Happiness, Value, and Organizational Toughness: Three Concepts in Search of a Theory

Abstract

Happiness—life satisfaction, subjective well-being, or welfare—is generally considered the ultimate goal of life. Research shows that happiness correlates positively with various resources, desirable characteristics, and favorable life circumstances. Happiness can influence productivity, emotions, health, self-esteem, social skills, creativity, hope, or integrity. As such, happiness seems to affect how individuals may go about their personal and professional lives. As complex social systems rely on competencies, attitudes, and behaviors to fulfill their goals, happiness affects organizations and vice versa in different ways. Resilience, flexibility, plasticity, and eventually organizational toughness can all be seen as emerging coping properties of complex adaptive systems needed to continue meeting their objectives, despite uncertainty and adversity in turbulent periods. These properties are valuable because they account for enhancing the viability and sustainability of individuals and organizations. However, the conceptual mechanisms through which happiness at work connects to value creation and organizational toughness are in short supply. In this chapter, we provide a conceptual model for addressing this complex relationship.

1. Introduction

For centuries the contemplation of this desire [happiness] was the exclusive preserve of philosophers and theologians, who speculated and offered prescriptions on ‘the good life’ [1].

Learned men have been writing about happiness since antiquity [2]. In ancient Greek, eudaimonia emerged as the most popular proxy word to happiness, next to a constellation of closely related terms such as eutychia (lucky), olbios (blessed; favored), and makarios (blessed; happy; blissful) [3]. In every Indo-European language, the modern words for happiness, as they took shape in the late Middle Ages and early Renaissance, are all cognate with luck. For instance, there is the Old French heur (luck; chance), root of bonheur (happiness), and heureux (happy); and the Portuguese felicidade, the Spanish felicidad, and the Italian felicità—all derived ultimately from the Latin felix for luck (sometimes fate) [4]. Etymologically, the term happiness has originated from the Middle English and Old Norse word “happ,” suggesting chance, that is, happiness would be whatever would happen to someone. Only later, the concept of happiness became also associated with luck and fortune, implying that happiness—that is, being fortunate—was then conceived as dependent on events outside human control [4]. Currently, the term is popularly defined as a state of well-being, contentment, and a pleasurable or satisfying experience (Merrian-Webster). Etymology, however, can be misleading because it reflects a socially embedded, contextual, and historical set of commonly accepted beliefs rather than a comprehensive body of scientific knowledge on a specific topic or domain. Definitions in dictionaries are useful interpretative devices for common usage, but they cannot be seen as guiding mechanisms for scientific inquiry. Moreover, such an etymological definition of happiness seems to involve distinctive sets of fundamental assumptions about what constitutes happiness as a reality (ontology) and how to make sense of it (epistemology). On the one hand, it portrays happiness as a state, that is, an attained—or attainable—emotional, mental, or psychological condition. On the other hand, it also depicts happiness as an experience, that is, a gratifying process toward a specific desired state. In this chapter, we argue that the separation of the happiness state (what is) from the happiness process (reaching it) is conceptually unwarranted, artificial, if not flawed or misleading.

The idea of happiness—however, is defined in its specifics—makes a claim about what is most desirable and worthwhile in a person’s life [5]. However, happiness has been regarded as an elusive, contested, incomplete, and fluid concept, just like it has been deemed a much-sought value, aspiration, desire, possibility, expectation, and even a right or entitlement. How people conceive of, evaluate, and pursue (or not) happiness can reveal much about who they are, how and for what they live, and the values they hold dear in a particular context [5]. What is more, throughout history, the concept of happiness has been subject to different interpretations. For instance, in ancient Greece, in the fourth century B.C.E., happiness was seen as an activity of the soul that expressed virtue, whereas the Romans later claimed that happiness is a function of the will, not of external forces, conveying an alternative view on human agency [4]. In the eighteenth century and the values of Enlightenment, the belief in the intimate association of virtue (“mother”) and happiness (“daughter”) was widely shared [4]. The cultural environment created by the Enlightenment promoted an intellectual shift toward the valuation of earthly matters and a reduced commitment to Christian staples such as original sin, making it legitimate to seek happiness and avoid unhappiness [6]. After hundreds of years of Christian emphasis on the afterlife, Western culture started to envision the ideal of human existence predominantly in the earthly realm [7]. What is more, it was also in the eighteenth century that new middle-class work ethic came close to arguing that work should be a source of happiness [6].

