Happy employees are more productive and that translates to better bottom-line, say a slew of research studies
Do happy employees translate into healthier bottomlines? Economists have established a link between workers' happiness and their performance, and say employers should take note. Research conducted by a team led by Andrew Oswald, a professor of economics at Warwick Business School, states, “Happy workers are 12 per cent more productive than the average employee while unhappy workers are 10 per cent less.”
But then what constitutes happiness for an employee? Is it fat pay cheques? Or work-life balance? Or is it endless vacations? According a new Gallup poll, what correlates most closely with happy employees is engaging work. In her book, Make More Money by Making Your Employees Happy, Dr. Noelle Nelson says, “When employees feel that the company has their interests at heart, they will take the company interests to heart.” Gallup quantified the link between employee feelings and corporate outcomes, reporting that lost productivity due to employee disengagement cost more than $300 billion in the U.S. annually.
So, should employers and managers hire people that are more positive and happy?
Studies conducted by psychologists point out that, if happier on a given day, people were not only more likely to come up with a new idea or solve a complex problem that same day, but also do so the next day. This is further corroborated by a separate Gallup study (2010) by researcher James Harter and his colleagues, which found that business unit sales and profits at a given point in time can be predicted by employees’ feelings about the organization at earlier points in time.
In his book Happy Hour is 9 to 5, author Alexander Kjerulf says, “Happy employees make the customers happy.” He puts forth the point that when employees like their jobs, customers get better service, and are more satisfied. The correlation makes sense when you consider that employees are usually seen as the face of the company. It is but common sense that a worker who is happy and engaged projects positivity, which customers can detect, whereas someone who is negative, or even just disaffected, can just as easily turn customers away.
So, what can organisations do to make employees happy?
In her book Work Happy: What Great Bosses Know, author Jill Geisler suggests four measures: a supervisor who cares (happy employees believe their boss listens to them and actually takes their input seriously); sincere and specific praise and feedback; supportive and fair workplace culture; ways to put new employees off on the right foot.
Geisler further adds in her book that hiring well is also a part of the equation. She suggests that organisations should look for people who are positive in nature, hard-working, and will add to the team.
In the fight for competitive advantage where employees are the differentiator, creating an environment where employees feel happy to be associated with the organisation should be the ultimate goal.