How happiness can boost your business

Seven ways to cultivate a more engaged—and happier—team

Though not often recognized as a key factor in success, the happiness of your team is not just important for your employees themselves—a happier team benefits everyone, including leadership, your clients, and your bottom line. How exactly? Happy employees are more engaged, motivated, and committed to their work, which translates into higher job satisfaction and boosted productivity. They may also show more willingness to take risks on key strategic initiatives. And, building up a positive work culture can have a major impact on employee retention rates.

In fact, companies with engaged workers have 23% higher profit compared with those with unhappy workers, according to a study by Gallup.1 An engaged workforce isn’t always a given. The Gallup study shows that 33% of U.S. employees are engaged at work—well below the 70% engagement rate at the world's best companies. In other words, if you can foster an engaged and positive culture, it can be a major differentiator for your team.

7 ways to cultivate a happier work culture

Whether a company is large or small, the smartest way to improve workforce engagement and build a strong culture is by supporting employees, says Dr. Ken Harmon, an academic and consultant who has made it his mission to help companies bring more happiness into the workplace.

To foster a happy and engaged workplace culture, Harmon recommends these seven practices:

  1. Be flexible. Leaders often make the mistake of micromanaging their teams. Instead, trust that your team will get its work done. Giving employees latitude over when they complete their work can have a happy ripple effect throughout their lives, giving them more flexibility to make it to a kid's soccer game or to drive an aging parent to a doctor's appointment.

  2. Embrace the whole person. The individuality of your employees is an asset, not a detractor. Leaders can encourage team members to share their unique points of view. After all, a team of people with different life experiences and perspectives gives you a powerful dose of diversification. And research shows that companies with strong gender and ethnic/cultural diversity are more likely to have better-than-average financial results.
  3. Understand the role of money.

    "The person you hired has had life experiences and that's what brought them to be who they are. You love who they are, and that's why you hired them." —Ken Harmon

    Too often, leaders think doling out pay raises will lead to a sharp bump in productivity. But research shows that productivity and higher pay aren't always correlated. Consider using pay raises or bonuses to express gratitude for what people have already done, not as carrots to get them to do more. In fact, frequent, smaller rewards may provide a steady stream of positive reinforcement that keeps employees feeling appreciated and valued for their work. 



  4. Hire happy people. It's easier to build a happy work culture if you start with a team of people who have the right attitude. Consider attitude as well as aptitude during the hiring process.

  5. Be the surgeon. Think of your company as a living, breathing organism. If there's a cancer threatening the health of your firm, you may have to fire an employee whose bad attitude is infecting the rest of the team. You may also have to deliver some specific and precise hard truths, whether about subpar performance or challenging interpersonal interactions.

  6. Be nice. Being nice doesn't mean giving up control or losing the respect of your team. Recognizing or praising employees for good work can yield big benefits, including boosting work quality and reducing absenteeism. The opposite is also true. Workers who feel their good work is going unnoticed may be more likely to leave. And major events, like staffing reductions or team reorganizations, can be pivotal times of stress and instability for employees. This is where leading with empathy and kindness goes a long way. These are moments when the decisions, actions, and behaviors of leaders can have lasting effects on company culture.      
  7. Trust your team. Great leaders understand happiness and lead through trust, stability, and hope. They also practice forgiveness and compassion. When problems arise, use them as opportunities to address organizational issues rather than assign blame. Building trust and a sense of psychological safety for your team can pay off in your workplace culture and engagement.      

Make workplace happiness a priority

Happiness matters in the workplace, even if it seems difficult to measure its impact on your metrics or the balance sheet. In fact, Gallup recommends that leadership add well-being metrics to their executive dashboard to keep themselves accountable. Strong leaders recognize this basic fact. "When you show up as a leader at work, you need to truly care about every one of those people who is in there,” says Harmon. “If you don't, there's a problem. If you do, it goes far." 

Contributor bio

Dr. Ken Harmon is an executive coach, motivational speaker, consultant, and founder of Harmon Consulting. Much of his work focuses on the research of happiness and how the results can be deployed to help people's personal and working lives. He is also a professor of accounting at Kennesaw State University, where he served as dean of the Coles College of Business. Dr. Harmon has bachelor’s and master’s degrees in accounting and a Doctor of Business Administration degree in accounting from the Haslam College of Business at the University of Tennessee.


What you can do next 

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    • Visit our Talent Resource Center for helpful resources and actionable tools for managing talent.
    • Check out our Talent Strategies page to learn more about evolving your talent strategy to advance your business. 
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1 Gallup, "State of the Global Workplace: 2022 Report," 2022,
2 Nick Otto, "Avoidable turnover costing employers big," August 9, 2017,