Should we focus on making workers happy?

How important is a happy workforce? According to Mark Price, the former boss of Waitrose, it’s the main thing that leaders should be thinking about. Make your workforce happy and the profits will follow.

To prove it Mark cites his experience running the supermarket chain, when with a goal of workers happiness he made it the fastest-growing, most profitable supermarket in the UK.

The original purpose of the John Lewis Partnership, as laid out by the very same John Lewis , was to uphold the happiness of the people who worked inside the organisation.

Mark’s new book is Happy Economics. Mark’s book makes the assertion that the quickest way to business success is to focus on creating happy employees.

This is genuinely a brilliant listen – and one that you might benefit from reading the transcript of – it’s below.

While I got real value from the book, I actually found the conversation even more enlightening. It challenged some things I believed and I found myself reflecting on it for the day afterwards. I think there’s a clarity in the conversation that the book lacks at times – I think it’s the challenge of books to be honest. We’re so used to ideas being visually backed up that when we’re paging through 200 pages of words the emphasis is often lost. Maybe they work best together.

Mark has a clear 6 stage framework for making a happy, productive workforce laid out in his compelling new book Happy Economics.

• Reward and recognition
• Information sharing
• Empowerment
• Wellbeing
• A sense of pride
• & Job satisfaction

Mark’s company is WorkL. You can take their surveys and see their data on that link.

Key takeaways

• The happiness of employees is crucial for driving productivity and increasing profits
• Managers play a vital role in creating a positive work environment and should focus on training, recognition, and coaching
• Leadership should involve setting a clear plan, making employees feel valued and important, and maintaining optimism about the future.
• Well-being initiatives should go beyond tokenistic measures and address underlying issues in the work culture. Employee happiness is crucial for workplace culture and productivity.
• The six key drivers of happiness at work are reward and recognition, empowerment, sense of pride, line management, career development, and job satisfaction.
• Implementing these drivers effectively can lead to improved well-being, productivity, and business performance.
• Building a positive culture is essential, and companies should focus on measuring and improving employee happiness.

TRANSCRIPT

Mark Price

34 years working with John Lewis. Then David Cameron asked me to join the government four months before Brexit where I became Minister of State for Trade. And then I was the poor beggar who had to go around the world for the next year and a half persuading all the countries to continue their trade deals with the UK. So I did that. And then when I left that, I founded WorkL, which is based on all the things I learned in John Lewis and Waitrose.

What WorkL does both for businesses and for individuals is measure, track and improve workplace happiness to drive employees happiness, to drive productivity, which I’m sure we’ll talk about. So I’ve kind of been dedicated to that now for the last six years. 

Bruce 

And WorkL is the technology that sits underneath Sunday Times best companies to work, is that right? 

Mark Price

That’s right. So we run the Sunday Times best companies to work. We do the same in Ireland. We do the same in South Africa, the UAE, the Philippines and Australia. So around the world we run for media groups. They’re best places to work. They use our methodology. So we do that. We work with a thousand companies around the world helping them measure, track and improve employee happiness to drive their productivity. And also as said, we help individuals. The other really cool thing that we do is about 10 ,000 people a week come to our website and take our happy at work test. So we’ve got a huge database and

When people take the test, we say to them, where do you work? And people tell us. So what we can do is link that data to companies and organisations. We’ve now got data on over 100,000 organisations globally. We then link that to 5 million jobs. So we help people find jobs in companies where people who look like them are happy. So we help companies with surveys. We help recruitment, both for individuals and for companies. And we run awards around the world.

Bruce 

Now, let’s jump to the conclusion. So you’ve just written this book, Happy Economics, which is based on this hypothesis that will come on to a second in the successful businesses start by thinking about how to make their employees happy. But I wonder if you could kick us off by just telling us the story, the very specific story. So people might remember that on the high street, there used to be Somerfield, and then it was overnight as far as we’re concerned as high street goers, it was consumed by Waitrose. And I’d love you to tell us what happened to that Somerfield business and the, I the people, the business, what happened in that transition? 

Mark Price

Just a little bit of background and history first. On my first day working for the John Lewis partnerships, that’s John Lewis Department Soils and Weight Trade, I was told that the supreme purpose of the organisation was the happiness of the people that work there. And that’s because the guy who founded the company over 100 years ago had this really simple idea. If my people are happy, they’ll stay longer, so training will stick. They’ll take less sick absence. I’ll have lower turnover, staff turnover, so that will save me on costs, but I’ll get increased productivity.

And so when I joined, I was told that’s what we do. That’s how we drive our business. We have people for the long term, better trained, giving better customer service. They’re happy in their jobs. I then spent 34 years trying to work out what does that actually mean? I was lucky enough to go to a number of business schools to think about it in both a practical sense, but also in terms of the principle of how does that work? And when I got to my last 10 years in the partnership,

I ran Waitrose as you know. And during my time running Waitrose and before when I was actually running retail, Waitrose made the decision for the first time in its history that it would acquire parcels of shops. So what we’ve done historically is we’ve grown organically, really to a small amount, like one shop a year, two shops a year. And the logic in the business was that our culture was so strong because of this belief in the happiness of individuals and training and developing people and understanding how the business worked, that you couldn’t just go out and take on 10 or 12 shops from a competitor and hope to absorb them in. But there was such amazing opportunities in the market. Somerfield were the first to break up. followed Safeway, a whole host of others. Morrison’s bought shops and sold off parcels. Co -op sold off all their big shops. So at the time that I started to run Waitrose, and just before, there was this opportunity to start buying parcels of shops.

