Why Happiness Matters

They lived happily ever after” is the end to many a tale, but never a beginning: Story tellers have always known that happiness is easy to mention but very hard to describe, and so they steer around the subject. Other thought leaders do, too. Thomas Jefferson, for example, told humanity about its right to the pursuit of happiness. He was too canny a leader to get bogged down in describing what that quarry would look like.

In the last couple of decades, researchers in psychology, management, law and economics began probing the details of happiness, and created a new discipline devoted to the subject — it’s called hedonics. But their work hasn’t appeared in many business leaders’ toolkits. It was easier to leave happiness out of the story, letting such quantifiable terms as money, labor and time serve as handy, albeit highly imprecise, surrogates. Ignoring happiness appeared to cost very little. Those familiar nuts-and-bolts measurements seemed good enough for crafting effective organizations and sound policies.

Today, that belief is fading fast, as it becomes apparent that the cost of ignoring hedonics is actually quite high. In corporations large and small, executives have seen, as the entrepreneur Ted Leonsis recently put it, that “happiness is a driver of success, not the other way around.” What executive doesn’t know that retaining people now requires helping them nurture their talents and meet their goals? Anthony Jack of Case Western Reserve, who has studied the effects of coaching on performance, echoes many other management experts in urging attention to more than the bottom line. “It is more important to focus on what gets you going in the morning,” he has said, “and gets you wanting to work hard and stay late.”

So, whether they know it or not, many companies — from the giant corporation whose motto is “Don’t Be Evil” to the midsized outfit that wants to fight turnover in critical staff to those of all sizes that are battling “self-destructive” behaviors like smoking — are getting into the hedonics business. They want to know what makes happiness tick, because the answer will make for more efficient and effective organizations. Hedonics, in short, is coming to the executive suite.

Now, you might think it’s easy to lead with happiness in mind. After all, if your goal is to ensure that people on the team are happy, why not ask them what makes them content, and then try to give them more of it?

And “just asking” is indeed an important part of hedonics. For example, in a recent study of worker motivation by Teresa M. Amabile of the Harvard Business School and independent scholar Steven J. Kramer, hundreds of people e-mailed the researchers a diary at the end of every workday. (Results: They found the most potent motivator at work isn’t salary or perks or awards, but simply the small hour-by-hour satisfactions of making progress on whatever task is at hand.)

But there are pitfalls to simply asking people what makes them happy. And there are even bigger pitfalls to trying to lead them to happiness.

An Uncertain Picture

People seldom have any trouble telling you whether they’re happy, at this moment or in general. Trouble is, these judgments aren’t very reliable. As the law professors Matthew Adler (University of Pennsylvania) and Eric A. Posner (University of Chicago) have noted, current research offers three possible definitions of happiness. One, “subjective well-being,” is, simply, how people sense themselves to be when they are asked. A second, “capability,” is a measure of how well people are exercising their human abilities (so that a healthy person with a creative job and many friends is considered happier than someone who’s sick, unfulfilled and friendless). A third, more in line with economists’ traditional measures, considers people happy to the extent that their preferences are satisfied. It turns out we aren’t very good at knowing where we stand according to any of these criteria.

Consider a curious fact about life’s major milestones, like winning your first well-paying job, getting married or becoming a parent. Intuitively, we think these attainments make us happier. And, in fact, when people are asked if they’re happy with their lives overall, it’s those with higher incomes, stable marriages and children who rate themselves higher. However, hedonics researchers don’t always ask for a general overview of life. Their other technique is the one Amabile and Kramer used: tracking people’s ups and downs from day to day, or even from hour to hour. You might expect that these two forms of measurement — moment-to-moment happiness and overall life satisfaction — would more or less align (at least, after smoothing out for bad days and passing moods). But they don’t.

Sometimes, in fact, the big and fine-grained pictures seem to contradict one another. Daniel Kahneman of Princeton, the 2002 Nobel laureate in economics, has noted, for example, that compared with married women, divorced women reported less overall happiness with their lives but more moment-to-moment happiness. That’s in line with findings reported by Harvard’s Dan Gilbert from studies on marriage, and by sociologist Robin Simon of Florida State University, who based her conclusions on data from the National Survey of Families and Households: Childless people say they’re in better emotional states more of the time. When people rate activities from happy to unpleasant, taking care of kids ranks pretty low, next to cleaning the house, and well under watching TV. On the long-view surveys about lifetime happiness, though, parents say they’re happier than the childless.

