October 24, 2018

Why Employee Satisfaction Is at an All-Time Low -- and What You Can Do About It

Odds are, your employees are unhappy. In a recent Gallup poll, 80% of the 1.7 million employees surveyed said their jobs did not set them up to do their best. Interestingly, as people reached higher levels of seniority and responsibility, the data showed that people were less likely to feel they were set up to succeed. This pervasive feeling - that people are not being supported to perform at work - leads to high levels of stress and unhappiness. 40% of employees say their job is "very or extremely stressful."

The cost

What does this mean for the companies that employ this dissatisfied workforce? Disengaged employees cost the US an estimated $450-500 billion in a single year, and turnover costs from unhappy employees who leave are estimated to be between 100 and 300% of the replaced employee's salary. Unhappy or stressed employees also result in decreased engagement, productivity and innovation. With the pace of disruptioncaused by digital and technological advancement, an inability to experiment and innovate can be deadly.

The cause

Daniel Cable, Professor of Organizational Behavior at London Business School and ranked among the top 25 most influential management scholars in the world, explains that we've reached this point of pervasive employee unhappiness because we have created systems that ignore human biology in the workplace. His research shows people don't begin their careers by being disengaged, or trying to do the minimum. There's a lot of evidence that humans have an innate, inbuilt tendency to explore and discover. Companies that can support this inclination help their employees feel fulfilled and happy at work, and reap the benefits of engaged innovation. Most companies, however, haven't updated their organizational systems to promote this mindset.

Cable defines three triggers that lead to fulfillment and happiness for employees in the workplace:

  • Self-expression: Recognition and celebration of an individual's unique perspectives and strengths, and the value they bring to the company.
  • Experimentation: Creating room for an individual to explore the frontiers of their knowledge and to engage in new, challenging tasks. Requiring employees to perform the same action day in and day out reduces motivation.
  • Purpose: Finding a feeling of individual purpose isn't just about curing cancer or solving hunger. Instilling purpose means enabling employees to have a connection between their own cause and effect. Put simply, it's about feeling that you having an impact and seeing the result of that impact on other people and the world.

The history

Cable shares the example of a cobbler working in the period before the Industrial Revolution. Everyone working in the cobbler's shop would have had direct interaction with the person buying and wearing their shoes. During the Industrial Revolution and the decades following, production was scaled up. People become more specialized and more removed from the customer and their impact.

During this period, where success was achieved through mass economies of scale, experimentation and self-expression were abnormalities that posed risks to scaled production. They created the potential to fail and miss KPIs, quality targets, regulations, or customer expectations. When organizations scaled up they created rules, systems and controls to avoid this risk. To enforce these controls, they instilled a culture of fear and conformity. In a recent survey, nearly 50% of respondents said they regularly feel the need to conform within their organization, and more than 50% said that people in their organizations do not question the status quo. Many companies still use an approach to managing, evaluating, paying and rewarding their employees that was built for an earlier time when change wasn't as prevalent. As a result, these systems don't reward experimentation and innovation and don't prioritize individual employee happiness.

The solution

What can you do as a manager to help your employees perform their best and feel fulfilled by their work? Here are three critical steps you can take today:

Celebrate your employees and promote their individual strengths

Wipro, a company which provides customer service support for tech companies, had a severe problem with employee retention. To try and combat this issue, they added a one-hour workshop during onboarding that helped employees identify and focus on what they were like when they were their best. As a result of that one hour investment, 6 months later, employees were 32% less likely to quit and the customers they served were 11% happier.

Encourage experimentation

When social media was still in its infancy, KLM Royal Dutch Airlines knew they wanted to be active on channels like Twitter and Facebook, but weren't quite sure where to begin. Their management asked for employee volunteers to create a social media task force, and gave them a budget and the freedom to explore and test unconventional ideas. This led them to some groundbreaking engagement and discoveries like the "KLM Surprise" campaign and Live Reply customer service. While their team did encounter significant snares as they experimented, they were able to quickly learn and adapt from those failures earlier than brands with more hesitant or restrictive approaches. With a Webby award, NY Times recognition, and hundreds of case studies, KLM is now regarded as one of the most savvy social media brands.

Help individuals connect their function to their purpose

At Disney's Amusement Parks, they focus training of employees not only on their function, but on their purpose as well. Regardless of the employee's function - taking tickets, operating a ride, selling passes - all employees are told that their purpose is to "spread happiness." Helping employees understand the impact they are supposed to have by performing their function will keep them motivated and focuses on creating value. Tying that purpose to meaningful numbers helps quantify and track the impact they have over time, and connects the impact their work has on customers to the impact they have on the business' financial objectives.

Investing in your individual employee's happiness results in a workforce that is engaged, motivated, and invested in using their individual talents to drive the success of the company. As the pace of change increases and experimentation and adaptation become even more critical components of company growth, an engaged workforce can be your most important asset. As Lou Gerstner, the CEO who changed the trajectory of tech giant IBM, said, "Culture is not part of the game, it is the game."

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