And what we said to ourselves is, if we’re going to do this, what we’re going to have to do is obviously refurbish the shops and put in weight trays, fixtures, and fittings, and stock. But also, we need to think about the people. Now, when we took over Somerfields, their staff turnover was running at 70 to 80%, meaning that 70 to 80% of their total staff number were replaced every year, left and were replaced and their sick absence was 25%. So any one time they had a huge number of their staff off sick. 

Bruce

Was that long? That seems like such a big number. You know the space better than me. Is that a big number? 

Mark Price

It is a big number, but I mean, there are many out there now who’ve still got double digit sick absence numbers. So what happened is we took over those shops. The managers who were there, we kept on, but we sent them to other branches of Waitrose.

to understand our culture and how we worked and how we got the best from people. We put in a new management team, but we pretty well kept all the same existing people. And we trained them and we managed them in the way that the business managers, which I can explain how we did that later on. And what we got within three months was staff turnover fell from 70 % down to, I think it was 17-18%.

We had sick absence that fell from 25 % to about 4-5%. And of course, that meant that you could train people and it would stick. You didn’t have the cost of recruitment. You didn’t have the cost of covering sick absence. People were better trained, better led, better managed. And as a consequence, we had a bottom line benefit. So the nub of happy economics is that you can measure the impact on a business in terms of the happiness of their people.

and the consequential benefits that has on staff turnover, sick absence and productivity. And that’s what we do now. We do that for thousands of companies. And in specific terms for Waitrose, what it meant in the average Waitrose branch that we bought, we got a benefit to the bottom line, depending on the size of the shop, of between a £ quarter of a £ million to £100,000. So that was on top of anything.

Bruce Daisley 

What’s that  percentage wise? 

Mark Price 

Five, six percent

So forget the profit that we might get from our trading, from our assortment, from all the things that Waitrose did. We got an efficiency benefit because of those advantages. And once we had that model, it was really easy for us. What we’d then do is we bought Safeway shops, we bought co -op shops. And over the course of the 10 years I was running Waitrose, sales doubled. Market share went up from 3.6% to 5.3% and profits tripled. So we had an amazing time. And after my time in government, what I wanted to do was to set out that philosophy, how you do that, how you create extra discretionary effort, how you get your people to give more, how that’s a competitive advantage. And happy economics now is a distillation of all of that. It’s all the research that we’ve built over six years from working with a thousand companies. from millions of individual surveys completed, looking across 26 sectors and data on 106 countries. 

What I can tell you with absolute confidence is those organisations that have the highest level of employee happiness as we measure it, they have higher profits, they have higher productivity, they have lower stuff turnover, and they have low levels of sick absence. And that gives them a competitive advantage. And when you measure happiness,

Bruce

Typically in the study of happiness, subjective happiness is a good prediction. Asking someone how happy they are is a good prediction of how happy they are. Is that right? 

Mark Price

I don’t think it’s at all subjective. I think the question is an opener. So I know you’re a huge tennis fan. And if you were playing a game of tennis and you had a coach there and you did a serve and the serve was this, that, the other.

The coach might well say to you, you happy with that serve? Now you know that he’s not asking you some ethereal question about happiness. He’s asking that as a way for you to say, I didn’t quite get the toss right. I didn’t quite get it out of the middle of the racket. I didn’t quite get the spin on it. I hit it a bit too hard. It went a bit too long. It was a bit too short. So you know how you would define happiness. So what I did for 34 years is define happiness in terms of the workplace. And it’s defined by six things

Bruce

I’m happy to hear them. 

Mark Price

1. So there are six things which are key to driving workplace happiness. And it’s not about pizza nights. It’s not about bean bags and pool tables as nice as they might be. It’s about six things. So the first is reward and recognition. Are you paid fairly? And more importantly, do you think you are paid fairly? And do you get recognised when you do something well? Pay.

Reward is a hygiene factor. If you’re paid five percent less than you think you’re worth, it niggles at you every day. You think these people got me on the cheap. If you’re paid five percent more than you think you’re worth, you don’t go into work and work harder. And pay is relative. People don’t think, well, I’m doing this job working in the supermarket and I’m paid this, but Lionel Messi is paid that. They think about it in terms of their relatives. So it’s about relative. It’s about mitigating discontent. That’s what pay does. 

