Kindness in the Workplace: It Just Makes (Dollars &) Cents

 

Why Kindness Is Important

Kindness is important everywhere, and the workplace is no exception! The power of kindness is extraordinary. But when we talk about the workplace, there are some important additional reasons why kindness is so vital.

Treating employees well and making them happy affects the bottom line. As shown in the diagram below, employee happiness increases profits three ways:

1.     By increasing customer satisfaction, and thereby increasing sales.
2.     By decreasing absenteeism, and thereby reducing the costs associated with absenteeism.
3.     By improving employee retention, and thereby reducing the costs associated with replacing an employee.

There are numerous research studies to support this model.

employment engagement

Dr. Noelle Nelson is a clinical psychologist, business trial consultant, and best-selling author of Make More Money by Making Your Employees Happy. In her book, Nelson cites a study from the Jackson Organization, which shows, “companies that effectively appreciate employee value enjoy a return on equity and assets more than triple that experienced by firms that don’t. When looking at Fortune’s ’100 Best Companies to Work For,’ stock prices rose an average of 14% per year from 1998-2005 compared to 6% for the overall market.” Dr. Nelson explains, “When employees feel that the company takes their interest to heart, then the employees will take company interests to heart.”

absenteeism

The American Psychology Association tells us that stress is a major cause of illness today, and often workplace stress is the primary cause. This contributes to workplace absenteeism, which causes considerable direct and indirect costs to businesses. According to a white paper from Circadian, “A company of 5,000 hourly employees has the potential to reduce costs by over $7.9 million per year, or 3.2% of total payroll.”

employee retention

 A white paper by the Kenexa® Research Institute reveals that organizations with highly engaged employees achieve twice the annual net income of organizations whose employees lag behind on engagement. Their conclusion: “It is clear that properly-fitted leadership practices give rise to an engaged workforce—a workforce positioned to deliver the organization’s customer value proposition. Loyal customers lead to market share gains, greater profitability and long-term success.”

Are You Listening?

Listen.
In every office
you hear the threads
of love and joy and fear and guilt,
the cries for celebration and reassurance,
and somehow you know that connecting those threads
is what you are supposed to do
and business takes care of itself.
Someone needs to say “amen”.

 Amen. — Stanza of a poem called Threads, by a former CEO and author of Love and Profit, James Autry

CCC is honored to host this 2-part series on the value of kindness in the workplace written by Carol Preibis. Part 2 will focus on how businesses can achieve a kinder workplace and enjoy the benefits mentioned in this post. For more on Carol, keep reading.  

 

Carol Preibis and her sister Michele value the Simple Life and want to help you shed the complicated nature of today’s world. They share insights on food, decorating, stress relief and living more simply, while actually enjoying day-in, day-out living. [UPDATE: Their blog, Ahh the Simple Life, is no longer active.]