The Business Case for Happiness

By Jennifer Aaker, Sara Gaviser Leslie, Debra Schifrin
2012 | Case No. M345
The Business Case for Happiness discusses why it is important for employees and customers to be happy, how happiness positively impacts the bottom line, and how an organization can design for happiness. Research shows that employee happiness leads to increased productivity, increased generation of innovative ideas, fewer sick days, higher income, favorable evaluations from supervisors, and a more supportive working atmosphere. Customer happiness leads to company loyalty, increased spending on company products, and even customer-driven marketing. However, the paradox is that what we often think drives happiness in fact does not. So how do we design organizations and brands with happiness in mind? The case presents four principles for achieving that goal: Higher Purpose: Feeling you are part of something meaningful. Achieved when you feel part of something bigger than yourself, and where the shared goal matters significantly. Note: People are happier when their short-term and long-term goals are aligned. Examples include corporate philanthropy for customers and employees. Autonomy: Perceiving that you are in control of your future path, able to work on things you are good at and learn new skills. Achieved when you feel you have the trust from yourself and others to make decisions critical to your work. Examples include giving employees time to work on projects they are passionate about, and allowing customers to personalize their experiences. People: Cultivating meaningful relationships. Achieved through shared experiences where collaboration is productive, innovative and/or fun. Examples include having company-wide innovation generation days, and using interactive websites to create connections between the company and customers. Impact: Having your work impact the lives of others. Achieved when you feel valued and see the concrete, measurable and positive difference that your actions have on others. It is also a feeling of momentum and seeing your skills utilized toward the goal of excellence. Examples include creating a non-hierarchical system to allow employees to present and implement new ideas, and providing customers perks and a voice, for example, through an interactive website or blog.
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