Build back happier
The most important metric most companies ignore
With an emergence from pandemic lockdowns in sight, it’s a good time to take stock of what works and what doesn’t about the world of work. This past weekend, the World Happiness Report was released, and it has lessons for every business. ‘Happiness’ in the World Happiness Report (and in the academic field) is not just about fleeting positive feelings (affective happiness), but deep wellbeing; it’s really the study of how humans thrive.
Wellbeing matters to companies — determining how successful and productive they are—and yet, only about one quarter of organizations measure happiness or wellbeing. For the 2.1 billion workers in the world, it’s time to build much better work.
Many companies talk about making customers happy, often collecting metrics like the net promoter score. But asking how customers feel about a company’s product or service is very different from learning whether they are truly happy in their lives.
Similarly, many companies describe their people as their ‘most important asset’, and measure employees’ performance. But again, understanding performance is very different from understanding whether people are truly happy in their lives.
Pursuing happiness is an orienting goal for most people, so if we don’t understand customers’ and employees’ happiness, then we don’t understand their primary ‘job to be done’ (to use Clay Christensen’s term). If customers aren’t happy in their lives, there’s a clear business opportunity to serve their needs. If employees aren’t happy in their lives, there’s a clear opportunity to make people’s lives better, and the company work better; happier people earn more, stay longer, are more productive, and make happier customers.
Despite the clear market opportunity and proven benefits available, only about one quarter of organizations measure happiness or wellbeing. It’s therefore not surprising that just 15% of employees worldwide are engaged in their work.
Nearly two years ago, we (enso) started having a conversation with the team at Indeed that issued ‘best place to work’ lists and awards. We started discussing how to move beyond the plethora of those lists, which mostly aren’t very useful to job seekers, towards something more useful. We oriented around the question, ‘how could we lead people to jobs that enable good lives?’.
That led us to explore what really constitutes a good life, and all the research around wellbeing and positive psychology. That led us to a vision of a ‘Work Happiness Score’ for every company, so job seekers could really know whether Company A or Company B may offer a better experience. To build that score for every company, we changed how employees rate companies on Indeed, so instead of collecting Uber-like 5-star approval ratings, we could collect the key dimensions of wellbeing, like whether people feel they belong, are included, are supported, are appreciated. And because Indeed serves over 250 million people per month, the dataset quickly became the largest dataset on work wellbeing in the world.
Fast forward to today, and this data is used for the 2021 World Happiness Report, in a chapter edited by Oxford’s Jan-Emmanuel de Neve — one of our key collaborators in designing the the Work Happiness Score. The chapter shows how happiness at work changed during the global pandemic:
Most significantly, the chapter also uses Indeed’s data to reveal the most important drivers of wellbeing:
Contrary to most people’s expectations, income is not the primary driver of happiness at work; the most significant drivers are social—belonging, inclusion, feeling supported, appreciated and trusted, as well as feeling a sense of purpose and flexibility.
I’ve written before that the best brands build belonging. I focused on the opportunity companies have to serve a giant ‘job to be done’ in serving customers looking for more belonging. But now I realize there’s an even more important agenda: creating belonging for employees, the most significant driver of wellbeing at work.
Here’s a thought experiment: McDonald’s has a Work Happiness Score of 63 on Indeed. In-N-Out Burger has a Work Happiness Score of 77. This is borne out by the love people on the West Coast have for In-N-Out, which creates a delightful experience for customers, and has a level of fandom around its brand that most companies could only dream of, despite famously spending almost nothing on marketing. Happier In-N-Out employees create better experiences, happier customers and a better brand. McDonald’s in contrast tries to make up for suboptimal customer experiences by spending about $500M per year on advertising; would McDonald’s be better investing instead in its own people, rather than advertising?
McDonald’s could at least start by measuring employees’ happiness (or, using Indeed’s Work Happiness Score), and developing a strategy to boost it.
If you want to learn more about happiness at work, we made a doc short series featuring many of the experts in the field, and it’s fun to explore Indeed’s Work Happiness Score, comparing a few companies’ ratings on their profile pages (here’s Starbucks’ — click ‘see full report’).
There are 2.1 billion workers in the world, and many of them are not very happy; or put another way, the upside opportunity is enormous. Huge advancements in wellbeing could be unlocked, huge business value could be created as a result of happier employees, and McKinsey postulated that it might be the most significant social benefit that companies could create:
Businesses looking to make an external social contribution should, paradoxically, look inside: improving workers’ job satisfaction could be the single most important thing they do.
— Tera Allas and Bill Schaninger, McKinsey
As we rebuild from the pandemic, happier work environments can make a virtuous circle of happier employees, which create happier families, happier communities, and stronger companies that are more positive, generative (and more profitable) forces in the world.
The future happens by default, or design.
Enso is a futures design company.
Learn more: enso.co