Can Your Business Survive Lower Productivity?

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The Department of Labor reported that productivity is down for the third straight quarter. Can your business meet its goals with lower productivity?

The government and economists put forth various guesses as to why productivity is trending lower including:

  • Lack of capital investment
  • New technology
  • Measurement errors

I don’t know why they don’t mention something research has demonstrated has a significant impact on productivity: employee engagement. Perhaps because the government wants congress to put your business’s productivity on the congressional agenda.

I don’t know about you, but as a business owner, I’ve observed that every area the government is involved in my business takes time away from productivity by creating requirements for documentation with the sole purpose of CYA’ing regulators. I don’t think they are here to help us.

If congress wants to be involved in business productivity we need to be sure we have input into the process. My preference is to let businesses deal with productivity.

Let’s look at the elephant in the room that the commentary is ignoring:

Employee Engagement. 

Widely available research shows that employee engagement has a significant effect on every area of your business, from customer satisfaction to employee theft, safety, absenteeism, and turnover. Employee engagement impacts both quality and productivity. All of these factors have the ability to impact profitability and even the viability of a business.

  • Khanlou and Wray’s research found that low resilience led to many undesirable outcomes including lower productivity.[i]
  • Sonja Lyubomirsky wrote “Once a happy person obtains a job, he or she is more likely to succeed. Employees high in dispositional positive affect receive relatively more favorable evaluations from supervisors and others . . . happy people receive higher ratings from supervisors, work performance may be more strongly predicted by well-being than by job satisfaction . . . job performance, as judged by supervisors, was significantly correlated with well-being but uncorrelated with measures of job satisfaction . . . as rated by objective observers, those high in dispositional positive affect performed objectively better on a manager assessment task (including leadership and mastery of information) service departments with happy leaders were more likely to receive high ratings from customers, and that the positive affective tone of the sales force was an independent predictor of customer satisfaction . . . CEOs of manufacturing companies with high positive affect were relatively more likely to have employees who rated themselves as happy and healthy, and who reported a positive, warm climate for performance. In turn, organizational climate was correlated with productivity and profitability . . . optimistic life insurance agents appear to sell more insurance and optimistic CEOs receive higher performance ratings from the chairpersons of their boards and head companies with greater returns on investment . . . the causal relation between pleasant affect and strong performance is bidirectional. Undoubtedly, one of the reasons that happy, satisfied workers are more likely to be high performers on the job is that they are less likely to show “job withdrawal”—namely, absenteeism, turnover, job burnout, and retaliatory behaviors . . . positive moods at work predicted lower withdrawal and organizational retaliation and higher organizational citizenship behavior, as well as lower job burnout. Positive affect at work has also found to be directly associated with reduced absenteeism.”[i]

A small sampling of research that indicates increased productivity is an outcome of increased happiness includes:

  • Shawn Achor in The Happiness Advantage
  • A report to the United Nations by De Neve, J.E., Diener, Ed, Tay, L., & Xuereb, C. in 2013 titled The Objective Benefits of Subjective Well-Being.
  • Lyubomirsky, King, and Diener in The Benefits of Frequent Positive Affect: Does Happiness Lead to Success? published in Psychological Bulletinin 2005.
  • An article the Gallup Management Journalpublished by M. H. Greenberg in 2007 titled Optimistic managers and their influence on productivity and employee engagement in a technology organization.
  • Mason’s 2011 book, The H Factor: how Happiness Will Improve Your Bottom Line and Help Your OrHelpation Thrive.
  • Psychological capital and employee performance: A Latent Growth Modeling approach byPeterson, S. J., Luthans, F., Avolio, B. J., Walumbwa, F. O., & Zhang, Z. in Personal Psychology in 2011.
  • Martin E. P. Seligman, commonly referred to as the father of Positive Psychology, published Explanatory style as a predictor of productivity and quitting among life insurance sales agents in the Journal of Personality and Social Psychology in 1986 detailing the significantly higher productivity of optimistic sales staff.
  • A 2009 article by Oswald, A. J., Proto, E., & Dgroi, D. published for the Institute for the Study of Labor titled Happiness and Productivity.

These aren’t small names in the field. In fact, many of the studies mentioned above are from leaders in their respective fields.

I didn’t set out to write an employee engagement book when I wrote Empowered Employees become Engaged Employees. I was actually reviewing research about resilience for my dissertation when I came across a number of studies that pointed to an employee’s core self-evaluations as the most significant factor that impacted employee engagement.

If you think of happiness and resilience as high-level factors composed of several lower level factors which may, in turn, be composed of additional, single-item factors, aspects of core self-evaluations are a significant lower-level factor for both resilience and happiness. The same low-level factors are significant for employee engagement.

The differences don’t matter in relationship to employee engagement. The overlap is strong enough that using logic one could make the following statements:

[message type=”custom” width=”100%” start_color=”#FFFFFF” end_color=”#FFFFFF” border=”#fb7200″ color=”# fb7200″]

A happy employee will be an engaged employee.

A resilient person will be happier than someone who is not resilient.

Resilience increases one’s capacity for happiness.

A resilient employee is more likely to be an engaged employee.

It is likely that an engaged employee will be resilient.[/message]

[su_spacer]

The abundance of research that indicates happiness increases productivity is understandable when the lower-level factors of happiness, employee engagement, and resilience are compared to one another.

The question that remains is how does one increase their employee’s levels of resilience and happiness. At Happiness 1st Institute that is our sweet spot. It is the area Dr. Joy has researched for over two decades and that Happiness 1st was founded on in 2011. The process has evolved into what we refer to as The Smart Way.

It is smart for two reasons:

  • It is self-sustaining. Most solutions are dose-dependent and require repeated boostersto maintain their effectiveness, The Smart Way does not require boosters and its effectiveness increases over time.
  • The Smart Wayaddresses the root of the problem, not a symptom. By developing healthy roots, the entire person can flourish.

If your company wants or needs increased productivity, The Smart Way provides a solution you can count on to help you thrive. 

  • [i](Lyubomirsky, The How of Happiness: A Scientific Approach to Getting the Life You Want, 2008)

[i] (Khanlou & Wray, 2014, p. 70)

Jeanine Joy, Ph.D.
Jeanine Joy, Ph.D.http://www.happiness1st.com/
WORLD CHANGER, International Speaker, and Trainer – Dr. Joy stepped up to do everything she could to help humanity thrive more after she discovered that she could help to improve societal problems by empowering people to manage their mindset, develop psychological flexibility, and use their innate emotional guidance. She began studying the genesis of human thriving in 1995 and as her knowledge grew she became a thought leader and educator. The evidence-based techniques she teaches and writes about create improvements in physical, mental, emotional, and behavioral health. Her approach has a direct, positive effect on crime, violence, relationships, racism, educational outcomes, suicide prevention, employee engagement, happiness, career success, and more. She focuses on solutions that are both affordable and scalable because she wants to help everyone have a greater opportunity to achieve their dreams and goals. As the owner of Happiness 1st Institute, a Thrive More Now Company, Jeanine speaks internationally and provides training to organizations through her empowering, practical, and usable techniques that target the root causes of human thriving. She is recognized as a bridge builder who creates bridges by translating jargon-laden research into usable information with practical examples that help individuals fulfill more of their potential.
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