Workplace Unhappiness Just Cost the Global Economy more than $6 Billion
On July 19th, Cybersecurity firm CrowdStrike pushed out a routine software update. Within hours, computer systems worldwide crashed, stranding people at airports, ATMs and hospitals with no way to get home, get their money or get necessary medical care.
I believe this global meltdown would never have happened if the leadership at CrowdStrike had made the happiness of their workforce a higher priority.
No, I’m not kidding.
In early 2023, CrowdStrike implemented a Return to Office (RTO) policy and fired people for complaining about it. Others who opposed the policy left of their own accord.
No one can say with certainty if any of the former employees would have caught the small error in the code that caused the very large problem, but there’s a good chance one of them would have.
Because you know who you lose when your company becomes a miserable place to work?The people with options!
Highly skilled, highly sought after, with a depth of knowledge and expertise that is hard to replace.
Parametrix, a provider of cyber insurance services, estimates the costs of the CrowdStrike outage to be $5.4 Billion among Fortune 500 companies alone, with the portion covered by cyber insurance likely to be no more than 10-20%. This is the cost of being willing to lose great people over arbitrary policies.
Prioritizing the happiness of your workforce has extreme value.
Happy employees don’t :
- walk out
- “quiet quit”
- need mental health days to recover from the way the boss speaks to them
- steal
- sell your corporate secrets on the dark web
- attack co-workers or customers
Happy employees are less likely to:
- have workplace injuries
- sue you
- cause you to be sued
- vandalize your property
- destroy inventory
In medical settings, happy employees are significantly less likely to commit malpractice, and in manufacturing, they cause fewer product defects.
Happy employees are more innovative, more diligent, more likely to catch a bug in your code, and to care whether one is there or not.
These are not anecdotal musings! They are the result of Gallup’s decades of research on the topic, as shared in the State of the American Workplace report.
Workplace happiness is the most undervalued resource in our economy, and the costs of ignoring it will continue to skyrocket.
We have ample evidence that CrowdStrike was not considering the well-being of their workforce in decision-making, and this event is probably the result of that oversight.
(h/t QA guru, Jim Broshar, for sharing this screenshot)
This graphic shows a thread on Hacker News about CrowdStrike firings a year and a half ago, in which a user who goes by someone_idk posted the following about one of the terminated employees:
“Many people were afraid to speak up. This person did on behalf of us. Now we’re too afraid to voice our disagreements with Return to Office. I knew this person and it seems incredibly unjustified. […] They always advocated for the company and were vigilant about security policies so that the company was protected.”
That was written a year-and-a-half ago!
In other words, those who spoke out against the RTO policy were shown the door, apparently regardless of their contributions.
I wonder how that’s working out for CrowdStrike now.
Actually, I don’t.
What I do wonder is if anyone in the post-mortem on the global outage is bothering to connect these two events.
I wish they would. I wish every company would take an unsparing look at the happiness of their workforce, bringing in experts as needed to perform assessments and train managers.
The ROI on workplace happiness is off the charts. If you’re in a leadership position and wouldn’t even know where to begin to make your workplace happier, reach out. I’m happy to hear what’s going on there and share some ideas and insights. Everyone in charge of other human beings needs training on how to motivate and inspire people to give their best, to love their jobs, to be excited to come to work every day.
It is not that hard to get workplace happiness right. It’s not about espresso machines or dance breaks, the latter of which being as likely to cause dread as joy.
It’s about giving people a sense of accomplishment in their work, the autonomy to put their skills to their best use, and the acknowledgement that they make a difference.
That’s it! Happiness achievement unlocked!
Unfortunately, we don’t train managers how to do this. The great majority are instead what I call, “Accidental Managers.” These are people who have been put in charge of other people without being given any managerial skills training, or worse, they have no idea they are actually in charge of other people. Think of doctors, lawyers, engineers, scientists, and others who are running teams without anyone bothering to make sure they have the skill set for it.
How many people answer to a doctor in the course of a single procedure?
What are the downsides to that doctor having no idea that she’s a manager?
A dear friend of mine is an administrator at one of the top medical schools in the country, and when I asked if any managerial skills classes are required for their students, he looked at me blankly and responded, “We don’t have any managerial skills classes. This is the med school.”
Sigh…
CEOs, Boards of Directors, insurance underwriters and Wall Street analysts are failing to look at one of the most critical barometers of a company’s success and long-term viability: the happiness of the workforce; and one of the biggest risk factors: workplace unhappiness. If they gave this metric the weight it deserves in valuing companies and assessing risk, things would change for the better overnight.
I have no doubt there will be a lot more firings at CrowdStrike over the next few months, if the company survives at all. It would be amazing if whatever new leadership is brought in focused on what actually caused the problem – undervaluing the people – and homed in on fixing that.
My hope for CrowdStrike, and any other organization that wants to lower labor costs, increase returns, and generally be a nicer place to work, is that they give the highest rewards and the biggest promotions to those leaders and managers who are able to create the happiest workforce.
The results are clearly worth billions.
About the Author:
As a globally-recognized speaker on the topics of happiness in the workplace, the advancement of women, and identity & inclusion, and as a corporate culture consultant, specializing in assessing workplace happiness and training leaders how to maximize it, Valerie Alexander is committed to expanding happiness and inclusion in all communities.
Valerie was the 2016 commencement speaker for her undergraduate alma mater, Trinity University, giving the inspirational talk, “Tiger at Heart,” and her TED Talk, “How to Outsmart Your Own Unconscious Bias,” has been viewed over a million times and is used as a teaching tool in board rooms and classrooms around the world.
Her career started in the Silicon Valley as a corporate securities lawyer, investment banker and Internet executive, then transitioned to Hollywood, where she enjoyed success as a screenwriter and director, with all of those career paths culminating in her work as the CEO of Speak Happiness, delivering compelling keynotes, effective leadership training, and eye-opening assessments to corporate, nonprofit, educational and government clients.
Valerie and her husband live outside Atlanta with their exuberant German Shepherd, Vegas, Baby!
