Industry Market Trends

Productivity Lessons from the Happiest Companies

Feb 12, 2013

There's a new business metric we're hearing more about lately: happiness. Many of the world's most profitable companies also happen to have very happy employees. What can your firm learn from these joy-filled businesses?

Online job community CareerBliss maintains one of the best known global "happy company" rankings. At the top of this year's list is pharmaceutical powerhouse Pfizer, up from number 11 last year. Interestingly, two government agencies - NASA and the U.S. Department of Defense - found their way into the number two and three spots, respectively.

But, as one might expect, a large number of tech companies round out the rest of the list. These include Motorola, networking giant Cisco, telecom equipment company Avaya, Qualcomm, GE, Siemens, Amazon, and cloud-based solutions provider

So what makes a happy company? To compile its rankings, CareerBliss analyzed more than 100,000 employee reviews rating the quality of work-life balance, relationships with superiors and co-workers, work environment, job resources, compensation, growth opportunities, company culture, company reputation, daily tasks, and personal control over work performed on a daily basis. Based on these factors, companies were assigned a "bliss score."

While salary and perks are certainly important contributors to employee happiness, what really makes employees rank their company well is the type of work they do, how well they are managed, and how well they are recognized for their work.

"Employees in these companies have the freedom to use their knowledge, skills, and abilities to solve interesting problems," Bradley Brummel, a Ph.D. in workplace psychology, told Forbes. "This type of problem solving can be intrinsically motivating and leads to a happy workplace."

While every company can strive to emulate the type of benefit, salary, and perk structures that happy companies have in place, getting the more nuanced aspects of job valuation and satisfaction right is a lot trickier.

First, it helps to learn what employees hate most about their jobs. A 2012 Kelly Services report concluded that only 44 percent of the global workforce feels valued by their employers and two-thirds of workers intend to look for new jobs in 2013. In general, the younger the worker, the more he or she is likely to dislike a job. High turnover, of course, costs companies a lot-not only in recruiting, hiring, and training, but also in the loss of knowledge employees take with them when they leave.

Employee job dissatisfaction is on the rise, according to the Conference Board. Twenty years ago, 61 percent of all Americans said they were satisfied with their jobs. Today, that figure is just over 47 percent.

Smart companies know that boosting employee satisfaction brings benefits to every corner of the organization. So how do you turn an ordinary workplace into a happy one? While there's no single path to providing a joyous work experience, the happiest companies tend to do many of the same things:

Maintain good communications. Companies with the most satisfied workers are good at establishing two-way communication with employees, explaining what the corporate objectives are and helping each employee understand how he or she can help achieve those goals. Having muddled or conflicting goals is one of the most frequent complaints of unhappy employees.

Kill the excess meetings. The economist John Kenneth Galbraith once noted that "meetings are indispensable when you don't want to do anything." Forcing employees to halt work each time someone in the organization calls a meeting is counter-productive and another major source of griping. Put someone in charge to determine whether the proposed meeting is necessary, or whether the information can be shared just as easily via standard office communication. Consider banning meetings entirely at least one day a week.

Remember that employees have lives. According to the Center for Work Life Policy, the average professional work week has been getting longer in recent years, and it's not uncommon for employees to be plugged into work for 60 to 70 hours each week. If this is company policy, it needs to change. If employees are doing it of their own accord, then consider establishing rules for time off, as well as setting mandatory vacation time.

Allow employees to be innovators. While not everyone works in a creative capacity, employees feel more valued when they contribute to company success. Consider building a channel to allow all employees to make suggestions to improve operations, services, or product lines.

Build a likable corporate culture. A lot of employee unhappiness stems from not fitting into corporate culture. If your organization has a lot of younger employers, consider whether a formal work environment is working for them. Simple changes like casual dress, less formal physical arrangements, and more company-sponsored social engagements may make a big difference.

Validate employees' efforts. While it's not necessary to hand out trophies at the end of each day, employees need to feel their efforts are valued. A combination of formal and informal recognition of a job well done can go a long way toward satisfying employees.

Employees who are happy at work stay in their jobs twice as long as those who aren't, spend approximately twice the amount of time on productive work tasks, and take far fewer sick days. So while focusing on employees' happiness may seem a bit new-agey, it's important to understand that it can have a direct positive effect on the bottom line.