How to Get the Most From Investing in Employee Wellbeing

How to Get the Most From Investing in Employee Wellbeing

While organizations have been using health and wellness programs to engage employees for decades, in recent years the rewards space has moved toward a more holistic view of employee wellbeing. Today, companies are feeling pressure from all sides to enhance their employee wellbeing programs. Employees are hearing more about the wellbeing benefits their friends are being offered at other organizations, our peers are innovating in this space, and vendors are constantly coming up with new services to differentiate themselves as they compete for our business.

Facing these combined pressures, companies have greatly expanded their wellbeing offerings in the past five years: Whereas in 2013, the average company had four wellbeing programs, by 2017 that number had quadrupled to 16. In a peer benchmarking session at the CEB ReimagineHR summit in Washington, DC, last Thursday, a plurality of rewards leaders said they expected wellness or wellbeing to be their number one area of change in 2018, more than healthcare or retirement.

Budgets for wellbeing, however, are not growing: Most companies we surveyed at CEB said their wellbeing expenditures were either remaining the same or decreasing from 2016 to 2017. As demand grows while budgets stagnate, many HR functions are being asked to do more with less in their employee wellbeing programs. Here are some facts for total rewards leaders to keep in mind as they try to get the most bang for their wellbeing buck.

Holistic Wellbeing Programs Have a Real Impact on Engagement

The shift in the conversation from wellness to wellbeing reflects a growing awareness that maximizing employee productivity and minimizing health care costs involves not just preventing or managing diseases, or even promoting physical fitness, but also helping to mitigate stress. That’s how psychological, emotional, and even financial wellbeing became part of the more holistic offerings we’re seeing today.

And there’s a good reason for this change, because organizations with well-designed holistic wellbeing programs see levels of employee engagement nearly 10 percent higher than average. Designing a progressive wellbeing program has as much positive impact on engagement as letting employees choose their own hours, and three times as much impact as providing dental and vision benefits.

Physical Wellbeing Is Foundational, but Emotional and Financial Wellbeing Add Value

Now here one might say, “holistic” is a pretty broad term. How holistic do we need to be? Given the ever-expanding menu of wellbeing options and pressure to deploy the hot new benefit, we tested all the various types of wellness offerings in our research to see which ones actually had a meaningful impact on employee engagement.

What we found was that despite the proliferation of options, good old-fashioned physical wellbeing remains the foundational benefit that should still be at the core of any employee wellbeing program. One of the ways we made this determination was to ask what the cost was of not offering particular types of wellbeing programs, and this cost is substantially higher for physical wellbeing than other common programs.

On its own, however, that physical wellbeing offering doesn’t have the same impact on employee engagement as it does when combined with other types of wellbeing, particularly emotional and financial. A program that includes physical, emotional, and financial wellbeing has a 33 percent greater impact on engagement than one that covers only physical wellbeing. Beyond those three, however, adding other wellness offerings doesn’t move the needle much further.

The Best Wellbeing Programs Are Easy to Use and Meet Employees’ Needs

In designing wellbeing programs, many organizations focus on adopting cutting-edge technological solutions, thinking that this will improve the execution of their program and its impact. Employers also tend to worry a lot about keeping up with competitors in offering the newest and trendiest stuff in the wellbeing space. When it comes to boosting employee engagement, however, these metrics don’t matter. What does make a difference, we’ve found, is making it as easy as possible for employees to participate and ensuring that the program meets their needs. Communications about wellbeing offerings should therefore focus primarily on what is available to employees, how it relates to their goals, and how to participate.

CEB Total Rewards Leadership Council members can go through all our wellbeing research and tools here.

And click here for more highlights and insights from CEB’s ReimagineHR conference in Washington, DC.