Happiness has been influenced by a multitude of sources, including religion, politics, culture, philosophy, and even arts. Unsurprisingly, happiness has been the subject of growing attention from various academic disciplines, including history and anthropology [5, 8, 9], philosophy [10, 11, 12], sociology [13, 14, 15], psychology [16, 17, 18], psychiatry [19, 20, 21], economics [22, 23, 24], and management [25, 26, 27]. Each discipline’s different theoretical, conceptual, and methodological approaches to systematically examining happiness, its antecedents, nuances, consequences, and its ongoing pervasiveness account for its conceptual richness rather than its weakness. The concept of happiness is thus amenable to be understood from different theoretical standpoints, none of which has been able to set or claim any moral, ethical, or disciplinary superiority over any other. For instance, some argue that since the study of happiness necessarily draws together considerations of meaning, values, and affect, it strikes a chord at the very heart of the anthropological endeavor. What is more, anthropologists have long recognized that people are generally happiest in those moments when they feel most connected to others [5], suggesting that happiness cannot be thought of as absolute and independent value but as intersubjective and relational. Consequently, happiness is not just one thing; it is polysemic and multifaceted. It means different things in different places, societies, and cultural contexts. As such, there may be no unambiguously single pursuit of happiness but, rather, multiple “pursuits of happiness” [8].

In this contribution, we seek to shed light on a more particular debate, which is especially relevant for organizational scholars: how does (individual) happiness connects to value creation and organizational toughness, and vice versa. Organizational scholars are particularly interested in multilevel phenomena happening within and across organizations. Organization studies can be seen as an interdisciplinary academic domain interested in contextualized individual and collective activity and how this relates to organizations, organizing, and management. Relying heavily in insights from major social-sciences disciplines, organization studies look at organizations and organizing as psychological, social, economic, cultural, political, historical, and philosophical phenomena. As organizational scholars, we are particularly interested in investigating topics that are endemic to organizations (e.g., strategy, structure, management, resources, policies, or procedures) and how these aspects affect individual and group behavior, relationships, beliefs, feelings, performance, and outcomes [28, 29].

In this context, economic value creation lies at the heart of modern human societies’ quest for survival. It is through value creation that many human needs and desires are satisfied. Economic value is found in any product that fulfills those needs and wants. In this chapter, a product is conceived as a vehicle for representing any good, service, idea, experience, or information that, having economic value, can be traded in specialized markets. A product is something of value to at least two parties, and, as such, it can be sought and offered by people, groups, or organizations. As we will elaborate further, in addition to economic value, a product may also have social, ecological, and psychological value.

The third construct presented in this chapter is organizational toughness [30]. It has been proposed as a high-order concept that includes other related constructs such as organizational plasticity and strength. Organizational toughness points to the corporate ability to accommodate and adapt to social and natural forces. Thus, a fundamental question arises as to how the happiness of individuals, the creation of value, and organizational toughness can mutually impact each other, eventually contributing to a happier society.

This chapter is organized as follows. First, we provide a brief historical, conceptual overview of happiness from the standpoint of organization studies. Second, we sketch out a theory of value that acknowledges non-fungible or intangible properties, or conditions, which seems particularly suited for discussing how happiness resonates in or through organizational life, creating value. Then, we present the concept of organizational toughness, discussing its connections, tensions, similarities, and differences with close allies, such as plasticity or resilience. Finally, we present a model suggesting the conceptual relationship between the three constructs and their possible constitutive nature. We conclude by shedding light on future avenues for research regarding this triplet.

2. Happiness: societal and organizational perspectives

Throughout history, happiness has been conceived differently across time and space. For the ancient Greeks, happiness meant virtue, yet dependent on good luck and fortune, or favorable external circumstances. For the Romans, happiness implied prosperity and divine favor, whereas for Christians, happiness was equated with God [31] and, as such, only attainable in the next world. From the age of reason onward, though, authors have been holding the opposite, that is, that the only happiness man can expect to be found on earth [2]. The United States Declaration of Independence of 1776 takes it as a self-evident truth that the pursuit of happiness is an unalienable right comparable to life and liberty [22].

In recent decades, happiness has been the subject of growing attention from various academic disciplines, media, and governments. People’s happiness—that is, citizens—has been hailed as the true measure of (societal) progress [32]. The ideal and pursuit of happiness became omnipresent in our daily lives. In the West, happiness is about feeling good; it denotes a preponderance of positive over negative affect and a general sense of contentment or satisfaction with life [5]. Happiness is everywhere: on TV and the radio, in books and magazines, at the gym, in food and diet advice, in hospitals, at work, at war, in schools, in universities, in technology, on the web, in sports, at home, in politics, and, of course, on market’s shelves too [33]. This recent and widespread upsurge of public attention to the happiness, which some regard as the “happiness turn” [34], has not been immune to critique. Happiness is more intrinsically appealing and less threatening than competing themes such as sadness, depression, anxiety, stress, or burnout. And, apart from some notable exceptions [33, 35, 36, 37, 38], it is probably hard to find anyone against happiness. Happiness haunts our cultural imaginary, and, as such, it is becoming both a contemporary romanticized obsession, a new moral regime, and a political concept [33].

