All posts by Alexander

Employee engagement vs. happiness at work – what should companies focus on?

I met a manager recently who claimed in no uncertain terms that companies should forget all about employee happiness and focus only on engagement.  He argued that people can be happy at work without performing well, whereas employee engagement leads directly to better performance.

I’ve actually heard this claim a few times recently, but it is still wrong. In this article we’ll look at why.

But first let’s define the two terms. Both can be defined in many different ways, which will confuse any discussion, so here are the definitions I will base my argument on.

This is the first result that comes up when you google “employee engagement definition”:

Employee engagement is the extent to which employees feel passionate about their jobs, are committed to the organization, and put discretionary effort into their work.

And this is the definition of happiness at work that we use:

Happiness at work is the extent to which employees feel good about their jobs.

Both are clearly emotional at their core (the word “feel” appears in both) but the key difference is that engagement is more about the work and less about the person. It’s not really about how you feel in general, it’s how passionate you feel about your job, how committed you are to the workplace and how much extra effort you put in.

Happiness at work, as we define it, is how work makes you feel more broadly. It’s not about feeling good every second of every work day, but it is about experiencing mostly positive feelings about your job.

Just to make it clear: We think employee engagement is a useful concept and we are not arguing against it. We just want to argue that of the two, it is much more effective for a company to focus on making their employees happy than on making them engaged. Here are the four main reasons why.

1: Happiness is easier to sell to employees

Whether you’re looking to create employee happiness or engagement, you need your employees to be active partners in the process. This is not something you can do to them without their active and willing participation or (even worse) against their will.

Employee engagement, being directly related to commitment and effort, is a very easy sell to managers and companies. Every manager wants employees who are passionate about their work and go above and beyond to do a better job.

But seen from the employee side, it’s a much harder sell. When a manager states that they want their employees to “be more engaged in their work” or “give more discretionary effort” it can easily come off as if they are simply demanding more passion and work from people, without giving anything back.

On the other hand, when a manager sets a  goal to create a happy workplace, the benefits are immediately clear to employees and it’s much easier to engage them in the process.

Ironically, happiness can be a harder sell towards managers, many of whom are skeptical of “all that happiness crap”. This video covers their most common objections and why they’re wrong:

2: Engagement without happiness is unsustainable

How engaged can someone really be if they’re unhappy at work?

This happens. One of our International Partners, Sheona McGraw of Cloud 9 to 5 in Canada has seen it first hand:

Having worked in a number of charities, non-profit orgs and social enterprises, I can tell you that most of these employees are passionate and committed about their org’s cause but unfortunately a lot of the orgs don’t have a very happy work environment and it’s not uncommon at all to find super engaged yet super unhappy employees working in these orgs.

This is something I talk a lot about in my discussions with potential clients. I myself have been in this circumstance a number of times, being super engaged but miserable. And while I performed satisfactorily, had I been happy I would have blown the job out of the water.

A person can be incredibly passionate about their work and totally committed to the workplace, but still be miserable at work. I’ve seen this happen for instance when people are treated badly by their coworkers or manager or when they can’t do their job in a way that satisfies their own professional standards.

In this case, two things can happen:

  1. The employee’s unhappiness can leech away any feeling of engagement, leaving the person not caring about their work.
  2. Or, even worse, the person remains engaged and unhappy – which leads to stress and burnout.

So even if you want an engaged workforce, you still need to focus on making them happy because engagement without happiness is not sustainable.

3: Ultimately, it’s about performance – and happiness drives better performance

As I stated above, some fans of engagement argue that it matters more because it directly drives effort and performance. They also argue that employees can be happy but not productive. Both of these arguments reveal a poor knowledge of the research in happiness at work.

Sure, engagement leads to better performance – but given the definition above that includes commitment and extra effort, that’s almost a tautology.

Furthermore, we know from a large amount of research, that happy employees perform much better. Ed Diener, one of the world’s leading happiness researchers summed it up like this:

In the workplace we know that happiness causes more-productive and more-creative workers.