The thing that really drives engagement, happiness at work, is acknowledgement, recognition. Somebody noticing what you’re doing and saying well done. And there are a whole host of things you can do in a business to either formalise that or just having really good managers who actually notice what you’re doing. And that of course leads on to coaching because if you see what somebody’s doing and it could be better, you can say to look that’s great but… you could do this a bit better, you could focus on that. And again, going back to that tennis coaching world, the coach would say, yeah, it’s good, but I think you can get an extra 10 % out of your serve if you did this. Business is the same. So people really like that. It plays to the last point I’ll mention about career development. 

The second thing that’s really important is information sharing. And the guy that founded the partnership said for him, this was the single most important aspect of happiness at work. And there are two parts to it. One, have you been trained well enough to do your job effectively? And the second is, do you have enough information about the organisation you’re working in, the context in which you’re working to do your job effectively? So a lot of people just think, I’m kept in the dark, I don’t know what’s going on here, I just go and do my job and even then I’m not trained well. So you’ve got to be happy at work, you need context and you need to be well trained. 

Bruce 

And that must come out in your WorkL stuff as well as in the Waitrose experience. But tell me this, it strikes me that there’s a real balance to be struck because the notion that all sharing is good sharing has created the world that many of us operate in now, where we’ve got 20, 30 hours of meetings. And people frequently tell me, you know, I’ve got multiple meetings at the same time, I’ve got so many meetings, I’m overwhelmed with meetings, and all I do is I sit on mute and have information shared with me. Now it strikes me there’s a real important balance there that, because we haven’t come in with any prior filtering, people just believe, I’m just going to share everything with everyone. And to me, that creates one of the problems of contemporary working. Now, much easier for you in a retail space where someone on the floor telling them that the aisle ends, the aisle bins is going to make them 10% more for the store and all the profit comes from the aisle bit. Great. But they’ve also got their job to get on with.

But how would you bring this to something that’s maybe less, it’s got less other content to it. How would you bring this to the world of an information job? 

Mark Price

So, by way of background, as you say, on work or when we measure all these things, most commonly people say they don’t have enough information, which is strange, isn’t it? Because as you say, we live in a world where there’s so much information. But it’s about filtering that information and giving people what they really need. 

When I worked in John Lewis and Waitrose, every Friday we had a journal called The Gazette that was published. It had the sales figures of all the branches and it talked about the key things that happening in the business. And at the back page there were notes and notices, which you were expected to read. In the shop that you worked in, they would have a green piece of paper which would have every week the things that you needed to know. And again, everybody would have to sign that, say they’d read it and they’d seen it. So there’s something about the overarching information. The day -to -day information, it’s really down to your manager. You know, what do I need to tell my people to do their job effectively? What do I see in their performance that leads me to believe they either need more coaching or I’m very comfortable that they can get on and do this. So at its simplest level, it’s about two things. How do you provide global information to give context?

There are numerous ways you can do that. You can have a team stand up. You can do anything you want to do. And then it’s about how do you coach on an individual level to give people the information they need. 

Bruce Daisley

Right. So it strikes me that this probably comes under the sphere of management and having good middle managers. You talk about the importance of that and the vitality of that when it comes to differentiating results. But it strikes me that probably a lot of us work in an environment where there’s no management filtering what information we get and so as a result of that we’re just overwhelmed with information

Mark Price

Yeah I think that’s right and the sick thing that we measure is job satisfaction and that breaks down into three things Bruce. First of all it breaks down into do I actually like the job I do which is pretty obvious and some people just don’t even like the job they do but then there are two further things that make up job satisfaction in what we measure. One is career development. Am I in something where I’m learning, and what we know is if people feel that they’re growing and learning, they’re happier. And the last is their relationship with their line manager, which plays exactly to this point. 

Now the challenge that we have in management is that, I was delighted for a number of years to be president of the Chartered Management Institute, and research they did said that 82% of managers are accidental managers. They’ve been promoted either because they’ve been there a long time and they know how something works, or they have a technical qualification.

But what they’ve not been taught is how to manage people, EQ, the whole EQ bit of how you get the best from people. And what we see, we measure flight risk. So we measure the percentage of an organisation that’s going to leave. And what we find is there is a correlation between that and do I have a good relationship with my line manager? It’s a key question. There are a number of questions, but that’s a really key question.

So you’re absolutely right. That relationship between a line manager and the people they’re managing is vital. It’s why I have real concerns that management spans get too big, because you can’t possibly take personal interest. 

As an archaeologist, an ancient historian, I think the Roman army had it right. Effectively, they would have one person looking after eight soldiers, because they believed that the best way to manage was to look after that number of people and make sure they’re on the jobs. What I saw in my time certainly in Waitrose and John Lewis was a view that you could extend the number of people that somebody could look after until you got to ridiculous levels, not what I’m saying in John Lewis and Waitrose, but elsewhere, you’d get spans of management of 50. Well, how can one person look after 50 people? How can you do an annual review of 50 people? How do you know how they are personally? How do you know what development needs they have? So for me, that relationship between a line manager and their people is critical to driving their happiness and to improve productivity and performance. the objective of being completist, 

Bruce

I’ll return because you started talking about your six and then I interrupted. And so the six, just for the benefit of listeners, and anyone who’s reading these show notes will see these six laid out. The six are:

• Reward and recognition
• Information sharing
• Empowerment
• Wellbeing
• A sense of pride
• & Job satisfaction

And you’ve touched a little bit on the job satisfaction there. We’ll go through these. I noticed that there’s no sense of community or connection. And for me, happiness at work is often collegiate. It’s often feeling part of something. Where would that fit in your six? 

