Testing an Assumption: Are Happy Teams Really More Productive?

The driving force seems to be that happier workers use the time they have more effectively, increasing the pace at which they can work without sacrificing quality.—Daniel Sgroi, British economist.

Testing an Assumption: Are Happy Teams Really More Productive?We tend to take certain things for granted in the business field. For example, we once assumed—because we’ve seen it again and again—that successful entrepreneurs almost always fail before they succeed in a big way. But research published in the Harvard Business Review proved this a myth years ago. Indeed, previous failure does not determine future success. Some entrepreneurs succeed on their very first try, and those who’ve failed before succeed no more often than those who haven’t.

But I’m happy to report that another “everyone knows” fact actually enjoys support from the research community: success makes us happy, but happiness can also result in success, in a kind of chicken-or-egg scenario. In one eye-opening experiment, workers did 10-12% better at math problems when they got free chocolate and watched a comedy video first, as opposed to colleagues who got no chocolate and watched a neutral video.

On a more sobering note, we already know unhappy workers actively hurt our organizations, whether they intend to or not. Gallup polls have repeatedly shown low engagement levels in American businesses. According to Gallup’s 2014 engagement survey, 51% of American workers aren’t engaged with their work, with another 17.5% actively disengaged. As of mid-2013, Gallup estimated that disengagement cost American businesses as much as $550 billion annually. In an earlier 2010 study, Gallup researchers showed that how employees felt about where they worked predicted later sales and profit figures.

So, yes: happier workers really are more productive. The real issue here involves determining how to make the largest number of workers happy for the longest period of time. Businesses have tried different ways to accomplish this, with varying results; Google seems to do it well, with their toys and free food, but they also have a high turnover rate.

Positive Means Productive

In 2011, researchers at the University of Michigan argued in the Journal of Applied Behavioral Science that workplaces based on “positive and virtuous practices” hold the true key to worker happiness. Happiness doesn’t come from special benefits or financial incentives, they claimed; people prefer positive work environments where they care about each other, provide support, kindness, and compassion when others struggle, treat each other with respect, inspire others with meaningful work, and generally take responsibility for one another’s contentment.

We’re not talking coddling here, just wholesome Golden Rule behavior. The “Greed is Good” mentality went down the toilet with the Great Recession; some would argue it caused the Recession. The economic downturn and our long, hard slog out of it generated a lot of unhappy campers, all of whom could use a few rays of sunshine going forward. The Michigan researchers pointed out that positive and virtuous practices increase positive emotions, buffer against stress and other unpleasant factors, attract new employees, and increase existing employee loyalty.

Leadership by example, a lively work culture, retreats and workshops, and even small steps like having workers keep gratitude journals can make huge differences toward creating and maintaining positive and virtuous work environments. Businesses like Quicken Loans, Salesforce, and Apple provide good examples here, according to the annual Forbes Magazine poll of the best places to work in America.

Other Happiness Factors 

Job satisfaction isn’t just about general happiness or loving what you do; growth also matters. Facing and overcoming challenges seems to contribute as well, according to several studies that are, frankly, older than the Millennials now flooding the workforce. The practices of broadening a worker’s comfort zone and helping them realize they’re smarter than they think seem especially effective. So does the ability to spend part of their time working on independent projects, as 3M and Google have learned to their benefit. Not everyone accepts these factors as contributory to happiness, but they seem to work for some.

Sadly, many companies seem not to care much about employee happiness, a case of paradoxical behavior if ever there was one. None actively tries to suppress it, but few make significant gestures toward pushing workers further up the contentment scale. Even small gestures like taking the team out to lunch or providing free donuts or bagels once a week can work wonders, but that’s about as far as most businesses seem willing to go. Apparently, they’re satisfied with the status quo and don’t care about increasing market share.

© 2015 Laura Stack. Laura Stack, MBA, CSP, CPAE is an award-winning keynote speaker, bestselling author, and noted authority on employee and team productivity. She is the president of The Productivity Pro, Inc., a company dedicated to helping leaders increase workplace performance in high-stress environments. Stack has authored seven books, including her newest work, Doing the Right Things Right: How the Effective Executive Spends Time (Jan. 2016). She is a past president of the National Speakers Association, and in 2015 was inducted into its exclusive Speaker Hall of Fame (with fewer than 175 members worldwide). Stack’s clients include Cisco Systems, Wal-Mart, and Bank of America, and she has been featured on the CBS Early Show and CNN, and in the New York Times. To have Laura Stack speak at your next event, call 303-471-7401 or visit her website.