Understanding Employee Happiness and Productivity With An Employee Evaluation System

Posted by Tyler • November 13, 2015 (Last modified July 29, 2018) • 3 min read

There are often assertions that happier employees are more productive, but until recently it’s been largely speculation driving that claim. The Social Market Foundation, in conjunction with the University of Warwick’s Centre for Competitive Advantage in the Global Economy, released a report on a 700 person experiment that found when employees are happy they are 12% more productive on average.


Perhaps the most interesting finding of the study is that happiness is not necessarily tied to large incentives, but rather small incentives like drinks, snacks, and occasional breaks to have comic social interaction. The old mantra of “buckling down” to achieve a task is being disproved and shown to exhaust employees, lessen productivity, and erode job satisfaction.


Now that we know happier employees are more productive, we can begin focusing on what it takes to make our employees happier in the workplace. Thankfully psychologist Ron Friedman published his book “The Best Place To Work”  and Mark Zwilling over at Forbes provided an apt synopsis on practical takeaways on how to amplify your attempts to increase employee happiness:

1. Reward frequency is more important than size.

Business feedback indicates that smaller frequent positive feedback and rewards will keep people happy longer than a single large infrequent happy event. Even the biggest awards or raises “wear out” in less than a year, with most employees responding better to small doses every few days.

2. Positive event variety prevents adaptation.

People tend to discount events that happen repeatedly, no matter how positive. The value of going away on vacation is that it breaks the routine of everyday life, as well as making you recognize the pleasures of being back home. At work, variety could mean unique events or awards each month.

3. Unexpected positive experiences deliver a bigger impact.

When something surprising happens, our brains automatically pay closer attention, lending these events greater emotional weight. Thus you must make positive surprises more frequent, like special lunches or activities, to override the occasional unavoidable bad news.

4. New life experiences have more impact than reward objects.

Evidence indicates that providing new positive life experiences (for example, a hot-air balloon ride, wine-tasting class, or vacation to Italy) tends to provide a greater happiness boost than spending a comparable amount on material objects (flat-screen television, fancy suit, or purse).

5. Happiness can be triggered outside of conscious awareness.

Relaxing music can lift employee moods unconsciously, as can pleasing scents (nearby bakery, candles, or coffee). Stores and casinos use “aroma marketing” to put customers in positive moods, not for productivity, but to increase their optimism and willingness to spend.

6. Focus on achievements leads to better job appreciation.

Businesses need to spend more effort asking and listening to employee achievements, rather than a continuous focus on what’s broken or not done. Asking about achievements in a group setting encourages recognition of co-workers and gratitude expression, which catches on.


One of the ways you can begin to understand if your efforts at employee happiness are working is to conduct an employee satisfaction survey using your employee evaluation system. These results can help to track trends over time to ensure that your efforts at employee happiness are, in fact, paying off with a more productive workforce.


While we know that we can’t make all employees happy all of the time, it is fair to assume that making an effort to create happy employees will go a long way to fostering a more productive work environment with a committed workforce. In an age where the average job tenure is shrinking, paying attention to the happiness of employees may be the answer to ensuring a more productive workforce that stays devoted to an organization that they see values them as employees.

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