Happy employees perform best (with a twist)

By Jeff Haden

Ask the average leader what they do to improve employee performance and you tend to hear the usual suspects. Provide the right tools and resources. Set and measure progress towards meaningful targets. Offer developmental opportunities. Build a great culture. What you’ll rarely hear is making sure employees are happy.

A study recently published in the Journal of Happiness Studies shows employee well-being and happiness accurately predicts employee performance.

Researchers who spent seven years studying over 900,000 soldiers found that high positive affect, low negative affect and high optimism predicted awards for performance and heroism.

Or in non-researcher-speak, happy people perform better.

How much better? The most positive and optimistic soldiers were four times more likely to receive awards than the least positive and optimistic soldiers.

Of course, you could argue the relationship is correlational, not causal. High performers could result in happier people. Since high performers tend to receive more recognition and praise, tend to feel more like part of the team, tend to get promoted more frequently, etc. (Instead of my happiness driving my performance, maybe I’m happy because I’m doing so well.)

But here’s the thing: Negative affect (read: I’m kind of miserable) predicted lower performance. How many unhappy employees somehow magically turn the performance corner on their own?

In my experience, very few. They need help turning that corner. Encouragement. Opportunity. Someone who believes in them, possibly even before they believe in themselves. The research bears that out as well. While employee well-being predicted performance, the researchers found that well-being most strongly predicts performance between unfavorable and moderate well-being.

In short, “deliriously happy” is great, but “fairly happy” is very powerful.

The researchers write: “There was a greater increase in the probability of attaining an award between low and moderate positive affect, compared to moderate and high positive affect. Affect is more strongly related to award attainment when going from unfavorable to moderate, rather than moderate to favorable.

“Thus, successful workers are substantially less likely to be unhappy individuals, but moderate happiness was sufficient in our study to produce most of the benefits.”

That’s good news for all the startup founders and small business owners whose resources are limited, and who can’t afford to provide all the frills and perks people tend to think of — even though most of them really don’t work — when they want to create a happier work environment.

While trying to make happy employees even happier is an admirable goal, the key is to fix some of the things that make people less happy. Eliminating major negatives? That will have a much larger impact than providing incremental positives.

Take meetings, for example. Since nearly half of employees surveyed feel overwhelmed by the number of meetings they have to attend, eliminating unnecessary meetings (and by unnecessary, I mean almost all) will immediately improve employee optimism and well-being.

The same is true for off-hours email. Since most employees assume a quick response is required — even if you don’t expect one — receiving off-hours emails increases their stress and anxiety, and lowers their overall well-being. Set expectations for response time — or stop sending off-hours emails — and you can immediately improve employee happiness.

Creating a workplace that promotes employee optimism and well-being isn’t just the warm and fuzzy thing to do. Fostering optimism and well-being is also the productivity-improving, performance-boosting, bottom-line-results thing to do. Can’t beat that.