How to make employees happy

How To Make Employees Happy

Life is too short not to be happy. When I look at the data (and there’s a ton), I’m shocked at what I see. There are way too many people that are unhappy at work.

Not only that, but there are way too many employers that seem to not care.

Before we dive into the data, does it not make common sense to have happy employees? Does it not make common sense to just treat people with respect? If you treat them with respect, don’t think you think they’ll reward you and work harder for you? How can it be that so many people don’t understand this?

There’s a book that was written, called “Make More Money by Making Your Employees Happy.

It proves with case studies how making employees happier ultimately leads to higher profits. For example, here’s an excerpt from the book:

A Jackson Organization study shows that companies that effectively appreciate employee value enjoy a return on equity & assets more than triple that experienced by firms that don’t. Fortune’s “100 Best Companies to Work For” stock prices rose an average of 14% per year from 1998-2005, compared to 6% for the market overall.

What happens is that crappy managers cause stress to their employees, by micromanaging them, or by simply not respecting them.

Not only does this lead to employees not being happy, but it has major effects on their wellbeing, and workplace absenteeism is a major problem.

We’re talking about $84 Billion in lost productivity.

The American Psychology Association tells us that stress is a major cause of illness today, and often workplace stress is the primary cause.

Stress is pretty much unavoidable, so we all need to do everything  in our power to manage stress. There are a few different tricks to do this, but I’d recommend everyone reading this to watch this TED talk called How To Make Stress Your Friend.

I’d like to introduce those who might not be familiar, to a concept called the Service Profit Chain.

The service profit chain is the link (chain) between service and profit. What it basically says is that profits come from customer loyalty. Customer loyalty comes from customer satisfaction.

Customer satisfaction comes from employee satisfaction. Here is the diagram. here's how to make employees happier at work

I think I can make this image much easier to understand for everyone. And then I’d like to dive deep and explain how to make this work, and why it’s so important.

If you had any doubts about why treating employees well and making them happy was important, you need to understand that it affects your company’s bottom line.
employee happiness is kind of a big deal
Having happy employees is the key to your success.

Make sure that everyone in the company (especially senior management) understands this. First let’s talk about why it’s important, and I’ll use data to back up what I’m saying, and then we can talk about how to make employees happy.

Men lie, women lie, numbers don’t – Jay Z

On the other end of the spectrum, there are companies that just can’t get it right. Here’s a presentation on why most workplaces can’t engage their employees.

Here are a few stats taken from employee surveys that will help explain my point:

  • 53% of more than 2,000 U.S. adults surveyed reported that they would remain with their current employers for longer periods of time if they felt like they were more appreciated by their bosses. Employee retention is a major issue both in terms of morale, and in terms of company profits.
  • JDA, a professional services firm, calculated the costs of replacing an employee, and the numbers are pretty crazy. They estimate that it costs up to $150,000 to replace a good employee. This particular example is a bit dramatic, but still illustrates the point well.
  • A 2009 study by Watson Wyatt showed that highly engaged workers are twice as likely to be top performers and that three-quarters of them exceed or far exceed expectations for performance.
  • A 5% increase in staff engagement correlates to a .7% increase in operating margin.
  • Sears measured that a 5 point improvement in employee attitudes drove a 1.3 point improvement in customer satisfaction, which in turn drove a 0.5% improvement in revenue.
  • Standard Chartered Bank found that branches with a statistically significant increase in levels of employee engagement (0.2 or more on a scale of five) had a 16% higher profit margin growth than branches with decreased levels of staff engagement.
  • A study of 64 organizations revealed that organizations with highly engaged employees achieve twice the annual net income of organizations whose employees lag behind on engagement.
  • Fabick CAT, a company that sells, rents, and repairs Caterpillar construction equipment improved “percent of industry net sales” by 300% by focusing on employee happiness.
  • Employees with lower engagement are four times more likely to leave their jobs than those who are highly engaged.
  • Highly engaged employees were 87% less likely to leave their companies than their disengaged counterparts.

The statistic that I personally found the most interesting, was this next one: In companies who administered an employee survey, 27% of managers never reviewed the results at all, and 52% reviewed the results but took no action. Both of these numbers are terrible in my opinion. It’s pretty well known by now that people don’t quit their jobs, they quit their managers.

Managers can definitely destroy Employee Motivation

It seems like there is still a lot of work that needs to be done on the manager’s part.

Shame on any manager that falls into either of those 2 numbers. If you’re going to administer an engagement survey, you need to be ready and willing to act.

Don’t ask employees what will make them happy, only to not even bother reading their responses. How do they expect things to get any better?

