How well are you balancing business needs and employee well-being?

How well are you balancing business needs and employee well-being?

A recent poll has shown that some companies struggle to find the right balance and neglect the well-being of their employees. Here, we look at the challenge of balancing business needs with the mental and physical needs of your most important asset – the workforce.
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According to a recent Gallup poll, only 24% of workers think their employer cares about their well-being, which is remarkably almost half of the figure at the height of lockdown. During the COVID-19 pandemic, some businesses clearly recognised the need to invest time and money into ensuring the well-being of employees, but with the world returning to ‘normal’, it seems some employers may have forgotten the importance.

We all know that a positive, open and supportive working environment is best for employees, managers and executives, but financial interests often compromise this. However, this doesn’t need to be the case - there is now a wealth of evidence to show that commercial needs and employee well-being considerations are, in fact mutually inclusive. A modern, prosperous business understands that considering commercial needs and employee well-being is not a balancing act; rather, the former is powered by the latter. 

So, what is employee well-being?

Employee well-being refers to your employees' physical, mental, emotional and economic health. It’s not just an absence of disease or other debilitating conditions but rather refers to an affirmative state of all-round wellness, one that extends beyond the office. Many factors play into an employee’s sense of their well-being. Of course, there are aspects that individual employees are responsible for, such as the care they take to maintain their own personal health, while on the other hand, there are elements in which employers are influential, from the benefits and support they offer, to the working culture they create. In this sense, the onus is not entirely on the employer; rather, their role is to help employees help themselves.

The importance of well-being in the workplace has become particularly salient in recent years, so much so that no less than 90.5% of employees agree that investing in health and wellness programmes is imperative. This statistic isn’t surprising - perhaps the leading impact of COVID-19 has been the increased focus on mental health, and this has led to an expansion in how we define well-being. In the pre-pandemic world, a typical understanding of personal health may have focused more on physical well-being, but workers have now shown mental well-being is more important to them than ever. As the Cigna Healthcare 360 Global Well-being Survey shows, 65% of respondents have started exercising, 42% changed their diet, 34% did relaxation techniques such as yoga, and 24% used natural therapies to improve their mental health – workers are taking extra care over their own well-being, and employers need to do the same.

Three young women in a modern office sitting around a table loking at a laptop

Why should businesses invest in employee well-being?

Poor well-being is not just harmful to individual employees but is also problematic for businesses as a whole. The effects can be higher rates of absenteeism and presenteeism, higher healthcare-related costs and subsequently lower productivity levels, all of which cost time and money. According to the World Health Organisation, two of the most common mental health conditions, depression and anxiety, cost the global economy US$ 1 trillion annually, while the Gallup poll revealed that unproductive employees could lead to 59% higher medical costs. Similar financial damage can be seen in unmanaged oral health, with the World Economic Forum estimating the cost to be approximately $54 billion in lost productivity. Therefore, avoiding these unwanted consequences by cultivating a health-focused workplace is an absolute necessity for any efficient organisation.

Many businesses have yet to realise quite how effective investing in employee-wellbeing is.

The World Economic Forum Report on Digital Transformation Initiative shows that the return on investment in well-being is almost four times larger than any other internal business investment, such as in new technologies. The University of California, Riverside similarly found that investment in employee mental health pays massive dividends – according to their research, organisations which invest in well-being saw a 5% increase in productivity, with each dollar spent on well-being programmes resulting in a reduction of US$3.27 in health costs and US$2.73 in absenteeism costs. Put more simply, the numbers show that for every dollar spent on integrated care, US employers save $6.

The evidence is clear: a business cannot function fully without investing in employee well-being. Executives, take note - investment into the physical and mental health of your employees is the wisest use of your budget, and as a bonus, it will make your business an even more enjoyable place to work.

There is also a reputational aspect to investing in well-being. With such clear evidence of its efficacy, properly doing so could benefit your business brand. ‘In the past, the reputation of a company as an employer was largely restricted to local word of mouth,’  explains David Thompson, director and co-founder of Employer Branding Made Easy, ‘but these days employees are able to share their experiences far more openly through employer review sites such as Glassdoor and Indeed. For employers, there really is no hiding place, so it’s imperative that they are seen to care for their employees.’

And putting a focus on well-being will also benefit the company overall. ‘Companies who invest in employee well-being can expect to see strong employee reviews and overall scores on review sites as well as gaining employer awards,’ says David. ‘This can have a number of positive effects on business performance.

‘Well-treated employees tend to stay with companies for longer. Improved employee retention rates help to reduce recruitment costs, improve business stability and increase productivity.’

Employers will find themselves with a stronger field of talent to pick from when they advertise their roles, helping to strengthen the organisation overall.’

Finally David points out, ‘We are seeing increasingly strong connections between employee satisfaction and shareholder/stakeholder satisfaction. These days, investors and stakeholders look at employee treatment and working conditions with a great deal more rigour than before. It’s now a crucial factor in investor and community relations’.

Colleagues in an office looking at a white board

How should you invest in employee well-being?

It’s easy to say that businesses should invest in well-being, but only by implementing industry best practices will you feel the full benefit to your business.

The Cigna ‘Health and Wellness in Workspaces: What Works?’ study, the most extensive review yet on the subject of the economic impact of workplace wellness interventions, highlights four key steps that employers should follow to implement a successful programme:

1. Recognise Business Loss-Drivers

2. Develop an Effective Programme

3. Measure for Success

4. Maintain Programme Engagement

The first is to recognise the biggest loss-drivers in your business. For some businesses it may be presenteeism, for others it may be healthcare costs, but understanding which affects you most is essential to building a bespoke well-being programme. Simply investing capital isn’t the answer, it's where you focus that investment that matters; indeed, the study found that low-investment programmes yield almost four times more in return than costly programmes.

Secondly, businesses must identify what well-being needs still need to be met. The study found that the most effective way to do this is to design programmes that are tailored towards specific health risks for individuals rather than to the workforce as a whole; these are known as case management programmes. However, the study recognised that both have a role, the latter particularly as a preventative tool.

Focusing on individual’s mental health was found to be particularly effective, yielding a sixty-fold return on the initial investment. This includes interventions such as stress management coaching to employees; with the Cigna Healthcare 360 Global Well-being Survey showing that 84% of employees are stressed, this is an obvious target area.

Another essential aspect is ensuring that those in leadership roles are supported, particularly middle management. With around a tenfold ROI, the study reveals that managers who received training to deliver mental health interventions recorded a significant reduction in work-related sick leave among their employees, as they were far more confident in discussing mental health issues.

The third step is to measure success, something the study found to be often overlooked. Ongoing measurement helps employers to understand the impact of well-being programmes far better and to recognise the significant financial gains. Monitoring can include cost parameters, participation parameters and health outcomes.

The final step is to maintain employee engagement with well-being programmes. Running surveys to understand employee expectations from wellness programmes and their level of engagement with those programmes is essential for designing the most effective programme for each individual and the workforce at large.

Overall, the key to balancing commercial needs with employee well-being is recognising that the latter is intrinsically linked to the former. In a time when the workplace is rapidly changing, be it the shift to hybrid working or the introduction of new technologies, ensuring that your employees' well-being is identified, monitored and considered is vital to a well-functioning and enjoyable working life.