Mark Price

So we put that in sense of pride. OK. So we measure how you feel about your work. Would you recommend where you work to friends and colleagues? So we give people Net Promoter scores.

But it fits across a whole host of areas. If you think about empowerment, empowerment that we measure is about having information needed to do your job, but also feeling trusted to do your job, also being able to ask questions and get straightforward responses, being treated with respect. Well -being is genuinely feeling that your manager and the company you in cares about your well -being, mental, financial, physical. And sense of pride is doing something that you feel proud about. You you understand your place in the organisation and you feel proud of the organisation, you feel proud of the job that you do. So there are some studies that say, okay, what you need to measure is how many friends you have at work. I’m not sure that’s the right measure. You can have a friend at work but not like your job and not like your manager and you might stay on because you’ve got a good friend there but it’s not necessarily the best reason for you to stay there. So I think that’s a kind of a far -off consequence and it’s definitely a benefit.

But if you’ve got a friend at work, it doesn’t make you in an overall sense happier at work. You might be happy with that friend that you meet when you’re having your tea break, but if you’re working for a manager that you don’t respect, doing a job that you don’t enjoy, not being paid particularly well, not being recognised when you do something well, having a friend at work doesn’t make you any happier. So for me, it’s another one of those things that’s sort of on the side, a bit like having pisza or beer nights, or it’s great that you’ve got that. but that in and of itself is not driving your, you know, Okay, so you’re saying from a business objective that a friend at work is an interesting detail, but it’s not the biggest predictor, because I guess that’s interesting. 

Bruce

Gallup say it’s the single biggest predictor of whether you’re engaged with your job. And I guess it’s worth sort of laying your approach with their approach side by side. You know, one of the things that comes out of their research is they say that 10% of British workers are engaged with their job.

Now in your analysis, your numbers are significantly higher than that. How would you lay them side by side? Are they measuring the same things? What do you think the level of engagement is for British workers? 

Mark Price

So I would say that roughly, I mean there loads of different studies. I you can go to all the big four, they’ve done studies. Some of them say, you know, 80% are not happy in their jobs. I don’t understand what engaged means. What does engage mean? I mean I know what happy means.

So does engage mean that you’re thinking every moment about the dough that you’re needing to make a pizza? I don’t understand what engagement is. What I understand is the measures and the questions that lead to somebody being happy at work. And those are the six things that I’ve set out. If you were to look at all of our millions of surveys that been completed you would conclude, if you say people who score below 70% are in need of improvement, you would probably say that 30% are genuinely happy in their job, 30, 40%. The rest have got some degree of disillusionment. If you currently look at our figures for flight risk, about 28%, so 28% of the workforce today are looking to leave within or will leave within the next six to nine months. We do new start or an exit survey so we know how people answer questions if they’re going to leave. If you look at well -being risk today, 22% of people have got a wellbeing risk at work. So one in five. 

That’s what we measure. We measure are people going to go? Are they going to, are they have they got good wellbeing, and then are we happy? But there are lots of different measures. On our measure, I think you could say that 30 to 40% of people who take our survey, millions, 10,000 every week just individually, let alone what we do with companies, 30, 40% are happy in their work, enjoy their work, enjoy going into work. The rest, to one extent or another, are less happy and their workplace happiness can be improved.

Bruce

Let’s complete that list of six things that make people happy. 

Empowerment – empowerment is all about trusting somebody to do their job. So once you’ve trained them, letting them get on with it, letting them make decisions, letting them make decisions, get them wrong and learn from decisions. But it requires coaching. It’s treating people with respect, listening to their points of view. So empowering an individual to feel responsible for what they’re producing. 

Bruce

And this presumably is the secret source of great managers, right? This is where the manager must earn their corn.

Mark Price

I think all of them. I think all of the six are about a manager making sure that an individual feels well supported in their job, well trained in their job, rewarded for their job, acknowledged for their job, has a sense of pride in what they’re doing, feels that they have a future and can be developed. All of those things are important. It’s what any great coach would do. And I think really, really good managers do. That’s slightly different from leadership. 

I’ve always felt there are three great qualities to leadership, and if I may say so, you embodied them in your previous work. The first is that you’ve got to have a really clear plan. You’ve got to know what you’re going to do, how you’re going to compete, and you’ve got to be able to communicate that plan really effectively to your workforce so that everybody’s on the same page. 

The second thing then I think great leaders do is they manage to convince everyone in the organisation that their particular role is vital to that success. So it doesn’t matter what job you’re doing, if you don’t do your job to a really high standard, that cog will mess up the whole machine. We’ll be less effective than can be. So people feel that sense of pride in what they’re doing and the importance in what they’re doing. 

