Tuesday, May 27, 2014

Unhappy employees are bad for your business

According to data compiled by Bolt Insurance, a whopping 80 percent of employees are dissatisfied with their jobs in some way. And when that dissatisfaction gets so high that employees jump ship, it can cost an average of one fifth of the employee's salary to find a replacement, not to mention the loss in productivity.
This infographic shows the industries with the highest turnover rates and what businesses can do to keep their employees more engaged in their work.

To me, beyond the monetary cost to replace an employee who has left the company, the disastrous and non-quantifiable consequences of unhappy employees are essentially a loss in productivity, a poor delivery of customer/brand experience, and ultimately a loss in the inner innovation power of the organization.

According to an analysis conducted by the Gallup Organization disengaged employees cost the American economy up to $350 billion a year due to lost productivity, because they are the lowest performing. To put it simply, if there had been engaged workers in those positions, they could have been far more productive.
Employee unhappiness can drag a company's image down. Take the example of Walmart. 
I guess it depends on the person, but I think that we can all agree that in general - perhaps with the exception of the elderly greeters - most Walmart employees don't seem particularly passionate about their jobs. I don't think I'm being unfair by saying that. Some even seem to really, really, really hate their job. I'm not judging, and I am not saying that Walmart employees should act as happy as Starbucks baristas... I can't help but wonder why they don't. Does Starbucks pay that much better than Walmart? Is serving coffee all day that much more fun than stocking or scanning stuff? Is there really that much of a difference? Is it just that working at Starbucks is cool but working at Walmart isn't? Are a person's identity and sense of self worth tied-in with the image of the company they work for? (If Starbucks is cool, then working at Starbucks makes me cool? If Walmart sucks, then working for Walmart means I suck?) Maybe, I don’t know for sure. I guess I could see a little kid wanting to grow up to be a barista: they make coffee, the coffee makes people happy, so it isn't a bad job. I don't know too many kids who would ever find working register 12 at Walmart fun or cool or rewarding.
Obviously, Walmart has an image problem, and the entire company's identity may be caught in a self-perpetuating vicious cycle of substandard customer-to-brand experiences.
Unhappy employees can turn even the best companies into "have beens". In contrast, happy employees can turn even the most average companies into worthy lovebrands.

Ask yourself: Do you feel special when you buy a cup of coffee at Starbucks? Do you feel special when you buy a BMW or an Apple computer? Do Starbucks, BMW and Apple employees play any role in that?
Do you feel special when you buy something at Walmart?

Do those companies' employees play any role in that? 
Do you think that those employees' sense of worth relative to their jobs has anything to do with how happy or unhappy they are to work there?
What can businesses do to address the problem? 
In his book Delivering Happiness, Tony Hsieh wrote about the practice of paying some employees $2,000 to quit Zappos. Though this policy may seem bizarre to some, it very likely winds up saving an organization money by preventing some of the negative outcomes mentioned above. If a very negative employee was allowed to continue acting out over a number of years, the cost to the organization in lost productivity could be much greater than $2,000.
Without being as extreme, Dave Lavinsky’s checklist to motivate employees is a very good resource.
As I
wrote in a recent blog, a more a constructive approach is an engaged and empowered workforce.

How do you motivate your team? Share your experience with us.


  1. Disengaged or unhappy employees don't just drag a brand down in terms of direct contact with customers, they complain about work to friends and occasionally on social media. What do you want your company's image to be? It's not enough to project the image externally, it must be made a reality inside the company.

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