2.1 Societal value of happiness: from individual virtue to collective value

On 19 July 2011, Bhutan sponsored resolution 65/309, “Happiness: Towards a holistic approach to development,” adopted by the General Assembly of the United Nations, inviting national governments to “give more importance to happiness and well-being in determining how to achieve and measure social and economic development” [39]. Since then, Bhutan’s now-famous “Gross National Happiness” index has been widely heralded as an alternative to gross national product and other conventional measures of prosperity and growth for arriving at policy decisions and measuring progress [5].

On April 2, 2012, the first World Happiness Report presented evidence from the emerging science of happiness for the “Defining a new economic paradigm: The report of the high-level meeting on well-being and happiness.” And on June 28, 2012, the United Nations General Assembly adopted resolution 66/281, proclaiming March 20th as the International Day of Happiness to be observed annually. The World Happiness Report is now released every year around this date as part of the International Day of Happiness celebration [39].

Happiness is typically defined by how people experience and evaluate their lives as a whole [40]. In contrast, well-being is defined as people’s positive evaluations of their lives, including positive emotions, engagement, satisfaction, and meaning [41]. Current research on well-being has been derived from two general perspectives: the hedonic approach, which focuses on happiness and defines well-being in terms of pleasure attainment and pain avoidance; and the Aristotelian eudaimonic approach, which focuses on meaning and self-realization and defines well-being in terms of the degree to which a person is fully functioning [16]. When used in a broad sense, the term happiness is thus synonymous with “quality of life” or “well-being” [42], terms we use interchangeably in this chapter. During the last half-century, happiness, and happiness-related topics, viz. (subjective) well-being [16, 18, 23], and life satisfaction [43, 44, 45] of individuals and populations, have been the object of independent inquiries across the globe. Questions on happiness—or well-being—have been used in large-scale survey studies, such as the General Social Survey in the USA (since 1972), the Eurobarometer in the European Union (since 1974), or the German Socioeconomic Panel (since 1984). In 2006, for instance, the Pew Research Center issued a technical report entitled “Are we happy yet?”. Based on 3014 telephone interviews conducted in English and Spanish with a representative sample of adults, ages 18 or older, living in the continental U.S. did not look at life events or psychological characteristics but at happiness by demographic and behavioral traits [46]. Afterward, in 2010, the Organization for Economic Co-operation and Development (OECD) set up the “Better Life Initiative: Measuring Well-Being and Progress,” aiming to evaluate the diverse experiences and living conditions of people and households in all 37 OECD countries. The initiative covers 15 dimensions, including perceived quality of health, subjective well-being, social connections, natural capital, safety, jobs, and incomes [47]. And other supranational organizations such as the World Bank, the European Bank for Reconstruction and Development, the European Commission, or global consultancy firms (e.g., Gallup) have all been directing attention—and resources—to the topic of happiness, well-being, or life satisfaction. Consequently, some argue that policymakers and businesses are increasingly making decisions and crafting policies based on such well-being measures [32, 48]. Across the board and the globe, the happiness of individuals is progressively considered the true measure of economic, social, and political progress [14, 39].

It comes as no surprise that that developing, testing, and applying multidimensional surveys for subjective measuring happiness have become a focal point in this debate. Discussions on how to objectify or measure happiness come in many shapes and colors. Psychologists have long differentiated between an affective (or emotional) component and a cognitive (or judgmental) component of happiness or well-being. However, social conditions for happiness have been studied at the macro-levels of nations, meso-level of organizations, and micro-levels of individuals [42]. Empirical work on happiness uses surveys of people’s perceptions of their lives, and the questions vary: “Generally speaking, how happy are you with your life?” (i.e., affective component) or “Generally speaking, how (much) satisfied are you with your life?” (i.e., cognitive component) [36]. The responses, though not unproblematic, are meaningful and reasonably comparable among various groups of individuals [1]. It should thus come as no surprise that answers vary across nations [42], and according to perceived institutional quality [49], individual freedom [50], socioeconomic status [42], economic freedom [51, 52], social networks [53], housing conditions [54], equality [55], age [56, 57], education [58, 59], or health [60, 61].

2.2 Organizational happiness: determinants and implications

Happiness has become a ubiquitous topic in all societal domains, and organizations are no exception. We live in an organizational society [62]. Therefore, since much of our life is spent in organizations, namely workplaces, concerns abound about whether—and if so, how—happiness relates to organizational life [42]. What is more, the role that employment and workplace experiences play in shaping happiness for individuals has also been under scrutiny [63]. Paid work activities can provide enjoyable activities and a structure for the day, social contact, a means of achieving respect, and a source of engagement, challenge, and meaning [41]. Happiness in the form of pleasant moods and emotions, well-being, and positive attitudes has been attracting increasing research attention [26]. Research suggests that work and employment drive happiness, and happiness makes people more productive [40]. Moreover, the relationship between happiness and employment is deemed as mutually constitutive as it runs in both directions.

