The Economics of Happiness

| Posted in Leadership Blog

Is it just me or is everyone talking about happiness these days? The January/February issue of Harvard Business Review has a 4-article section on “the happiness factor,” my minister has launched a 12 month “pursuit of happiness” series and then of course there’s Gretchen Rubin’s best seller “The Happiness Project.”  Of course, with the terrible shape of our economy, and global turmoil one might speculate that concern about whether or not our employees are happy might seem a little misplaced or even “over the top.” Not so, according to experts such as Gretchen Spreitzer, professor of management and organizations at University of Michigan’s Ross School of Business: “happy employees produce more than unhappy ones.” (We knew that intrinsically, right?!) Plus, research confirms that happy employees show up with “can do” attitudes, are more loyal, go above and beyond the call of duty and attract co-workers and team members who are equally committed to the job. I don’t know about you, but I’d love to lead more work groups like that! Perhaps, then, this is the perfect time to deepen our focus on the economics of happiness.

Think about Google, DreamWorks, Alston & Bird, Mercedes-Benz and other “top 100 places to work” – what is it they do differently (a la more successfully) than other businesses? Many would say the “creative freedom” given in how they accomplish their tasks makes the difference. For others the opportunity to learn and tackle new problems may ignite the spark of happiness. In our work with organizations, we find the two most important factors for cultivating employee satisfaction are a sense of purpose and a sense of accomplishment. When someone understands the purpose of their work – how what they do impacts their team, their company, their customers, (or their world) – they tend to feel a deeper sense of pride and ownership. Purposeful employees are internally motivated by doing a good job. Yes, appreciation, recognition, rewards and a good team helps, but assist each individual employee in understanding why what s/he does is important and engagement/happiness levels will rise. Many charitable organizations have this down pat, and the rest of us can learn from their example – (e.g. –a fundraising associate, custodian or artist employed by American Cancer Society may all feel a sense of pride and devotion to their work, because they know they are a part of something bigger than themselves, making a difference on a grander scale.) And, as we already know there is a powerful link between a thriving workforce and better business performance.

How can we apply the economics of happiness? Here are a few tips for creating happier employees and a thriving, performance-focused organization:

  1. Provide decision-making discretion wherever possible – minimizing politics and “red-tape” – When employees are given permission to solve problems on their own, they feel empowered. This added control generally results in more creative solutions and opportunities for learning at every level of the organization.
  2. Share feedback and information regularly – Knowledge is power or at least promotes feelings of influence! However, doing a job in an info-vacuum is un-inspiring at best. Letting people know how they’re doing as well as what’s happening at a department and company level promotes accountability, ownership and better performance. The truth is most people want to do a good job. Let’s give them the tools and information necessary to succeed.
  3. Give employees a chance to learn and grow – Innovation is essential to thriving (and even surviving) in today’s marketplace. In fact, it has been said that our ability to learn faster than our “competitors” may be our greatest (if not only) advantage. Formal and informal learning opportunities, including coaching, traditional classroom programs, mentoring, and eLearning, can create a new level of expertise, company pride, loyalty and of course results. It is our mandate as leaders however, to make sure that all learning endeavors are linked to business outcomes and our future competency requirements.
  4. Teach employees how to stay energized – Science has proven time and time again the value of a good night’s rest as well as regular breaks from intensive work. Likewise, a game, friendly competition or other fun at work can promote a healthier, more energized and agile workforce. Teach employees the value of renewal and watch your bottom line grow.
  5. Encourage employees to invest in relationships that bring you joy – As a rule of thumb, we would all be happier and more productive if we spent more time with colleagues who inspire us or challenge us to be “better” people while minimizing time with those who deplete our energy and self-worth. Try starting meetings by sharing good news or “wins” or expressing sincere gratitude to someone who did an exceptional job…these simple actions promote team cohesion and reduce tolerance for incivility.

Other low or no-cost activities that may help employees feel valued and happier include: mentoring programs, stretch assignments, job rotation, flexible schedules, award programs, volunteer projects (such as volunteering together to build a Habitat house or sponsor a local charity event). When considering happiness over the long haul, it may be that “the small stuff” really does matter most. According to psychologist Ed Diener, someone who has a dozen mildly nice things happen to her each day is more likely to be happier than someone who has a single truly amazing thing happen. In other words, happiness is the sum of hundreds of small things rather than the profound effect of one or two. Keep this in mind when designing programs to motivate and engage your sales teams and work groups.

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