Does Employee Happiness Pay Off? Jenn Lim on Culture and Core Values

Feb 11, 2014

6 min read

Updated: 16 hours ago

Many owners hear happiness at work and think it sounds fluffy. Something for big companies with time to spare. Jenn Lim, CEO and Chief Happiness Officer of Delivering Happiness, makes the opposite case. She created the first culture book for Zappos and watched its core values take shape as the company grew. Her argument is practical. When you raise your employees' happiness, you improve productivity, your customers get happier, and you build a business that can weather the highs and lows of the economy. She also says the biggest lesson from Zappos was timing. They started thinking about culture late, and it would have been far easier from day one. Her napkin says that to change the world, you follow passion and purpose. Here is how she turns that into something a founder can actually run.

Inspired by Paper Napkin Wisdom Episode 52 with Jenn Lim.

Why happiness at work is a business question, not a perk

Jenn knows happiness can sound like a self-help quote. What drew her to Delivering Happiness was the science behind it. She points to positive psychology research showing happiness is contagious. Smile at someone, even a stranger, and it can release dopamine in that other person, and they never know it.

Inside a company, she describes the chain this way. Make your team happy first. Happier employees mean happier customers who keep coming back. And a company that keeps to its real values holds its people longer and can ride out the ups and downs of the economy.

She is careful to say this is not fluffy happiness. In traditional terms, she says, it comes down to employee retention, engagement, and keeping a loyal, productive workforce. Delivering Happiness simply calls it happiness, because that is what everyone wants in the first place.

It is worth separating her claim from the evidence. She describes data and case studies from the companies they work with. Zappos is their big case study. The specific numbers behind that are not part of this conversation.

How Zappos scaled its culture with core values and a culture book

At Zappos, happiness was not a launch announcement. It was an evolution, and it started with a problem. The company was getting bigger and people were no longer recognizing each other. So how do you scale the culture so it gets better as the company grows, instead of worse, as it does at most companies?

It started with core values. Jenn admits it sounded corporate at first, and some people were very against it. Some of them left after the values were set, because it was no longer the company they started with. She sees that as a natural part of a workforce changing around what matters.

Then came the culture book. Employees wrote what the culture meant to them, and it was printed every year with nothing taken out. The good and the bad both went in, as a check on whether they were keeping true to it.

The phrase delivering happiness came later still. An employee tweeted that they loved delivering happiness to the world, and the company realized that was what it was doing. For its employees, its customers, and anyone trying to do the same at work or at home.

When should a small company define its core values?

Jenn's answer is day one. The biggest lesson from Zappos, she says, was that they did not start thinking about culture until late. If they had worked on their core values from the start, it would have been much easier.

Many founders tell themselves they will hit their numbers first, build the team, and then get to culture. Her view is that by then it is already late, especially once people are on the team, and it is much harder to undo. It feels like waiting is easier. It is the opposite.

For a small company, she suggests starting with two questions. What are your core values? What is your purpose? In a startup, the purpose is what you come back to in the hard moments, when you ask yourself why you are doing this and whether to keep going.

Next to purpose, she puts people. Delivering Happiness began with a firm belief in hiring the right people and trusting that you will make it work. She says that has held true in the years since. Be straight with your team about that, too. It will not always be fun or easy. Happy, as she puts it, does not mean easy.

Why leading a happy team starts with the leader

Delivering Happiness uses a simple model of three concentric circles. The inner circle is me. Then comes we, your team or company. Then community.

Jenn's point is that until you have a happy me, it is almost impossible to change the happy we, and harder still to reach the community. For an owner, that puts the work on you before it lands on your team.

Her own path shows what she means. She was supposed to become a doctor and chose Asian American studies at UC Berkeley instead, then could not find a job. She went through the first dot com boom and bust, where money, title and status arrived and then disappeared. Later came the loss of her father, which she calls her greatest fear made real. She was, by her own account, the brooding kid in the back of the classroom asking why any of this was happening.

What she took from it is that life will keep getting harder in places, and the one thing that saves us is our own perspective. Her company has a core value for this: be true to your weird self. Be who you really are, not what others expect. Once you are there, she says, passion and purpose start to show up on their own.

How to measure happiness in your company

Jenn knows that if happiness were easy, everyone would be happy. So Delivering Happiness brings it down to measurement. They work with a statistician known for the Happy Planet Index on a happy business index, and go into companies with real tools to measure where happiness stands today.

The loop she describes is straightforward. Measure happiness. Correlate it to ROI. Keep iterating and keep improving.

She says the company has worked with over 200 companies around the world, and half of its clients are international. Some are in countries and companies that are barely making it, and they see this as the competitive advantage that could help them get ahead.

She also accepts that some people will not buy it. Some believe they have to be miserable now and pay their dues for happiness later. No amount of research changes that for them, and she does not try. She shares what the research says and lets it be.

How to apply this in your business this week

Start small and start now, which is the whole of Jenn's advice to a small company.

Write down your core values this week, even as a rough draft. Ask two people on your team what they would add or cut.
Write one sentence on why the business exists. Keep it where you will see it on a bad day.
Ask each person on your team what the culture means to them, and keep every answer, good and bad. That is the start of a culture book.
Check the inner circle. How are you doing? A team rarely runs happier than the person leading it.
Pick one thing to measure, such as how people feel about their week, and look at it again in a month.

I wonder how many owners are waiting to hit a number before they think about values. Jenn's experience says that wait is what makes it hard.

Related Insights

If your culture is getting harder to hold as the company grows, this is a good place to look at what is really in the way. The Growth Pattern Diagnostic

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This conversation is part of the Culture Growth Hub, number 4 in its top 10. See every Growth Hub.