How to Prove Value of Employee Programs

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I’m not going to spend time making the case that leaders need to care about their people. If you don’t believe in caring about employees, just stop reading now. But if you’re tired of feeling that HR investments are viewed as superficial, “feel-good” and ultimately “soft” — read on.

Mountains of data and case studies prove that as leaders, we have to care for our most important asset — our people. If an employee feels like their employer cares about their well-being, they’re 38 percent more engaged.

But can a company really care? I think so. In fact, they have to not only care but show they care. Frequently. Authentically. Intentionally.

Our research shows there are several ways employers can invest in the engagement and well-being of employees in ways people feel every day. We call this ‘organizational support for well-being’ — and it’s all about culture. We believe it’s the highest ROI investment you can make. In fact, 99 percent of employees with high well-being and support from their organization say their company is a great place to work.

But the reality is, even though it’s more important to be a great employer than to look like one, you still must demonstrate how daily actions matter to strategic value. You have to prove it.

OK, let’s prove it together. Everyone loves the cool factor. New programs, TED talks and technologies abound. But buzzwords and fads won’t keep you or your company moving up and to the right. And your CFO probably doesn’t watch them as much as you do. Proving value for employee-facing initiatives is totally possible now with the rise of sophisticated people insights tools. The big data, machine learning, predictive analytics and artificial intelligence phrases have a little more gravitas.

According to 2017 Global Human Capital Trends from Deloitte, 71 percent of companies see people analytics as a high priority in their organizations. Yet, so few organizations are doing anything about it. Sure, they may pay consultants millions once every year or two to measure engagement, pay health and wellness vendors to assess health risk or safety or other things — but then what? Most large employers have more sophisticated systems for tracking travel expenses than employee engagement, well-being and culture. And some say you can’t manage what you can’t measure.

The relentless and expensive pursuit of great talent and the ever-increasing pressure to provide awesome employee experiences means that proving the value of HR investments has never been greater. So, let’s go.

Laying the groundwork. All strategies can, and should, be measured. Without strategic alignment, it’s nearly impossible to create meaningful ROI. “We want to lower employee turnover by 5%” or “We want to improve employee engagement by 1%,” are good places to start. “We want our customers to recommend us 10% more” and “We want to sell more,” are natural next steps.

Once you’ve established clear business goals, you’ll want to align strategies and initiatives to these. Then you’ll need real-time views into the key drivers to understand the connection between your people investments and real business results.

Some organizations prioritize cost savings — operational or financial. For some it’s safety, (Some don’t even try to connect people metrics to people or business outcomes — and it’s these companies that risk extinction.) Effective HR programs should have multiple metrics that build on each other and impact your business in various ways. Because causality is nearly impossible to prove with people and program investments, you need to cast a data net wide enough to provide actionable insights — but not so wide that you drown in statistics. Most people just don’t know where to start to show this.

Here are some ideas:

Let’s get started. The Limeade Institute released its Limeade Results Model to guide people on how any investment designed to create a more aligned workforce connects to business goals. The hypothesis in plain English is: As people participate in company programs and initiatives, they’ll build stronger habits, which leads to improved well-being. This improved well-being leads to improvement at work, which ultimately helps drive better business results. These are some of the most studied connections in all of organizational behavior. Is it time to study them in your company?

The Limeade Results Model organizes the metrics into five key areas, which build upon one another:

1. Program Program measurement includes metrics like participation, goal achievement and user satisfaction. How many employees have registered vs. how many are returning regularly? Do your employees like the program? Would they recommend it?

2. Habits How are people forming new mind, body, work and social habits? Are your employees more aware of their habits? Are they taking steps to improve their habits? Are managers helping them here?

3. Well-being Well-being measurement looks at how overall well-being improves — including emotional, work, physical and financial themes — as measured by a Well-Being Assessment and other data like quizzes and pulse surveys. Are these self-reported scores improving? Do your employees need more help with work or financial well-being? Is emotional well-being improving year-over-year?

4. People (HR) People measurement include metrics like employee engagement, performance, turnover and cost (e.g., missed work, health costs or recruiting). As well-being improves, are you seeing improved engagement and lower turnover? With increased engagement are you seeing higher performance?

5. Business Business measurement in this model includes metrics that connect directly to company goals like sales, customer satisfaction and profits. If you’re a retailer you’ll be interested in seeing how same-store sales correlate to changes in well-being and engagement. If you’re a hospital you’ll more likely looking at patient satisfaction and readmittance rates.

Our science suggests that overall well-being, engagement and employee turnover are the three elements most valuable when measuring results — but it’s critical to find the metrics that move your company’s needle.

Making it happen. Seeing the connections between these five elements — in clear dashboards you can slice and dice by country or division or department — is like taking the blinders off and finally seeing the whole racetrack.

Once you do that, you’ll be part of a burgeoning crew of changemakers advancing how the HR industry measures success and takes action to improve. Making clear connections between well-being, engagement and business results will ultimately elevate discussions about your most important strategies and programs from HR and benefits silos into the C-Suite. When this happens, it will ultimately change how companies invest in their people. And how their people invest in them.

Henry Albrecht is the CEO of Limeade, an employee engagement company on a mission to improve well-being in the world. Connect with Henry and the Limeade team on Twitter, Facebook and LinkedIn.

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