If you know academics, you know how careful they are about using the word “causes.” In this case, we know that happiness at work causes higher:

  • Productivity – happy people get more work done with the same resources.
  • Creativity – feeling good makes your mind more able to think of new ideas and approaches.
  • Intrinsic motivation – happy people don’t need constant external motivators like bonuses or threats; they want to do good work.
  • Loyalty – happy employees care about the company and stay longer in their jobs.
  • Discretionary effort – employees who like their jobs go above and beyond for the customers, their co-workers and the workplace.

So employee happiness has been shown to directly cause increased performance.

4: Happiness causes engagement

You’ll notice that both loyalty and discretionary effort were part of the definition of engagement that we presented above.

Given that (as we saw in the previous section) happy employees are more loyal and are more likely to go the extra mile, it’s clear that happiness  doesn’t only cause better performance – happiness also directly causes engagement.

Of course, the effects are circular and engagement and happiness will cause each other. But given the results above as well as the fact that engagement cannot last in the absence of happiness, it seems clear to me that happiness causes engagement more than engagement causes happiness.

Gallup does a lot of great work on employee engagement and their Q12 survey is one of my favorite metrics. They also acknowledge that many factors play into engagement, including happiness / well-being, writing:

Leaders have to think about everything from culture to well-being to purpose and meaning — and make it all come to life in a personalized way for employees.

The upshot

Engagement is a great concept but ignoring employee happiness in the pursuit of engagement makes no sense.

At the very least, sustainable engagement requires happiness at work, meaning you can’t ignore the happiness aspect.

When do people feel “passionate about their work, committed to the workplace and give discretionary effort?” When they’re happy at work!

So if you want engaged employees, focus on making them happy and engagement will follow.

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Never ask employees what would make them happy. Here’s why.

Most managers have realized by now that happy workplaces are more productive, more creative, attract better talent and make more money.

So if you were a well-meaning manager or HR person looking to capitalize on this and create a happier workplace, you might be tempted to start by asking your employees some version of this question:

“What would make you happier at work?”

It seems like a great place to start. To make people happier, ask them what they want and them give them that. Right?

Wrong.

Here’s why: We know from the research that people are notoriously bad at predicting what will make them happy.

Stop random people on the street and ask them what would make their lives happier and a lot of them will reply “Winning the lottery.” But studies of lottery winners show that they are actually only marginally happier than all of us non-lottery millionaires.

Similarly if you ask employees what will make them happier at work you will most likely get responses like:

  • A raise
  • A promotion
  • A bonus
  • A gym in the office
  • Free fruit
  • Free lunches

But while all of this sounds perfectly reasonable (indeed, you might give some of the same answers if asked the same question), we know from the research that these factors don’t make employees any happier at work. Just to be clear: We cannot ignore them when making workplaces better, because these factors can absolutely make people unhappy when they’re unfair. But once they are fair, increasing them further does not increase happiness at all.

This explains why many organizations spend a ton of time and money on every perk imaginable and employees are still not happy.

Quite simply: giving employees what they ask for is doomed to fail, if they don’t know what to ask for. And they don’t.

What we need to do instead, is help people discover for themselves what really makes them happy at work and there’s a much better question for that:

Tell me about a recent good experience at work that made you happy.

This may look like essentially the same question as the one above so why is this one better? With the previous question (What would make you happy at work) we only get at the things people think will make them happy.

With the latter question, we ask about specific previous experiences that caused happiness. This means that we get directly at what really works.

I have used this question in hundreds of speeches all over the world and never once has anyone told a story of getting a raise, a promotion or a perk. Never once has anyone said “I was really happy last Thursday because I got a free apple.”

The one exception was when I did a workshop at Lego and an employee shared this example:

Every week our team gets a new box of fruit and there’s always only one banana in it. If I get there in time to get that one banana, it makes me really happy!

I’m 98% sure he was kidding!

