Enhancing Employee Morale and Productivity: Key Strategies and Insights

For most of us, our day-to-day lives are consumed by the relentless pursuit of productivity. However, we often overlook the direct correlation between employee morale and productivity. 

For some reason, we tend to justify the powerful effects of toxic work environments by looking to our heroes — and there are countless examples: 

• Chevy Chase and Bill Murray got in a fistfight before Saturday Night Live that was so bad they didn’t even speak on the set of Caddy Shack years later. The movie was still a success. 
• Kobe Bryant and Shaquille O’Neal somehow won three straight NBA championships despite an ongoing feud.
• Oasis was one of the most successful bands in the world despite constant beef between brothers Liam and Noel. 

While these three stories make for great journalism, they’re statistical outliers. This post can help you help your team go the distance, reduce turnover, and increase productivity. 

Importance of employee morale and productivity

All three duos in our intro have something in common: they couldn’t sustain their success together for over a few years. Pressure might make diamonds, but those diamonds aren’t forever. 

They might not be as exciting as the celebrity gossip above, but you can’t debate the statistics: 

• A study from the University of Manchester shows that employees working in negative environments are 10% less productive. 
• The Harvard Business Review states that number might be closer to 40%. 
• Happy employees are 20% more productive.

Now that you understand employee morale and some factors that affect it, let’s explore how it can impact productivity and job satisfaction. 

Understanding employee morale

Understanding why employee morale is essential differs from understanding the concept of employee morale as a whole. Those statistics show its importance, but what exactly is it? 

Definition of employee morale

Employee morale refers to one’s well-being and how their attitude and demeanor in the workplace reflect it. Those with high morale help create a motivated, supportive environment. Employees with poor morale can lack drive and ambition and project their negative attitude onto those around them. 

While the concept of morale is an intangible that can be tough to measure, the key contributors that affect it are anything but. Let’s take a look at some factors that influence employee morale. 

Factors affecting employee morale

To address and improve employee morale, you have to break it down into smaller factors you can reasonably address. Below are a few examples of some areas to explore:

• Salary. Nobody is clocking in every day to hang out, right? It might be shallow to say, but morale starts here. Schedule one-on-ones, performance reviews, and other check-ins whenever possible to gauge how employees feel about their roles and their compensation. 
• Benefits. What good is a job if it doesn’t help one’s physical and mental well-being? Work with your HR team to assess your benefits package early and often. Companies that prioritize PTO, healthcare, and other benefits are more likely to succeed in recruiting and retention. 
• Diversity, Equity, and Inclusion (DEI). Morale is tied to a sense of belonging, so creating a culture prioritizing diversity, equity, and inclusion is crucial. If you’re looking for tips on improving DEI, look no further. 
• Team-building. As previously stated, the point of a job is to collect a fair wage — but that doesn’t mean everyone wants to punch the clock and go home. Team-building exercises, happy hours, and outings are great ways to build chemistry. If you’re a fully remote team, a virtual retreat can also be fun. 
• Creative freedom. When it comes down to day-to-day job responsibilities, most employees are looking around for creative freedom. If you find yourself micromanaging your employees, don’t be surprised if employee morale begins to slip. 
• Flexible schedules. If this would work in your industry, consider flexible working arrangements. Perks include flexible start times, four-day work weeks, or asynchronous hours. 

Hopefully, these ideas can help get you started, but the factors that make up employee morale are unique to each work environment. The best way to gauge the factors that directly affect employee morale is to survey employees and ask what they value most.  

Relationship between employee morale and productivity

Now that you understand employee morale and some factors that affect it, let’s explore how it can also impact productivity. 

How employee morale affects productivity

By now, it’s no secret that employee morale and productivity are directly correlated. Take it from Tom Wright, an industrial-organizational psychologist and professor at Kansas State University specializing in psychological well-being in job performance: 

So there you have it. Morale’s not just the latest buzzword in the content marketing space. It’s a real determining factor that psychologists agree can significantly impact productivity.

Case studies and research

Tom’s not alone in these findings. There are countless studies and statistics that continue to uncover this direct correlation: 

• Employees who think they have a positive work-life balance are 21% more dedicated and productive than those who think they don’t. (Forbes)
• A Canadian study of health care professionals found that allowing team members to create their own schedules with flexible hours and decide how they approach work tasks helped reduce employee burnout. (American Psychological Association) 
• Only 36% of employees feel engaged at work. (HR Cloud) 
• A Deloitte case study found that 77% of employees felt volunteerism was essential to high employee morale and well-being. (Training Magazine)

Strategies to increase employee morale and productivity

Now that you understand the impact of morale on productivity and some of the things you need to change to help your team reach their full potential, it’s time to develop some strategies to help you get there. Here are a few ideas. 

1. Recognition and rewards

Who doesn’t love a little recognition? SHRM found that teams that prioritized employee recognition were 63% more effective than those that didn’t. Whether it’s a simple shoutout in a Slack channel or any other ideas to reward employees, most employees respond well to positive feedback. 

