Strategic HR

How Employee Satisfaction Affects Organizational Performance

Regardless if you’re in a small or large business, we’ve all dealt with employees who are great at their jobs and those who couldn’t care less.engagement

In today’s fast-paced world and increasingly competitive market, it is more crucial than ever for organizations to motivate and engage your greatest asset—your employees. While there are employees who are passionate and enthusiastic by nature, there are some who remain disengaged and cynical.

It is clear-cut that employee satisfaction leads to organizational success. Moreover, they result in the following benefits:

  1. Higher Productivity. Results from a series of experiments carried out by economists at the University of Warwick show that happiness made employees around 12% more productive, while unhappy workers showed to be 10% less productive.Therefore, happiness proves to have large and positive effects on productivity. For example, companies like Google invest in employee support and satisfaction to succeed in generating happier workers, which in turn, make for highly productive employees.
  2. More Creativity and Collaboration. The author of The Happiness Advantage, Shawn Anchor, found that when positive emotions are present in a person, it makes the brain work much better, therefore making the individual inclined to be more creative and better at problem-solving.Other research has shown that workers who are happy tend to be more collaborative in working toward common goals.
  3. Lower Turnover. All businesses, whether big or small, know that employee turnover is expensive. For an entry-level employee to be replaced, it costs between 30% to 50% of an annual salary; for a mid-level employee, upwards of 150%; and for a senior or highly specialized employee, up to 400%.When employees are satisfied, they are typically much less likely to leave, therefore, saving you money. Conventional wisdom holds that enough pay or a raise in salary will make employees happy and therefore, productive. However, there might be more to it.

Here are some of the things you can do to ensure that your employees are satisfied with work.

Workplace Appreciation

People like recognition for their hard work. A survey of 750 employees across businesses in the UK shows that workplace appreciation is a large factor in job satisfaction.

If you want to retain your staff, you have to show more appreciation. Make sure that your employees don’t feel underappreciated by focusing on achievements rather than what’s broken or not done.

Say, for instance, when someone on your team gets a difficult project done, closes a big sale, or lands a large press hit for your company, you can show that you acknowledge the accomplishment by sending an e-mail to the entire company congratulating them on a job well done.

Also, asking about achievements in a group setting encourages recognition of coworkers and expression of gratitude. Positive recognition, even as simple as nurturing your employees with a “thank you,” can make a massive impact on your employees’ morale.

Good Relationship with Coworkers

When employees are happy with their relationship with bosses, colleagues, or teams, it increases the odds that they go to work excited. So, how do you foster great relationship at work?

For one, trust tops the list. It is the cornerstone of every good relationship, as it allows openness, honesty, and transparency among employees. With trust, so much energy would be conserved for being effective and productive instead of employees who constantly watch their back and calculate everything they say or do.

Mutual respect is also key when fostering good relationships at work. When everyone’s thoughts, ideas, and input are valued, it cultivates a collaborative environment which enables people to be on the same page, as well as work toward the same goals. This is where diversity comes in.

When diversity in opinions are accepted and welcomed, everyone feels valued, which then results in good bonds at work. Open communication is also one of the ingredients of great relationships simply because the more it is fostered, the richer the relationships at work become.

Training and Mentoring Programs

Job satisfaction is a cyclical pattern in the workplace. According to Dr. Shoshana Dobrow Riza, there are ways by which both managers and employees can work to break this pattern of job satisfaction.

One is through mentoring, training, and seminars, as these reenergize older employees and motivate younger workers. They can also find new ways to design work so that day-to-day responsibilities are motivating and meaningful.

Giving constant feedback is another way of doing this. Today’s employees desire to receive constant, specific, and defined feedback immediately from their supervisors rather than quarterly or through annual reviews. It motivates them to do better.

Psychological Ownership

Involve your employees in determining and seeing “the big picture” and the specific steps needed to achieve it. They feel most engaged at work when they understand and share your company’s goals.

This gives them a sense of ownership as though their organization, not only their job, is “theirs” to the point that your business becomes an important part of your employees’ self-identity. This, in turn, results in greater customer satisfaction, higher quality products and services, lower turnover, and greater commitment from employees.

How to Identify Unhappy Employees

Now that you know the benefits and how to improve employee satisfaction, the next question is – how do you determine unsatisfied employees? Guthrie-Jensen recently released an infographic that showcases the top 10 signs of unhappy employees, and it offers tips on ways for employers to improve employee satisfaction.

If your focus is on the bottom line and long-term growth of your business, you should invest in the support and satisfaction of your employees, who are your most important assets. Other than the ones listed above, it pays that you find out for yourself what specifically makes them happy.