I honestly don’t understand what the point of administering a survey is, if you don’t plan on taking any action? Is this the classic “cover your ass” mentality that we see too often in corporate environments? Is it just so the manager can check off “sent engagement survey” off of his to-do list for when they show it to their manager?

Case Studies On Staff Engagement

Before I give specific tips, I’d like to talk about 2 examples of companies that are getting it right.

The first example, is an amazing case study of a company that turned things around. Campbell’s Soup, is a great example of a company that had declining sales, decided to focus on engagement, and then noticed a massive increase in their bottom line.

The story is featured in a book called Closing the Engagement Gap: How Great Companies Unlock Employee Potential for Superior Results. Doug Conant, their CEO, joined the company in the year 2000. When he joined, they had lost 54% of their market value, and job satisfaction was at an all time low.

He’s quoted as saying

To win in the marketplace…you must first win in the workplace. I’m obsessed with keeping employee satisfaction front and center.

Long story short, after a decade of focusing on employee happiness, their stock price rose by 30%.

The second story I’d like to highlight is from Zappos, the kings of company culture. I saw this tweet in my Twitter feed, and I needed to share it.

It’s a simple example of a company that obviously gets it right. Most employees dream of being able to work from home, and this is one of the things millennials look for when looking for a job.

At Zappos, this particular employee says that he knows that he can work from, but would rather come into work, because he loves it so much.

There are plenty more examples of companies using employee engagement to boost profits.

How To Make Employees Happy

I’d like to give a few simple, actionable ways that employers can make their employees happier.

I’ve talked about this many times before, but one of the most important things to do for employees to be happy is to give them autonomy in their work.

As an employer, you need to give employees the impression like they own the place. Once they feel “invested”, they’ll be much more likely to perform well for you.

They’ll also be happier about coming to work, because again, it will feel like it’s theirs.

A simple way to do this is to let employees become familiar with what’s going on in other departments, and allow them to have input and suggest ideas for improvement.

Looking at the company from a higher, more overall picture will give them that sense of ownership. Another important thing for employees to be happy is for them to grow within the company.

Don’t be afraid to give employees new responsibilities that will let them expand their knowledge. I also believe in letting employees learn new skills on their own time. Let them sign up for courses online, and if you’re so inclined, pay for the course for them.

Transparency is another thing that is so important to all employees. Tell employees what’s going on with your work, what the long term vision for the team is, and how their work is affecting things. Be open and honest with them, and the employees will appreciate it, and reward you for it, in the form of higher productivity.

Give your employees constant feedback. Trust me when I say we love it. The only rule I would say is that as an employer, you need to give clear, actionable feedback, and tell the employee exactly what they can do to improve.

If you’re vague, they won’t get it, and they won’t end up improving. You should even offer to help them implement whatever recommendation you’re giving them.

Lastly, be nice to your employees. Ask them how their weekend was, ask them what music they like, whatever, it honestly doesn’t matter. Even if you don’t care, ask them anyways, because it will show them that you’re showing an interest in their life outside of work, and that you don’t just view them as an employee, but as a human. Don’t get me wrong, perks like free lunches and foosball tables are cool, but that’s not what really makes employees happy. As you see, most of these things cost little or no money at all.

What Employees Should Do To Stay Happy

It’s not fair for us as employees to put all of the onus on the employer. We’re responsible for keeping ourselves happy as well. Here are 5 things that you can do to keep yourself happy at work.

  1. Exercise – It’s been proven scientifically that exercising will make you happier. If anything it will give you a chance to take a break from work.
  2. Get rest – Sleep totally affects your mood, and not getting enough sleep can be pretty damaging. But it’s not necessarily about the number of hours you sleep, but more about your habits. Fun fact, women need more sleep than men.
  3. Spend time with family/friends – There was a 72 year long study that was concluded recently on what it takes to live a happy life, and the main conclusion was that your relationships with other people is the most important thing.
  4. Help Others – Helping others, like your coworkers, is a proven way to become happier and to feel less pressured at work.
  5. Meditate – I know, this one sounds so spiritual, and nobody has time for that, but it works. In fact, according to the research, regular meditation can actually rewire your brain to become happier.

For all the managers reading this, it’s important to remember, that when trying to establish a company culture and a good engagement initiative that you don’t just “set it and forget it”.

You need to constantly be tweaking it, and testing things. Ask your employees what’s working, and what’s not. Remember that if you want to have the best company in the world, you need the best people in the world, and the only way to get them and retain them is to keep them happy.

Like Mark Twain said:

Work and play are words used to describe the same thing under differing conditions.

What do you think companies should do to keep employees happy?

Do you agree with our ways on how to make employees happy?  Let me know your thoughts on twitter @Officevibe.

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