♥︎ Hi everyone, happy Wednesday ♥︎
Welcome to The Contrarian. In my last analysis, Detachment & Doing Things For Their Own Sake, I analyzed detachment and how it relates to art. We will be discussing company culture today, you can expect all Wednesday pieces to be centered around the workplace. Find me on Instagram and LinkedIn.
Let me know your thoughts in the comments :)
In an ideal world, organizations would have substantial growth, increasing profits, loyal customers, low turnover, etc. As companies continue to grow and evolve, each measure has its own set of barriers to overcome in order to reach the next level.
Long-term success of a company depends on various factors, including the ability to maintain competitiveness, innovate, and navigate challenges in a business environment. Regardless of whether an organization gets acquired or continues to stay in business for decades to come, companies must rely on their people and values to stay ahead.
More specifically, organizations need to put an emphasis on job satisfaction and engagement to improve overall job and company performance.
✮✮✮ Let’s get into the research ✮✮✮
The University of Oxford’s Saïd School of Business published a research study in 2019 where they measured the correlation between employee well-being, productivity, and firm performance.
The question they sought to answer was: “Does higher employee well-being lead to higher productivity, and, ultimately, to tangible benefits to the bottom line of businesses?”
They conducted a meta-analysis of 339 research studies, examining the well-being of over 1.88 million employees across 82,248 business units from 230 organizations in 49 countries.
Here are the measures they looked at:
Employee Well-being & Job Satisfaction:
Employee well-being is defined as the overall mental, physical, economic, social, and career health of an employee.
Employee engagement was measured under well-being for this study. Employees who are engaged with their jobs are absorbed with what they do and are committed to advancing their organization’s interests; they identify themselves with their organization’s mission and values, and they represent it outside of work.
Examples of questions and statements that participants were asked on a scale from 1 (Strongly Disagree) to 5 (Strongly Agree): —
“How satisfied are you with your organization as a place to work?”
“There is someone at the company that encourages my development.”
“My manager cares about my opinions.”
Performance Outcomes:
Customer loyalty: Customer satisfaction, likelihood to repurchase or recommend a product or service, repeated number of transactions, customer service evaluation on quality, service excellence, etc.
Employee Productivity: Mostly financial measures such as revenue or sales per person, growth in revenue over time, labor hours, cost to the budget, performance ratings, new customer acquisitions, etc.
Profitability: Measured the difference in revenue or sales from the budget to the actual numbers & looked at different time intervals.
Staff Turnover: Percentage of voluntary departures.
& the results are IN!
The findings were as follows —
The higher employee satisfaction, the higher the customer’s loyalty. The results indicate a substantial correlation between the two.
Employee satisfaction has a positive correlation with profitability and employee productivity. Meaning the more satisfied and engaged an employee is, the more profitable the company and the more productive the employee.
Employee satisfaction has a negative correlation with staff turnover. Meaning the higher employee engagement and satisfaction, the lower staff turnover. This is another substantial correlation.
Overall, focusing on job satisfaction and employee well-being leads to higher firm performance. In both their professional and personal lives, employees will be more creative, have better physical health, and will flourish in more aspects of their lives.
✦✦ Sooo, why does it matter? ✦✦
In the first 3 months of 2024, 70% of employees reported that they were not highly engaged and enthusiastic in their workplaces. 30% of employees reported that they were which is the lowest engagement has been in the last 11 years. Read full article here.
In a report from November 2023, 21% of employees reported ‘Strongly Agree’ to the statement ‘My organization cares about my overall well-being’. Once again, this finding is the lowest it has been reported. Read full article here.
In 2023, 69% of employees voluntarily left their organizations due to ‘engagement and culture’ and ‘well-being and work-life balance’. Only 16% of employees reported compensation and benefits for the reason they left. Read full article here.
All of the data mentioned above were gathered from Gallup, Inc.
Anyway, to say the least, it matters. Whether you’re an employee or you lead a team, or you’re an executive.
I understand that there are complex nuances for each and every situation. Meaning that no situation is ever 100% the same, and since we’re measuring feelings, the foundation of this data is HIGHLY subjective.