Invariably, when people reflect on this question their stories fall into two categories.

They either talk about doing good work, achieving great results or making a positive difference for others. This includes things like:

I had a complicated problem on a project and found a really creative solution for it.

A customer liked my work so much they sent me an email with tons of positive feedback.

I helped a coworker by sharing advice and knowledge.

Or they talk about moments of personal connection at work, like:

I came back to the office from parental leave last week and so many people on my team welcomed me back with smiles and hugs.

I had a bad day and my manager noticed and did her best to help me.

We celebrated a team member’s birthday last week with cake and coffee and had a great time together.

Very often their stories contain both elements. That’s why we talk about results and relationships being the two main sources of happiness at work.

The upshot

Don’t ask your employees what will make them happy – because they probably have completely the wrong idea and giving them what they ask for won’t work. Instead, help them connect to past positive experiences because those are a much more reliable predictor of future happiness. And then work on doing simple daily actions that promote a feeling of results and relationships.

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5 reasons why Danish workers are the happiest in the world

You will often see Denmark listed as one of the “happiest countries on the planet.” Interestingly Danes are not only happy at home, they’re also happy at work and according to most studies of worker satisfaction among nations, the happiest employees in the world are in Denmark.

Here’s just one data point: Gallup found that 18% of American workers are actively disengaged, meaning they are “emotionally disconnected from their workplaces and less likely to be productive.” The same number for Danish workers is only 10%.

But why are Danish workers so much happier than their counterparts around the world? Here are five fundamental differences that explain what’s going on.

1: REASONABLE WORKING HOURS

I once talked to an American who had gotten a job as a manager at a Danish company. Wanting to prove his worth, he did what he had always done and put in 60 to 70 hours a week. After a month, his manager invited him to a meeting. He was fully expecting to be praised for his hard work, but instead he was asked “Why do you work so much? Is something wrong? Do you have a problem delegating? What can we do to fix this?”

Some non-Danes wonder if Danes ever work. Not only do Danes tend to leave work at a reasonable hour most days, but they also get five to six weeks of vacation per year, several national holidays and up to a year of paid maternity/paternity leave. While the average American works 1,780 hours and the average South Korean 2,024 hours per year, the average Dane only works 1,408, according to Organization for Economic Cooperation and Development (OECD) statistics. Danes also have more leisure hours than any other OECD workers and the link between sufficient leisure and happiness is well established in the research.

The difference to other countries is stark. Many companies around the world celebrate overwork as a sign of commitment. “You have to put in the hours” is the message in the mistaken belief that the more hours you work, the more work you get done. We call this “The Cult of Overwork.” Danish companies, on the other hand, recognize that employees also have a life outside of work and that working 80 hours a week is bad for both employees and the bottom line.

2: LOW POWER DISTANCE

In many countries, if your boss gives you an order, you pretty much do what you’re told. In a Danish workplace, extremely few direct orders are ever given and employees are more likely to view them as suggestions.

Dutch sociologist Geert Hofstede has quantified the culture in more than 100 countries on several parameters, one of which is “power distance.” A high power distance means that bosses are undisputed kings whose every word is law. Danish workplaces–with a score of 18-have the lowest power distance in the world. Just for comparison,  Belgium has a power distance of 65, China clocks in at 80 and Malaysia holds the world record at 100.

By law, any Danish workplace with more than 35 employees must open up seats on the board for employees. This means that Danish employees experience more autonomy and are more empowered at work. Here’s just one example: By law, any Danish workplace with more than 35 employees must open up seats on the board for employees, who are elected to the board by their peers and serve on an equal footing and with same voting powers as all other board members.

3: GENEROUS UNEMPLOYMENT BENEFITS

In Denmark, losing your job is not the end of the world. In fact, unemployment insurance seems too good to be true, giving workers up to 90% of their original salary for two years. In the U.S., for instance, losing your job can easily lead to financial disaster and loss of health insurance. This leads to job lock i.e. staying in a job you hate because you can’t afford to leave.

