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Memo to Executives: Well-Being Boosts Employee Engagement

Memo to Executives: Well-Being Boosts Employee Engagement

by Justin Heifetz and Jade Wood

Story Highlights

  • High well-being boosts employees' performance
  • Beware of well-being quick fixes -- isolated events don't work
  • Well-being is good for employees, the company and clients

Companies often are skeptical of the importance of well-being at the office because of the misconception that focusing on well-being cuts into work time and doesn't affect key business outcomes.

This is a misunderstanding. Well-being is the catalyst companies need to cultivate engaged, thriving employees who perform at their best every day. And a company well-being program -- if done right -- can cut down on skyrocketing employee health costs while allowing productivity to soar.

Gallup's research reveals that when companies add a well-being focus to their engagement program, it has an accelerating effect. Together, these two approaches help establish a workplace culture that enhances employees' lives. In a company that supports employees' well-being and engagement, workers are more likely to be thriving overall, which helps boost their individual, team and organizational performance.

Engagement alone has been shown to have a positive relationship with employees' health outcomes. Case in point: At one large insurance company Gallup studied, workgroups with high employee engagement had 8% fewer unhealthy days than average over a six-month period -- low well-being scores notwithstanding. But workgroups that were engaged and thriving in their well-being had 38% fewer unhealthy days, illustrating the added benefit of a well-being focus.

Maximizing Productivity

The data also show that focusing on engagement and well-being together helps companies maximize productivity.

"Employees are probably more freed up if they have high well-being and high engagement, because they don't have a lot of things holding them back," says Jim Harter, Ph.D., Gallup's chief scientist of workplace management and well-being. "They can use their energy to engage their customers."

If employees are emotionally connected to their work and are thriving in Gallup's five well-being elements (purpose, social, financial, community and physical), they will be at the top of their game and bring their best to work every day, Harter says.

The Gallup-Healthways Well-Being 5

Gallup and Healthways have developed a comprehensive, definitive source of well-being measurement, the Gallup-Healthways Well-Being 5. This scientific survey instrument and reporting experience measures, tracks and reports on the well-being of individuals and organizations. The five essential elements of well-being are:

  • Purpose: liking what you do each day and being motivated to achieve your goals
  • Social: having supportive relationships and love in your life
  • Financial: managing your economic life to reduce stress and increase security
  • Community: liking where you live, feeling safe and having pride in your community
  • Physical: having good health and enough energy to get things done daily

At the insurance company Gallup studied, workgroups that had high engagement but low well-being experienced turnover at a rate that was 20% lower than average. But for workgroups that had high engagement and high well-being, the results were even better: These teams had 30% lower turnover than average. Meanwhile, workgroups that were less engaged and had low well-being had a turnover rate 48% higher than average.

Not a Quick Fix

Companies should note that a quick fix or one-off event, such as a benefits talk or a smoking cessation workshop, is not enough to constitute a successful well-being program. Isolated interventions removed from employees' typical workday rarely gain traction. For well-being programs to succeed, they must first be part of a well-communicated, company-wide strategy backed by executive leadership.

Second, employees need to be engaged. Engagement is the baseline for getting people involved; if employees are engaged, they are more likely to participate in well-being programs. Third, the company must offer opportunities to enhance each of the five elements so that employees can shore up every aspect of their well-being. Gallup found that employees thriving in all five elements have significantly lower turnover and healthcare costs compared with those thriving in just one element.

When companies build an engaging culture in which employees can thrive, it ultimately helps them win customers. At a professional services company Gallup studied, customers of workgroups with high engagement and high well-being were:

  • 17% more likely to say that the professional services company had a significant impact on their performance
  • 21% more likely to say the company shared knowledge with them
  • 24% more likely to say the company had resolved their problems
  • 20% more likely to say the company delivered on its promises
  • 24% more likely to perceive that the company was committed to accuracy and quality

"Whether it's conscious or not, there's some reciprocity that happens -- employees think, 'I'm going to do what's right for my company because the company is looking out for my best interest,'" Harter says.

In essence, well-being promotes the greater business good -- and what's good for the individual is good for the organization and its customers. Because of this, an organization needs to think about the work experience from their employees' point of view and consider whether policies, structures and workplace culture are adding to their well-being or detracting from it.

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