The Healthy Executive

Chief Wellness Officers: The Next New Thing?

In a first, Stanford Medical Center has hired a chief wellness officer. George Mason University is exploring the development of a program for Chief Well-Being Officers.

Evidence shows that employee wellness has an ROI of $3.92 for every dollar spent.

Is There A Business ROI For Wellness?

CEOs are concerned about the health of their business AND their employees health.

Companies understand that an investment in wellness is an investment in a long-term, overall employee health, and that when they invest wellness programs they save at least 3 times their investment in health-related costs:

  • Better health equals better business according to this billionaire.
  • Health-related productivity losses account for 77% of all employee productivity losses.
  • More than 60 percent of employers said workplace wellness programs reduced their organizations’ healthcare costs.
  • Employees who scored low on “life satisfaction” stayed home from work 1.25 more days per month than those with higher scores, adding up to about 15 additional days off per year according to this study.
  • A meta-analysis conducted by The American Journal of Health Promotion found that having a lifestyle management program in place resulted in a 25% reduction in absenteeism and sick leave.
  •  Employees that participated in a disease management program resulted in savings of $136 per employee per month according to this Rand Company study. These savings were largely in part by the 30% reduction in inpatient visits.
  • Research shows that productivity falls sharply after a 50-hour work-week, and falls off a cliff after 55 hours—so much so that someone who puts in 70 hours produces nothing more with those extra 15 hours.

The Evolution of Workplace Wellness

The Pullman Company, maker of sleeping cars for railroads, introduced an athletic program for its workers in 1879. A few years later, National Cash Register upped the ante. It instituted twice-daily exercise breaks, built an employee gym and even created a 325-acre recreation park for workers.

In 1926, Ford introduced a 40-hour work week, after learning employees were more productive with constraints on the amount of time they could work. Hershey Foods built an elaborate employee recreation facility — swimming pool included. Johnson & Johnson even sponsored a women’s basketball team.

Companies like Texas Instruments, Rockwell and Xerox all opened employee fitness centers in the 1950’s and ‘60s.

Boeing became the first large company to ban smoking in the workplace in 1987

Today, organizations that invest in employee well-being see valuable results. A study published in the Journal of Occupational and Environmental Medicine found that companies with high well-being scores outperformed the 500 largest U.S. companies listed on the S&P 500 index by 235 percent over a six-year period.

What Is Driving This Trend?

The evolution of workplace wellness and trend towards Chief Wellness Officers is driven by 2 trends in market:

  1. Technology Drivers
    • Nearly thirty-five percent of 2017 Healthiest Employers® include wearable technology in their wellness strategy.
    • Predictive analytics using new data sources is transforming the art of wellness into more of science.
    • Social Media platforms allow for more relevant and meaningful personalized wellness engagement with employees.
    • Online coaching is lowering the cost of delivering wellness directly to employees using their Smartphones.
  2. Behavior Drivers
    • There is now a recognition that information alone is not sufficient to make changes to health behaviours.
      • The days of the internal company health portal are over.
    • Corporate Wellness Programs are built one a “one size fits all” paradigm instead of being personalized to each employees individual health and fitness needs.
    • Executive Health Programs have a number of well known shortcomings in improving health behaviors.
    • Business leaders understand that they must lead by example when it comes to wellness.
 I have documented all this and more in my extensive Corporate Case study where I coached an entire executive team to achieve objective improvements to their wellness, health, and fitness.

What Does A “Chief Wellness Officer” Do?

A Chief Wellness Officer (CWO) is responsible for improving the overall health and well-being of a company’s most valuable assets, its employees.

The scope of this role includes:

  • Selecting and working with a “health team” of vendors, brokers and consultants to develop a program for the organization.
  • Designing wellness initiatives, such as online coaching, exercise programs, healthy office eating, or substance cessation programs.
  • Reporting on health outcomes of members to the CEO.
  • Measuring Return on Investment (ROI) on all wellness initiatives.
  • Leveraging data and predictive modeling to craft new wellness initiatives, increase investment in initiatives that are working, and decrease investment in initiatives that don’t move the needle.

How To Measure ROI on Workplace Wellness

A study revealed that Johnson & Johnson’s wellness programs produced a ROI of $3.92 for every dollar spent on their wellness budget

Companies have the opportunity to set themselves up for financial success and invest in everyone of their employees, but the question now becomes how do you measure the specific ROI on these programs?

Here are metrics that a Chief Wellness Officer can track to measure the company ROI on their Wellness Programs:

  • Healthcare cost trend of participant vs. nonparticipant
  • Number of participants to trend of spend on Healthcare
  • ROI of one specific wellness program compared to ROI of another specific wellness program

CEOs are concerned about the health of their business AND their employees health.

You can stay updated about Corporate Health Trends, Executive Performance, and Employee Wellness by following my updates here.

The Healthy Executive CEO Advisor

 


Also published on Medium.

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