In the wellness space, the concept of value on investment has gained traction in some circles, replacing more traditional return-on-investment measures. The rationale is that employers need to factor in the intangible aspects of wellness as they measure its impact on organizational performance. Tangible assets alone, proponents contend, fail to paint the full picture.
At the Virgin Pulse’s Thrive Summit held earlier this week in Miami, the company’s leaders made it quite clear they prefer to focus on VOI rather than ROI. That first acronym was referenced repeatedly during the two-and-a-half-day event, including at a breakout session titled “The Direct Financial Impact of Employee Wellbeing Programs on Workforce Productivity.”
“I think CEOs, boards and senior leadership are starting to realize that investing in well-being is much more strategic than just tactically trying to control healthcare costs,” said Dr. Rajiv Kumar, chief medical officer of Virgin Pulse, a provider of a workplace well-being platform. “We can measure a reduction in healthcare cost in dollar amounts saved, but there are so many other areas of value that can be measured and quantified, but not always put in dollar terms.”
Rather than having one single dollar metric such as a three-to-one or five-to-one return on investment, Kumar said, employers would be better served to look at all of the value that’s being created.
Kumar cited findings from several relatively recent studies that sought to measure the connection between well-being and stock performance, including one involving the Corporate Health Achievement Award winners and another involving C. Everett Koop Award winners. The findings demonstrated that companies known for their health and well-being excellence outperformed the overall market.
To further build on this existing body of research, Virgin Pulse began partnering several years ago with the Human Capital Management Institute to specifically look at what kind of impact wellness was having on workplace productivity at 49 of its own clients.
So what did the research reveal? It found that those companies outperformed their peers and experienced a 11.7 percent productivity gain, reported HCMI CEO Jeff Higgins, who co-presented the session.
“For every dollar invested, you’re going to get 11.7 percent more out over time on the back end,” Higgins said. “How much is that worth? About $7,700 per person. If you’re a large company, and you start multiplying that by all of the people in your company, and all of those who enroll, you really get some very, very big numbers.”
In many cases, Higgins said, the companies being studied were “below benchmark when they started, and when they ended, they were at or above benchmark.” The benchmark consisted of 1,908 other companies in four industries.
Higgins also pointed out that the research found that those companies that enrolled 30 percent or more of their workforce in the program experienced significantly greater productivity gains overall.
Virgin Pulse’s CEO David Osborne also commented on the company’s commitment to being “outcomes-based” at the conference’s Tuesday opening, which preceded a keynote by American graffiti artist Erik Wahl and a Q&A with tennis star Serena Williams.
“People want to see how this platform is driving outcomes,” Osborne said, noting that the company strives to “show quantifiable results every single day, whether it’s hard results or soft results.”
To that end, the Framingham, Mass.-based company is continuing to enhance its Hub, an engagement and communication portal that seeks to streamline and improve the employee experience by connecting people with various tools and information.
Also, at the beginning of the year, Virgin Pulse acquired Preventure, a competitor based in Coventry, R.I..
The case for wellness was further advanced on Wednesday morning during a keynote by Laurie Santos, a Yale University psychology professor who teaches one of the most popular classes in the school’s history: “Psychology and the Good Life.” The class, which attracted nearly 1,200 students this semester, explores the kinds of activities that have been proven to create individual happiness. Why such a high demand? Santos suggested it has a lot to do with stress being so prevalent at universities such as Yale.
In her talk, Santos covered a list of 10 activities that can lead to greater happiness. None have anything to do with power and money, she added.
One of the insights she shared was that “our minds aren’t always honest with us about what we need to do to be happy.”
“Our minds regularly lie to us about the kinds of things we need to do to be happy,” she said. “We all have the sense that we’d be happier if we got a raise or we’d be happier if we had $1 million. But the research shows that’s not true.” If anything, she added, the constant seeking of wealth leads to unhappiness.
Similarly, she said, most students think getting good grades will make them happy. “But there’s no correlation between getting good grades and being happy. Instead, the opposition is true: They are the least happiest because they’re killing themselves trying to get good grades.”
One of the 10 activities Santos cited is that very happy people tend to prioritize their social connections. “They spend more time with people they love and spend more time with people in general,” she said, adding that people get a happiness boost even when they make connections with people they don’t know.
Santos also cited research that showed doing nice things for others is more likely to help us become happy more than treating ourselves well. “We know from the research that simply doing random acts of kindness can make us happier.” She referenced one study that showed recipients who gave a portion of their bonus away to others felt better than those who kept the entire bonus for themselves.