Thursday, January 7, 2016

Investing in People – Your most valuable resource

Give a man a job he loves, and he’ll never work again. An expression that’s as old as the hills, but still holds true today. Research by the University of Warwick has proven the idiom that a happy workforce is a productive one. When it comes to predicting any fluctuations within the share price of a company, a lot of interesting information can be gleaned from looking at employee satisfaction. If we are to look at Fortune Magazine’s list of 100 Best Companies to Work For, topping their poll is Internet Search Behemoth Google, who turns over an average of $60 Billion every year. Other recognisable names that fall into the top 100 include Twitter, American Express, Marriott International and KPMG.

By looking at this list what we see is that some of the world’s most profitable companies have some of the world’s happiest employees. It would therefore be prudent to have a look at what business owners can do to improve employee satisfaction as a means of improving profitability and share price. Gretchen Rubin as cited in believes that one factor that can create a satisfied employee is to give them more control. She states that taking steps as simple as allowing employees to customise their own workspace or considering their work-life balance. This lets employees know that their bosses care about them as individuals.

Opportunities for Development make up an important part of building satisfaction among employees. Having a clear path towards a better career is an excellent motivator and encourages people to do their job better. Their effort can be reciprocated with a possible promotion and a move up the ladder. Many retailers offer graduate programmes to their employees, but it is McDonalds who win in the game of offering employee prospects. Hamburger University was set up as a training centre to allow the many people employed by the fast food giant to expand their skill base. Today over 80,000 people have graduated onto positions within the company, more educated and committed than before. 
Another means of improving employee satisfaction make take the form of offering company perks. These can vary from simple things like a bonus system, flexibility with working hours or extended holidays, to highly desirable incentives such as offering a company car or comprehensive health insurance for their workforce. Not only will offering perks such as these increase the job satisfaction of your current employees, they will also go some way to encouraging the best talent to want to come and work for you. Overall it’s a win win situation!

Having read this article, you will now have a greater appreciation of how having happy employees really works for everyone. Several simple steps can be taken, but in terms of how much you are willing to invest in your employees, the sky’s the limit. Increasing satisfaction increases profit, which in turn increases the share price, which increases shareholder satisfaction, which should, overall, increase your own personal satisfaction!