26 Oct FACT: Happy Employees Are Productive Employees
There is a well known saying that ” A Happy Employee is a Productive Employee”, and when you think about it it makes sense, after all if you are happy in your job you will be able to focus better and therefore be more productive.
But until recently there has been a lack of real-world evidence supporting this statement, and without this it can be difficult for HR departments to justify additional expenditure to promote employee well being. This has now changed thanks to recent research conducted at Oxford University that provides the evidence on the relationship between employee well-being and productivity.
When combined with APeopleBusiness StressFactor™ solution, it is now within the reach of most companies to be on-top-of their employee well-being, and therefore improve their overall productivity.
The new Study on the relationship between employee well-being and productivity:
The research from economist Jan-Emmanuel De Neve, who lectures at Oxford University’s Saïd Business School, is the first to provide large-scale causal evidence on the relationship between employee well-being and productivity.
De Neve and his team collaborated with British telecommunications giant, BT – one of the UK’s largest employers, for over 5 years before reaching their conclusions.
The weekly survey asked BT’s call centre staff how they felt their week was going, and compared it to how well their work was going by analysing time spent per call, customer satisfaction and weekly sales. The survey also considered other variables that could affect the results including the local weather conditions (better weather tends to make people feel happier).
To quote De Neve:
We found a remarkable relationship — from one week to the other, one standard deviation in worker happiness was related to an almost 20% improvement in his or her weekly sales.
The reason why employee well-being actually matters is that social and emotional intelligence are heightened when people are in a better mood, which has implications for work.
The difference between Pressure and Stress
Unfortunately, even in this day & age the attitude still prevails in upper management and at board level that ‘a bit of Stress is good for improving efficiency‘.
But at APB we understand that there is a real difference between stress and pressure, and although they both refer to similar concepts they shouldn’t be used interchangeably. The reason is that pressure is when you put a person under a workload they can cope with, and it stimulates them to perform at their best. Whereas stress is when the work becomes too much for the person to handle, causing them to feel overwhelmed and unable to do the task given to them and causing them distress. This is not only undesirable for the individual concerned, but it also impacts the business negatively.
Without an in-depth understanding of the employee’s mental state and individual capacity to deal with workloads pressure can easily tip into stress, with all its negative consequences.
The Pressure/Performance curve
The Pressure/Performance curve (see chart) shows the different levels of pressure and their impact on performance. They range from Boredom to Crisis:
- Boredom: When there is little or no pressure then boredom sets in.
- Comfort Zone: With increased pressure (and stimulation) we enter a productive zone where performance increases.
- Stretch: This is where we are being extended and find it starting to become challenging, although still within our ability to cope.
- Strain: Where we begin to falter leading to fatigue, poor judgement and decision making.
- Crisis: This is the least desirable of all outcomes as the workload has become so intense it causes actual physical and psychological damage, including: exhaustion, health problems, breakdown and burnout.
For your workforce to function at optimal levels you need to carefully calibrate the workload you put them under; too little and they risk being uninterested and bored, too much and they will experience undue stress and be unable to cope.
Recognising when there is too much pressure, and it has turned into stress is key to being able to do something about it. That’s where APeopleBusiness StressFactor™ comes into its own.
The negative impact of stress on business productivity
According to Cambridge University the negative impact of employee stress on businesses includes:
- High absenteeism.
- High employee turnover.
- Poor time keeping.
- Poor performance and productivity.
- Low morale.
- Poor motivation.
- Increased employee complaints.
- Increased ill-health, accidents and incidents reports.
- Increase in Psychosocial Risk and Presenteeism.
The real-world impact of stress on productivity conducted by research commissioned by the Health and Safety Executive indicates that:
- About half a million people in the UK experience work-related stress at a level they believe is making them ill.
- Up to 5 million people in the UK feel ‘very’ or ‘extremely’ stressed by their work.
- Stress-related illness is responsible for the loss of 6.5 million working days each year.
Furthermore, the UK mental health Charity Mind estimates excessive stress at work costs the British economy approximately £100 billion a year in lost output.
Q: How do you achieve the right balance between Pressure and Stress? A: StressFactor™
As we’ve seen it’s critical that you get the employee pressure / stress balance right to achieve maximum productivity. Unfortunately, it’s easier said than done as no two individuals are alike, and their ability to deal with stress can vary wildly. When you have hundreds, thousands, or tens of thousands of employees to oversee this can become a real challenge to manage.
Fortunately, there is a solution that gives both HR and senior level management an easy-to-understand overview of the current wellbeing of their workforce – it’s called StressFactor™, a software solution by APeopleBusiness.
StressFactor™ enables organisations to identify underlying workforce dynamics and surface potential issues. Its easy to understand heat-map statistics gives management a dashboard overview of their employees’ mindset.
The real-world uses of StressFactor™ also go beyond the identification of employee stress issues, it is also an invaluable tool that helps businesses grow throughout their strategic development. It is a tested and trusted solution used by many companies and international organisations including CERN.
Thanks to the research conducted by De Neve and his colleagues there is now incontrovertible proof linking employee’s mindset, i.e. how happy they feel, to their productivity. With this information it is now possible for HR departments to present a compelling case for investment in people orientated health programs and organisational change intitiaves that alleviate stress to upper management.
Positive initiatives from within an organisation pay off in the long run by increasing productivity; retaining staff who are expensive to replace and retrain, reducing the odds of reputational damage caused by disaffected employees, and lead to a better working environment.
APeopleBusiness StressFactor™ solution allows business leaders and managers to avoid a pressure (challenge) workplace environment turning into a stressful (threatening) one.
To discuss how StressFactor™ can positively impact your business please contact us for a free consultation.
Bellet, Clement and De Neve, Jan-Emmanuel and Ward, George, Does Employee Happiness have an Impact on Productivity? (October 14, 2019). Saïd Business School WP 2019-13, Available at SSRN: https://ssrn.com/abstract=3470734 or http://dx.doi.org/10.2139/ssrn.3470734
The Pressure/Performance curve Source: https://www.uea.ac.uk/documents/746480/2855738/PressPerfCurveWilliams1994.pdf
Happiness / Sales chart: Source: https://poseidon01.ssrn.com/delivery.php?ID=161070001067087064091123082025003123120047030012065075094104116097002030100005072120049062054045104022006125121000092015125101123011053034003086094007085111108001010021050031125069090083104093025084096096106127125026102107124095108000125076069094099087&EXT=pdf&INDEX=TRUE