What accounts for the difference? Some argue that big-picture answers are more serious and reflective, because they involve long-term goals and enduring values, rather than the pleasures and pains of the moment. Unfortunately for this claim, it has proven quite easy to move the meter of people’s judgment on how good they feel overall about their lives. For example, if single people are asked how many dates they’ve had in the month before being surveyed, those who’ve had a lot will rate their entire lives as happier than those who’ve done less well.

That’s not because everyone is particularly obsessed with dating. It’s because whenever our attention is drawn to something, psychologists have found, that thing feels important, in ways we don’t consciously sense. It’s a mental tic reflected in the design of some graphical user interfaces: When you flip through icons on a screen, the one under your cursor swells to look bigger than the others.

In the same way, thinking about your mating-game wins and losses makes them seem more consequential. So does thinking about the weather. Surveys have found that many people around the world think they’d be happier if they lived in California, where, they feel certain, the weather is almost always sunny and mild. Even people who live in California say they’d be less happy elsewhere. In fact, though, comparisons on happiness-survey data show that weather has no actual effect on happiness.

This effect runs deep. One of the bestknown and surprising findings in hedonics is the fact that even very big life changes don’t seem to have a long-term impact on people’s overall contentment with life. Winning big at the lottery produces short-term elation, but a year later winners report levels of overall satisfaction that aren’t different from those of their loser neighbors. Conversely, paraplegics and blind people aren’t markedly less happy than everyone else; nor do colostomy patients and dialysis recipients report being more sad than average.

There are two important takeaways from these findings. The first is that we don’t know what makes us happy, now or in the future. The second is that we think we do know. So leadership that takes happiness seriously can’t work by just asking people what will make them happy. In fact, the right kind of leadership will sometimes actively contradict people’s expectations.

A Matter of Attention

The key to these seeming contradictions lies in the mechanics of attention: Your attention is a powerful spotlight, and whatever it lights on makes a strong impression on your thoughts and feelings. Mention the number “seven” to a group of people before a price negotiation, and that number will come up in the offers and counteroffers more than it would have by chance. Having paid attention to that figure, the people at the table will just feel that it’s the right number. Similarly, if you’re invited to think about your lack of dating success this month, it will color your answers to questions about how you view your life as a whole. You can’t help it. “Attention” evolved so that we could focus on important things; modern life may pull it away from the significant, but we’re programmed to think that whatever we’ve focused on must be major.

That, say a number of researchers, is the reason that we think being married will make us happy (focusing on marriage makes it loom large) but then find that it didn’t make life that different (after a few months, being married is just a part of life, and we don’t much focus on that fact about ourselves). So lottery winners find their state of mind is the same a year later as it was a year before they won; so paraplegics and dialysis patients report that they’re in the same emotional state after their misfortunes as they were before. The general rule, Kahneman and his colleague Richard Thaler have written, is this: “Nothing in life matters quite as much as you think it does while you are thinking about it.”

Here, hedonics serves to correct the assumptions of classical economic and management models: These assume first, that people have reliable preferences, which stayed the same over time; and second, that people can and do know what these desires are, at all times. As the sociologist Jon Elster of Columbia University pointed out, wiser heads have long known that people aren’t like this.

That’s the point of Aesop’s fable about the fox who wants a nice-looking bunch of grapes. Only after he’s frustrated and has to give up does he decide they must be sour. The fox’s change of heart — from wanting the fruit to deciding that no one could want such lousy grapes — is an example of what Elster calls an “adaptive preference.” Far from staying the same, the desire adapts to circumstances.

Adaptive preferences obviously have their advantages for leaders in tough times: Many a heart set on a promotion has decided, after a wave of layoffs, that that’s really not essential to a happy life. But this aspect of human psychology makes it hard to say for sure that doing X 18 months from now will make people on your team happier.

Ignoring the slipperiness of happiness can cost a company, or a society, quite a bit of time and money. The U.S. legal system’s record of unpredictable awards for damages supplies a good example, according to Cass R. Sunstein, the University of Chicago law professor and current chief of the federal government’s Office of Information and Regulatory Affairs. In a recent lecture at a conference on hedonics and the legal system, Sunstein pointed out that in American lawsuits, juries often make large awards for “pain and suffering,” because able-bodied people assume that the loss of a limb, or a marriage, or the ability to pick up one’s children is a source of long-lasting misery. The evidence is clear, Sunstein argues, that this is not so. Meanwhile, the kinds of harm that really do cause lifelong unhappiness — for example, constant headaches — often trigger low awards. What’s so bad, the jurors think, about a daily headache?

