If you Google “impact of employee satisfaction on business performance,” you’ll find two decade’s worth of research that supports the unequivocal correlation. Happier employees are more productive and provide higher levels of customer service.
Many companies out there might hear that theory and say, great, we’re all for “happy employees” as long as the numbers add up at the end of the quarter. The fact is, they do!
“Organizations with more engaged employees produce better results on a number of levels,” reports the International Association of Business Communicators. The association summarized extensive research conducted by both the Institute for Employment Studies and Aon Hewitt’s 2014 Engagement Report. Results include more productive employees, lower absenteeism, increased customer satisfaction and, of course, higher company revenues and profits.
In New Jersey, one measure of this theory is rooted in the Best Places to Work (BPW) listing, put out annually by business publication NJBIZ. This year’s results were announced earlier this week at an event at iPlay America in Freehold. The 2016 listing reveals the 100 best places to work in New Jersey, as voted on by the employees themselves. These companies are recognizing huge returns as a result of their commitment to investing in their employees.
As an example, Hamilton, NJ-based technology company Internet Creations’ revenues approached $5M in FY2015, a growth rate of 44 percent when compared to FY 2014. Glen Wilson, director of talent, was elated, but not surprised, to learn the company ranked No. 15 on the 2016 Best Places to Work List. This is the company’s second year making the list. He fully attributes the impressive growth to the company’s commitment to its employees and, in turn, their commitment to Internet Creations.
While the company is focused on assisting customers in their pursuit of operational efficiency, Wilson is well aware that cultivating a productive, happy team is critical to meeting Internet Creations’ goals. It’s true that the winning BPW companies have employees who report less stress and an increased desire to be productive at work. And, it stands to reason happy employees are committed to exceeding the expectations of employers and customers, alike.
But, What Makes a “Happy Employee?”
OK, so happy employees rule the day. Check. But, where do you find them and how do you attract them to your company. Wilson says it’s not a matter of the “build it and they will come philosophy,” although referrals from satisfied employees are invaluable.* He answered those looming questions by saying, “you cultivate a happy workforce and then you work daily to nurture it so it blooms.”
Building a productive, award-winning team, he added, begins with a focus on culture. It’s more than just finding good, smart people. (Although that’s critically important, too.) It’s more than encouraging so-called “work/life balance” because, quite frankly, Wilson and the entire management team at Internet Creations believe there is no place for balance in this discussion. It’s about give and take, open dialogue, understanding and acceptance of all team member’s views, ideas, personal situations and goals.
Wilson said it’s about flexibility. “We’ve created an employee-centric culture that drives motivated productivity. It shows in our customers’ satisfaction, IC’s own growth rate and our bottom line.”
Wilson maintained Internet Creation’s employees are happy, motivated and productive because they are accepted in a culture of tolerance – where mistakes aren’t the end of the conversation but the place where solutions begin. “When people are not admonished for missteps but instead are given the freedom to learn from those mistakes, everyone benefits,” he said.
At Internet Creations, there is a consistent focus on developing and maintaining effective communication and listening skills. Regardless of position, seniority or tenure, all employees have an equal voice. Internet Creations’ focus on collaboration leads to award winning solutions for their customers and an award winning corporate culture. Employee input is encouraged and solicited on all matters ranging from the company’s solution offerings to corporate benefits.
Further, at Internet Creations, knowledge sharing and life-long learning are equally embraced. The company’s success cannot be pinned to any one person, rather it’s the result of teamwork. Employees are encouraged to share knowledge and ask questions. Lunch and learn events are common to promote positive team interaction: i.e.: “we all have something to bring to the table.” The sharing of new ideas is wholeheartedly encouraged. Wilson added, “We hire individuals who are constantly in pursuit of greatness and willing to take risks, in spite of the possibility of failure.”
Speaking of communications, Wilson said there is no need for the proverbial “open door policy” at Internet Creations because there are no office doors. Even the CEO sits at the same type of desk, in the same type of chair, as all the company’s other team members. To that end, Internet Creations is far ahead of the curve. The company has long embraced regularly scheduled reviews, well beyond the annual review, so challenges are uncovered early and can be appropriately and positively addressed.
Additionally, there is considerable research out there that maintains a consistent finger on the pulse of employee activity allows managers to focus on outcomes, not on “desk time.” This is a concept Internet Creations embraces; managers are focused on employees as people and productivity as a whole, not on how often people work from home and whether lunch breaks are 30 or 60 minutes.
“One-on-one coaching meetings allow for consistent back-and-forth communication between managers and staff,” Wilson said. “It give us an opportunity to foresee challenges and foster solutions. We operate from a position of understanding based on communication. If employee performance changes, we seek to understand what’s going on. We recognize that every single person has unique influences outside of work. We seek to support and assist our employees, rather than admonishing them when they are dealing with challenging times.”
Who would have thought that simple communication could mean so much? However, a Threshold Survey revealed people who truly feel their managers make time for them and listen to their ideas and concerns are almost ” five times more likely to have high enthusiasm for their jobs, and 21 times more likely to feel committed to their company than those who do not feel listened to.”
Which Brings Us to Why Employers Must Protect Valued Resources
In terms business people can understand: Human Capital is called such for a reason. Companies invest a lot of money in their workforce, and employees are their most valuable asset. According to a study conducted by the Center for American Progress, onboarding costs for new employees range based on position. For a mid-range job ($30,000 to $50,000 a year,) it costs about 20 percent of the person’s annual salary to get the new employee up and running. Consider then, that the $40,000 worker is actually costing you $48,000 in Year 1. A new employee’s productivity and potential may not even be reached for a year or two, as well. Ka-ching!
This is where Internet Creations’ brand of forward-thinking culture, better known as work/life flexibility, shines. The company has long realized that employees who constantly feel pulled in all directions – home, family, community obligations, activities, health and, yes, work – are always trying to balance everything. It’s like a circus performer spinning plates atop poles. Balance in the workplace is a misnomer.
In fact, the effort to be everything to everyone at all times achieves little more than burnout. Concentration and most certainly productivity take a nose dive. This leads to mistakes and a negative attitude for many members of the team. Unhappy employees, especially the good ones you previously were proud to have attracted and cultivated, jump ship.
Further, the trickle-down impact on co-workers is considerable – and costly. Josh Bersin of Bersin by Deloitte, claims that the “real” costs encountered when a good employee leaves are numerous. He cited the following in a 2013 article that stands the test of time. Failure to retain good people has a serious, long-term impact on your culture at large. If a valued employee is leaving, it’s human nature for others to wonder “What’s wrong? What do they know that I don’t know?” This is a stressful position for people to find themselves in and, of course, it’s simply human nature; stress has a major negative impact on productivity and morale.
Conversely, a focus on retention can make a real difference. According to the Corporate Leadership Council (CLC), simply engaging in retention-causing activities can reduce employee turnover by nearly 90 percent. Wilson smiled when hearing that the CLC research reported that 70 percent of business leaders are only recently realizing how critical the concept of employment engagement is to company success.
Internet Creations’ retention rate was 100 percent in 2015. Enough said.
Returning to the topic of employee referrals*, this isn’t rocket science. It’s simply excellent business sense. “When people are happy at work, they focus on doing a great job. They also talk about their workplace to friends and colleagues. Good people attract good people,” Wilson said. “In this marketplace where good people are very hard to find, employee referrals are valuable commodities, indeed.
We want to know what you think. What is your company doing to grow an exceptionally happy, productive workforce? Share your thoughts and ideas below.