Why every leader should be concerned about happiness

There is nothing fluffy about happiness – and that’s why it should be on organisational to-do lists, says Professor William Scott-Jackson

The happiness of your people is one of the most important factors in your success, and the success of your organisation. We know that employees who are happier or more engaged exert 57 per cent more effort. Similarly, companies with high levels of engagement enjoy three times more profit and 22 per cent higher shareholder returns, when compared with average organisations.

But what is happiness? Is it a zen-like state of contentment, or the buzz a world-class athlete gets from winning the Olympics? Is it a stress-free life or the challenge of a difficult project?

Many people, organisations, countries and international bodies are striving to measure (and sometimes improve) people’s happiness. But we find that without a clear idea of what happiness is, these efforts may succeed in measuring and maximising entirely the wrong thing.

If we draw a simple box with active and passive on one side and low/high happiness on the other, we find there are at least four types of happiness ranging from passive/low (depressed), through passive/high (contented), active/low (angry) through to active/high (enthusiastic or engaged). If we also add a third dimension of time, we can also have short- or long-term sustained versions of all these types of happiness. The recent surge of interest in happiness has arisen from work on positive psychology and an original idea from Bhutan that governments should aim to maximise the happiness of their people, not just their economic success. On the other hand, organisations have been trying for even longer to make their people more engaged in order to increase productivity. And indeed, for most people in developed economies, it is arguably just as important to be actively enthusiastic about work, life, family or whatever, rather than just being able to cope with life. For these reasons, all our research focuses on helping people maximise their long-term active committed enthusiasm (ACE).

There have been thousands of studies linking thousands of factors to happiness and engagement, and sure enough, nearly everything can have an effect (especially in the short term). In a work setting, things like the balance between your job’s demands and your capabilities, or the degree to which you can make your own decisions, have an impact. However, there is one major factor which is often overlooked, particularly in the context of engagement, and that is your own propensity for enthusiasm.

We all know someone who, whatever is happening, seems to be more positive and enthusiastic than everyone else, and we also know people who display a ‘glass half empty’ disposition. Why should this be? It turns out that our happiness and enthusiasm is not directly caused by any external factors but rather events are filtered through our perception. A letter offering a free holiday, for example, could be seen as very positive by a trusting, optimistic (maybe naïve!) person, whereas a more cautious individual might see it as suspicious.

Humans must act and learn from situations, even if we don’t have factual data. Over the years, we all develop a ‘style’ (formally known as ‘attribution style’) which we use to fill in the gaps when data isn’t available. If I fail an interview, I probably won’t know the precise reason. However, I’ll explain it as ‘I had a cold’, or ‘the interviewer wasn’t very good’. Research found that a person’s attribution style is persistent, is applied to all sorts of situations and significantly affects how they act in the future. Luckily, this style is mostly learned – it is not a deep personality trait that you were born with. Since it is learned, it can be modified by training, experiences and understanding.

As a leader, whether in a company, government or NGO, you want your team to be successful, achieve their goals and have a great time in the process. As we have seen, a happy and engaged team massively outperforms a disengaged team, so you have not only an organisational obligation but also a human and moral obligation to do whatever you can to maximise the ACE of your team members.

Most organisations try to improve engagement by, for example, having an annual survey and then modifying working conditions, environment and communications to engage people more effectively. This, as we have seen, doesn’t seem to be working. And we now know why – the biggest causes of high or low ACE are the immediate leader and the individual’s own attribution style.

Our research suggests that very few leaders are good at maximising enthusiasm, and various complex theories of leadership such as ‘transformational leadership’ and ‘authentic leadership’ try to address this issue. However, it is very hard, and requires time, effort and extensive training, to make an ordinary person into a transformational leader. Much more important, however, is that a great many leaders do things that actively destroy the enthusiasm of their teams.

When we looked into this, we found this wasn’t because the leaders were nasty, stupid or downright evil, but they simply didn’t know how to do a few crucial things correctly to maintain or even increase enthusiasm. For example, how many of us have come into work and faced an angry leader who proceeds to tell us off in front of other team members, or the leader who never gives praise?

How can you, the leader, best help your people maximise their own enthusiasm? You can use iLeader to make sure you’re doing the most important things effectively. But you can also help them increase their own propensity for enthusiasm.

The best ways to do that are to first help your leaders be able to help their team members. Then, individuals must be given the tools and training to help themselves. But you, of course, are a person too, and you influence every single person in your team, organisation or country. The chances are that you, like everyone else, will find a few simple actions can make everyone feel a little better every day.

Professor William Scott-Jackson is chair of Oxford Strategic Consulting

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