2. Effective communication

Effective communication isn’t just about moving laterally. Companies that have a healthy communication style create a culture of trust and transparency between employees and leadership. 

One of the best ways to do this is with the right technology. Time tracking and productivity tools like Hubstaff make it easy to gauge employee performance, spot signs of burnout, and improve productivity and morale. 

3. Professional development

Sometimes, poor employee morale isn’t tied to burnout at all. Instead, top-performing employees aren’t being challenged and lack access to professional development programs to help them meet their goals and advance in their careers. 

Don’t wait until employees begin to stagnate to attack career development programs. Start early and often with proper onboarding programs that help employees and managers forecast future opportunities. 

4. Creating a positive work environment

It’s easier said than done, but removing negativity from your work environment is crucial for sustained success. Negativity (even in small doses) can spread like wildfire across your business.

With Hubstaff, you can use tools like automated Stand-ups and achievement badges to spot burnout. The Insights add-on can also help your employees better manage their meeting time to ensure enough time to complete their work. 

5. Work-life balance

Have you ever had an employee burn themselves out? It’s wild to think of this possibility, but sometimes morale issues can stem from an employee’s own internal drive to succeed. 

While most employees will help you set boundaries and push back when work-life balance is lacking, others aren’t good at it. This is increasingly common in remote work. Studies have shown that remote teams actually work more than their in-office counterparts due to blurred lines between work and personal life. 

Stress the importance of work-life balance and check on teammates who tend to overwork themselves. Encourage them to take an employee mental health day and use all of their PTO. Without doing so, their burnout can spread to other team members.  

Tools and techniques 

We’ve already done a bit of shameless plugging about how Hubstaff can help teams measure employee morale and productivity, but what other tools and techniques can teams use? Here are a few ideas.  

Employee feedback systems

Even beyond the Hubstaff Stand-up feature, you can turn to employee feedback and survey tools like Officevibe, Culture Amp, and TINYpulse to better understand employee morale. Keep these surveys anonymous so that each team member feels comfortable expressing their feelings. If you notice some common themes piling up, it’s time to make changes. 

Team building activities

Team building may seem tedious, but it doesn’t have to be. If nobody on your team wants to step up and plan team-building exercises, consider businesses that will host trivia, virtual escape rooms, and other outings or virtual meet-ups that prioritize team chemistry and well-being. 

HR software and platforms

If employee morale is becoming a huge issue and starting to hurt your recruitment and retention efforts, you’re probably long overdue for an HR (or People Operations) platform to measure employee satisfaction. Industry leaders like Lattice, BambooHR, and Leapsome are great places to start.

Most of these tools prioritize employee well-being at every step, from onboarding checklists to setting goals and OKRs for career advancement. 

Measuring employee morale and productivity

Metrics and KPIs

As previously mentioned, tools like Lattice use KPI and goal-setting features to help managers monitor employee morale and well-being. But what exactly are the KPIs and metrics managers should examine?

Again, we might be biased, but looking at employee productivity indicators like website and app usage and activity scores can show potential for more significant issues to look out for like: 

• Absenteeism rates
• Turnovers rates
• Retention rates
• Customer satisfaction
• Task completion rate

No matter what metrics you pinpoint to help you gauge and boost morale, try to look past the data to the people themselves. Viewing your employees as a number or statistic might have started the employee engagement issues in the first place. 

Addressing low employee morale

Let’s say you’re having trouble identifying low employee morale for a team member or the company as a whole. Your first move should be to recognize the signs of low morale. 

Identifying causes

Causes of low employee morale are apparent when you see them, but that doesn’t mean they’re always easy to spot. Try to look for indications of burnout like: 

• Missed deadlines 
• Absenteeism 
• Reduction in communication skills
• Isolation
• Negative attitude toward work or peers

Actionable steps

If you’re noticing these trends in one or more of your employees, it’s time to make changes. Fortunately, there are steps you can take, like: 

• Scheduling one-on-ones
• Encouraging employees to take a mental health day
• Train managers on how to spot burnout and morale issues
• Provide positive feedback
• Meet to discuss employee goals

Conclusion

Well, there you have it. Morale is a crucial component in maximizing your team’s potential. If you’re not paying enough attention to employee morale improvement efforts, taking the extra time to assess work-life balance, team building, benefits, and other factors could move the needle. 

Do you have any strategies to boost employee morale you’ve found to be successful? Has boosting employee morale led to better productivity for your team? We’d love to hear more about your findings. 

Frequently asked questions

How does employee morale affect productivity?

Negative employee morale puts a damper on your employees, which can spread across the company. On the other hand, high morale does wonders for a team and can help you build momentum and increase productivity. 

What is the relationship between morale and productivity?

Employee morale and productivity are directly correlated, which means that teams are statistically more likely to be productive when morale is high.

What is meant by employee morale?

Employee morale refers to your employees’ mental and physical state and how it affects their willingness and ability to perform their day-to-day job functions, collaborate with their peers, and meet broader company goals and expectations.