Employee Happiness Drives Business Results

Employee Happiness Drives Business Results

New studies regarding employee happiness continue to support the principle that high levels of employee engagement lead directly to increased productivity, improved customer satisfaction, and a increased business profits.

While this is no surprise to those familiar with the extensive research the Gallup Organization has done over the last thirty years — studying what accounts for the most productive teams and organizations — it is refreshing to see additional research that supports their findings.

There should be little (if any) doubt at this point that making an effort to increase employee engagement should be a primary focus of every business owner, executive, or manager within every business or organization. Failing to do so, is to miss the most significant opportunity to make a significant, sustainable improvement in most every area of an organization’s operations, at every level within the organization.

The following article does an excellent job of reaffirming the case for targeting employee engagement as a strategic imperative that every leader should put at the top of his or her list.

Does Happiness Really Drive Results?

by Dan Bowling and Shannon Polly, Talent Management Contributors

Promoting happiness in the workplace is now a scientifically motivated practice that has proven benefits for productivity, profits and people.
Happiness at work, whether it is described as engagement or something else, is the subject of much attention these days, from the January 2012 cover of the Harvard Business Review to the Sept. 4, 2011, New York Times article suggesting “Happy People Work Harder.” Employee happiness generally does correlate with business results.

Happiness studies, a fairly new field, comprises academic disciplines as diverse as positive psychology, neuroscience, positive organizational scholarship and behavioral economics. Hundreds of researchers in some of the world’s top universities, such as Harvard, the University of Pennsylvania and Michigan’s Ross School of Business, are working in this area.

Their findings — that optimism increases life satisfaction and creates positive business outcomes, that strong human relationships have a direct impact on the quality and length of life, and that developing strengths is more powerful than trying to fix weaknesses — are being applied in the military, health care, education and the highest reaches of several governments. Happiness studies, broadly defined, even won psychologist Daniel Kahneman a Nobel Prize in economics.

In business, while no one has shown a direct correlation between happiness and stock price, “[There] is a lot of compelling evidence — across industries, continents, sectors, that positive practices pay off,” said Kim Cameron, a positive organizational scholar at the University of Michigan’s Ross School of Business. “Companies make more money, they are more productive, they produce higher quality, higher customer satisfaction and higher employee engagement” when they focus on positive practices.

Strengths, Strengths and More Strengths
Mainstream happiness studies in the workplace typically focus on strengths. Work in this realm from The Gallup Organization, which is chronicled in StrengthsFinder 2.0 by Tom Rath, head of Gallup Consulting, is well known.

Typically, performance management has been about identifying employee weakness, as is often done in annual performance reviews. Gallup has turned this approach on its head, surveying more than a million workers during the last four decades about their jobs and how often they use their greatest strengths at work. Those who work in environments where they use their strengths daily are “50 percent more likely to work in business units with lower employee turnover, 38 percent more likely to work in more productive business units and 44 percent more likely to work in business units with higher customer satisfaction scores,” write Donald O. Clifton and Marcus Buckingham in Now, Discover Your Strengths. The Gallup annals are filled with success stories of how a strengths approach improves work outcomes in large businesses such as Toyota North America.