And lastly, good leaders are unrelentingly optimistic. They say all of the time, we’re getting there, we’re doing well we’re going to get through this when it’s a bit tougher, when it’s good, it’s working, we’re going to get there. So I think good leaders have those three things. The ability to set out a coherent plan and the ability to communicate it convincingly. The ability to make everybody feel part of that plan and vital to that plan. And lastly, then they view everybody with a sense of optimism about the future and where they’re going to go together. 

Bruce

(Thank you for the nice things you said about me). Wellbeing is number four on your list. I’m interested with that because well -being is such a… It’s often treated in a quite tokenistic way, isn’t it, by organisations. They attempt to tick off well -being while not necessarily resolving the underlying issues of their culture. 

Mark Price

Yeah, I totally agree. We work with a big American company that very, very sadly had two suicides and they brought us in and they couldn’t understand why because they had mental health first aiders and whatever. But what we were able to demonstrate is that it wasn’t all of the training that they’d put in place or the support they put in place. was the managers were asking people to do ridiculous amounts of work, work till two, three in the morning, be ready to present the following morning, put real pressure on them about financial performance. And it was that that was buckling the team. So it was the way that people were being managed. It was the six steps and how they were being implemented. So you can tick all the boxes. You can have mental aid first aiders, et cetera, et cetera. And I would encourage all of that. But the root of it is the way that you’re asking your people to work, the environment in which you’re creating.

And that creates workplace happiness. When we did the survey with this particular company, they had a terrible workplace happiness score. High levels of staff turnover, high levels of sickness. Because it, I mean, if I talk through that, I can’t obviously name the company, if I talk through that, reward was very good. People were very well paid. Recognition was very low. They weren’t very good at telling their people what to do. Information sharing, nobody had the context for why they were being pushed so hard. 

And it was during COVID this company had lost a lot of sales, the management were really worried about the liquidity of the company and therefore they were pushing hard. But they hadn’t really explained that, you know, why we need more from you now. In terms of empowerment, they were micromanaging, I need this now, I don’t like that, you must do that. So that kind of trust in employees had started to disappear. There was no thought about well -being, are you okay, are you spending enough time with your family?

In terms of sense of pride, they didn’t feel any particular pride. They thought the company had just become a machine and was crushing them. And then in terms of line management, career development, job satisfaction, none of that was working for them. So the things that we talk about and we measure at WorkL, and I set out in the book, hopefully with lots of practical examples and illustrations, are things that make a real difference. They are the things that drive happiness and workplace culture. They’re the things that I learned in 34 years.

And if they’re applied, we see amazing results. mean, we commonly see flight risk come down by 22%. That’s the average that we see when we work with the company. We see reductions in sick absence. We see increases in productivity. We see a 9% increase in job satisfaction. So we know it works, which is why I wrote the book, because I wanted to set out not just the theory, which obviously I’ve had for a long time and I’ve seen the theory work for my days in Waitrose and Somerfield as we started. But I’ve now seen it across the thousands of companies that we work with. And it’s not difficult. And it will improve the working life of employees. 

It will improve the commercial return of businesses. And it will improve the GDP of countries. I think I said when we complete our week daily surveys, people go to the work site and take the survey.

Not only do they tell us where they work, tell us what country they’re from. the productivity of the UK, which is the worst in the G7, correlates to the position for worker happiness in the UK. And we find that’s the same across industries. The happiest industries are the most profitable within the industry. The happiest companies are the most profitable. They’re always outliers, but it’s really consistent in all the data that we’ve crunched and there’s a lot of it.

Bruce

There’s an interesting perspective that you take which is I guess quite often someone might look at unhappiness and go this is a culture thing, we need cultural change and I think the way I interpret you is saying often culture is sort of just this vague word that people use and they don’t specify the specific lever they’re looking for. Talk me through that. You talk about cultural change. I’d love you to articulate the point of difference you take there.

Mark Price

So my definition of culture is it’s the sediment of past transactions. So when a new management team go in, they often say, we’re going to change the culture. And of course, the workers go, well, let’s see. Let’s see in a year’s time. Let’s see if you do change. Let’s see if you do. Offer me some flexibility when I need to go early to see the doctor or get the kids from school or do whatever I need to do. Let’s see if you do recognise good performance when I perform. Let’s see if you do do something about recognition when I do a good job. So you’ve got the management walking in saying we’re going to change the culture. Whether they’re precise about what they mean, I’m not sure. Some are, some aren’t. But then you’ve got to live it day in, day And it takes years. 

The tough thing with culture, as you know, takes years to build, it takes weeks to destroy. 

A manager comes in and people will say, they used to say in John Lewis and Waitrose, people talked about having green blood in that business. And they would say, they haven’t got green blood. They don’t understand it. Which was a shorthand for they’re not operating in the way that we would expect people to operate. The wonderful thing about John Lewis Partnership is because of all the structures it had, that would self -regulate because it’s almost the partners, as they’re called in John Lewis and Waitrose, would say you’re not behaving in the way you should and then there’d be a course correction. 

