Measuring progress is critical to ensuring you are doing the right thing, the right way for your employees and your organisation.
It is important that both employees and the organisation see positive, impactful change otherwise what’s the point?
Happy, resilient employees will be productive and will follow good leadership BUT there must be a balance between how much to invest in employee happiness verses the organisational benefit.
In a 2017 survey by Deloitte, the average return on investment (ROI) in workplace mental health was 4.2:1 and ranged conservatively from 0.4:1 to 9.1:1. It was found that the most proactive interventions, such as organisational wide culture and awareness raising showed an ROI of around 8:1. The return will obviously depend on your organisation, your industry and many other factors, including being able to source data in the first place. An ROI calculation is simply the benefit divided by the cost of responsive measures.
Example
An organisation provides employees with an employee assistance programme (EAP), which costs £5pa per employee, assuming 1000 employees = £5,000pa cost.
Let’s say the overall cost of lost productivity is calculated at 4000 hours x avg £20ph = £80,000.
If the efficacy of the EAP provides a 20% reduction in the lost productivity cost – 20% x £80,000 = £16,000.
The ROI is therefore 3.2:1 (£16,000/£5,000).
There are many issues with this calculation such as:
– Calculating with some accuracy the cost of productivity lost
– Averaging the hourly rate distorts the overall picture and this is not necessarily representative
– Calculating the efficacy of the EAP can include a range of different factors.
Ideally, by introducing workplace mental health interventions, you will see direct and indirect benefits in the form of:
- Increased staff productivity
- Increased staff capability and skill set
- Reduced error rate
- Improved process and regulatory control
- Improved customer service
- Increased staff retention
- Reduced recruitment costs
- Reduced overtime costs
- Reduced staff attrition
- Reduced employee absence
- Reduced presenteeism
- Improved general morale
- Client retention and returning customers
- Brand awareness
Key performance indicators (KPIs) are commonly used to measure short term progress and report back to management. With workplace mental health, KPIs might centre around engagement barometers, capability & development, attrition and absence rates.
You will need to decide what improvements you are looking for; do you want to reduce staff turnover or reduce overtime costs? Not every measure will tackle every issue therefore engaging staff early in the process can be of huge benefit.
Who better to let you know what will make them happy?
