Happy workers mean more revenue

Is a company a great place to work because it is wealthy, or is it wealthy because it is a great place to work? Ron Friedman has gathered a vast array of quality research to answer this question. As you work your way through this exceptionally valuable book, the answer will become increasingly clear and compelling.

Fortune magazine has ranked Google the world’s best place to work 7 times in 10 years. Employees can have massages, haircuts, foreign language courses, doctor’s appointments and more, all on the campus and free of charge.

More instructive is Wegmans, a US grocery chain that has been high on the ‘100 Best Companies to Work For’ list for the past 14 years. During this period, annual sales have nearly tripled! Whereas many retailers try growing by squeezing labour costs, Wegmans did the opposite: they invested more in their people.

The conclusion Friedman has drawn from wide research is that “the more invested and enthusiastic people are about their work, the more successful their organization is on a variety of metrics”. Happy employees are more productive, more creative, provide better client service, and are less likely to call in sick. They also act as brand ambassadors outside the office.

Focusing on workplace happiness doesn’t cost the company money in the long run, and ensures revenues will grow. Those on the Best Companies to Work For list outperform the market as a whole, by a factor of 2 to 1.
Friedman demonstrates across the 11 chapters of this book that very little wealth is required. All of the advantages can be achieved by any company, irrespective of the staff or balance sheet size.

Failure is the only reliable path to success
In a chapter entitled “Success Is Overrated – Why Great Workplaces Reward Failure”, Friedman shows that accepting failure is not only a way of making it easier for employees to be risk-takers, but often proves to be the only reliable path to success.
Shakespeare, Beethoven and da Vinci were all far more productive than their contemporaries. Their most interesting common denominator is the volume of attempts they made to produce great work. Thomas Edison’s hundreds of failures led to his successful invention of the lightbulb.

Prior to the huge successes of the iPhone and iPad, Steve Jobs racked up a remarkably long list of failures that includes the Apple I, the Apple II, the Lisa, the Newton personal digital assistant, and NeXT hardware. As Larry Page of Google points out, “Even if you fail at your ambitious thing, it’s very hard to fail completely. That’s the thing that people don’t get.”

But failure alone won’t add to success unless the failure is interrogated for insights that can help the next attempt.
I was particularly intrigued by chapter five: “How to Turn a Group of Strangers into a Community”. Dr Donald Clifton, founder of the Gallup organisation, developed the Q12 survey to identify employee engagement.

One of the items measured is whether employees have workplace friendships – one of the strongest predictors of productivity. Employees with a best friend at work tend to be more focused and more loyal to their organisations. They are sick less often, suffer fewer accidents, change jobs less frequently and have more satisfied customers.

In a variety of clinical studies, friends outperformed acquaintances. Friends were more committed at the start of a project, communicated better, and offered teammates positive encouragement. Acquaintances preferred to work alone and did not help others avoid mistakes. They engaged others only when absolutely necessary, and were less comfortable seeking help.

The reduction of staff churn is particularly important in contexts where there is a shortage of talent. If co-workers are friends, it is harder to leave. The opposite is also true.

Workplace friendships, however, do not have to be left to chance.

Fostering friendships at the workplace
What can organisations possibly do about employees’ friendships, since friendships are voluntary and people can’t be persuaded to become friends? There are three ingredients in building friendships and they are all surprisingly straightforward. All have been verified by research.
The first ingredient for friendship is physical proximity. Co-workers who work nearby increase the chances of forging friendships more than if they worked in different departments.

The second ingredient is familiarity. Psychologists call this the ‘mere exposure effect’ and argue that our minds are designed to distrust the unfamiliar. Studies show that the mere exposure effect doesn’t just affect our impressions of people: it also applies to paintings, songs and consumer products.

The third and strongest contributor to friendship is similarity. The writer C.S. Lewis once observed, “Friendship is born at the moment when one person says to another,’‘What! You too? I thought I was the only one’.” Similarity is reaffirming. If I like what you like, your opinion validates mine and increases my self-liking.

Even if all the ingredients are present, friendships might still not blossom. Research by Art Aron shows that factual exchanges aren’t enough to create friendships. People need to reveal intimate information about themselves in a reciprocal fashion; both partners need to self-disclose. This self-disclosure needs to progress because without deeper revelations a relationship can stall.

Is mutual self-disclosure with co-workers really wise? Research conducted by Professor Patricia Sias suggests it is, at least if your goal is to make friends.

How can you tell if coworkers are friends? By the amount of time they spend discussing nonworkplace topics. When talk is only about work, you might develop a reputation for being competent, but you’re not likely to develop many friendships.

While we know a lot about the formation of friendships, we seem to apply very little of that knowledge to cultivating relationships in the workplace, despite their proven work value. “Surprisingly little thought is given to the way onboarding can contribute (or undermine) a sense of connection between team members.”

Most company introductions to newcomers consist of little more than being shown your workspace and going through the corporate equivalent of speed dating – back-to-back meetings with key people, at breakneck speed.
Intelligent onboarding must reflect the reality of the needs of employees as well as those of their companies, and must accomplish two major concerns: demonstrating competence and connecting with their colleagues.
Introducing new employees by more than just their professional background, such as their hobbies, their favourite entertainments or an unusual talent, is valuable. The Great Place to Work Institute’s Best Companies to Work For award in 2011 has made personal interests a key feature of their onboarding practices.

Providing a colourful introduction makes it easy for teammates to have nonworkplace topics to talk about the first time they meet, a short cut to possible workplace friendships.

There are so many superb insights and so much practical advice for anyone who recognises the value of creating a great place to work in this book. Such a place is unlikely to happen by chance. Friedman offers advice across too wide a range of issues to cover in this column. The book should be read by all HR professionals and managers with organisational responsibility.

By Ian Mann of Gateways

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