In other organisations you have to build that culture over a very long time but I think if you want a positive culture where you want happy employees the six things we’ve talked about are the key drivers. You might think you know what we’ll get everybody a pizza on a Thursday night. If you’re not recognising people, if you’re not giving them information, if you’re not worried about the well -being it doesn’t matter. know people will see through it for what it is.

So it’s those deep line things, Bruce, which are key to changing a culture. And to be honest, they’re not hard. These are not hard things. As we demonstrated in Waitrose when we took over Coops and Somerfield and other businesses, we did get a transformation in behavior. I’ll tell you one story from the summer field, the first one we took over. And it was the branch in Helsing. two stories from there.

We’d spent about a million pounds refurbishing the shop and the night before it opened, somebody graffitied in the loos. And so the branch manager, because all the trades had gone, got a local painter and decorator, came in, repainted it. The next morning, put a note on the table saying, somebody graffitied in the loos. I’ve got a painter and decorator in last night to tidy it. It costs 120 pounds. That means there’s 120 pounds less in the bonus to be shared this year. And all of that nonsense stopped.

About four weeks in, manager went along the cashiers and said, where’s Rosie? And her friend said, she’s not here. And the manager said, yeah, that’s right. She’s phoned in sick. I hope she’ll get better. And the other cashier said, actually, she’s gone to see her sister in Brighton. But now we’re all in this together. I don’t think that’s fair that she’s done that. And so the manager saw Rosie when she came back and said, look, I understand you weren’t sick. You went to see your sister. If you wanted to take a day off, we would have given you a day off to do that, but you can’t do that. Within two weeks, Rosie had gone because the cultural expectations had raised. 

And that’s the important thing about creating a culture where everybody knows the rules. 

Bruce 

There’s interesting context here because John Lewis and Waitrose are quite different businesses, aren’t they? They’re owned by the people who work there, effectively or there’s more sharing, there’s more collective benefit. But if you’ve got an organisation which is paying, let’s say another retailer, or it could be an office, but they’re just paying a fixed wage, most people don’t have a benefit in the upside, there’s nothing, there’s no stake in it for them other than maybe a cursory end of year reward that might be sort of quite nominal. It strikes me that the system thinking that John Lewis and Waitrose have sets them apart, it enables them to say the £120 made a difference. 

And firstly, I guess, you know, as you say that the challenge for UK business is our productivity is lower. I might say as a pushback then, then the lesson seems to be here. If you want better results, you give people a bigger stake in what they’re doing. 

Mark Price

Well, I mean, I wouldn’t argue against that. I’ll pick off those two things separately. So the UK productivity… The obsession that we have is with infrastructure spending. What we never ever talk about is are we getting the most from our people and how does our productivity compare in terms of human endeavor? And that’s what I measure and that’s where we’re less good. In terms of the first bit, being able to leverage in the John Lewis department of the fact you’re a partner, you’re a co -owner, is part of that pride. It’s leveraged by the management to say you should feel really proud of work.

But other companies give bonus. M&S gives a 1 % bonus. I think M&S employees have had bigger bonuses than John Lewis and Waitrose people for a number of years. Asda gives bonuses. Most companies give some form of bonus to incentivise work. It isn’t the bonus per se, however that’s distributed. It’s making people feel proud of where they work, that they’re doing something different. They’re doing something important.

And that’s what John Lewis and Waitrose can lean back on. They say, we’re all in this together. We’re a co -owned business. But if you look at the cash benefits, the bonus benefits, they’re not dissimilar to what other people get. Now, in a gloriously fantastic year, there’s no doubt people in John Lewis and Waitrose can do very well. But in a normal year, it’s probably no different than what people might get elsewhere.

Bruce Daisley

It also strikes me, sort of going through your checklist here of the six things that you can be over achieving. You can be over indexing on some of these things. you know, I worked in one big technology company where four of these things, they were exceptional at. 

Reward and recognition was almost excessive. People were allowed to reward and recognise each other. 

There was a habitual information sharing, openness was their identity. 

Well -being was obsessively looked after. 

There was a sense of pride of working in this company.

But there was incredibly low empowerment and as a result, people’s job satisfaction was minimal. And those two things fundamentally undid everything else. People feeling like their work wasn’t, having any impact whatsoever. They just felt like they were in a bureaucracy. It just meant that there were a lot of people there with managed depression really. People, you know, they were in this sort of affluenza dynamic of how can I have all this material wealth and still feel unhappy? And it just, it’s an interesting framework that you’ve created because it firstly illustrates that you might over -index on some, but that won’t compensate for the fact that if core elements are missing, it will undo all the hard work. 

