Staff Happiness Increases Profits: The Business Case

Adam Shaw | 7th June 2016

When I first started running team-building and resilience workshops I believed that it was the lack of education about how stress works, the implications of not managing this properly, and failure to appreciate the importance of work-life balance that were the key issues. However, I had taken one critical area for granted. Fast-forward 8 years, and my understanding of the issue has completely changed.

Whilst all of the above are factors, I have come to the conclusion, from the numerous feedback forms of the people participating in my training programmes – that happiness is the underlying factor in just about everything employee related. The ability to get to know work colleagues in a different light is one of the most common benefits of training days.

Organisations that do not focus on the happiness of their employees are missing a massive trick here, as the statistics clearly highlight. 

Here are just a few stats to back this up: Happy employees are 20% more productive. Happy sales people produce 37% better sales. Close work friendships improve employee satisfaction by 50%. Employees who report being happy at work take 10 times fewer sick days.  Fortune’s “100 best companies to work for” enjoyed a 14% per year average stock price rise, compared to 6% for the overall market between 1998-2005*.

Team building days provide a massive return on investment when the central focus is on improving team dynamics.

Problems are caused by increased workloads, lack of personal contact (emails replace talking), and people feeling misunderstood. In one blue-chip organisation I worked with, the team were brought in from all over the country. Because they lacked proximity, they also lacked the personal touch, and empathy to the feelings of their colleagues. At the end of the day I always ask, “What are the biggest take-outs from today?” I was shocked to find something as simple as: “We need to pick up the phone more often,” was one of their biggest breakthroughs.

In the strive towards efficiency, it is easy to lose the personal touch.

Ironically, the time that I was happiest as an employee was back in my nursing days, working on one of the heaviest and most stressful medical admission wards.

What was the difference? I loved working with the team there. The critical factor was that the staff also became my friends. Some of whom, 20 years later, still are. We went out socially regularly, spent time together outside of work, and perhaps most importantly of all, would not want to let each other down by being sick or absent from work. In fact, I looked forward to going to work to catch up with my friends.

It was this experience, along with speaking to so many employees who were diagnosed with cancer, strokes and heart attacks who often talked about stress at work over long periods that started me thinking…

The fact is that long-term unhappiness at work causes illness. Apart from this being toxic for businesses, it is also hugely expensive. Long-term sickness costs money, and reputations.

Being able to measure happiness is critical for organisations, which is why the simplicity of what The Happiness Index does comes as a welcome relief to me. After all, organisations who do not value the happiness of their staff are unlikely to be top-performers.

Being able to measure happiness is something every company would be wise to do.


*(Source: http://www.snacknation.com/blog/employee-happiness/).