Facts & Figures: What Happy Companies Know - H2C

The Gains Created by Happiness
A survey of 3,000 companies showed that an investment of 10 percent of revenue on capital improvements yielded a 3.9 percent rise in productivity, while the same investment in people yielded an 8.5 percent increase in productivity.

—University of Pennsylvania

Companies with the best people practices provided a 64 percent total return to shareholders over a five-year period, more than three times the 21 percent return for companies with the weakest practices, based on a survey of 750 companies worldwide.

—Watson Wyatt research firm

Professional services firms with great people practices demonstrated financial results far above the average. The five highest scoring offices had results of: 52 percent above average; 47 percent above average; 73 percent above average; 169 percent above average; and 300 percent above average.

—Statistical analysis by David Maister, author of Practice What You Preach

Activities directly related to emotionally intelligent employees have a far more profound impact on stock price than quantitative results.

—Statistical analysis by Kevin Gregson, Sherwood Solutions

Companies with strong organizational virtues such as trust, integrity, optimism and compassion had a higher level of profits than organizations that are not perceived to have those virtues.

—Study by the University of Michigan Business School

Boards of directors providing the greatest oversight of management averaged 51.7 percent in shareholder returns, against an average of 12.9 percent returns for companies whose boards provided weak oversight.

—1999 BusinessWeek study

The top ten companies based on the quality of management governance and board oversight showed returns of 6.5 percent and 7.9 percent for three-year and five-year returns, compared to bottom ten returns of negative 0.2 percent and negative 4.0 percent for three and five years, respectively.

—Institutional Shareholder Services 2003 study

SAS Institute, the largest private software company in the world, has a turnover rate of less than five percent, compared to a 20 percent industry average, with savings of at least $85 million annually.

—What Happy Companies Know

Companies with a clearly articulated reward strategy have 13 percent lower turnover than other companies. Practices such as a lack of hierarchy, employee input into company processes and decisions, and high trust in management deliver a 9.0 to 21.5 percent increase in shareholder values.

—Watson Wyatt research firm

Managing people in ways that build high commitment creates returns of 30 to 50 percent.

—Jeffrey Pfeffer, Stanford University

Source:http://www.h2cleadership.com/publications/what-happy-companies-know_facts-figures.shtml