Mark Price

Yeah, you’re absolutely right. And that’s what I spent 34 years from day one in the John Lewis Partnership when I was told the supreme purpose of the happiness of people who work here is working out what creates happiness at work. So I had 34 years practically working it through, went to three business schools, which the organisation, I was delighted they let me go away to think about and study the subject. And then 10 years running Waitrose, putting it all into practice. You’re right, you can be good at two, three, four of these things, but there are six. And people often say to me, are they weighted? Is one more than one more the other? No, they’re not. These are six key things that drive employee happiness. And as you’ve just beautifully illustrated, get two wrong, and you can still have high levels of staff turnover, high levels of sick absence, because you’re not getting them right. So what I hope I’ve done is to codify for every dream what it means to be happy at work. in a very practical way that can be implemented. And if you go to WorkL and you go to the world’s happiest workplace list, which is open source, you’ll find a list of 100 ,000 global organisations or organisations around the world, and you’ll be able to see the data for everyone. You’ll see how they score for women, for men, for people with a disability, for LGBTQ +, you’ll see what they think about the confidence of manager, you’ll see what the flight risk currently is in that organisation, what the wellbeing risk is in that organisation and then we’ve linked that to five million jobs around the world and we’ve done it so that people can say, you know what, that’s a really good company. The people there are scoring it really highly on these six steps. 

This is how each of them score within each of the six steps. These are the things they’re good at. These are the things they’re less good at. And I hope it empowers people that when they go to an interview with a company, they can ask those questions. They can say, seems that you’re not quite so good at empowerment. 

Bruce

Can you just talk to me about that, how this operation works? 

Mark Price

And we work with loads of companies. I’d love to tell you stories about individual companies, but for obvious reasons I can’t. there was a telecoms company that had massive staff turnover of students. They were recruiting people. It was a well -known brand. People thought great company, go and work for them. They got in there three months. They’d gone because they were doing telesales all day, no break, dadidadida, really tough work.

And they weren’t being honest with them interview about the nature of the company. And so my hope is that by giving this information to both managers, but also to individuals, they can make better informed choices about where they work, what’s going to be good about that company, and what’s perhaps going to be less good, and where they might need to ask questions. But also it helps managers. I every large company in the UK is on that. So you can go and look at the data. So what I hope we’re doing is helping to inform people about where they’re going to get the most from their working lives. I worked with one chairman of a very large UK retail company who said, in fact I mentioned it in the book, he said, my big problem is I’ve got lots of people here who’ve got lots of friends here. They’ve been here a long time. They like the benefits, but actually they don’t like the company. They’re not enjoying it. And I think it’d be better if they went. And so we did a piece of work and it was absolutely right.

People were there for all the wrong reasons. They didn’t enjoy their job. They didn’t enjoy the way the company had gone. They felt it had been detrimental. And the biggest issue was how do you move those people on and bring in a fresh new group of people who are going to be more energised? Or alternatively, what do you have to do to turn those people to be advocates again for the company? So people look at the data and use the data in a whole host of different ways. 

Bruce

I guess all of that is suggesting that this exists at a company level. But I think that one of the things I’ve found compelling from what you said is that, and you were fortunate in the world of retail that you had stores. (And I guess you had departments in stores). 

But you could have an A-B test where one store was performing better than another store. And so it was all part of the same Waitrose umbrella, but one store was a great place to work and another store wasn’t. And it was often down to that leadership team or that I guess there’ll be an individual version of those six factors laid out in that store. so it’s a good reminder that, albeit your company is an umbrella, actually every team manager, every team leader can play a part in shaping these six things in their own small team, as well as in being part of an organisation. 

Mark Price

We work with Iceland, Wagamama’s, Burger King etc.

And what we do with those organisations is give them data down to every individual manager. And they can A, B, the whole organisation. They can see which Burger King branches have got high levels of staff turnover, high levels of sick absence. They can relate them to the happy at work survey test that we’ll do for them. And they can see very clearly. But then we can also calculate. We can say in this shot, because your score is at this level rather than this level. it’s costing you £50,000 on the bottom line. If this manager had lower staff turnover, lower sick absence, your productivity would improve by this amount. You’d save this amount on training, save this amount on recruitment, you save this amount on overtime cover because people are sick. And so we do that for companies around the world. mean, finance directors love us because we can be very specific with them. We can show them a score.

We have something called our extra discretionary effort calculator. We know in every country, in every sector, what it costs to recruit somebody, what the cost of sick absence is. We can apply that and we can say to them, this is the potential saving that you can get. And the savings are massive, absolutely massive. If you’ve got a retailer and you can move your staff turnover from 50% to 20% and you’ve got 2,000 people, the saving on that. I was talking to an airline company andvI mean they were just spent, the HR department was spending the whole time recruiting. They said we can’t do anything else. You know the biggest challenge we’ve got at the moment is just keeping people in the business. And you’ve got to break that cycle. You’ve got to find a way of recruiting the right people, which again I talk about in the book, how do you recruit the right people. Once you’ve recruited the right people, it’s then how do you keep them on board. So we work with companies and we do new starter surveys. So we measure for the first six months how that person is feeling. We can see whether they’re becoming slightly jaded or whether they still feel energetic. It allows managers to go in and to have an impact, hopefully, to keep them on board, keep them in the company, not have all the turnover costs. I think this, when I was running Waitrose and at John Lewis, in our monthly board meetings and KPIs, this was the first measure for me. How are our people? And we’d have ways quantitatively and qualitatively of measuring that. Staff turnover, sick absence, how people felt.

