HRD talks to Virgin Pulse's Chief Medical Officer about how employers can best prove the ROI of wellbeing programs
Prioritising health and wellbeing results in an immense impact on many aspects of our lives, according to Rajiv Kumar, Chief Medical Officer and President of the Virgin Pulse Institute.
Kumar told HRD that a wellbeing program has the potential to help employees look better, feel better, improve their energy, reduce the burden of chronic disease, lose weight, and control or reverse any medical issue they might have.
“It also makes them more productive, happier and successful in their jobs over time,” he said.
“There are so many benefits at the individual level and that’s a major reason why so many employers offer wellbeing programs.”
At the employer level, Kumar said that by investing in these types of programs organisations are building a relationship with employees and supporting them when they are most in need.
“The attitude of the employer is that if the employee comes in, works hard and does a good job then they are going to help take care of them and one way they can do that is by investing in their wellbeing,” he said.
“Beyond that, investing in employee wellbeing reduces absenteeism and presenteeism. It is also an employee recruitment tool and there is a lot of data that shows that companies that invest in the wellbeing of their employees financially outperform companies that don’t.”
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According to Kumar, it’s becoming easier for HR professionals to make the case for wellbeing programs to senior leadership every year. That’s because there is a growing body of evidence demonstrating that investing in employees is not just the right thing to do but the smart thing to do since it pays financial dividends that far outweigh the costs of these types of programs.
Indeed, Virgin Pulse recently commissioned Forrester Consulting to conduct a Total Economic Impact study to examine the potential ROI enterprises can realise by deploying a Virgin Pulse wellbeing solution.
Forrester’s interviews with four existing customers and financial analysis found that a composite organisation experiences benefits of $30,953,277 (US) over three years versus costs of $11,622,577 (US), adding up to a net present value (NPV) of $19,137,500 (US) and an ROI of 162%.
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The study also validated that the reduction of fatigue-related sleep errors was 1.26%, directly attributable to engaging with the Virgin Pulse platform. This resulted in a three-year risk adjusted cost savings total PV of $1,479,231 (US).
“You always have skeptics and there are people who are constantly looking for reasons not to invest versus reasons to invest,” Kumar added.
“But if companies are open-minded and are looking for reasons to invest in their people they will find a lot of reasons in the wellbeing space.”
So how can employers best prove the ROI of wellbeing programs?
According to Kumar, they should start off by being strategic and articulating what they hope to achieve from the outset.
What are the outcomes that they care about? What are the problems and challenges that they are trying to solve within their workforce?
Based around that, it’s important to create a set of metrics to commit to and measure to track the progress of the employees and the program.
Then, over time, HR should report on those metrics consistently and use that data to build the business case and demonstrate the impact.
“We often see companies check the box and roll out a wellness program as a tactic, as opposed to a strategy,” said Kumar.
“They don’t clearly articulate what they are looking to achieve and don’t outline the metrics that they are going to track over time.”
Therefore, at the end of the day, they are unable to tell a very convincing story about the benefits of the program.
They might have some “feel-good employee success stories and some nice anecdotes”, but they don’t have a robust set of data over a long period of time that can demonstrate the impact.
“It’s about being strategic and data-driven and working with providers/vendors who can provide that data and have the capability to help with measurement,” said Kumar.
“This is a fast-evolving space and just in the last few years alone we have seen the impact of technology in enhancing wellbeing programs, making them more engaging and more integrated to the workplace environment and other programs that people may be using at work or in their personal lives.
“I think our ability to take in large quantities of data and harness data from the program to identify insights and make the program better over time has dramatically increased in the past few years.”
Kumar added that employee wellbeing programs are far more capable, far more sophisticated and far more effective than ever before.
“I think that is why we are seeing such a massive global adoption happening at such a rapid pace. The solutions have gotten so much better in a short period of time and employers are excited to adopt them and employees are highly responsive to them.”