Organizational researchers have been generally focused on grasping the ins and outs of happiness at work and, mainly, on making sense of its causes and consequences. Theoretical foundations of this interest are to be found mostly in psychology and economics. In psychology, setpoint theory gained some academic attention before positive psychology—or science of happiness [64, 65, 66]—took over in the early 2000s, making inroads into numerous disciplines, including business and management. From a setpoint theory standpoint, individuals are believed to have a fixed setpoint of happiness or life satisfaction determined by genetics or personality, to which they usually return after temporary disturbances due to favorable or unfavorable external events [67]. Differently, positive psychology suggests that unprecedented levels of happiness can be reached as long as ordinary human strengths and virtues such as optimism, kindness, generosity, joy, honesty, originality, courage, empathy, flow, humor, gratitude, resilience, zestful work, and wellness can be nurtured [64, 66]. In contrast, when addressing happiness, economics draws on the importance of life circumstances—mainly on one’s income and employment situation—to well-being [1].

Numerous studies have shown that happiness is associated not only with, for example, physical well-being, strong immune systems, longevity, satisfying human relationships, but also with work-related aspects such as effective coping, creativity, productivity, and higher earnings [68]. The notion of happiness—and well-being—at work is becoming increasingly important for organization scholars [25, 26, 69, 70, 71, 72, 73, 74, 75, 76, 77]. Research has shown that high levels of well-being at work are good for the organization and the employee, as they tend to imply, for example, lower sickness-absence levels, better retention, more satisfied customers [70], and positive work behaviors [41]. Well-being at work not only is desirable as an end in itself, but also can help to produce greater economic productivity [41].

For many years, organizational behavior scholars have studied a number of constructs that appear to have a considerable overlap with the broad concept of happiness, including organizational commitment, job involvement, engagement, thriving and vigor, affect at work, and job satisfaction, the latter being the most central and frequently used concept [26].

Happiness at work includes, but is far more than, job satisfaction. The causes of workers happiness, well-being, positive moods, and emotions are multifaceted. A host of diverse contextual, environmental, and job-related factors has been implicated in this relationship, including low noise levels [78], air pollution [79], positive behaviors of the supervisor [80], promotional opportunities, pay and benefits satisfaction, performance appraisal satisfaction, training, and workload [81], workplace health culture [82], employee involvement and participation [83], organizational climate [84], inclusive leadership [85], quality of work life [86], corporate volunteering activities [87], high-performance work systems [88], career success [89], work-life balance strategies [90], corporate social responsibility [91], organizational culture [92], organizational justice [93], organizational trust and organizational support [94], organizational benevolence [95], workplace relationships [96], type of occupation and working hours [97], person-job fit [98], job resources [99], job characteristics (viz., task significance, skill variety, task identity, feedback, autonomy) [100], and meaningful work [101].

Happiness and positive attitudes do not directly result from all these factors but rather from individuals’ subjective perceptions, interpretations, and appraisals of those factors. Appraisals, in turn, are to be influenced not just by the objective nature of those constructs, but also by dispositional characteristics, expectations, attributions, and social influence. Happiness at work results from both personal and environmental factors [26]. The existence of any of, or a combination of some of those situational factors, may contribute to individual’s positive moods, emotions, and well-being at work, but it is insufficient to fully explain it. Research suggests that social and affective influence abound in groups, playing a key role in the positive moods and emotions of their members [102]. The conscious or unconscious process through which individual or group moods, emotions, or behaviors influence the moods, emotions, or behaviors of other individuals or groups is known as emotional contagion [103]. In organizations and workplaces, people do not live in emotional islands. Group members experience moods at work, and these moods ripple out. In the process, these moods influence not only other group members’ emotions, but also their group dynamics and individual cognitions, attitudes, and behaviors as well [104].

Happiness is believed to have an impact across multiple life domains, including marriage, friendship, income, work performance, and health [17]. Now, we turn our attention to the potential implications of happiness, and happiness-related topics to work and organizational life. In so doing, we seek to shed light into the potential value of happiness to organizations.

Since the 1930s there is a great deal of interest in the relationship between well-being and productivity [105]. The so-called “happy-productive worker thesis” [105, 106, 107] has long fascinated organizational scholars and practitioners alike. According to this contested [108, 109, 110] yet highly popular thesis, all things being equal, happy workers show higher levels of job-related performance behaviors than unhappy workers. In other words, happy workers perform better and are thus more productive than non-happy workers. Unsurprisingly, it almost became a truism to say—or claim—that a happy worker is more productive. Knowing whether happiness promotes productivity has important implications for management and strategies for workplace improvements [105].

A considerable amount of person-level and organizational-level empirical research involving happiness-related constructs and work outcomes suggests that positive attitudes and experiences are associated with beneficial consequences for both employees and organizations [26]. Happy and state positive moods among workers have been positively associated with creativity [111], productivity and profitability [41], job performance [75], organizational citizenship behavior [71], innovative behavior [112], job satisfaction [113], career success [114], efficiency gains and productivity [115], employee or work engagement [116], reduced absenteeism and withdrawal [117], organizational learning [71], employee retention [118], knowledge sharing [119], cognitive flexibility [120], workplace cooperation and collaboration [121], organizational commitment [122], problem-solving and decision-making [17], intrinsic and extrinsic motivation [123], proactive behavior [124], customer satisfaction, and perceived service quality [125].

