frustrates the speaker and derails the point they’re trying to make. Allow the speaker to finish their thought before jumping in to ask questions.

Don’t interrupt with counter-arguments or to add your own ideas. When you listen, you listen. When you speak, you speak. There is a time for everything.

Active listening means focusing on the other person and really trying to understand what they are saying. This can’t happen if you are too worried or preoccupied about your own response or sharing your own views.

Sometimes interrupting someone is inevitable in a fast-paced exchange of information. But think about whether or not you are doing most of the talking or are constantly cutting off the other person. If you are, you need to take a moment to let them have a turn.

The importance of active listening for small business owners lies in the necessity of showing respect to customers and in understanding their needs. Everyday situations provide perfect active listening exercises to allow you to practice these techniques until they become second nature.

Respond: When the person speaking has finished talking and it’s your turn to speak, be open, inquisitive, and honest with your response. Assert your opinions, ask the right questions, and do it all with great respect.

Treat the other person as you would want to be treated. For leaders, listening is a central competence for their success. For business, listening is a competitive advantage.

Listening Can Reduce Conflict

Conflict can arise when an individual feels misunderstood or mistreated. This is when listening can reduce conflict. For example, if you fail to listen to grievances from an employee, you might lose that employee in a tight labor market. Or worse yet, someone might get hurt on the job.

Pay attention to nonverbal cues, as well. If an individual’s facial expressions, gestures, or behavior contradict their words, ask questions to find out what they really mean.

Motivating Employees by Listening

A business owner or supervisor can improve morale and productivity by understanding what motivates each employee. Listen to employees to discover what aspects of the job they find most rewarding and challenging.

Don’t expect to understand an employee’s needs from a single conversation. Continue to be an attentive listener so that the employee knows you are sincerely interested in what they have to say.


At its core, listening is effectively connecting and engaging. Your ability to understand the true meaning and spirit of a message as it is intended to be communicated, and to demonstrate your understanding, is paramount in forming connections and leading effectively.

Listening is an acquired skill. It takes a lot of determination and concentration. But if done right, it will help you become a better communicator and develop stronger relationships—important elements of success in any field.

Alexandra Walsh is the vice president of Association Vision, a Washington, D.C.–area communications company. She has extensive experience in management positions with a range of organizations.

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