Freakonomics Radio - 63. The Dilbert Index?

Episode Date: February 22, 2012

Measuring workplace morale -- and how to game the sick-day system.

From APM, American Public Media, and WNYC, this is Freakonomics Radio on Marketplace. Here's the host of Marketplace, Kai Risdahl. Time now for a little bit of Freakonomics Radio, that moment in the broadcast every couple of weeks where we talk to Stephen Dubner, the co-author of the books and the blog of the same name. It is the hidden side of everything. Dubner, good to talk to you again. Great to talk to you, Kai. And I got a question for you. All right, shoot. Are you pretty happy with your job? Am I pretty happy? Most days, yeah. Tell me this. What about your co-workers? How's their employee morale, would you say? It depends on how heavy the beatings are. But no, actually, they're doing all right. You know, workplace morale is something, especially in an economy

like this, is something that's really worth thinking about. It translates directly into productivity. Low morale, bad for the bottom line. Good morale is kind of a tide that lifts all boats. Now, here's Michael Johnson, who studies organizational behavior at the University of Washington. A lot of the current research on employee morale and managing people in general and organizations suggests that this may be the only remaining competitive advantage that organizations have. Organizations that do this well, they tend to do really well financially too. But Kai, let me run an interesting wrinkle past you. In a tough job market like this one, fewer people quit their jobs. Less than 2 million a month now compared to more than 3 million before the recession, which means that more grumpy employees

are staying put. Right. So they're staying put because they're worried that they can't find another job. Exactly. Yep. Yep. How do you measure grumpiness? Well, unfortunately, that's the problem. It's hard. A lot of firms do surveys, but personally, in my work that I've... Here's the thing for HR managers everywhere, we all lie on those surveys. Yeah, exactly. We lie on most surveys, but especially, you know, how happy are you? And I'm the person who pays you and I need you to tell me how happy you are. Exactly, that's right. So sometimes you have to get creative. We actually put this question out to readers on our Freakonomics blog and we got some good answers. Here's Damon Bevan. He's a software engineer in Lexington, Kentucky. He used to visit lots of different companies. Here's how he sussed out worker morale in those places. I look for the number of Dilbert comics,

and that seems to be inversely proportional to the level of morale. A lot of Dilbert comics seem to be like a passive-aggressive way of employee complaining. This is good. First of all, I love the Dilbert index, but also I love that we're crowdsourcing this segment now. That's awesome. Of course. We've cut down here. I don't know if you knew, but all right, try this one. This is from a management consultant named Tim Wadlow. He visited more than 100 manufacturing companies around the world. He came to believe that parking direction is an indicator of employee morale. Here's what Wadlow saw at the companies that had low morale. A lot of these people seem very anxious to leave work, and often as they got to work,

they would back their cars into their parking spot. And it seemed like maybe the moment they got to work, they were so dreading it that they were planning their escape. I like that. That's great. Now, that doesn't apply here at Marketplace World Headquarters, because our parking lot is mandated, nose-in parking only. That's a way to keep morale high, force people to park that way. You must. You must. Okay, this is good anecdotal evidence, the key phrase being there, anecdotal, my friend. Exactly.

What you really want to know is you want to keep your eye on sick days because calling in sick, especially when you're not sick, is kind of the ultimate expression of bad morale. Well, yeah, but I mean, come on. HR is going to call everybody who calls in sick and says, I need a note from your doctor. What are we, 12? Not going to happen, unfortunately. Michael Johnson, the UW professor we heard from earlier, he investigated a pair of auto parts plants that tried out a variety of incentives. Some were carrots. Some were sticks.

They wanted to cut down on absenteeism. He found that the combination of threat and reward actually worked very well. But he also found an interesting loophole, a little something we call the FMLA or the Family Medical Leave Act. Are you familiar with that? Yeah, you bet. It's the get time off to care for a sick, injured, whatever family member. Yeah. Exactly. The federal law. Now, when the company made it harder to call in sick the old way, some employees found a new way. Here's Michael Johnson. Overall, absenteeism dropped about four to four

and a half days. But the absenteeism that was related to the FMLA went up about a day or day and a half over the year. So it seemed to us they might actually be gaming the system so that they could keep taking days off work and not suffer any punishment for it. Right. So it took us a while to get there. But this is the hidden side, right? This is the unintended consequences of all that stuff. That's exactly right. And, you know, at the end of the day, isn't it nice to know that whenever you're feeling down and need a little me time, the federal government is there to give you a day off? That's right. Stephen Dubner, freeconomics.com is the website. He's back in a couple of weeks. Talk to you later. Thanks much, Guy.