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Happiness is considered somewhat of a fluffy term, and ask your board of directors if they care about how happy your employees are they will probably say yes, but may not know why it matters so much. Focussed predominately on business growth and fixated on the traditional Profit & Loss (P&L) view of company performance, too many organisations are still missing the opportunity that lies in maximising their ‘2nd P&L’, their ‘people and leaders’. By taking a one dimensional view of what drives company growth, organisations miss key opportunities to increase the performance of their number one asset – their people.

Your people form the front line of your brand’s interaction with clients, customers and partners. Their sentiment and happiness toward their work has an inconceivable power that can subconsciously rub off on the people they work with, both internally and externally.

So how is happiness at work going to help make your business better?

Essentially, no matter what research you look at – all data leads back to the same conclusion. Without doubt, improving workplace happiness and engagement has a cascade of positive effects on other parts of your business from increases in productivity to decreases in staff turnover, and ultimately an improved profit at the end of the financial year.

Put simply, working to make teams happier means implementing changes that bolster a sense of well-being and contentment. Make the right changes and your teams will naturally excel.  Not convinced? Well there is an abundance of research to help persuade you the power of being happy is not to be underestimated.

Research conducted by American firm revealed that happiness was the only emotion that actually increased sensation all over the body, and better still it was consistently seen across all subjects regardless of their ethnicity or culture meaning it can be applied to your organisation no matter its location, workforce demographic or sector with positive effects.

The clever people at the University of Warwick took this concept a step further and actually investigated if happiness can make teams more productive. They found that happy staff were 12% more productive. Essentially happy people are more focussed, use their time more effectively and work at a higher pace. In contrast, staff suffering unhappiness in whatever form are proven to be less productive (by up to 10%), are easily distracted and make more mistakes.

They proved a link between well-being and productivity which has formed important evidence that successful companies with ambitious growth plans cannot afford to neglect their staff happiness in the workplace. Investing in spreading a little happiness can go a long way.

Earlier research by the Wall Street Journal and iOpener Institute for People and Performance suggested that happy employees stay longer in their roles, are more energetic, have significantly less absenteeism and are more helpful to their colleagues – by a whopping 33% in fact. This same research also found that happy people were simply more open and engaged with their companies, with a 98% increase in the engagement with their company’s values. Identifying with company culture and feeling a sense of belonging is surely an excellent start to making people happier. After all your staff spend more time at work generally that they do with their friends and families!

Put in simple terms – a happy company has a competitive advantage against its competition.

How to find out how your employees really feel

Undeniably employers are now armed with enough evidence to make investing in employee engagement and well-being a priority at board level. With this said however, the challenge comes in knowing what will improve happiness in your organisation and undoubtedly each staff member you employ is likely to find happiness at work in different ways. Some will want security and transparency first and foremost, others will appreciate a good work-life balance and appropriate recognition and reward. There is no ‘one-size fits all’ approach to employee well-being sadly, so listening to your teams and acting on the insights in a timely manner is key.

When was the last time you asked your team ‘how happy are you at work’? You would be surprised what an open question of this nature will return. It forces an honest answer, as most people are not quick thinking enough to hide their dissatisfactions when asked such a direct and broad question. And asking regularly is important. A single annual survey of your staffs’ satisfaction is unlikely to give you the instant intelligence you need to prevent the sudden resignations that most companies fear.

Engagement and happiness are fluid emotions, easily affected by the simplest of things, so ask your team how they feel regularly and monitor the impact of any initiatives you implement to improve workplace happiness.

As the strength of our work relationships form the basis of much satisfaction/ dissatisfaction in the workplace, employers have to consider the impact of asking the right questions but not acting efficiently on the results in an open and consistent way. This inability to action the insights gained can be more detrimental than simply not caring enough to ask in the first place! Manage your teams’ expectations from the outset and they will be forthcoming in their ideas on how to make your organisation better.

Happiness is contagious

Ensuring your staff are happy and engaged with your company and its objectives has to come from within and from the top down. Just as dissatisfaction breeds dissatisfaction, a positive attitude rubs off on others. If your organisation employs many people, start by looking at your managers and their well-being. The psychological contract between your company and its people is inevitably a good place to start making improvements and your managers are integral to getting this process right.

Smile your way to happiness at work

If nothing else, go out today and try to make a colleague smile. A smile, whether forced or not is proven to have positive psychological effects. It releases endorphins and serotonin, both associated with a feel-good feeling.

Putting your people at the heart of your business and its processes will inevitably increase productivity and boost financial performance. By measuring happiness you can spot opportunities and threats faster, innovate more, improve retention rates for clients and staff, and make teams significantly more productive without cracking the whip. Therefore, fluffy or not, happiness is something business leaders cannot afford to overlook anymore. It’s time to re-educate leaders as to why happiness is integral to their business growth.

Written by Tony Latter, CEO and Co-Founder of The Happiness Index