What emerges from these findings is that the discussions about the implications of happiness, subjective well-being, or positive affect to organizations and employees has become less a matter of hope, optimism, or wishful thinking, and more about, for example, scales’ validity and reliability, levels of analysis (transient experiences, stable person-level attitudes, and collective attitudes) and multiple foci (discrete events, the job, and the organization) [26]. Unsurprisingly, skepticism exists as to whether any of those scales, however complex they might be, can realistically capture the essence and value of happiness. Recognizing its relevance to organizations is not at odds with the accredited difficulty of understanding or measuring it fully. Moreover, the importance of conceptual and empirical research on happiness lies in supplying “eye-openers” to possible connections, controversies, and conflicts between the foundations of well-being at work and its positive outcomes, at both individual and organizational levels. At all levels, there is mounting evidence that happiness is associated with positive and successful valuable outcomes [126]. We turn now our attention to the mechanisms through which product value is created.

3. Theorizing value: beyond the triple bottom line

In modern societies, people look for and buy products—viz. goods, services, ideas, information, experiences—to fulfill their needs and desires, providing that these can meet expected or desired value. The absolute, relative, or comparative value individuals ascribe to products can be seen as an appropriate measure of their perceived utility or meaning at different affective or cognitive levels. Accordingly, individuals can distinguish products according to different layers of value, for example, personal, societal (community-level), and environmental (planet-preservation level).

An extensive analysis of traditional theories of value has been performed [30]. This analysis defines value creation as the utility a product can provide to individuals, linked to satisfying their needs and desires [127]. We also focus on the concept of distributed or perceived value of use, defined as the difference between the total value and the total cost of the product. The distributed or perceived value of use may also include experiences, sensations, and mental states. The total cost to the customer comprises all types of costs: financial (price, ability to pay, opportunity cost) and nonfinancial (physical, psychological, and social aspects related to the use of the product, such as accessibility, embarrassment, usability, etc.).

Economic value exists in all types of products. Customers’ satisfaction lies at the core of the economic value of a product [128]. For the organization, this value consists of cash flow and/or non-financial profit through effectively fulfilling its mission. There may also be economic value for society, resulting from job creation and wealth growth, as well as economic externalities, which various stakeholders share.

Social value relates to the well-being of individuals, communities, and the environment [129]. Additionally, social value meets basic and lasting needs, such as food, water, shelter, education, and medical services to those in need [129]. However, competing views have been proposed [130, 131]. For these authors, the social value may or may not exist in products. Social value is intertwined with other types of values. Still, it relates mainly to social impacts, like processes of socialization, social inclusion, equal opportunities, health and/or safety in the community, and the quality of life of the society.

Ecological value is related to the natural environment, biodiversity, sustainability, and protection of the planet. Avoiding a negative ecological footprint has become a general concern since people’s quality of life depends on how the products are produced and consumed. However, this type of value may not exist in a product.

The fourth is psychological or transformational value [130, 131]. Since it may also comprise social impact, most scholars tend to equate psychological with social value. However, sociology and psychology have different traditions and objects of study. The subjective concept of value is to be found at the individual rather than at the social level, as it is unwarranted to measure product utility (value of use) collectively [132]. Consequently, the psychological value may resonate at the individual level through attitude and behavioral change. This change happens when products influence, for instance, additive behaviors, healthier or ecological lifestyle, discrimination awareness, change of mentality, openness to new ideas, improved knowledge or new skills, self-realization, self-esteem, or self-efficacy. The potential transformations these products involve may, or may not have any significant social impact, as it frequently occurs with alcohol, tobacco, or other drugs. Growing public awareness did not result in reduced consumption, that is, significant behavioral changes. Moreover, similar products may impact persons differently, which is shared with social products and medicines. Thus, if a product may include any psychological value, it should be openly disclosed by organizations.

The separation between products’ social and psychological value has been acknowledged [131, 133]. Research suggests that people are mainly self-concerned with the products’ values for themselves rather than their particular social value [133]. Studies also indicate that social products appear to be more valuable in people’s perceptions. Findings from a survey with more than 800 university students in Portugal suggest that tobacco, mobile phone, Internet, libraries and museums, schools/education, foster care, domiciliary support, and disability support services are perceived to impact their life more significantly than their social environment [133]. In sum, individuals may acknowledge four types of product value, illustrating the tetrad-value theory. All products have economic value, and many of them also have ecological, social, and psychological values. Now, we turn our attention to the concept of organizational toughness, discussing its connections, tensions, similarities, and differences with close allies, such as plasticity or resilience.

