How employee happiness can increase company success

The happiness of your employees has a direct influence on your company’s profits. These 10 facts will give you lots of material for improvement.

Time and time again, successful businesses prove that happy employees are a main factor in happy customers.

Besides being ‘nice’ for employees, their happiness is very nice for the company since it  translates to an improved bottom line.

So, how can managers and entrepreneurs increase employee happiness?


These 10 facts will give you lots to work with.


1. Happy employees are measurably more productive.

By how much? The data shows that it can be as much as 13 percent. The happiness-productivity relationship has been quite a popular theory. This UK study gives the first ‘hard evidence’ to show that it is correct. Besides work-related factors, the study also found a ‘local weather-happiness connection’: bad local weather decreased employee happiness.

Is it time to consider a sunlight alternative in the office?


2. Employee happiness can increase sales.

Studies consistently show that employee happiness has a direct result on sales. The group studied (workers at British Telecom’s contact centers) worked more quickly and—more significantly—converted more of their sales calls. Due to the fact that happy employees are more engaged and productive, sales can rise as much as 37 percent. In addition, employee happiness decreases turnover. Basically, ‘two for the price of one’ to increase the company bottom line.


3. Managers have an up to 70% effect on employee engagement.

Polls in both the U.S. and the U.K. show that managers have game-changing power with regard to employee happiness. Significantly, this is a well-established fact. For example, the U.S. poll (Gallup, 2015) has found consistent results over 15 years (from 2000 when Gallup first started to measure workplace engagement).


4. Hedonistic workplace experiences = short-lived employee happiness.

Hedonism: a feeling of pleasure and happiness from the external world

Hedonistic examples at work include appreciation for a job well done, company vouchers for spa treatments/dinners/fitness clubs, and casual (or dress down) Fridays. While these things are a necessary part of employee happiness, they get old soon and need to be part of a bigger picture.


5. Eudaimonic well-being = long-term employee happiness.

Eudaimonia: an inner feeling that your life develops your personal strengths and contributes to the greater good.

Research appears to show that the day-to-day eudaimonic experiences of employees are better predictors of their workplace performances. The latest research describes eudaimonic workplace well-being as a synthesis of two main factors:


Interpersonal situationIntrapersonal needs
Quality relationships with others in the workplace (co-workers, management, customers, etc.) based on positive social acceptance and social integration.



The work itself satisfies the employee’s needs for value and meaningfulness at work. It also gives the employee opportunities for autonomy/independence as well as personal growth and development.


6. Managers can directly increase their employees’ eudaimonic workplace experiences.

Here is a short list of examples:

  • Focus on employee productivity and freedom instead of micromanaging.
  • Consult with employees about modifications to work/projects.
  • Encourage employee autonomy/independence—what can they contribute?
  • Give meaningful rationales for tasks.
  • Support employees—work on office/company morale; keep an eye out for destructive workplace personalities.
  • Provide opportunities for personal growth and development—challenging tasks; workshops and other education; promotions; etc.
  • Cultivate an office/company culture that believes company success is due to the developing abilities, professional attitudes, and valuable hard work of its employees.


7. The work-life balance affects employee happiness.

According to the data, workplace stress can literally make employees sick. One study estimated that in the U.S., 8 percent of the money spent on health care was related to the effects of stress. Worse, this same study estimated that stress is responsible for 120,000 deaths each year. Companies which support an optimal work-life balance for their employees can improve their profitability.


8. Workplace happiness is a personal perception.

Two co-workers can work for the same manager, on the same project, in the same roles. One will feel happy; the other will not. Personal happiness is an idea we each have based on factors such as the generation we are a part of, our cultural values, role models who have influenced us, and our current wants and needs (which change over time). Effective managers spend time getting to know their employees’ perceptions of happiness.


9. The new CEO = Chief Eudaimonia Officer.

A software company CEO, Matthew Gonnering has redefined his role. He now practices ethical decision-making at work by incorporating eudaimonia into his thinking. Gonnering believes that “businesses should encourage well-being across several dimensions.” One example of his encouragement is to include people with developmental challenges as part of his team.

Gonnering feels that this 5 percent of his staff has caused the empathy, compassion, and gratitude of his other employees to develop. He believes that improvement in these skills have translated to a “better ability to create marketing technology.”


10. Futurists suggest that employee well-being and happiness is a must rather than a ‘nice to have.’

Increasing AI means that employees are going to have to be more multi-skilled, creative, and complex than before. This could lead to increased employee stress and/or burnout. Add in globalization which offers employees a wider choice of job opportunities. In other words, it’s more of a ‘buyer’s’ (employees) market. The big picture indicates that companies need to prioritize employee well-being and happiness.



It is true that attention to employee happiness may force a big change in your company’s culture and practices.

Yet, the overwhelming evidence shows that companies which do not take employee happiness seriously may find themselves out of business in the not so long run.