Simply put: If you’re a Dane and you don’t like your job, you can quit that job without risking serious financial problems, forcing companies to treat their employees well or risk losing them.

4: CONSTANT TRAINING AND DEVELOPMENT

Since the mid-1800s, Denmark has focused on life-long education of its workers. This policy continues to this day, with an extremely elaborate set of government, union, and corporate policies that allow almost any employee who so desires to attend paid training and pick up new skills. It’s called an “active labor market policy,” and Denmark spends more on these types of programs than any other country in the OECD.

This lets Danish workers constantly grow and develop and helps them stay relevant (not to mention stay employed) even in a changing work environment. It also makes their jobs richer and more interesting.

5: A FOCUS ON HAPPINESS

Here’s a word that exists only in the Scandinavian languages: Arbejdsglæde. Arbejde means work and glæde means happiness, so arbejdsglæde is “happiness at work.” This word is not in common use in any other language on the planet.

Many people around the world hate their jobs and consider this to be perfectly normal.

For instance, where we Scandinavians have arbejdsglæde, the Japanese instead have karoshi, which means “Death from overwork.” And this is no coincidence; there is a word for it in Danish because Danish workplaces have a long-standing tradition of wanting to make their employees happy. To most Danes, a job isn’t just a way to get paid; we fully expect to enjoy ourselves at work.

In other countries, the attitude towards work is often very different. A few years ago I gave a speech in Chicago, and an audience member told me that “Of course I hate my job, that’s why they pay me to do it!” Many people around the world hate their jobs and consider this to be perfectly normal. Similarly, many workplaces around the world do little or nothing to create happiness among employees, sticking to the philosophy that “If you’re enjoying yourself, you’re not working hard enough.”

THE UPSHOT

I’m not trying to paint Danish companies as utopias for workers and their international counterparts as tyrannical hellholes. There are bad Danish workplaces and stellar non-Danish ones–Zappos and Google are two that I’ve personally visited and studied.

But studies have uncovered a number of systemic and cultural differences between Denmark and the rest of the world that serve to explain why Danish workers are on average so much happier.

This goes far beyond happiness. We know from any number of studies that happy workers are more productive and innovative and that consequently, happy companies have happier customers and make more money. This may help explain why Danish workers are among the most productive in the OECD and why the Danish economy continues to do so well.

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10 steps to build a strategy for happiness

If you want to build a happy workplace, you have to take happiness seriously – paradoxical as that may sound. You must make sure to include happiness in every aspect of the company.

In this presentation from our latest Conference on Happiness At Work, I share 10 ways that some of the world’s best and most successful workplaces have built happiness into their DNA by making it one of their top strategic priorities, including things like:

  • Hire for happiness
  • Appoint a CHO (Chief Happiness Officer)
  • Plan for happiness
  • Measure and promote happiness – not satisfaction
  • Promote and train managers for happiness

Our next  conference is in May in Copenhagen. See the full program and get your tickets here.

51 COUNTRIES!!!

My awesome coworker Arlette Bentzen is speaking at a conference in Azerbaijan’s capital city Baku today. This is the 51st country we’ve worked in.  It’s great to see, that happiness at work is gaining traction all over the world.

Here are all the countries we’ve worked in so far:

Antigua, Australia, Azerbaijan, Bahamas, Belgium, Bulgaria, Canada, Chile, China, Croatia, Curacao, Czech Republic, Denmark, Dominican Republic, Estonia, Finland, France, Germany, Greenland, Guatemala. Hungary, Iceland, India, Ireland, Israel, Italy, Japan, Kuwait, Lebanon, Luxembourg, Netherlands, Norway, Poland, Portugal, Romania, Russia, Serbia, Slovakia, Slovenia, South Africa, Spain, Sri Lanka, Suriname, Sweden, Switzerland, Turkey, Ukraine, United Arab Emirates, United Kingdom, USA, Vietnam