This is the reason why it’s important more than ever to understand the way our employees think, feel, and behave on an individual level. Quite literally, bringing human skills into the workplace.
✮ The important thing to note is that employees are making critical decisions based on how they feel, and they are leaving jobs based on how they feel. This is called behavioral economics, where feelings become facts. Employees need to feel like they are essential partners that add value to their organizations. When our employees feel like we care about them and their success, they will be more invested in our teams. In turn, in our growth. ✮
Look, it’s not based on rational logic. We all know that. But it doesn’t matter because our society is taught that our feelings are valid. We’ve all participated in behavioral economics at some point, it’s embedded in our nature.
⭒❃✮ Okay, what do we do about it then? ✮❃⭒
Lucky for you, I won’t leave you without solutions.
ORGANIZATIONS —
It is crucial for organizations to hire based on values. You want to find candidates that have similar values to the company, and you want to find social proof of candidates acting in accordance to those values. I would say that this is the most crucial step in the hiring process, even more so than if a candidate fits all the requirements of a job description. This is because intrinsic motivation will outperform extrinsic motivation in terms of employee well-being every single time. (Side note: I have an article coming out with research done on employee motivators and how it relates to job performance and company performance).
To be clear that when I say values, I’m referring to principles like courage, integrity, grit, humility, compassion, curiosity, collaboration, innovation, creativity, etc. These characteristics represent who a person is at his or her (or their) core, and as a company, we want to encourage our employees to be who they are and want them to act within their values. With this being said, it doesn’t matter what race someone is, what background they have, where they come from, what their opinions are, etc. All that matters is who they choose to be and if they are both willing and able to do the work (they do not need to have the skillset before you hire them - they can learn anything if their values encompass curiosity and grit). Additionally, this will help create even more diverse workspaces.
MANAGEMENT AND LEADERSHIP —
Leaders should to take the time to check in with their employees, and learn more about each person on their team. There are several questions that managers can ask to get a better understanding of what their team members prefer and what they don’t.
How do you prefer feedback and recognition?
What aspects of your work do you find most enjoyable or engaging?
What does a strong work/life balance look like to you?
The goal is to build trust and understanding with your team, and most importantly, for your employees to feel heard and cared for. Even if you can’t offer them unlimited vacation, it’s good for you to know what they value.
Unfortunately, there is a hierarchical element that goes beyond the togetherness of a team where team members may feel like they cannot be 100% honest. For instance, ego, status and money are all at play. These are all things that contribute to someone’s livelihood and how someone is perceived. With this being said, when your team members are honest and open with you, it is crucial that their feedback does not impact their future opportunities for growth, compensation and benefits, etc.
EMPLOYEES —
While this article primarily advocates for organizational responsibility in enhancing employee well-being and psychological safety, it's equally important for employees to actively contribute to their own job satisfaction.
Align with Your Values: Seek out employers whose values resonate with your own. This alignment not only enhances job satisfaction but also drives engagement, making your work more fulfilling.
Engage with the Culture: Actively participate in your company's culture. This could involve joining committees, responding to surveys, or embodying the company’s values in your daily tasks. Your involvement not only enriches your work experience but also influences the organizational climate.
Advocate for Your Needs: Communicate clearly about your needs and preferences. Whether it's the type of feedback you find most helpful or the resources you need to succeed, speaking up is key to forging a productive work environment.
Embrace Continuous Learning: The landscape of work is ever-evolving. Stay proactive about your professional development to keep pace with changes and demonstrate your commitment to growth.
Remember, the shift away from purely resume-based hiring underscores the importance of being proactive about your career path. Employers are increasingly valuing the whole person, not just the credentials. So, focus on demonstrating your values and commitment through your actions and interactions at work.
I am in no means saying that you have to be a workaholic, in fact, I’m saying the opposite. Live a full life and bring aspects of that life into your work life. :)
As a friendly reminder, my thoughts and opinions in this piece are subject to change with more information. However, after years of experience managing teams and reading literature and studies on leadership, this is where I stand today. Feel free to challenge my thoughts, I would love to hear different perspectives. :)
As always, I want to hear from you!! Please comment or message me. I hope you all are having the best week.
XOXO,
Palak