Companies are well versed with investment in Physical capital, but are they fully convinced about investing in Human capital?
Evidently, some are, but many are not.
Historically, companies have been reluctant to invest in transferable skills in case employees leave and take the skills with them – often to a better paying competitor. This is understandable to a point, but that mind-set will only take you so far. We are familiar with the conundrum: ‘what if we train them and they leave’ versus ‘what if we don’t and they stay’ and if there are skill shortages within the workforce of course you need to train otherwise everything suffers. At the very least, training gives staff that rare and precious commodity - time - to think about what other issues and challenges they have in their jobs.
Alarmingly, research suggests that only 28% of workers in the UK are highly satisfied with their jobs. In 2015/16 11.7 million days were taken out of the economy through stress, depression and anxiety. These are significant numbers. Attribute these numbers to any other component of business operations and they would be seized upon immediately as a matter of urgency.
Perhaps time, workload and more pressing monetary issues push the ‘employee well-being’ agenda further down the line but, as the stats highlighted in this blog suggest, if companies step back for a moment and invest time and effort into looking their employee’s emotional well-being, the returns will far exceed the expenditure. Not just from a productivity stand point, but also from a customer experience perspective.
Employee loyalty, that emotional connection, can deliver many times ROI but also delivers a fundamental change in behaviour. Something that is hard to measure, but easy to spot. When was the last time you felt inspired at work? How did you feel about your work and life during this time? I’ll wager you were more creative, more engaged and wanted to share your heightened sense of wellbeing with others. Maybe you even inspired a colleague.
Gallup research shows that 70% of an employee’s motivation is influenced by the manager, so management is the obvious start point of this journey, as they have the most impact on an employee’s experience. Are they looking after their team? How do you know? What is the cost of their performance in terms of their well-being? Is this performance solely based on sales figures, a once a year survey and feedback from the managers (human nature suggests we rarely reveal stats that make us look bad) or something more granular? Managers can be made aware of the importance of job satisfaction on their own happiness and well-being. Managers should try and understand what staff see as important (what is of value to them) and ensure line and middle managers are committed to continual improvement.
Companies can ensure changes within the business are not working against other new, or legacy business processes. They can ensure that their staff are equipped with the techniques to improve their own job quality; letting employees act without support or guidance can cause more problems than it is designed to solve. Ensure proper management training and look at the culture within the company; does it prevent managers from voicing concerns or employees from ‘whistle-blowing’?
We talk a lot about Customer Experience, but it occurs to me that we need to start to think about Employee Experience first. The two are inextricably linked to one another and profits, growth, productivity and operational costs are all linked to these experiences.
In a recent survey a participant said ‘Your self-worth can be affected if you’re not enjoying your job’
Self-Worth: “the sense of one’s own value or worth as a person”. Heavy stuff, no? And if you have had a negative experience of this, as I am sure many of us have, you will hopefully by now found a new role that gives you a better ‘Employee Experience’. The chances are you’re working for a different and probably a successful organisation.
In conclusion, and for those who need empirical proof, here are some stats for you:
- Organisations with high levels of employee well-being, have outperformed the stock market by around 2%-3% per year over a 25 year period: London BusinessSchool,2015
- FTSE100 companies demonstrating best practice in employee health and well-being show a higher than average shareholder return - 61% compared to an average of 51%. BITC/Ipsos MORI, 2010
- The average cost of filling an employee vacancy (recruitment, selection, temporary cover, redundancy payments, training and induction) is £6,125: CIPD, 2009
- Sickness absence costs UK employers about £692 per employee per year. CIPD, 2009
- The total cost of sickness absence to UK business is around £15bn per year: Black and Frost, 2011
- Presenteeism (where employees work, but are under-productive due to poor emotional well-being) costs the UK economy £15bn annually: Centre for Mental Health, 2011
- The average annual cost of absence and ‘presenteeism’ due to ill health is around 8% of a company’s wage bill: Daily Telegraph: Britain’s Healthiest Company Survey, 2015
- Organisations promoting health and well-being are seen as 3.5 times more likely to be creative and innovative. The Wellness Imperative: World Economic Forum, 2010
Food for thought?
SOURCE: What Works Centre for Wellbeing