The ROI of well-being

The financial case for investing in team mental health

Well-being, what’s all the fuss about?
Well-being is one of those buzzwords everybody talks about nowadays. They say that if you get it right, your organisation will be catapulted into massive success and your e-NPS scores will skyrocket. And if you’re not on top of your well-being game, it will affect your absenteeism and employee turnover rates!

Before we all panic about things we don’t fully understand, let’s get some facts straight here. Well-being is a concept that has many dimensions, definitions and theories tied to it. I’m not going to outsmart Wikipedia here to explain it at full length. I suggest asking your preferred ChatGTP vendor about it, if you like short answers on complicated matters.

Business Impact
For now, I would like to focus on the concept of psychological well-being or mental well-being and its impact on running a business. Although it’s still a multidimensional concept, researches like professor Arnold B. Bakker, professor Wilmar B. Schaufeli and professor Evangelia Demerouti were able to provide methodologies and toolkids that improve engagement and well-being in the workplace in a way that impacts hard nosed business numbers, so bear with me.

But before we deep-dive into solutions, let’s have a look at the common organisational well-being problems that need to be addressed. Research suggests that a lot of companies struggle to provide a healthy workplace, resulting in 40% of employees (globally) experiencing mental health issues directly related to stress in the workplace. The costs of work-stress-related absenteeism have risen to €3.1 billion euros per year (by 2019) only in The Netherlands!

Hot C-suite topic
The WHO defined burnout as the direct result of stress in the workplace not managed well. The WHO therefore determined that the employer should bear responsibility for overseeing employee mental well-being and preventing stress-related mental health issues. However, employers willing to take on this responsibility struggle to come up with measures that result in anything substantial. Organisational wellness is an $8 billion dollar industry in the US, and yet a 2019 Harvard study found that wellness programs had NO impact on overall health of employees.

A 2023 survey by Deloitte points out that workforce well-being remains a hot topic in C-suites and workplaces around the globe, yet many organisations continue to focus on simply adding new benefit programs to support the workforce. This is a traditional reaction to an unexpected disruption — treating the symptom and not the root cause.

Employers willing to address those root causes have a hard time figuring out what it is in their workplace setup that is energising and what causes people to feel stressed. The multidimensional nature of the problem aggravates the issue. I briefly touched upon this previously: individuals naturally bring their personalities and private life to the workplace and both individual behaviour and team dynamics are hard to objectify, manage, control & scale from a leadership perspective. Organisational demands and allocation of resources add to the complexity.

Leadership FAQ’s
Given the intricacy of building the well-being case, it might not surprise you that in talks with C-level executives and People Leads, these are the top FAQ’s we commonly discuss:

1. I love my team and obviously like to invest in their mental health, but from a strict business case perspective does it makes sense to invest in well-being?
2. If so: what should I invest in, that makes sense from my specific organisational context?
3. What are concrete steps I can take & how do I measure return on investment?

It is our ambition to provide practical answers to those questions in a single platform. But regardless if you use platforms or tools or not, we strongly encourage to follow a few core principles when executing on well-being initiatives:

• Increase the frequency of workforce scanning: Continuously engage with the workforce to better understand their (unmet) needs and expectations related to well-being. Help individuals and teams understand what makes them feel stressed while performing on the job and develop a plan to prepare for eventual stressors — versus reacting to them.
• Lead by example: Educate Leadership and People Leads about how to demonstrate well-being behaviours in positive and supportive ways. For example, there’s a difference between leaders stating the importance of disconnecting from work and actually demonstrating it by visibly taking time off. It is very important for leadership to role-model the right behaviours and protocols that allow for full recovery while empowering others to thrive in their absence.
• Communicate workers’ options: Workers should know what’s available and how it can help. Centralize and communicate all of the well-being support that is available to your staff and highlight data & success stories so that well-being resources are top of mind when the need arises.
• Iterate and improve: Continuously measure, assess, and, when necessary, revise your strategy and approach to supporting workforce well-being. This does not only imply the inclusion of new programs to meet new challenges. Rather, it means creating an environment where your workforce feels comfortable bringing their full and authentic selves, and then crafting supporting behaviours.
• Make it a core value: The shift from talking the talk to walking the walk is crucial in transforming the organisation’s culture and integrating well-being into its DNA. Workers — in particular, Millennials and Gen Z — are paying close attention to the mission, purpose, and values of their employers. Being branded as an organisation that authentically practices well-being, requires well-being to be ingrained in your values.

Still sounds too theoretical and not practical enough? Let us share an example that is focussed on the area of a worklife area called ‘community’:

To answer the essential leadership questions in short:

1. Does it makes sense to invest in well-being? Yes it does make sense to build a business case around well-being. Investing in well-being strongly and directly influences employee engagement, e-NPS scores and has direct monetary impact, for instance, as we explained, related to retention.

2. What should I invest in, that makes sense from my specific organisational context?
Invest in providing teams with the autonomy and toolkit to improve on their relationship with work. Your team can use the continuously growth principles they are probably already familiar with: measure, build and learn.

3. What are concrete steps I can take & how do I measure return on investment? Start listening to what your team has to say about how they envision their relationship with work. Allow teams and individuals to adjust how and where they work, implement those changes and measure it’s effectiveness. Share the results with the team, reflect on it together and move on. It will show your team that you act on their feedback. It’s a practical way to start changing collective perspective on sense of community, participative leadership and values. Over time it will allow you to measure your influence on retention and engagement, as our case shows.

Would you like to learn more about your company’s well-being ROI?
Please reach out to me.