Why More Businesses Need to Focus on Employee Happiness

Editor's Note: Take a look at our featured best practice, 5 Dimensions of Employee Engagement (24-slide PowerPoint presentation). Businesses typically focus on customers. However, with rapid changes and intense competition they have come to realize that employees make or break an enterprise, create brand impression, and represent the organization's culture & values. Exceptional service has been realized as a key source [read more]

Also, if you are interested in becoming an expert on Human Resource Management (HRM), take a look at Flevy's Human Resource Management (HRM) Frameworks offering here. This is a curated collection of best practice frameworks based on the thought leadership of leading consulting firms, academics, and recognized subject matter experts. By learning and applying these concepts, you can you stay ahead of the curve. Full details here.

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Keeping customers satisfied has always been a priority for small businesses. Yet, many companies neglect to take their employees’ happiness into account.

Employee happiness isn’t difficult to achieve. However, it’s one aspect of your business that benefits it in various ways. Without making this a priority, company owners risk damaging their business — including its reputation.

Here’s why you must focus on employee happiness this year.

Increases Productivity

A study by the University of Warwick found that productivity increases by 12% when employees are happy. Unsurprisingly, workers who are more satisfied at their jobs will take fewer sick days and coffee breaks.

At the same time, unsatisfied employees are more stressed and become easily distracted. They’ll find any excuse to get away from their desk to avoid getting work done.

Businesses keeping an eye on their bottom line must be aware of how employee satisfaction can affect this.

Maintains High Engagement

Engaged employees mean they are passionate about their job and are more willing to contribute to their work. In fact, employee happiness is the key to driving their engagement. It makes for a more positive workplace and helps them feel more connected to their role in the company.

Enhances Creativity

Satisfied employees can see the bigger picture when they are engaged at work. With that comes creative thinking and innovative ideas that may benefit the company.

They also may feel safe to take risks, which can be vital to a company’s success.

Improves Retention Rates

Employee happiness plays a vital role in employee turnover. Most workers who are unsatisfied aren’t likely to stick around. In fact, their chances of finding a job that will satisfy their needs are high since most employers are hiring these days.

And what most employees want typically pertains to their wellness and flexibility.

High turnover rates can be costly for businesses. The recruiting and training process can cost well over thousands of dollars when they have to replace their employees.

Lower Absenteeism

Unsatisfied employees share a lesser commitment to their jobs and may find any excuse as to why they can’t be at work. Those who take off more work days can seriously impact your bottom line.

In contrast, happier employees are more likely to show up at work because they are motivated to do their job.

Ways to Keep Your Employees Happy

There are several methods that businesses can use to increase employee satisfaction. Yet, before you implement these tips, consider asking for employee feedback with surveys. You can do this on a regular basis to understand your employees’ needs better.

1. Create a Diverse and Inclusive Company Culture

Creating a workplace culture that fosters diversity and inclusion helps employees to feel more welcome in the workplace. Plus, it attracts top talent to your business.

You can start by creating a company policy and training your management team to demonstrate these values. By enhancing your company culture, your employees will feel more satisfied and want to stay at their place of employment.

2. Recognize Their Accomplishments

The biggest driver of employee dissatisfaction is feeling unappreciated for their hard work. That’s where businesses must use positive reinforcement by showing their appreciation.

This could be in the form of an employee recognition program, where all staff members can offer positive feedback to one another. Or, the leadership team could write a Thank You note that praises them for their efforts.

3. Create Training and Development Opportunities

Companies that want their employees to feel content must give them tools that help them feel comfortable doing their jobs. However, they should offer training whether it’s a new software they’re using or a new policy going into effect.

Your team will need to know why something new is taking place and what benefits it provides them and the company.

Furthermore, team members are going to grow within the company. Therefore, you must consider creating development opportunities for them so they can advance in their career. Learning and development are to employee happiness and retention.

4. Offer Flexible Schedules

Since the COVID-19 pandemic, employees have gotten a taste of what it’s like to work from home. They could spend more time with their families and work during hours they felt most productive. Since then, most of the workforce has had no desire to return to the office.

With that in mind, companies have started offering remote or hybrid work options to satisfy the need for flexible work schedules. It’s an attractive opportunity that many Americans want today.

If your company can provide flexible scheduling, your employees will thank you.

5. Offer a Comprehensive Benefits Package

A competitive salary and benefits package is essential for attracting and retaining talent in today’s market. Since the job marketplace is tight for finding labor, you likely need to enhance your offering to stay in the race.

Therefore, paying employees for their worth is necessary to maintain their satisfaction.

Offering a competitive wage with benefits shows how much you value your team members and care for their wellbeing. Consider reviewing these annually to ensure you’re keeping up with industry standards.

Increase Your Company’s Health With Happier Employees

The evidence shows that a culture of happiness leads to higher business success rates. Employee happiness leads to greater productivity, retention and decreased absenteeism.

Give your team a sense of purpose to lock in the success of your company’s future. Once you implement changes within your organization, you’ll see the connection between employee happiness and enhanced operational performance.

Want to Achieve Excellence in Human Resource Management (HRM)?

Gain the knowledge and develop the expertise to become an expert in Human Resource Management (HRM). Our frameworks are based on the thought leadership of leading consulting firms, academics, and recognized subject matter experts. Click here for full details.

The purpose of Human Resources (HR) is to ensure our organization achieves success through our people. Without the right people in place—at all levels of the organization—we will never be able to execute our Strategy effectively.

This begs the question: Does your organization view HR as a support function or a strategic one? Research shows leading organizations leverage HR as a strategic function, one that both supports and drives the organization's Strategy. In fact, having strong HRM capabilities is a source of Competitive Advantage.

This has never been more true than right now in the Digital Age, as organizations must compete for specialized talent to drive forward their Digital Transformation Strategies. Beyond just hiring and selection, HR also plays the critical role in retaining talent—by keeping people engaged, motivated, and happy.

Learn about our Human Resource Management (HRM) Best Practice Frameworks here.