In fact, research shows that trouble we cannot ignore, that we cannot adapt to and work around, causes much more unhappiness in the long run. A physical injury like the loss of one’s legs looms very large right after it happens, but like other spikes and troughs in life’s course, the emotions fade. On the other hand, a persistent, debilitating problem that can’t be adjusted — say, a constant headache — wipes out the ability to concentrate on other things. It drags your mind back to the pain as if it were Day 1. And that kind of misery, which you can’t forget or work around, is a source of constant unhappiness.

Hence, among Sunstein’s ideas for tort reform is a way of informing juries about the realities of our ability to adjust to physical injury and our inability to adapt to constant pains like backache and depression.

Creating the Right Circumstances

As a leader, your goal isn’t to get people to think they’re happy at the moment. It’s to create circumstances in which they will be happy, whether they know it or not. And what are those circumstances?

One time when a worker is indubitably happy is also one in which she’ll be at her most effective. It’s the state of mind generated when great skills meet a great challenge, causing all the mind’s attention to engage the task at hand. It is the moment in work when, to use George Eliot’s lovely phrase, you “thrill out of self-consciousness into passionate delight.” This is the state of mind that Mihály Csíkszentmihályi, of Claremont University’s School of Behavioral and Organizational Sciences, has dubbed “flow.”

Creating the circumstances in which people, and an organization, can enjoy this state is a way to increase people’s happiness with their work and help their organization. But how to do it?

Now, flow has an important characteristic in terms of its attentional demands: To attain this form of happiness, you have to give the task all your attention — including the attention you usually spend on yourself.

If flow makes us joyful and efficient, and the signature of flow is a suppression of the sense of self, then self-consciousness is the enemy of a happy work session. Yet for certain kinds of questions, self-consciousness is inescapable. You can’t figure out if you’re hungry unless you first think about yourself, after all. And, of course, the same is true when you ask yourself if you’re happy.

This is the ultimate paradox of hedonics, then, and it’s highly relevant to leadership: Trying to figure out if you’re happy means thinking about yourself, which takes attention away from where it needs to be for you to be happy. Happiness at work is self-forgetfulness. Bottom line: Wondering if you are happy is a sure way to make sure that you aren’t. Wondering if your organization is happy is a sure way to make sure it won’t be.

So, how do you get there? That is a lively hedonics research topic, but a few themes emerge from the work on happiness and attention. Because the mind is influenced so strongly by whatever it pays attention to, the impact of incentives like a bonus or a corner office will vary from day to day. That’s even more true of awards and recognition — after your picture has been up in the lobby for a few days, you don’t feel its uplifting effect. You’ve habituated.

Consider, though, that certain things can’t be habituated. They demand our attention each and every time we encounter them, as if each encounter was Day 1. Those are the kind of incentives and awards whose effect won’t wear off. They are the positive answer to experiences like chronic back pain or an annoying, persistent sound on the street: Perceptions that can’t be shut down or gotten used to.

What are the characteristics of these attention-grabbers? One is that they are pegged to an absolute scale, not a relative one. We habituate to a big raise because we don’t keep comparing ourselves to the person we were before our earnings rose. Instead, we compare ourselves to other people at our level. The jolt of a raise is easy to get used to. But certain kinds of achievement are absolute, in that they’re awarded according to a scale of value that never changes.

A good example of this kind of recognition might be military rank. Members of the armed services may hope and expect to be promoted with their peers, but they don’t count on it as a sure thing. That’s because that kind of advancement is supposed to be based on performance judged by an absolute standard — not how well someone falls on a curve. Perhaps it’s no accident that military organizations display each member’s rank at all times — like a persistent, inescapable sound, rank is something that can’t be forgotten or gotten used to.

Might a system of recognition that was based on absolute standards, that was implemented in an unscheduled, “as needed” way, be the key to helping your team get to a happy state of mind? It might be worth a try.

But there is another less scientific, more practical, approach that could be taken, courtesy of Jay Goltz, an entrepreneur. “I have learned the long, hard and frustrating way that as a manager you cannot make everyone happy,” Goltz wrote last year in his New York Times blog. “You can try, you can listen, you can solve some problems, you can try some more. Good management requires training, counseling and patience, but there comes a point when you are robbing the business of precious time and energy.”

That’s a useful reminder about another downside to an over-focus on happiness: Some people and some organizations don’t fit, creating a well of misery that can never be sweetened. It has to be capped.

The secret to having happy employees? It’s simple, says Goltz. Fire the unhappy ones.

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David Berreby (david@davidberreby.com) is the author of “Us and Them: The Science of Identity” (University of Chicago Press, 2008). He writes the Mind Matters blog for Bigthink.com and has written about the science of behavior for The New Yorker, The New York Times Magazine, Nature, Strategy + Business, Smithsonian, The New Republic and many other publications.