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
Sean Burgess | PraxisIFM Asset Manager and Co-Founder Emirates HR
S&P 500 CLOSES AT ALL-TIME HIGH
The first record finish in 145-days, driven by energy stocks that received a welcome boost from a surge in oil prices. The general market was supported by comments from Fed Chair Jerome Powell that the central bank will gradually normalize monetary policy, rather than aggressively hike rates. Following
Powell’s comments, the US dollar fell 25 basis points against a basket of major peers.
UK GOVERNMENT RELEASE ‘NO-DEAL’ BREXIT PLANS
As a contingency in the event that the March 2019 deadline passes without an EU-exit deal being agreed. The release sent the pound lower and held back UK stocks. The plans offer guidance to UK businesses on possible additional paperwork requirements, warnings of medicines shortages for NHS patients and potentially higher credit card charges when Britons visit EU countries.
JAPANESE STOCKS POST FIRST GAIN IN A MONTH
With the Nikkei 225 rising 1.5 percent, on the back of a proposed record-breaking defense budget. The Defense Ministry will ask the government for a ¥5.3 trillion ($65 billion) budget for the 2019 fiscal year to buy missile systems that will protect against possible North Korean aggression, as well allow Japan to act against China’s escalating activities in the South China Sea.
CHINA’S YUAN FALLS FOR 11-CONSECUTIVE WEEK
Extending its record losing streak, as a reconciliatory meeting between US and Chinese trade officials ended without an agreement and both countries imposed previously announced tariffs. On Thursday, during the trade meeting, the US introduced a 25 percent tariff on motorcycles and machinery whilst China introduced similarly sized tariffs on US coal and trucks.
OIL RECORDS FIRST WEEKLY GAIN SINCE JUNE
With benchmark prices rising over 5 percent for the week, as investors digested a bullish US inventory report and Iranian supply disruptions. After Donald Trump pulled the US out of the Iranian nuclear agreement and reintroduced sanctions, Iran’s production has fallen by as much as 600,000 barrels a
day. WTI and Brent crude closed the week at $68.72 and $75.82 a barrel, respectively.
In other financial news:
Brazil’s real falls below $0.25 to the dollar, the weakest level since 2016, as polls for October’s election show rising support for the imprisoned former president.
Saudi Aramco IPO plans put on hold, as advisers to the listing were disbanded, although ministers in the kingdom refuse to officially confirm the cancellation.
Tesla’s board votes to keep company public, after it transpired that CEO Elon Musk did not have a funding deal with the Saudi Arabian sovereign wealth fund.
The chain of events that leads to strong and sustained business results starts with great managers who defy common management practice at virtually every turn, says Curt Coffman, global practice leader for employee and customer engagement consulting at The Gallup Organization.
What is the defining contribution of great managers? They boost the engagement levels of the people who work for them. According to Gallup research, only 28% of U.S. employees are engaged, or are actively pursuing top performance on behalf of their organizations, and Gallup studies show that this has a direct impact on the bottom line. Engaged employees lead to engaged customers, who in turn drive a company’s growth, long term profitability, and stock price.
So what distinguishes managers who not only retain valuable employees but, by boosting engagement, also extract their full value? According to Coffman, coauthor with Marcus Buckingham of First, Break All the Rules: What the World’s Greatest Managers Do Differently(Simon & Schuster, 1999), the answer lies in rejecting conventional wisdom in four core areas of managing people: selection, expectation setting, motivation, and development.
Most managers select employees according to the skills needed for the role, but great managers select people for their talent. Coffman defines talent as a recurrent pattern of thought, feeling, or behavior and accounts for the different results produced by those with the same skills and training. Talent is abundant, Coffman observes, yet people whose natural talents fit their role are a rare and valuable commodity.
Consider what differentiates top performing customer service representatives, Coffman notes. All reps in a firm get the same training, but the best take one-third fewer calls than the average to resolve the same complaint. Why? Because they use the phone as a tool of intimacy—they can envision what the customer looks like, what room he is in; they smile and nod even though the customer cannot see what they are doing. Instinctively, their talent leads them to manage each customer relationship in the most effective manner.
Great managers resist the temptation to hire people whose skills are a good match for how a job is already configured; instead, they seek those whose talent will redefine how the job is done.
Conventional wisdom says managers should specify the steps that employees need to take to accomplish a specific task. But great managers define the outcomes they seek and let each person use her individual talent to achieve them. For example, while great managers do not usually mandate steps to be taken, they do provide specific direction when accuracy or safety is involved, or when a company or industry standard is at stake. But even then they don’t let the steps obscure the focus on the outcome.
Conventional wisdom says that “anybody can be anything they want to be,” and thus managers tend to focus on finding and fixing a person’s weaknesses. This leads to reviews and development plans that focus on negatives— where the emphasis is on “improving” a person into someone he is not.
In contrast, great managers emphasize the development of their subordinates’ unique strengths so as to help further their talent, while finding strategies to support their weaknesses. The key here is determining how to take greater advantage of what people already do well.
Conventional managers rate the person and develop the performance; great managers rate the performance and develop the person—they realize that every person is different and should be treated as such.
Most companies view promotion as the natural path of progression. But is that always the right course? No, says Coffman, because success in one role is not necessarily an indication of success in another.
