Why are employee engagement, happiness and wellbeing now far higher up the boardroom agenda than they were 15 or 20 years ago?

We all instinctively know that having happier employees is good for business. What’s changed is that now we can prove it. Happier workers really are more productive.

The bottom line

You might argue that happier employees being more productive isn’t much of a revelation. And you’d be right; it’s entirely logical that this should be the case.

We can safely assume that this isn’t a recent development either (that happier employees haven’t just suddenly started to become more productive). The difference is that, along with everything else performance-related, engagement and happiness are now routinely measured by big companies. And, as a result, CEOs and shareholders can see clearly the impact that happier workers have on a company’s bottom line.

In fact, the impact of increased employee happiness stretches way beyond the bottom line, helping businesses to:

·         Retain their best employees. This is, in itself, a big business challenge. In years gone by there was a greater commitment between employer and employee. Today, if someone’s not happy, they’ll leave and get a job with one of your competitors.

·         Realise a competitive advantage. In most sectors there’s now huge competition for customers. Companies are desperately seeking every competitive advantage they can possibly get and harnessing the full potential of their employees tops the list.

Evaluating the evidence

Research by the University of Warwick found a causal link between employee happiness and increased productivity. It suggests that happy employees are 12 per cent more productive than other employees. 

Separate research by the London Business School highlights a link between not just happier workers, but between happier companies and shareholder dividends. It looked at the 100 top companies to work for in the United States (from Fortune magazine) over a 15 year period, finding that they outperformed their peer group by 2.3 per cent per year. Pretty compelling evidence, huh?

It’s highly relevant too at a time when Britain’s productivity per head lags worryingly behind that of many other European and world powers. Politicians and businesses must look at all possible solutions with an open mind and not be afraid to innovate in order to reverse this trend. Fostering a happier workforce would certainly be a good start.

The secret of a happy (work) life: Learning from Google

Internet giant Google is, rightly, heralded as a pioneer when it comes to its people strategy. Fostering a happy and engaged workforce has, naturally, been a particular focus for them. But how do they do this?

One way is by investing in the office environment and making it so comfortable and well-equipped that employees don’t ever want or need to leave. This includes offering free meals, dry cleaning services and all manner of recreational activities and facilities.

Another key factor is their approach to, and philosophy on, developing their people. Perhaps the most revolutionary initiative they’ve introduced that impacts upon employee happiness is ’20 per cent time’. If you aren’t familiar with it, this where they encouraged all employees to spend 20 per cent of their time at work on non-work projects that interest them. While this is rumoured to no longer be running in the same guise, this kind of empowerment and autonomy for employees will naturally be positively received.    

Five ways to make your employees happier

Naturally, there isn’t a universal playbook on how to make all workers happier. Drivers of engagement and happiness vary. There are, though, some initiatives and ideas that are sure to find favour with your people:

1. Make your workplace more comfortable – our benchmark data of over 1.3 million employees suggests that around 25 per cent of employees aren’t satisfied with their work environment. Most of us spent a lot of time at work so such dissatisfaction will naturally affect morale and happiness.

2. Give praise generously – offering recognition for a job well done – either publically or privately – should never be underestimated and can have a profound impact on employees. You should also celebrate successful projects and try to do so spontaneously rather than in a formulaic way.

3. Offer free refreshments – this may sound a little ‘gimmicky’ but providing employees with free soft drinks, fresh fruit, breakfast or sweet treats shows you care. What you actually offer matters less – it is, as they say, the thought that counts.

4. Offer (non-monetary) rewards – where you’re not able to reward employees financially, consider what else is important to them in their lives. Non-monetary rewards could include extra time off work, ‘duvet days’, social events and support for health and wellness or fitness initiatives (e.g. subsidised gym memberships).

5. Support employees’ wider development ambitions – ok, rolling out a scheme in the mould of Google’s ‘20 percent time’ might be a step too far, but providing support for employees’ personal and career development will always be popular. It could be offering X number of days per year to pursue charitable or other projects. 

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