4. Organizational toughness: beyond resilience, flexibility, and plasticity

Organizations are critical players in modern societal landscapes, facing multiple risks (e.g., financial, strategic, technological, market, competitive, reputational, environmental, political, and economic). However, if organizational risks are to be fully understood, then the systemic risks related to the possibility of occurring a pandemic, terrorist threats, revolutions, natural disasters, or strikes in sectors of activity that immobilize one’s business should also be taken into account. Systemic risks may hamper organizations’ production for at least two other reasons: (1) Governments can adopt preventive laws aiming at protecting workers from contagion or physical damage and (2) disturbances across value chains or infrastructures and facilities. These adverse situations call for novel preventive management behaviors, requiring alternative approaches to organizations’ survival strategies. In the context of the COVID pandemic, unplanned and untested organizational solutions have been adopted to keep up with the production of goods and services.

Organizational approaches to risk, plasticity, and resilience, that is, corporate coping mechanisms with turbulence, uncertainty, and complexity, coalesce around the concept of organizational toughness [30]. This concept emerged from a particular stream of management research, which draws on four properties of materials studied in physics to explain business phenomena: resilience, flexibility, plasticity, and toughness. First, resilience is defined as the ability of a material to absorb energy when it is deformed elastically, a combination of strength and elasticity [134, 135]. Second, flexibility is defined as the ability of an object to bend or deform in response to an applied force [136]. Third, plasticity is defined as the ability of a material to undergo irreversible or permanent deformation without breaking or rupturing [137, 138, 139]. And fourth, toughness relates to the capability of materials to absorb energy or withstand shock and plastically deform, without fracturing, as a combination of strength and plasticity [30]. Thus, during uncertain and turbulent periods, the comparative advantage of the concept of Organizational Toughness is that beyond (organizational) resilience, flexibility, and plasticity, and it captures the possibility of organizations to evolve and become different and better adapted to the future uncertainty. As the theory of material properties suggest, toughness combines plasticity and strength. Thus, by analogy, the concept of Organizational Toughness includes the concepts of Organizational Plasticity and Organizational Strength. The concept or organizational toughness evolved from the literature, as extant ideas were unable to represent what was taking place to organizations adequately during the pandemic period [30].

Therefore, Organizational Toughness is represented by two other constructs: organizational plasticity and organizational strength. Organizational plasticity also includes two constructs: staff preparation and structure adapted to change. In turn, the former presents, as manifest variables, staff flexibility, competencies, and motivation, while the latter includes strategic planning, leadership, and market-oriented organizational learning. Organizational strength comprises internal and external availability of resources as manifest variables [30]. Next, these extant constructs and concepts are described.

Organizational plasticity relates to organizational adaptability, flexibility, or agility. The idea of plasticity has been introduced to specify how organizations define their strategic planning [140]. The concept of plasticity has its roots in psychological approaches, emphasizing different reactions that individuals present to similar circumstances [137, 140, 141, 142]. The link between agile thinking and organizational plasticity development [138, 143] enhances strategic agility or organization plasticity [144]. Organizational change can be seen as the combination of organizational agility and resilience, resulting in the ability to respond to fast and/or disruptive changes in the market and sustain future organizational success [134]. In this context, human resource flexibility is an essential dynamic organizational capability [145, 146, 147], which is studied via three components: employee skills, employee behavior, and human resource practices [148]. These variables positively impact organizational performance [147, 148] when organizations face new environment situations.

Competencies and motivation add to staff flexibility. Skilled and motivated workers can adjust their behaviors more quickly to new activities or situations [145, 149]. Competencies can be defined as a set of capabilities, skills, knowledge, experience, and effort that can result in higher levels of performance [150]. Employees’ competencies are critical to developing flexible or agile organizations [151, 152], as well as employees’ adaptability [153], flexibility [147], and agility [154]. A broad set of workers’ competencies helps organizational adjustment to changes in the market or the environment [147].

Nevertheless, competencies are only meaningful if employees experience well-being and are motivated to change and act [75, 112, 123]. A turbulent or disruptive situation can lead to demotivating factors such as fear or loss of income. Neuroscience and psychology suggest that intrinsic and extrinsic motivations shape work plasticity and behaviors [138, 155, 156]. Skilled employees may lack the behavioral motivation to change [146]. Better disposal of their competencies, practical activities, rewards, and recognition may improve employees’ motivation. Moreover, workers need to be embedded in an organization with a structure adapted to change; otherwise, their skills, motivation and flexibility could thwart.

In the scope of an organizational structure adapted to change, “Strategic planning is critical to developing adaptive and/or innovative processes between the organization’s resources and capabilities and its market objectives, opportunities and threats” [150] (p. 175). Strategic agility is the capability of an organization to continuously adjust the strategic direction and develop innovative ways to create value [157]. This dialectic approach is essential to a balanced strategic plan, which tries to predict a roadmap for the organization to achieve its goals and objectives and tries to forecast a contingency plan to deal with uncertainties and unexpected events. In this context, leadership is crucial to developing a strategic plan. Organizational survival becomes facilitated when the leadership is well adapted to diverse situations and the situational workers’ context [150].