Consider how many outstanding account representatives fail miserably when they are promoted to sales managers. The ability to sell is entirely distinct from the ability to manage. What’s more, promotion removes the high-performing salesperson from the position in which she has been producing substantial value for the company.
Great managers seek the right fit for a person’s talent, they work to see that he is rewarded for his performance, and they endeavor to ensure that his talent is developed through progressively more challenging and meaningful assignments.
This article appeared in the August 2004 issue of Harvard Management Update.
Sean Burgess | PraxisIFM Asset Manager and Co-Founder Emirates HR
DEFENSIVE US STOCKS OUTPERFORM
Whilst the tech-heavy Nasdaq suffers the only loss of the major indices, with investors moving towards safe-haven sectors as relations with Turkey and other trading partners worsen. In other financial news, Donald Trump has asked the SEC to look into public companies reporting just twice a year, rather than quarterly, a move widely criticized as it could lead to less transparency for investors.
EUROPEAN STOCKS FALL ON MULTIPLE FACTORS
With the pan-European STOXX 600 index sent 1.5 percent lower by Turkey’s currency crisis, the state of European banks and general trade worries. Some of Turkey’s biggest creditors include the European banks UniCredit, BBVA and BNP Paribas, and the country’s escalating currency crisis has exposed weaknesses in these banks that has weighed heavily on their share prices.
CHINA’S YUAN LOWER FOR TENTH CONSECUTIVE WEEK
Extending its record losing streak, as the currency fell to a 20-month low midweek. On Thursday the yuan recovered some losses after the Chinese announced it would send a trade delegation to meet with their US counterparts. Although a weaker yuan helps the export market, the central bank has recently increased efforts to stabilize the currency to avoid capital outflows by investors.
TURKISH CREDIT MOVES FURTHER INTO JUNK STATUS
With Moody’s and S&P Global Ratings cutting the country’s rating to B+ and Ba3, respectively, citing the wide current-account deficit, runaway inflation and weakening lira. The lira had found support after the Qatari government pledged investment of $15 billion, however sentiment declined after the US sanctioned members of the Turkish government until a detained US pastor is freed.
OIL PRICES FALL FOR THIRD CONSECUTIVE WEEK
With the US benchmark losing 2.5 percent from the previous Friday close, on the back of a surprise rise in US inventories and a stronger dollar hurting demand from emerging countries. The EIA reported a 6.8 million-barrel increase in US crude inventories, despite a forecast of a 2.4 million-barrel fall. WTI and Brent crude closed the week at $65.91 and $71.83 a barrel, respectively.
Chinese billionaire Jack Ma realized a policy of not hiring the best candidates for a job during Alibaba’s early years and it eventually paid off.
According to the book “ALIBABA: The House That Jack Ma Built,” Ma hires applicants who were a notch or two below the schools’ best graduates.
Written by China-based investment adviser Duncan Clark in 2016, the book also revealed Ma’s unflattering opinion of those who graduated from business schools:
“It is not necessary to study an MBA. Most MBA graduates are not useful… Unless they come back from their MBA studies and forget what they’ve learned at school, then they will be useful. Because schools teach knowledge while starting businesses requires wisdom. Wisdom is acquired through experience. Knowledge can be acquired through hard work.”
As the entrepreneur pointed out, candidates from the so-called “college elite” have the tendency to get frustrated easily when faced with real-world challenges.
Ma revealed in a speech:
“A good team does not mean you hire excellent people from Harvard or from a multinational or from Fortune 500 companies.
“I remember when we raised the first $5 million, we thought, ‘Ha, now we have money.’ From $50,000 to $5 million, so we should hire great people. We hired close to 10 excellent vice presidents from many multinational companies. One of the guys who was a marketing expert vice president of a big company, he gave me a business plan, a marketing plan: $12 million.
“And I said, ‘Hey, we only have $5 million, how could you give me a business plan for next year’s budget in marketing set for $12 million?’
“He said, ‘Jack, I’ve never made any plan below $20 million!’
“Hire the right people, not necessarily the best people. The best people are always the ones you train. There’s no ‘best people’ in the market, the best people for you are always the ones you train yourself.”
Ma understood that it would take thick-skinned individuals to survive a company which was then still finding its place in the modern economy.
“Today is brutal, tomorrow is more brutal, but the day after tomorrow is beautiful. However, the majority of people will die tomorrow night. They won’t be able to see the sunshine the day after tomorrow,” Ma would often say to new recruits.
The new hires had to contend with very low salaries and grueling work hours, working seven 16-hour work days per week and earning barely $50 per month.
Alibaba employees were also required to live no more than ten minutes away from the office to save traveling time.
But what sets the company apart from the other firms in China is how Alibaba was managed like a Silicon Valley company from the start.
It has remained one of the very few Chinese companies which issue each employee share options in the company, vesting over a four-year period.
When the Alibaba’s clientele eventually grew, customer service demands also increased. Ma’s employees responded to the challenge by turning themselves into free “tech support” to customers.
From providing basic troubleshooting tips on computers to resolving delivery issues, the instant customer care team managed to respond to every email within two hours, further establishing the company’s “customer first” principle.
With the right people behind him, Ma was able to transform Alibaba into a multinational e-commerce, retail, Internet, AI, and technology conglomerate considered to be one of the biggest companies in the world today.