Why Employee Well-Being Matters to Your Bottom Line

Employees experiencing reduced productivity while at work, or presenteeism, attributable to health issues are much more likely to report reductions in productivity attributable to other factors, such as job overload, financial stress and personal problems. That's why experts believe that looking at health or wellness alone to contain medical expenditures or prevent health-related productivity loss is short-sighted. If an employer is determined to reduce expenses in these areas, it's necessary to consider all the factors that impact these outcomes.

Tables 1 and 2, below, show the results of surveys asking about health, well-being and job performance, conducted by Healthways Inc. at two representative for-profit U.S. employers: a mid-sized service organization (approximately 400 respondents), and a large health care provider (about 2,700 respondents). Data was collected from December 2008 through March 2009; both organizations had a response rate of over 80 percent of employees.

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Employees who reported that health had impacte
their job performance also were more likely to
report presenteeism attributable to other sources.
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While the diverse challenges that employees confront might not appear to be related, all are connected through the concept of well-being. Adding benefit programs to support one area might not yield the expected return on investment (ROI) if other sources of presenteeism are not addressed.

It’s important to expand the concept of wellness to include the total employee and not just the employee’s health. There are a number of non-health-related aspects of an individual that can impact their health. Financial worries and job stress are two examples. These can raise blood pressure and cause physiological responses of the sympathetic nervous system, as other research studies have shown. The reverse is also true: Poor health can hurt an individual’s emotional well-being, ability to socialize or personal life.

All these aspects don’t exist in isolation, and any might impact job performance. This is why moving to a more inclusive construct, such as well-being, is a key step toward creating a healthier, more productive, engaged and highly functioning workforce.

Organizations that support well-being are easy to recognize, although the organization’s efforts might not be labeled as such. They’re often among the names in “best places to work” and “top companies” lists. Because of a desire to attract and retain top talent, most organizations would like to be on these lists, but not all of them know how to get there. It begins with creating a workplace culture that creates and supports the right values to engage employees to do their best. A focus on well-being provides the groundwork for this type of culture.

Cultures that Foster Neglect of Well-Being

Well-being is missing from a lot of work cultures, but this is not necessarily intentional. In most cases, cultures that discourage well-being do so by accident. An employer might be growing quickly and have difficulty forecasting staffing needs, thus creating an environment where employees are required to work excessive overtime in order to meet customer demands.

In addition, many inexperienced managers create cultures where well-being is neglected because they’re focused on maximizing productivity. These managers often have a short-sighted approach and might be more concerned with making sure that all employees are at their desks at all times than with actual work output.

Changing benefit design frequently is another potential source of neglect for well-being. As benefits structures change, coverage might become inconsistent and employees might feel stressed. This might lead some to overuse their health care coverage, rather than basing their use of health care services on needs or obtaining appropriate preventive care.

A work culture that discourages well-being will inhibit employee performance, regardless of whether or not the culture was created deliberately. The results are the same, regardless of intent: Employees are disengaged and productivity decreases.

Work Group values

There are a number of steps that can be taken in order to infuse well-being into a work culture. The core element is to ensure that consideration, respect and value of the whole person are present. While many organizations believe that they have these values, they might not be enforced at the workgroup level.

Individual supervisors who use an authoritarian management approach or who refuse to give their employees appropriate personal time off create a subculture in the organization. So while the organization as a whole might otherwise be supportive of employee well-being, individual managers provide the lens through which employees view the entire organization. This lens might or might not support the overall company policy or culture.

Align Executives, Policy and Benefits

Immediate supervisors receive direction from their superiors. This is why it’s important for executive leadership to revise the organizational goals to incorporate well-being and then lead by example. One of the best ways to ensure that lower-level managers are aligned with the overall organizational policy is for upper management to interact with employees at all levels occasionally. If executives mingle only with other executives, a dual culture might form, with executives experiencing one culture and the rest of the organization experiencing another.

Organizational policies need to be written or modified to support well-being. Setting policies that discourage smoking, encourage healthier lifestyles and permit time off for family are key to making well-being a part of the culture. However, while policies are helpful, they aren’t enough. Benefits need to be aligned to encourage employees to comply with policy:

• Prohibiting smoking at the workplace does little if employees aren’t provided with a smoking cessation program to increase the probability of quitting.

• Written policies that employees will be allowed time for fitness activities during the work day does little if employees don’t have a place to exercise.

• Aligning executives to model well-being appropriately, writing policies that provide guidance, and providing a benefit design that supports the policies strengthen the concept of well-being in a workplace culture.

Many policies are put into place with good intentions but fail to accomplish the goal. In these situations, employees might perceive upper management or the organization as hypocritical. To avoid this, it’s important to measure outcomes carefully to identify potential disconnects between the intent of the policy and outcomes.

Measuring shifts in employee attitudes as well as quantitative outcomes, such as changes in smoking rates, can help to identify which policies are working and which ones aren’t. Remember the adage: If it isn’t measured, it didn’t happen.

People who don’t feel positive about themselves or their lives don’t do extraordinary things. People who feel good about their lives do great things, for themselves and their employers. The HR executive who supports employee well-being through appropriate policy and benefits design will do great things through his or her workforce.

Amy Neftzger is an industrial organizational psychologist who has worked as an HR consultant for a number of years and is currently a researcher investigating workplace well-being, employee health and human capital. Shannon Walker is a quantitative psychologist, researcher and adjunct faculty member at Middle Tennessee State University. She is working in the area of employee health and well-being.

Related Articles:

Poor Health Takes Financial Toll on Employees, SHRM Online Benefits Discipline, November 2009

Economic Fears Increase Unhealthy Behaviors Among Employed, SHRM Online Benefits Discipline, November 2009

'Tectonic Plates' and the ROI of Health Benefit Programs, SHRM Online Benefits Discipline, October 2009

Opportunity to Use Strengths Creates Sense of Well-Being, SHRM Online Employee Relations Discipline, September 2008

Wellness—and Well-Being—Depend on Fostering Good Judgments, SHRM Online Benefits Discipline, June 2008

The ROI of Wellness Programs: From Perk to Priority Investment, SHRM Online Benefits Discipline, January 2007

Work-Life Initiatives Focus More on Employee Health and Well-Being, SHRM Online Benefits Discipline, May 2006

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