From a behavioral plasticity standpoint, research shows that ethical leadership is positively related to organizational citizenship behavior and negatively associated with deviant behaviors [158]. Agile-thinking leaders may predict and analyze environmental problems and more easily cope with them, using different and innovative approaches [138]. They should promote workers’ flexibility, agility, and adaptability to handle a changing and unpredictable business environment [159]. Market-oriented organizational learning is also crucial in any context [150]. This strategic approach is based on a strategic plan that promotes learning at all levels, individual, collective, and organizational. Organizational learning is a process by which organizations learn through interaction with their environments [160], creating knowledge capital through four activities [161]: (1) constant challenge to the organization’s practices and beliefs, reflecting an attitude of openness of mind; (2) formal and informal commitment to learning and training; (3) sharing a vision; and (4) practices related to information research, experimentation, and innovation. These practices are also based on behavioral plasticity [162]. These characteristics should be market-oriented to produce successful organizational outcomes [161], namely in dealing with environmental turbulence [163, 164]. Thus, an organization needs an effective information system (generation, dissemination, analysis) with inter-functional coordination to respond to market turbulence and unexpected events [161]. An organization that presents flexible strategic planning and leadership that fosters market-oriented organizational learning can achieve competitive advantage and be more successful in the face of all market changes.

In sum, the construct of Organizational Plasticity is bracketed with two other ideas: (1) “Structure adapted to change” and all types of contingencies [134, 165], which calls for a versatile and agile leadership [159], flexible strategic planning to timely develop adaptive and/or innovative processes [150, 157], and market-oriented organizational learning [162, 163, 164]; and (2) “Staff preparation” that is based on workers’ flexibility [145, 147], competencies [151, 152], and motivations [155, 156]. As such, Organizational Plasticity is defined as the ability of an organization to change irreversibly and permanently its strategic approach to the markets to survive and/or grow under different environmental conditions (adaptability) and pressures (flexibility) and be able to timely and effectively (agility) react to threats and proactively seize opportunities [30].

Organizational Strength relates to organizations’ ability to obtain internal and external physical, human, intellectual, and financial resources [166, 167] and capabilities [147, 148, 168], which are dependent on the environment [169], and transforming them into products with economic value [30, 159]. All resources should be planned for easy access, preventing unexpected problems. It is also important to assess organizational resource flexibility, considering the possibility of using the resources differently and transforming or combining them to apply in different situations [166, 168].

New scales were developed, tested, and validated to measure these variables in the Portuguese clothing sector, one of the most affected during the COVID pandemic [170]. Moreover, this empirical study shows that the construct of Organizational Toughness and its components—Organizational Plasticity and Organizational Strength—present a statistically significant impact on the Economic and Social Sustainability of the organizations. However, it was impossible to discriminate between Staff Preparation and Structure Adapted to Change. Nevertheless, all the variables of these two aspects contribute to the construct of Organizational Plasticity. Results show that all the predicted variables are essential to organizational survival and success: flexible strategic planning, company leadership, learning quickly with the context to be more adaptable to the market, high workers’ competencies, motivation, and flexibility, and internal and external availability of resources.

Thus, organizations should prepare the logistics of their resources to continue producing, avoiding, for instance, just-in-time strategies. The companies’ owners or managers should develop an organizational culture that considers a market-oriented perspective to learn how to be close to the clients’ needs in any environment. Survival and success require flexible strategic planning, adjusted leadership, and effective personal recruitment and training that properly comprehends the needed competencies, motivation, and flexibility to address turbulent times or unexpected events.

5. Discussion and conclusion

Happiness has been the subject of growing attention from various academic disciplines, media, and governments. In societal terms, happiness has been hailed as the accurate measure of economic, social, and political progress [14, 32, 39]. Happiness has become a ubiquitous topic in all societal domains, and organizations are no exception. As much of adult life is spent in formal work organizations, the happiness discourse has received growing attention from organizational scholars. The so-called “happy-productive worker thesis” [105, 106, 107] has long fascinated scholars and practitioners alike, as it suggests that, all things being equal, happy workers show higher levels of job-related performance behaviors than unhappy workers. Well-being at work is good for the organization and the employee, making it not only ethically warranted, but also economically desirable. In other words, the mutually constitutive nature of the “happiness-positive work outcomes” relationship creates value for individuals and organizations alike, and eventually also to society at large. Given the apparent connections between happiness and value, both at individual and organizational levels, in this chapter we discuss how individual happiness connects to value creation, and, eventually, to organizational toughness.