Bruce

So turnover, staff absence, very easy to measure but you say in terms of how people feel that you can only really ask people once a year so how are you measuring that? 

Mark Price

So we do pulse surveys for companies. Okay. So they may have a department, I don’t know, warehouse where the scores were bad and we’ll set up a pulse so we’ll pulse there every month or two to see how they’re going but we say people or just a sample of people? No all the people.

So normally, with our, so one of the unique things we do, and it goes back to my time at Waitrose, when we were surveying at Waitrose, we did survey whole organisation. I hate averages, I hate averages. You’ve got your head in the oven and your feet in the fridge, you’re an average temperature, but you’re not in good shape. So as you know, it’s getting down to the detail. So one of the things that I was most keen to do is to break down the data. And we’d break it down by branch, as I’ve said, and manager. So that would be good.

But then I’d speak to somebody on the shop floor in a Waitrose and I’d say, what do you think of the survey results? Well, the first thing is in those days, it used to take three months to get the results sent out. We give instant results. We’ve got something called Instant Action Software, so within 24 hours you get your results, so it’s immediate. But that person would say, these results bear no resemblance to my survey response. That’s because you’re averaging. You’ve got people working there who are 60 and people working there who are 20.

And the difference in terms of what they want and they need from their job are completely different. Therefore, I came to the view when I was setting up work all and working with individuals and companies is you need to give individual feedback. You need to say to an individual, look, these are your results. This is how you’re scoring compared to everybody else. And here on that list of six things and the questions within it are the two or three things you can focus on to be happier at work. So a lot of people think the responsibility for my happiness at work is my manager.

It isn’t the responsibility for your happiness at work is you. So your manager, if they’re smart, knows that your happiness is going to drive commercial performance and they should want to improve it. But at the end of the day, you can’t rely on a company being paternal in some way and thinking they’re going to improve your life. You’ve got to do it for yourself. So our whole approach and why we’re different from every other organisation at the moment that’s trying to help companies in this field, we can give every individual, personalised feedback. No two people get the same feedback and it’s based on what they need and we give them then the information, podcasts, lectures, articles to read and to think about to say if you do these things you’ll be happy here. 

Then if they’re really not unhappy we’d say to them it’d be better for you and the company if you found a job elsewhere. 

Bruce

Answer me this question, we’re sort of almost out of time. Answer me this question, you speak about being data first and data driven. I got a sense from what you’ve written that your perspective on working in the office is almost a sign of how committed someone is to their job rather than the complexities of their life they’re dealing with in other angles. What is your perspective on working in the office? 

Mark Price

So I’ll tell you what our data says. Our data says that those people who have got flexible working where they can have it, so office -based workers. They’re happier. They score an average 74% if they’ve got a mix between home and office. People who are only home have a score of 72%. People who are only in the office are 69%. So what our data that’s within the margin of error broadly. Well, not on a million servers. Right. I mean, so we know pretty well that that’s how people feel. From the qualitative research, what I would say…

is that different populations are looking for different things. You can learn through osmosis. You can learn from being around people and picking things up. And if you’re young, if you go into our office, what you’ll see is we’ve got lots of people from university. They’re in their 20s. They’re the first job, maybe second job. And for them, the community is really important. Listening to people, being together, learning, being noticed.

If you’re older and mature, you probably need less of that. So there are different needs and requirements for different populations. There are different needs and requirements for people doing different jobs. So the conclusion that I’ve come to is there is something in every organisation about building community, building links, learning through osmosis, and those casual things you get when you’re having a cup of coffee with somebody. I think they’re precious, and I wouldn’t want to lose them, ideally.

But equally, I think that for some people, as you say, the flexibility of working from home on occasions is probably the best way. So what we do at WorkL is that we have three days in the office, two days when you can either work from home or work from the office is up to you. Some people do come into the office. And then in those three days, if somebody has a childcare issue or a caring issue or need to do something, we say to that’s fine, you can work from home. We’re not prescriptive in that sense. But what we tend to get, Monday, Tuesday, Wednesday people all in the office together, working together, enjoying each other’s company, building a company culture. The rest of the time it’s up to them where they work. 

Bruce Daisley

I’ve loved the discussion today. Thank you so much for taking the time to talk through, I think, a very compelling model of how we should be thinking about these things. I think it’s because it’s that holistic perspective that really to the credentials of what you’re saying. So I’m so grateful you’ve taken the time.

Mark

It’s my pleasure. It’s my pleasure to see you, Bruce. I mean, you’re such a legend. 

And I really hope that governments take on this as well as companies. Because I do think if we’re looking at national performance and thinking about productivity, there’s a lot for governments to learn about whether their people are engaged, looked after in such a way that it drives extra discretionary effort and improved performance. So my hope is that people will see that this is really good for individuals, it’s really good for companies, but it’s good for countries too. But it’s a great pleasure as always to talk to you and thank you for the opportunity. Thank you. Great. Thank you. Well done Bruce.