By SUN XI
PRODUCTIVITY isn’t everything, but in the long run, it is almost everything,” said Paul Krugman, an eminent Nobel laureate in economics.
So far, most of the ways used in Malaysia to raise productivity are conventional: capital investment, labour increment, skills training, and technological and business innovation.
However, one unconventional factor has been overlooked and underestimated — the power of happiness.
Happiness is a mental or emotional state of well-being defined by joy, satisfaction, contentment, enthusiasm and interest.
Many psychologists have pointed out that happiness promotes the capacities of innovation, improves memory and leads to greater altruism.
There have been clear and positive links between workers’ happiness and their productivity — happiness makes workers more productive.
A recent study led by Professor Andrew Oswald, Dr Eugenio Proto and Dr Daniel Sgroi from the Department of Economics at the University of Warwick found that happy workers were 12 per cent more productive, while unhappy workers were 10per cent less productive. The research was based on four different experiments with more than 700 participants. Based on statistics from 1994 to 2009, Fortune’s 100 best companies to work for in the United States outperformed their peer groups by 2.3 per cent annually.
According to Professor Alex Edmans at the London Business School, this is not a correlation, but a direct causation between happier companies and shareholder returns.
The US Internet giant Google/Alpha bet, the most valuable company in the world and the No. 1 place to work for the seventh time in 10 years, is regarded as the pioneer in employee happiness. Happy workers even make better sandwiches.
The British sandwich chain Pret a Manger, which takes its employees’ well-being very seriously, attributed its impressive 16 per cent annual sales growth in 2014 largely to its workforce’s happiness. Its staff are even given a special bonus for being happy during work.
Malaysia, however, is not known to have very happy workers. In the World Happiness Report 2016 Update by the United Nations Sustainable Development Solutions Network, Malaysia was ranked the 47th happiest country among 156 countries.
This could be one of the reasons for lacklustre productivity. In the World Competitiveness Yearbook 2016 by Swiss business school IMD, Malaysia was ranked merely the 19th most competitive economy among 61 surveyed countries, coming in 14th for “Business Efficiency”.
To boost productivity, tripartite partners (employers, workers and government) in Malaysia need to cooperate with one another closely and continuously.
FIRST, employers are at the centre of creating a happier workforce. They can follow a simple “E.M.O.T.I.O.N.” approach, namely Employee engagement, Maximising satisfaction, Optimising culture, Trust building, Individualisation, Opportunity creation and Non monetary incentives. In Google, its employees (called “Googlers”) are given competitive salaries, free WiFi on shuttle transport, free ice cream and healthy snacks, free lifts to work and the opportunity to spend 20 per cent of their office time on non-work projects of “passion”.
SECOND, workers play a key role in their own happiness, since in essence one’s personal perception of their job affects satisfaction. Everyone can follow a “H.A.P.P.Y.” recipe, namely contributing to Harmony at workplaces, working with Appreciation, staying Positive, pursuing your Passion and focusing on improving Yourself instead of competing with others.
THIRD, the government should consider measuring happiness in the workplace and society, as only “what gets measured gets managed”, in the words of Peter Drucker, the founder of modern management. In this regard, the United Kingdom could be considered a role model. In the UK, the All-Party Parliamentary Group on Well-being Economics was formed in 2009. In 2010, the National Well-being Programme was launched. Since FY 2012, its official annual well-being statistics have been published. Since then, reported personal well-being in the UK has been improving and the year on-year differences are statistically significant.
In October 2014, the What Works Centre for Well-being was set up in the UK to promote greater understanding on what the government, businesses, communities and individuals can do to improve well-being. A similar mechanism could be formed in Malaysia. For a start, the government should consider officially collecting and publishing annual national statistics on workforce well-being, measuring not only overall sense of satisfaction with work but also sense of fulfillment across different occupations.
To effectively use workforce wellbeing data, it is necessary to organise public dialogues and stakeholder engagements so as to communicate the likely impact of real policy initiatives on workplace happiness and to help employers build professional capacity so as to create the conditions for employees to work happily.
A happier society will also be beneficial for grooming higher productivity in Malaysia.
SUN XI, Senior investment analyst and independent commentary writer Singapore
Source: The New Straits Times