In organizations, just like in any other life domain, happiness is not given. At best, it can be seen as resulting from an ongoing interplay between the dispositional characteristics of employees, the contextual, environmental, job-related, and social influences at work. What is more, happiness, positive moods, emotions, and positive attitudes do not result from all these influences directly, but rather from individuals’ subjective and transient perceptions, interpretations, and appraisals of those factors. Therefore, if we are to take the prospects and value of happiness to organizations seriously, then attempts to untangle (individual) dispositional traits from (work) processes and (organizational) contexts may fall short of their potential. Happiness at work is likely to be found at the intersection of different yet mutually constitutive layers: the affective (or emotional) and the cognitive (or judgmental) factors; the personal and environmental factors; the objective and subjective perceptions, interpretations, and appraisals; and the individual, group, and organizational levels.

Happy workers are believed to perform better (qualitatively) and more productively (quantitatively) than non-happy workers. Research suggests positive associations between happiness with valuable organizational outcomes. While these outcomes come in many shapes and colors, we find it particularly useful and instructive to order them along a continuum with two extremes: affective and cognitive levels (see Table 1). From an affective viewpoint, happiness stimulates positive attitudes, values, emotions, or behaviors that are relevant for work-context directly and work processes indirectly. Inversely, from a cognitive standpoint, happiness stimulates positive work-processes directly and work-context indirectly.

Happiness affective outcomes	Happiness cognitive outcomes
Creativity [111]	Productivity and Profitability [41]
Organizational Citizenship behavior [71]	Organizational Learning [71]
Innovative Behavior [112]	Knowledge Sharing [119]
Job Satisfaction [113]	Cognitive Flexibility [120]
Employee Engagement [116]	Problem-Solving and Decision-Making [17]
Workplace Cooperation and Collaboration [121]	Customer Satisfaction and Perceived Service Quality [125]
Organizational Commitment [122]	Job Performance [75]
Intrinsic and Extrinsic Motivation [123]	Career Success [114]
Proactive Behavior [124]	Efficiency Gains and Productivity [115]

Table 1.

Affective and cognitive value levels of happiness at work.

The potential combined effect of these affective and cognitive influences on workers may ripple out to society at large for at least wo reasons. First, individuals do not live on emotional islands; positive moods influence others’ emotions, dynamics, attitudes, and behaviors [104]. Second, workers are also citizens and consumers, who look for and buy products—viz. goods, services, ideas, information, experiences—in order to fulfill their needs and desires. This suggests that happy workers might also become happier citizens and better-informed consumers. This is not to say that the reverse influence is immaterial; this is not the case, as clearly outlined earlier in this chapter. The question we pose ourselves, however, points to a different angle of analysis: how individual happiness connects to value and, eventually, to organizational toughness. Thus, it appears plausible to argue that the absolute, relative, or comparative value that workers ascribe to products (as consumers) is at least partly influenced by their affective and cognitive appraisals of context, utility, and meaning. The combination of these higher-level aspects seems to resonate in the tetra-value theory, as this adds a psychological dimension to the traditional approaches to value, drawing attention to the interrelatedness of economic, social, ecological, and psychological value [130, 131].

Organizational approaches to risk, plasticity, and resilience, that is, the mechanisms organizations adopt to cope with turbulence, uncertainty, and complexity, coalesce around the novel concept of organizational toughness [30]. Relying on the properties of materials, toughness illustrates the capability of materials to absorb energy or withstand shock and plastically deform, without fracturing, as a combination of strength and plasticity [30]. The concept of organizational toughness relies, too, on motivations, behavioral change, adaptive agility, and competences. In other words, organizational toughness rests on a subtle combination of affective (virtually unmanageable) and cognitive (partially manageable) elements. In turbulent or disruptive situations, it takes more than competences to adapt and change. It takes well-being and motivation to change and act [75, 112, 123]. Accordingly, employees’ happiness may well be the missing conceptual ingredient link that connects value with organizational toughness, well beyond resilience, flexibility, and plasticity.

In order to provide a foothold for the conceptual relationships addressed in this contribution, which may also serve as a beacon for further conceptual and empirical research in the field, the model “Happiness Value Model” (HAVAM) is proposed (Figure 1). This model rests, solely, on the mutually constitutive nature of happiness at work and positive work-related outcomes, and its ripple-out effect to society at large.

Figure 1.

Happiness value model—HAVAM.

The HAVAM model brings together aspects that acknowledge the conceptual mechanisms through which happiness at work connects to value creation and eventually to organizational toughness. The model concedes that individual happiness relates to organizational life and value in different layers, forms, and textures, and that this has wider implications for how organizations can deal with uncertainty in turbulent periods. The HAVAM provides a novel and complementary view on the relevant implications of happiness to organizations and society.

Acknowledgments

NECE-UBI, R&D unit funded by the FCT—Portuguese Foundation for the Development of Science and Technology, Ministry of Education and Science, University of Beira Interior, Management and Economics Department, Estrada do Sineiro, 6200-209 Covilhã, Portugal.

REMIT—Research on Economics, Management and Information Technologies, which is supported by FCT—Foundation for Science and Technology, I.P., within the scope of the project “UIDB/05105/2020”.

Conflict of interest

We have no conflict of interest to declare.