Happy Employees are not Necessarily Productive Employees

Another argument for Measuring what Matters

The AP ran an article recently that raises some interesting questions. The title shouts out Americans’ Job Satisfaction Falls to Record Low. In case you’re wondering, yes that is among Americans who are working.

This article is interesting and a little confusing… and here’s the problem: while we intuitively want to believe that happy employees are a good thing and that no good employer would be happy with dissatisfied employees, there is no – zero – correlation between employee happiness and business performance. Hundreds of studies over the years have tried to find one, and failed. Happy, satisfied employees are not more productive; in fact, there tends to be a negative correlation… some level of dissatisfaction with the status quo fuels passion and drive. It creates a gap between where we are and where we want to be that impels us forward.

On the other hand, there is a direct and well documented correlation between engaged employees and business outcomes. Engagement is the measure of how committed employees are, and how attached they are to delivering the team’s goals and objectives. It stands to reason that the more engaged the group, the higher the business unit’s performance and profitability.

We attended a presentation by the Corporate Leadership Council a few months back… their research (along with that of just about every leading consulting firm in the last decade) confirms the primacy of Engagement as a leading indicator of business performance.

Simply stated, it is engagement and not happiness or satisfaction that sets the stage for sustained high performance.

Interestingly, CLC’s research showed a precipitous decline in employee engagement overall globally in the quarter leading up to the market crash in 2008.

We always talk about engagement as a predictor of business performance in the context of an individual business unit or department… and of course there were other forces at play leading up to the crash. But it does raise the tantalizing question: to what extent was the crash either caused or exacerbated by the lowest levels of workforce engagement ever recorded?

There are clear, tangible ways to build the engagement of your workforce, and it’s not about better meals in the staff cafeteria and more paid time off.